Serrano vs.

NLRC Serrano was the head of security section of the

323 SCRA 445 (GR respondent department store. Sometime in 1991, the
No. 117040 respondent employer decided to engage with the
services of an independent security agency and
[2000])
therefore retrenched the whole security section. In
October 1991, the employer sent a letter to Serrano
reiterating the “verbal” notice of the retrenchment.
Thereafter, Serrano filed a case for illegal dismissal. –
SC Ruling that it is a valid exercise of Management
Prerogative. It is wisdom we do not intend to inquire
into and for which we cannot substitute our judgment.
"retrenchment" in its "plain and ordinary sense: to
layoff or remove from one’s job, regardless of the
reason therefor"; that the rule of "reasonable criteria"
in the selection of the employees to be retrenched did
not apply because all positions in the security section
had been abolished

In the case at bar, petitioner was given a notice of

termination on October 11, 1991. On the same day,
his services were terminated. He was thus denied his
right to be given written notice before the termination
of his employment

1.
o The petitioner’s layoff due to redundancy
(abolition of the security section) was
valid under Article 283 of the Labor
Code. The employer’s business decision
to phase out the department for cost-
saving purposes was deemed legitimate
and not arbitrary.
2. Violation of Notice Requirement:
o The employer failed to provide the
mandatory 30-day written notice to the
petitioner and the DOLE before
termination. However, this procedural
lapse does not render the termination
void if the dismissal was for a
valid/authorized cause (like redundancy).
3. Sanction for Lack of Notice:
o The employer’s failure to give advance
notice only makes the
termination ineffectual (not null and
void). The remedy is to award the
employee:
  Separation pay (as required by
Article 283 for redundancy).
 Full backwages from the date of
termination until the court’s
decision becomes final (to
compensate for the lack of notice).
4. Rejection of "Dismiss Now, Pay Later"
Policy:
o The court clarified that while the Wenphil
doctrine (imposing fines for lack of
notice) was insufficient to deter violations,
outright nullification of dismissals for valid
causes would unfairly penalize employers.
Instead, backwages are awarded to
balance the employee’s rights and the
employer’s prerogative to dismiss for
just/authorized causes.
5. Due Process Not Violated:
o The notice requirement under labor laws
is procedural, not constitutional. Thus,
lack of notice does not equate to a denial
of due process requiring reinstatement.
Only dismissals without just/authorized
cause are illegal under Article 279.
6. Remand for Computation:
o The case was sent back to the Labor
Arbiter to compute the
petitioner’s separation pay (one month
per year of service), unpaid
salaries, proportionate 13th-month
pay, and full backwages.

Agabon vs. NLRC Riviera Home Improvements, Inc. is engaged in the

442 SCRA 573 (GR business of selling and installing ornamental and
NO. 158693 construction materials. It employed Virgilio Agabon
and Jenny Agabon (petitioners) as gypsum board and
[2004])
cornice installers on January 2, 1992 until February
23, 1999 when they were dismissed for abandonment
of work. Petitioners were frequently absent having
subcontracted for an installation work for another
company. Subcontracting for another company clearly
showed the intention to sever the employer-employee
relationship with private respondent. This was not the
first time they did this. In January 1996, they did not
report for work because they were working for
another company.
SC RULING –
1. If the dismissal is based on a just cause under
Article 282, the employer must give the
employee two written notices and a hearing or
opportunity to be heard if requested by the
employee before terminating the employment:
a notice specifying the grounds for which
dismissal is sought a hearing or an opportunity
to be heard and after hearing or opportunity to
be heard, a notice of the decision to dismiss.
2. If the dismissal is based on authorized causes
under Articles 283 and 284, the employer must
give the employee and the Department of Labor
and Employment written notices 30 days prior
to the effectivity of his separation.

If the dismissal is for just or authorized

cause but due process was not observed, the
dismissal is still VALID but the employer is
made liable for non-compliance

6. If the dismissal is without just or

authorized cause, whether or not due
process was observed, the dismissal is
illegal, and Article 279 mandates that the
employee is entitled to reinstatement without
loss of seniority rights and other privileges and
full backwages.

