Dela Torre v. Twinstar Professional Protective Services, Inc.
REITERATIONFacts
The Antecedents: Petitioner Jose R. Dela Torre was employed as a security guard by respondent Twinstar Professional Protective Services, Inc. (Twinstar) in October 1988. In January 2011, petitioner sought assistance regarding alleged underpayment of salaries. Subsequently, he was directed to report to Twinstar's office and was informed he was being placed on floating status. Petitioner alleged he was on floating status for more than six months, prompting him to file a complaint for illegal dismissal and underpayment of salaries. Procedural History: The Labor Arbiter (LA) found petitioner to have been constructively dismissed and ordered Twinstar to pay backwages and separation pay. Twinstar appealed to the National Labor Relations Commission (NLRC), admitting petitioner's employment and alleging absence without leave (AWOL) on January 21, 2011. Twinstar claimed it sent several notices to report for duty and attempted to contact petitioner, who allegedly refused to receive a company letter and manifested unwillingness to return to duty. Twinstar terminated petitioner's employment on July 19, 2011, citing AWOL. Twinstar blamed its previous counsels for failing to submit its position paper before the LA. The NLRC granted Twinstar's appeal, reversed the LA's decision, and dismissed the complaint, finding no constructive dismissal but noting a failure to observe due process, which was deemed cured by a quitclaim executed by petitioner. The Court of Appeals (CA) affirmed the NLRC's decision, finding no grave abuse of discretion. The Petition: Petitioner filed a petition for review on certiorari with the Supreme Court, assailing the CA's affirmation of the NLRC's decision.
Issue(s)
Whether or not the CA gravely erred in affirming the NLRC when it admitted and gave credence to Twinstar's evidence submitted for the first time on appeal. Whether or not the CA gravely erred in finding that Jose was not illegally dismissed; and whether or not Twinstar violated Jose's right to procedural due process. Whether or not the CA erred in affirming the NLRC when it denied the award of nominal damages by reason of the alleged quitclaim; and whether the quitclaim is valid.
Ruling
The petition is partially granted. The Decision of the Court of Appeals is affirmed with modification. Twinstar Professional Protective Services, Inc. is ordered to pay petitioner Jose Dela Torre P30,000.00 as nominal damages, with interest at six percent (6%) per annum from the date of finality of the Decision until fully paid.
Ratio Decidendi
On the admission of evidence on appeal: The Supreme Court held that the NLRC was well within its discretion to admit Twinstar's evidence on appeal. The Court reiterated that rules of procedure in labor cases may be relaxed to facilitate the attainment of justice and not to frustrate it. The NLRC is mandated to use all reasonable means to ascertain facts speedily and objectively, and is not precluded from receiving evidence on appeal, as technical rules of evidence are not binding in labor cases. The Court found that admitting Twinstar's evidence, despite the alleged negligence of its counsels, was not arbitrary or capricious, considering the relevance and veracity of the evidence and the primacy of substantive justice over procedural technicalities. On constructive dismissal and violation of procedural due process: The Court affirmed the findings of the CA and NLRC that no illegal dismissal took place. It reiterated the standard for constructive dismissal, which requires an employer's act of clear discrimination, insensibility, or disdain to be so unbearable as to foreclose any choice for the employee but to resign. The Court found that petitioner failed to present evidence, beyond self-serving allegations, that he was forced into floating status for more than six months. Conversely, Twinstar established that petitioner went on absence without leave and that it sent several notices to report for duty, which petitioner failed to heed or refused to receive. Crucially, petitioner admitted declining an offered reassignment, which the Court found to be a stubborn unwillingness to return to work, thus providing Twinstar with just cause to terminate his employment. Despite finding just cause for termination, the Court ruled that Twinstar violated statutory due process by failing to observe the "two-notice rule." The Court explained that employers must provide a written notice detailing the charges, allow the employee a reasonable period to explain, conduct a hearing or conference for explanation and presentation of evidence, and then issue a written notice of termination. Twinstar terminated petitioner's employment without complying with these requirements. The Court cited Sy v. Neat, Inc., holding that deprivation of the right to notice and hearing warrants nominal damages to vindicate the violated right and discourage the "dismiss now, pay later" practice. On the validity of the Quitclaim and nominal damages: The Court found the Quitclaim executed by petitioner to be valid, as it was voluntarily entered into and represented a reasonable settlement. However, the Court clarified that the stipulations in the Quitclaim must be interpreted within the bounds of law and reason. The statement that petitioner had "no more claim, right or action of whatsoever nature" could not be deemed to include the illegal dismissal case, as the legality of dismissal is determined by law and falls under the jurisdiction of labor tribunals. The Court emphasized that nominal damages, arising from the determination of a violation of rights, cannot be covered by a quitclaim, as doing so would run counter to public policy discouraging the "dismiss now, pay later" practice. Therefore, Twinstar's patent violation of petitioner's right to procedural due process necessitated the award of nominal damages. Thus, regardless of the Quitclaim, petitioner was entitled to nominal damages.
Main Doctrine
While an employer may have just cause to terminate an employee, failure to observe the "two-notice rule" constitutes a violation of procedural due process, entitling the employee to nominal damages, which cannot be waived by a quitclaim that does not explicitly cover such damages.