Notes.-While It Is True That in Extrajudicial Foreclosure of
Notes.-While It Is True That in Extrajudicial Foreclosure of
Notes.-While It Is True That in Extrajudicial Foreclosure of
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* EN BANC.
111
112
ence. To this extent, Section 2(d), Rule I of the Implementing Rules of Book
VI of the Labor Code is in conformity with Article 277(b).
Same; Same; Section 2(d), Rule I of the Implementing Rules of Book VI
of the Labor Code should not be taken to mean that holding an actual
hearing or conference is a condition sine qua non for compliance with the
due process requirement in termination of employment; The “ample
opportunity to be heard” standard is neither synonymous nor similar to a
formal hearing.—Section 2(d), Rule I of the Implementing Rules of Book
VI of the Labor Code should not be taken to mean that holding an actual
hearing or conference is a condition sine qua non for compliance with the
due process requirement in termination of employment. The test for the fair
procedure guaranteed under Article 277(b) cannot be whether there has been
a formal pretermination confrontation between the employer and the
employee. The “ample opportunity to be heard” standard is neither
synonymous nor similar to a formal hearing. To confine the employee’s
right to be heard to a solitary form narrows down that right. It deprives him
of other equally effective forms of adducing evidence in his defense.
Certainly, such an exclusivist and absolutist interpretation is overly
restrictive. The “very nature of due process negates any concept of inflexible
procedures universally applicable to every imaginable situation.”
Same; Same; While a formal hearing or conference is ideal, it is not an
absolute, mandatory or exclusive avenue of due process.—Section 2(d),
Rule I of the Implementing Rules of Book VI of the Labor Code itself
provides that the so-called standards of due process outlined therein shall be
observed “substantially,” not strictly. This is a recognition that while a
formal hearing or conference is ideal, it is not an absolute, mandatory or
exclusive avenue of due process.
Same; Due Process; “To be heard” does not mean verbal
argumentation alone inasmuch as one may be heard just as effectively
through written explanations, submissions or pleadings.—A hearing means
that a party should be given a chance to adduce his evidence to support his
side of the case and that the evidence should be taken into account in the
adjudication of the controversy. “To be heard” does not mean verbal
argumentation alone inasmuch as one may be heard just as effectively
through written explanations, submissions or pleadings. Therefore, while
the phrase “ample opportunity to be
113
114
115
CORONA, J.:
Petitioners Felix B. Perez and Amante G. Doria were employed
by respondent Philippine Telegraph and Telephone Company
(PT&T) as shipping clerk and supervisor, respectively, in PT&T’s
Shipping Section, Materials Management Group.
116
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117
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118
118 SUPREME COURT REPORTS ANNOTATED
Perez vs. Philippine Telegraph and Telephone Company
We disagree.
Without undermining the importance of a shipping order or
request, we find respondents’ evidence insufficient to clearly and
convincingly establish the facts from which the loss of confidence
resulted.10 Other than their bare allegations and the fact that such
documents came into petitioners’ hands at some point, respondents
should have provided evidence of petitioners’ functions, the extent
of their duties, the procedure in the handling and approval of
shipping requests and the fact that no personnel other than
petitioners were involved. There was, therefore, a patent paucity of
proof connecting petitioners to the alleged tampering of shipping
documents.
The alterations on the shipping documents could not reasonably
be attributed to petitioners because it was never proven that
petitioners alone had control of or access to these documents. Unless
duly proved or sufficiently substantiated otherwise, impartial
tribunals should not rely only on the statement of the employer that
it has lost confidence in its employee.11
Willful breach by the employee of the trust reposed in him by his
employer or duly authorized representative is a just cause for
termination.12 However, in General Bank and Trust Co. v. CA,13 we
said:
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119
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14 Imperial Textile Mills, Inc. v. National Labor Relations Commission, G.R. No.
101527, 19 January 1993, 217 SCRA 237, 244-245.
15 Starlite Plastic Industrial Corp. v. National Labor Relations Commission, G.R.
No. 78491, 16 March 1989, 171 SCRA 315, 324.
16 Omnibus Rules Implementing the Labor Code, Book VI, Rule 1, Sec. 2 (a) and
(c).
