Procedural Due Process Prevails: Why Following Protocol Matters in Employee Dismissals

TLDR; Even when an employee’s termination is for a valid reason (just cause), Philippine law mandates strict adherence to procedural due process. This case highlights that failing to follow company-specific procedures or provide a proper hearing, even with a just cause for dismissal, can lead to legal repercussions for employers, including the payment of nominal damages.

G.R. NO. 146762, G.R. NO. 153584, G.R. NO. 163793

INTRODUCTION

Imagine losing your job not because of what you did, but how your employer let you go. In the Philippines, the right to due process in employment termination is a cornerstone of labor law, designed to protect employees from arbitrary dismissal. The consolidated cases of Suico v. NLRC, Mariano v. NLRC, and PLDT v. Borje, all decided by the Supreme Court, underscore this very principle. These cases, stemming from a labor strike at PLDT, tackled a crucial question: Can an employer disregard its own company rules and deny a formal hearing when dismissing employees for strike-related misconduct, even if there’s a valid reason for termination?

The employees, involved in a strike and accused of violent acts, were dismissed without a formal hearing, despite a PLDT company policy that seemingly allowed for one. This article delves into the Supreme Court’s decision, explaining why procedural due process is non-negotiable, even when just cause for dismissal exists, and what lessons employers can learn to avoid legal pitfalls.

LEGAL CONTEXT: THE CORNERSTONE OF DUE PROCESS IN LABOR LAW

Philippine labor law, deeply rooted in the constitutional right to security of tenure, meticulously outlines the requirements for lawful employee dismissal. At its heart is the concept of due process, ensuring fairness and preventing employers from acting capriciously. Article 277(b) of the Labor Code is the bedrock of this protection, stating:

“Subject to the constitutional right of workers to security of tenure and their right to be protected against dismissal except for a just and authorized cause and without prejudice to the requirement of notice under Article 283 of this Code, the employer shall furnish the worker whose employment is sought to be terminated a written notice containing a statement of the cause for termination and shall afford the latter ample opportunity to be heard and to defend himself with the assistance of his representative, if he so desires, in accordance with company rules and regulations promulgated pursuant to guidelines set by the Department of Labor and Employment.“ (Emphasis supplied)

This provision is further elaborated by Rule XXIII of the Implementing Rules of Book V of the Labor Code, specifying a two-notice rule and the right to a hearing or conference. These rules mandate:

1. First Notice: A written notice detailing the grounds for termination, giving the employee a reasonable opportunity to explain their side.
2. Hearing or Conference: An opportunity for the employee to respond to the charges, present evidence, and rebut the employer’s evidence, with the option of counsel.
3. Second Notice: A written notice of termination if, after considering all circumstances, grounds for dismissal are justified.

Beyond these statutory requirements, company policies play a crucial role. As the Supreme Court has consistently held, company policies, especially those concerning disciplinary procedures, are binding on employers. These policies can grant employees additional rights or procedural steps beyond the basic Labor Code requirements, and employers are obligated to honor them. This case turns on PLDT’s own