Serrano v NLRC [G.R. No. 117040, January 27, 2000]

FACTS: Petitioner was hired by the Respondent Isetann Department Store as a security checker to apprehend shoplifters. As a cost-cutting measure, private respondent decided to phase out its security section engage the services of an independent security agency. Petitioner was then terminated prompting him to file a complaint for illegal dismissal. NLRC ordered petitioner to be given separation pay holding that the phase-out of the security section was a legitimate business decision. However, respondent was denied the right to be given written notice before termination of his employment.


ISSUE: What is the effect of violation of the notice requirement when termination is based on an authorized cause?


HELD: The Wenphil doctrine stated that it was unjust to require an employer to reinstate an employee if, although termination is made with cause, if due process was not satisfied. The remedy was to order the payment to the employees of full backwages from the time of his dismissal until the court finds that the dismissal was for a just cause. But his dismissal must be upheld and he should not be reinstated. This is because the dismissal is ineffectual. In termination of employment under Art. 283, the violation of notice requirements is not a denial of due process as the purpose is not to afford the employee an opportunity to be heard on any charge against him for there is none. The purpose is to give him time to prepare for the eventual loss of his job and the DOLE to determine whether economic causes do exist justifying the termination of his employment. With respect to Art. 283, the employer’s failure to comply with the notice requirement does not constitute a denial of due process but a mere failure to observe a procedure for the termination of employment which makes the termination of employment merely ineffectual.

If the employee’s separation is without cause, instead of being given separation pay, he should be reinstated. In either case, whether he is reinstated or given separation pay, he should be paid full backwages if he has been laid off without written notice at least 30 days in advance. With respect to dismissals under 282, if he was dismissed for any of the just causes in 282, he should not be reinstated. However, he must be paid backwages from the time his employment was terminated until it is determined that the termination is for a just cause because the failure to hear him renders the termination of his employment without legal effect.