120
“ART. 277. Miscellaneous provisions.—x x x
(b) 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 causes 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. Any decision taken by the employer shall be without
prejudice to the right of the worker to contest the validity or legality
of his dismissal by filing a complaint with the regional branch of the
National Labor Relations Commission. The burden of proving that
the termination was for a valid or authorized cause shall rest on the
employer.” (emphasis supplied)
121
“Section 2. Security of Tenure.—x x x
(d) In all cases of termination of employment, the following
standards of due process shall be substantially observed:
For termination of employment based on just causes as defined in
Article 282 of the Labor Code:
(i) A written notice served on the employee specifying the
ground or grounds for termination, and giving said employee
reasonable opportunity within which to explain his side.
(ii) A hearing or conference during which the employee
concerned, with the assistance of counsel if he so desires, is given
opportunity to respond to the charge, present his evidence or
rebut the evidence presented against him.
(iii) 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.” (emphasis
supplied)
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122
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19 Id., citing Lina Jr. v. Cariño, G.R. No. 100127, 23 April 1993, 221 SCRA 515.
20 Implementing rules and regulations may not enlarge, alter or restrict the
provisions of the law they seek to implement; they cannot engraft additional
requirements not contemplated by the legislature (Pilipinas Kao, Inc. v. Court of
Appeals, 423 Phil. 834; 372 SCRA 548 [2001]).
21 Webster’s Third New Collegiate International Dictionary Of The English
Language Unabridged, p. 74, 1993 edition.
123
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124
The Labor Code does not, of course, require a formal or trial type
proceeding before an erring employee may be dismissed. (emphasis
supplied)
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to establish the rights which he asserts but the tribunal must consider the evidence
presented. x x x
125
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126
quirements of which are satisfied where the parties are afforded fair and
reasonable opportunity to explain their side of the controversy. It is deemed
sufficient for the employer to follow the natural sequence of notice, hearing
and judgment.”
The above rulings are a clear recognition that the employer may
provide an employee with ample opportunity to be heard and defend
himself with the assistance of a representative or counsel in ways
other than a formal hearing. The employee can be fully afforded a
chance to respond to the charges against him, adduce his evidence or
rebut the evidence against him through a wide array of methods,
verbal or written.
After receiving the first notice apprising him of the charges
against him, the employee may submit a written explanation (which
may be in the form of a letter, memorandum, affidavit or position
paper) and offer evidence in support thereof, like relevant company
records (such as his 201 file and daily time records) and the sworn
statements of his witnesses. For this purpose, he may prepare his
explanation personally or with the assistance of a representative or
counsel. He may also ask the employer to provide him copy of
records material to his defense. His written explanation may also
include a request that a formal hearing or conference be held. In
such a case, the conduct of a formal hearing or conference becomes
mandatory, just as it is where there exist substantial evidentiary
disputes29 or where company rules or practice requires an actual
hearing as part of employment pretermination procedure. To this
extent, we refine the decisions we have rendered so far on this point
of law.
This interpretation of Section 2(d), Rule I of the Implementing
Rules of Book VI of the Labor Code reasonably im-
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29 See Cleveland Board of Education v. Loudermill, 470 U.S. 532 (1985)
(Brennan J., concurring in part and dissenting in part), citing Arnett v. Kennedy, 416
U.S. 134 (1974) (Marshall J., dissenting).
127
128
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30 Omnibus Rules Implementing the Labor Code, Book V, Rule XXIII, Sec. 9, as
amended by Department of Labor and Employment Order No. 9 (1997).
31 Agabon v. National Labor Relations Commission, G.R. No. 158693, 17
November 2004, 442 SCRA 573, 610.
32 Panday v. National Labor Relations Commission, G.R. No. 67664, 20 May
1992, 209 SCRA 122, 126-127.
33 Sealand Service, Inc. v. National Labor Relations Commission, G.R. No.
90500, 5 October 1990, 190 SCRA 347, 355.
129
CONCURRING OPINION
BRION, J.:
I fully concur with the ponencia of my esteemed colleague,
Associate Justice Renato C. Corona. I add these views on the
specific issue of whether actual hearing is a mandatory requirement
in a termination of employment situation.
