LABOR REL: WENPHIL SERRANO AGABON DOCTRINE Distinguished

THE DISMISSAL IS FOR A JUST OR AUTHORIZED CAUSE BUT DUE PROCESS

WAS NOT OBSERVED.asasas

Due Process to be Observed by The Employer - For termination of the

employment based on the any of the just causes for termination, the
requirements of due process that an employer must comply with are: (TWIN
NOTICES)

Written notice should be served to the employee specifying the ground or

grounds for termination and giving the said employee reasonable
opportunity within which to explain;
A hearing or conference should be held during which the employee
concerned, with the assistance of counsel, if the employee so desires, is
given the opportunity to respond to the charge, present his evidence and
present the evidence presented against him;
A written notice of termination, if termination is the decision of the employer,
should be served on the employee indicating that upon due consideration of
all the circumstances, grounds have been established to justify his
termination.
For termination of employment based on authorized causes, the
requirements of due process shall be deemed complied with upon service of
a written notice to the employee and the appropriate Regional office of the
Department of Labor and employment at least thirty days before the
effectivity of the termination specifying the grounds for termination.
NOTE:
Under the so-called WENPHIL DOCTRINE if the services of the employee was
terminated due to a just or authorized cause but the affected employees
right to due process has been violated, the dismissal is legal but the
employee is entitled to damages by way of indemnification for the violation
of the right.
SERRANO vs. ISETANN et. al. abandoned the WENPHIL DOCTRINE and ruled
that if the employee is dismissed under just or authorized cause but the
affected employees right to due process has been violated, his dismissal
becomes ineffectual. Therefore, the employee is entitled to backwages from
the time he was dismissed until the determination of the justness of the
cause of the dismissal. aaaa
AGABON vs. NLRC (Nov. 17, 2004) abandoned the Serrano doctrine and
REINSTATED THE WENPHIL DOCTRINE. The sanctions, however must be
stiffer than that imposed in Wenphil.

Synopsis on the developments in the law.

In the last couple of decades, the Supreme Court has grappled with the legal
effect and the corresponding sanction in cases where there exists a just and
valid ground to justify the dismissal but the employer fails to comply with the
due process requirement of the law. Prior to the promulgation in 1989 of
Wenphil v. NLRC, [170 SCRA 69, February 8, 1989], the prevailing doctrine
held that dismissing employees without giving them proper notices and an
opportunity to be heard was illegal and that, as a consequence thereof, they
were entitled to reinstatement plus full backwages. Wenphil abandoned this
jurisprudence and ruled that if the dismissal was for a just or an authorized
cause but done without due process, the termination was valid but the
employer should be sanctioned with the payment of indemnity ranging from
P1,000.00 to P10,000.00.
In 2000, the Supreme Court promulgated Serrano v. NLRC, [G.R. No. 117040,
January 27, 2000], which modified Wenphil. It considered such termination
ineffectual (not illegal) and sanctioned the employer with payment of full
backwages plus nominal and moral damages, if warranted by the evidence.
In case the dismissal was for an authorized cause, separation pay in
accordance with Article 283 of the Labor Code should be awarded.

In 2004, the Supreme Court in Agabon v. NLRC, [G.R. No. 158693, November
17, 2004], abandoned Serrano and effectively reverted to Wenphil (known
also as the Belated Due Process Rule) and held that a dismissal due to
abandonment - a just cause - was not illegal or ineffectual, even if done
without due process; but the employer should indemnify the employee with
nominal damages for non-compliance with statutory due process. (Glaxo
Wellcome Phils., Inc. v. Nagkakaisang Empleyado ng Wellcome-DFA, G.R. No.
149349, March 11, 2005).
What is the ERs liability for non-compliance with
requirements of procedural due process?

By Atty. Golda Benjamin

History of SC rulings:

1. Wenphil ruling or Belated Due Process Rule (8 Feb 1989) where the employer had a valid
reason to dismiss an employee but did not follow the due process requirement, the dismissal may
be upheld but the employer will be penalized to pay an indemnity to the employee.
In this particular case, the ER was required to pay an indemnity of P1,000 to the EE. The
measure of the award depends on the facts and circumstances of the case, and the gravity of the
omission committed by the ER

2. Serrano doctrine (27 Jan 2000) the violation by the employer of the notice requirement in
termination for just or authorized causes was not a denial of due process that will nullify the
termination. However, the dismissal is ineffectual and the employer must pay full backwages
from the time of termination until it is judicially declared that the dismissal was for a just or
authorized cause.
Rationale for change from Wenphil to Serrano: the significant number of cases involving
dismissals without requisite notices (dismiss now, pay later). The imposition of penalty by way
of damages for violation of the notice requirement was not serving as a deterrent.

3. Agabon doctrine
 After carefully analyzing the consequences of the divergent doctrines in the law on
employment termination, the SC believes that in cases involving dismissals for cause but without
observance of the twin requirements of notice and hearing, the better rule is to abandon the
Serrano doctrine and to follow Wenphil by holding that the dismissal was for just cause but
imposing sanctions on the employer.

Such sanctions, however, must be stiffer than that imposed in Wenphil. By doing so, this Court
would be able to achieve a fair result by dispensing justice not just to employees, but to
employers as well.

The unfairness of declaring illegal or ineffectual dismissals for valid or authorized causes but
not complying with statutory due process may have far-reaching consequences. This would
encourage frivolous suits, where even the most notorious violators of company policy are
rewarded by invoking due process. This also creates absurd situations where there is a just or
authorized cause for dismissal but a procedural infirmity invalidates the termination.

Where the dismissal is for a just cause, as in the instant case, the lack of statutory due
process should not nullify the dismissal, or render it illegal, or ineffectual. However, the
employer should indemnify the employee for the violation of his statutory rights. The
indemnity to be imposed should be stiffer to discourage the abhorrent practice of dismiss
now, pay later, which we sought to deter in the Serrano ruling. The sanction should be in
the nature of indemnification or penalty and should depend on the facts of each case,
taking into special consideration the gravity of the due process violation of the employer.

Under the Civil Code, nominal damages is adjudicated in order that a right of the plaintiff,
which has been violated or invaded by the defendant, may be vindicated or recognized, and not
for the purpose of indemnifying the plaintiff for any loss suffered by him

The violation of the petitioners right to statutory due process by the private respondent
warrants the payment of indemnity in the form of nominal damages. The amount of such
damages is addressed to the sound discretion of the court, taking into account the relevant
circumstances. Considering the prevailing circumstances in the case at bar, the court deems it
proper to fix it at P30,000.00. The court believes this form of damages would serve to deter
employers from future violations of the statutory due process rights of employees. At the very
least, it provides a vindication or recognition of this fundamental right granted to the latter under
the Labor Code and its Implementing Rules.