7. However, 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. This became known as the Wenphil
or Belated Due Process Rule

Abandonment of Serrano doctrine (Reinstating

Wenphil with stiffer penalties)
8. In Serrano vs NLRC (2000), the Court held that
while 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.
9. The rationale for the re-examination of the Wenphil
doctrine in Serrano was the significant number of
cases involving dismissals without requisite notices
and the employers adopting a practice to "dismiss
now and pay later. The imposition of penalty by way
of damages for violation of the notice requirement
was not serving as a deterrent. Hence, the Court now
required payment of full backwages from the time of
dismissal until the time the Court finds the dismissal
was for a just or authorized cause

We believe, however, that the ruling in Serrano did

not consider the full meaning of Article 279 of the
Labor Code. Payment of backwages and other
benefits, including reinstatement, is justified only if
the employee was unjustly dismissed.

After carefully analyzing the consequences of the

divergent doctrines in the law on employment
termination, we believe 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.

Payment of nominal damages as indemnity

14. In the present case, the dismissal should be
upheld because it was established that the petitioners
abandoned their jobs to work for another company.
Private respondent, however, did not follow the notice
requirements and instead argued that sending notices
to the last known addresses would have been useless
because they did not reside there anymore.
Unfortunately for the private respondent, this is not a
valid excuse because the law mandates the twin
notice requirements to the employee's last known
address. Thus, it should be held liable for non-
compliance with the procedural requirements of due
process. 15. 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, we deem it proper to fix
it at P30,000. We believe this form of damages would
serve to deter employers from future violations of the
statutory due process rights of employees.

JAKA Food Employees were terminated on August 29, 1997

Processing because the corporation was "in dire financial straits".
Corporation vs. It is not disputed, however, that the termination was
effected without JAKA complying with the requirement
Pacot 454 SCRA
under Article 283 of the Labor Code regarding the
119 (GR No. service of a written notice upon the employees and
151378 [2005]) the Department of Labor and Employment at least
one (1) month before the intended date of
termination,

In this case, the cause of the termination is one of

authorized cause which is retrenchment. The court
fixed the nominal damages for violation of twin notice
requirement in dismissal of employee due to
authorized causes to 50,000PHP so 30,000 if just
causes according to Agabon Doctrine.
Bustamante vs. Petitioners were employed by private respondent
NLRC 265 SCRA 61 banana plantation as laborers, harvesters, and
(GR No. 111651 sprayers. Although they signed six-month contracts
beginning January 1990 until July 1990, they had been
[1996])
working for the private respondent in similar roles
since 1985 under short-term agreements. Their
employment was subsequently terminated on June
1990 alleged due to their age as none of them were
below 40 years old.

"Full backwages" refer to the total amount of wages

an employee would have earned had they not been
illegally dismissed. It includes all salaries, allowances,
and other benefits the employee was entitled to
receive from the time of their dismissal until their
actual reinstatement (or the finality of the decision if
reinstatement is not feasible).

Republic Act No. 6715, the concept of full

backwages means that no deductions should be made
for any income the employee may have earned
 elsewhere during the period of illegal dismissal. This
ruling was intended to protect workers' rights by
ensuring that employers bear the full financial
responsibility for unjustly terminating an employee.

R.A. No. 6715 took effect in 1989, the law explicitly

mandated the payment of full backwages, without
deductions for earnings elsewhere. The Supreme
Court clarified that the purpose of full backwages is to
fully compensate the employee for the illegal
dismissal, and any income earned elsewhere is
separate—because the employee must still support
themselves and their family while waiting for
reinstatement.
Pioneer Texturizing As reviser/trimmer, de Jesus based her assigned work
Corporation vs. on a paper note posted by petitioners. The issue
NLRC 280 SCRA concerned a certain P.O. where respondent trimmed
the cloth’s ribs.
806 (GR No.
118651 [1997]) Petitioner dismissed de Jesus due to tampering of PO
Box. The Court ruled that there was illegal dismissal,
de Jesus is not occupying a trust and confidence
position.

"Petitioners construe the above paragraph to mean

that the refusal of the employer to reinstate a
employee as directed in an executory order of
reinstatement would make it liable to pay the latter's
salaries. This interpretation is correct. Under Article
223 of the Labor Code, as amended, an employer has
two options in order for him to comply with an order
of reinstatement, which is immediately executory,
even pending appeal. Firstly, he can admit the
dismissed employee back to work under the same
terms and conditions prevailing prior to his dismissal
or separation or to a substantially equivalent position
if the former position is already filled up as we have
ruled in Union of Supervisors (RB) NATU vs. Sec. of
Labor, 128 SCRA 442 [1984]; and Pedroso vs. Castro,
141 SCRA 252 [1986]. Secondly, he can reinstate the
employee merely in the payroll. Failing to exercise any
of the above options, the employer can be compelled
under pain of contempt, to pay instead the salary of
the employee… The employee should not be left
without any remedy in case the employer
unreasonably delays reinstatement. Therefore, we
 hold that the unjustified refusal of the employer to
reinstate an illegally dismissed employee entitles the
employee to payment of his salaries