The petitioners’ position that a formal hearing should be an
absolute requirement whose absence signifies the non-observance of
procedural due process is an unduly strict view and is not at all what
procedural due process requires. This is not the intent behind the
Labor Code whose pertinent provision reads:
“ART. 277.
x x x
(b) Subject to the constitutional right of workers to security of tenure
and their right to be protected against dismissal except for a just or
authorized cause and without prejudice to the requirement of notice under
Article 283 of this Code, the employer shall furnish the workers whose
employment is sought to be terminated a written notice containing a
statement of the causes for ter-
130
mination and shall afford the latter ample opportunity to be heard and
defend himself with the assistance of his representative if he so desires in
accordance with company rules and regulations promulgated pursuant to the
guidelines set by the Department of Labor and Employment. Any decision
taken by the employer shall be without prejudice to the right of the worker
to contest the validity or legality of his dismissal by filing a complaint with
the regional branch of the National Labor Relations Commission. The
burden of proving that the termination was for a valid or authorized cause
shall rest on the employer.
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1 See: Jones, D.P. and De Villars A., Principles of Administrative Law (1985 ed.),
pp. 148-149.
131
partem 2—that a person must know the case against him and be
given an opportunity to answer it; and nemo judex in sua cause debe
esse3—the rule against bias. Still much later, the natural justice
principle gave rise to the duty to be fair to cover governmental
decisions which cannot be characterized as judicial or quasi-judicial
in nature.4
While the audi alteram partem rule provided for the right to be
notified of the case against him, the right to bring evidence, and to
make argument—whether in the traditional judicial or the
administrative setting—common law maintained a distinction
between the two settings. “An administrative tribunal had a duty to
act in good faith and to listen fairly to both sides, but not to treat the
question as if it were a trial. There would be no need to examine
under oath, nor even to examine witnesses at all. Any other
procedure could be utilized which would obtain the information
required, as long as the parties had an opportunity to know and to
contradict anything which might be prejudicial to their case.”5
In the U.S., the due process clause of the U.S.
Constitution6provides the guarantee for procedural due process, and
has used a general balancing formula to identify the procedural
guarantees appropriate to a particular context.7 In Mathews v.
Eldridge,8 Justice Powell articulated this approach when he said:
“In recent years this Court increasingly has had occasion to consider the
extent to which due process requires an evidentiary hearing prior to the
deprivation of some type of property interest
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132
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9 See: Potvin v. Metropolitan Life Insurance Co., 22 Cal. 4th 1060 (2000).
133
and has no cause of action for the mildly adverse action that
resulted.10
Philippine Due Process Requirement
Article III, Section 1 of the Philippine Constitution contains the
constitutional guarantee against denial of due process,11 and is a
direct transplant from an American root—the Bill of Rights of the
American Constitution.12 As in the U.S., our jurisprudence has
distinguished between the constitutional guarantee of due process
that applies to state action, and the statutory due process guarantee
under the Labor Code that applies to private employers.13 The Labor
Code provision, quoted above, is implemented under the Rules
Implementing the Labor Code which provides that—
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135
that there be an actual hearing despite the clear text of the Labor
Code that only requires ample opportunity to be heard.
I submit that in the absence of a clear legislative intent that what
is intended is an actual hearing, the Court cannot construe the
statutory procedural due process guaranty as an absolute
requirement for an actual hearing in the way that at least two cases,
namely King of Kings of Transport, Inc. v. Mamac16 and R.B.
Michael Press v. Galit17 now require.
a. Historical Reason.
Procedural due process cannot be read completely dissociated
from its roots. While the concept of procedural fairness that it
embodies originated as a requirement in judicial proceedings, the
concept has been extended to procedures that were not strictly
judicial as regulatory factfinding was devolved and delegated to
administrative tribunals. The devolution was driven by need; it was
beyond the capability of the courts to attend to the ever-increasing
demands of regulation as society became increasingly complex. As
discussed above, a trial-type procedure is not an absolute necessity
in administrative due process. In fact, in the U.S., not every
administrative decision-making requires a hearing.18 As the U.S.
Supreme Court stated in the Mathews ruling we quoted above:
“[d]ue process, unlike some legal rules, is not a technical conception
with a fixed content unrelated to time, place and circumstances.
[Due process] is flexible and calls for such procedural protections
as the particular situation demands.”19 [Italics supplied]
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136
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independent consideration of the law and facts of the controversy, and not simply
accept the views of a subordinate; and (7) the administrative body should, in all
controversial questions, render its decision in such a manner that the parties to the
proceeding can know the various issues involved, and the reasons for the decisions
rendered.
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139
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32 Neeco III v. National Labor Relations Commission, G.R. No. 157603, June 23,
2005, 461 SCRA 169.
