Hilton Heavy v. Dy (G.R. No. 164860; February 2, 2010)


Dy was employed at Hilton Heavy Equipment Corporation (hereafter, the "CORPORATION"). In the course of his employment, he was assigned as the personal bodyguard of Peter Lim (hereafter, "LIM"), the President of the said Corporation. On April 19, 2000, Dy mauled Duke Echiverri, a co-employee, within the premises of the principal office of the Corporation, in front of Lim and the employees. Dy defied orders of Lim to stop mauling Duke Echiverri. Dy also threatened to kill the latter, and uttered that if he will be given monetary consideration, he will cease working in the company.Geraldine Chan, Secretary of the Corporation, executed an affidavit attesting to the fact of Dy's utterance of his intention to resign from his job. Thereafter, Dy stopped reporting to work.

Duke Echiveri filed criminal complaints against Dy but the same were dismissed on the formers motion. A month after the mauling incident, on 19 May 2000, Lim requested Dy to come to the office where he was confronted by Lim and Wellington Lim, Lims brother. Thereat, Dy was paid by Wellington Lim the amount of P120,000.00 as separation pay.

Dy filed a complaint before the National Labor Relations Commission (NLRC) Regional Arbitration Branch VII in Cebu City against petitioners for illegal dismissal and non-payment of labor standard benefits with claim for damages and attorneys fees.

The LA dismissed Dy's complaint for illegal dismissal because Dy stopped working when he was given separation pay ofP120,000. The NLRC affirmed the LA decision on appeal. On further appeal to the CA, the appellate court ruled that that Dy did not voluntarily resign from his employment, but there was a valid cause for Dys termination from employment. Petitioners, however, failed to observe due process in terminating Dys services. The appellate court decided that Dy was dismissed for just cause but was not entitled to reinstatement.

ISSUE: Did the CA err in ruling that petitioners failed to observe due process in terminating Dy?

HELD: For termination of employment based on just causes as defined in Article 282 of the Code:

(a) A written notice served on the employee specifying the ground or grounds for termination, and giving to said employee reasonable opportunity within which to explain his side;
(b) A hearing or conference during which the employee concerned, with the assistance of counsel if the employee so desires, is given opportunity to respond to the charge, present his evidence or rebut the evidence presented against him; and
(c) A written notice of termination served on the employee indicating that upon due consideration of all the circumstances, grounds have been established to justify his termination.

Dy's behavior constituted just cause. However, petitioners cannot deny that they failed to observe due process. The law requires that the employer must furnish the worker sought to be dismissed with two written notices before termination of employment can be legally effected:

(1) notice which apprises the employee of the particular acts or omissions for which his dismissal is sought; and
(2) the subsequent notice which informs the employee of the employer's decision to dismiss him.

Failure to comply with the requirements taints the dismissal with illegality.

Petitioners should thus indemnify Dy for their failure to observe the requirements of due process. Dy is not entitled to reinstatement, backwages and attorney's fees because Dy's dismissal is for just cause but without due process.

In light of this Court's ruling in Agabon v. National Labor Relations Commission, the violation of Dy's right to statutory due process by petitioners, even if the dismissal was for a just cause, warrants the payment of indemnity in the form of nominal damages. GRANTED.

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