Article 224 states that the need for a writ of execution

applies only within five (5) years from the date a
decision, an order or award becomes final and
executory. It cannot relate to an award or order of
reinstatement still to be appealed or pending appeal
which Article 223 contemplates. The provision of
Article 223 is clear that an award for reinstatement
shall be immediately executory even pending appeal
and the posting of a bond by the employer shall not
stay the execution for reinstatement. The legislative
intent is quite obvious, i.e., to make an award of
reinstatement immediately enforceable, even pending
appeal. To require the application for and issuance of
a writ of execution as prerequisites for the execution
of a reinstatement award would certainly betray and
run counter to the very object and intent of Article
223, i.e., the immediate execution of a reinstatement
order.

Pizza Inn vs. NLRC Respondent employee was a server in the petitioner’s
162 SCRA 773 (GR pizza restaurant.
No. 74531 [1988])
Private respondent was employed by petitioner in its
Quad Carpark Makati outlet on a probationary status
with a monthly basic salary of P500.00. Before the
expiration of the 6-month probationary period,
Felicidad Fontanilla resigned.

Reinstatement pre- supposes that the previous

position from which one had been removed still exists
or that there is an unfilled position more or less of
similar nature as the one previously occupied by the
employee. Admittedly, no such position is available.
Reinstatement therefore becomes a legal
impossibility. The law cannot exact compliance with
what is impossible. Moreover an employer is
privileged to go out of business by closing the same
regardless of his reasons especially if done in good
faith and due to causes beyond his control like heavy
business losses. To deprive him of such privilege
would be oppressive and inhuman. In such cases, the
dismissed employee can no longer be reinstated but
 shall be entitled to backwages up to the date of
dissolution or closure (but not exceeding three years)
Kunting vs. NLRC An illegally dismissed employee's right to
227 SCRA 571 (GR reinstatement is not absolute. The Court has a
No. 101427 long line of decisions concerning non-reinstatement of
illegally dismissed employees on various grounds.
[1993])
One of these grounds is when there is a finding that
the relationship between the parties has become so
strained and ruptured as to preclude a harmonious
working relationship.

Consuelo B. Kunting was employed as a teacher by St.

Joseph School in Zamboanga City since 1969. Her
compensation included basic pay and an emergency
cost-of-living allowance (ECOLA), with variations
during the summer period when only basic pay was
rendered. Effective January 1988, her monthly salary
was consolidated at P1,820.00 with the ECOLA
integrated into the basic wage. For every school year
from 1969 until 1987-1988, a Teacher’s Contract was
executed between her and the school.

In the school year 1987-1988, her performance was

rated as “very satisfactory” based on the school’s
evaluations. Despite satisfactory performance, the
school did not renew her employment contract for the
1988-1989 school year. A termination letter dated
April 4, 1988, notified her that her contract had
expired and that the school would not be renewing it,
suggesting that she use the time for future
employment or business initiatives.

Private respondent is hereby ordered to reinstate

petitioner Consuelo B. Kunting to her former or
equivalent position without loss of seniority rights
with payment of backwages for three (3) years

Acesite
Corporation vs.
NLRC 449 SCRA
360 (GR No.
152308 [2005])

Manila Diamond
Hotel Employees'
Union vs. CA 447
SCRA 97 (GR No.
140518 [2004])

Roquero vs. PAL

401 SCRA 424 (GR
No. 152329
[2003])

Garcia vs.
Philippine Airlines
576 SCRA 479 (GR
No. 164856
[2009])

Primero vs. IAC

156 SCRA 453 (GR
No. 72644 [1987])

Maglutac vs. NLRC

189 SCRA 767 (GR
No. 78345 [1990])

Taganas vs. NLRC

248 SCRA 133 (GR
No. 118746
[1995])

Flight Attendants
and Stewards
Association of the
Phil. vs. PAL 559
SCRA 252 (GR No.
178083 [2008])

Lim vs. NLRC 171

SCRA 328 (GR No.
79907 [1989])

Philippine Long
Distance
Telephone
Company vs. NLRC
164 SCRA 671 (GR
No. 80609 [1988])

Gustilo vs. Wyeth

Philippines 440
SCRA 67 (GR No.
149629 [2004])

DBP vs. NLRC 229

SCRA 351 (GR No.
86227 [1994])

DBP vs. NLRC 242

SCRA 59 (GR No.
108031 [1995])