33 G.R. No. 119503, February 11, 1999, 303 SCRA 38.
140
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141
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142
The only issue covered by my dissent is, are Perez and Doria
entitled to a hearing or conference as mandated by Section 2(b),
Rule XXIII, Implementing Rules of Book V of the Labor Code?
The ponencia resolved this in the negative and held that Sec.
2(b), Rule XXIII, Implementing Rules of Book V,1 by requiring a
hearing, went beyond the terms and provisions of the Labor Code,
particularly Article 277(b) thereof that merely requires the employer
to provide employees with ample opportunity to be heard and to
defend themselves with the assistance of their representatives if they
so desire. The ponencia, however, conceded that a formal hearing or
conference becomes mandatory only when requested by the
employee in writing or substantial evidentiary disputes exist or a
company rule or practice requires it or when similar circumstances
justify. I submit that the actual hearing or conference is mandatory in
ALL dismissal cases for the following reasons:
(1) Art. 277(b) of the Labor Code provides that:
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1 Now only Sec. 2(d)(ii), Rule I, Implementing Rules of Book VI of the Labor Code
remains, as amended by Department Order No. 40-03, Series of 2003.
143
the termination was for a valid or authorized cause shall rest on the
employer.” (Emphasis supplied.)
“With respect to the issue of whether petitioner was denied due process
in the administrative procedure entailed in his dismissal, we agree with the
labor arbiter that petitioner was indeed denied procedural due process
therein. His dismissal was not preceded by any notice of the charges against
him and a hearing thereon. The twin requirements of notice and hearing
constitute the essential elements of due process in cases of dismissal of
employees. The purpose of the first requirement is obviously to enable the
employee to defend himself against the charge preferred against him by
presenting and substantiating his version of the facts.
Contrary to the findings of the NLRC, the notice of preventive
suspension cannot be considered as an adequate notice. Even the fact that
petitioner submitted a written explanation after the receipt of the order
of suspension is not the “ample opportunity to be heard” contemplated
by law. Ample opportu-
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144
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3 G.R. No. 116588, January 24, 1996, 252 SCRA 314, 320-321.
145
and its implementing rules, the basic law prevails. In the case at bar,
said principle does not apply because precisely there is no clear-cut
discrepancy between Art. 277(b) of the Labor Code and Sec. 2(b),
Rule XXIII, Implementing Rules of Book V of the Labor Code. To
the extent of being repetitive the phrase “ample opportunity to be
heard” can be construed to cover an actual hearing. This way, Sec.
2(b), Rule XXIII does not conflict with nor contravene Art. 277(b).
(4) Art. 4 of the Labor Code states that “all doubts in the
implementation and interpretation of the provisions of [the Labor
Code], including its implementing rules and regulations, shall be
resolved in favor of labor.” Since the law itself invests the
Department of Labor and Employment (DOLE) the power to
promulgate rules and regulations to set the standard guidelines for
the realization of the provision, then the Implementing Rules should
be liberally construed to favor labor. The Implementing Rules, being
a product of such rule-making power, has the force and effect of law.
Art. 277 of the Labor Code granted the DOLE the authority to
develop the guidelines to enforce the process. In accordance with the
mandate of the law, the DOLE developed Rule I, Sec. 2(d) of the
Implementing Rules of Book VI of the Labor Code which provides
that:
146
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147
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5 Guzman v. National University, No. L-68288, July 11, 1986, 142 SCRA 699,
706-707.
148
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149
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150
“It is the policy of the state to assure the right of workers to “security of
tenure” (Article XIII, Sec. 3 of the New Constitution, Section 9, Article II of
the 1973 Constitution). The guarantee is an act of social justice. When a
person has no property, his job may possibly be his only possession or
means of livelihood. Therefore, he should be protected against any arbitrary
deprivation of his job. Article 280 of the Labor Code has construed security
of tenure as meaning that “the employer shall not terminate the services of
an employee except for a just cause or when authorized by” the code
(Bundoc v. People’s Bank and Trust Company, 103 SCRA 599 [1981]).
Dismissal is not justified for being arbitrary where the workers were denied
due process (Reyes v. Philippine Duplicators, Inc., 109 SCRA 489 [1981])
and a clear denial of due process, or constitutional right must be safeguarded
against at all times, (De Leon v. National Labor Relations Commission, 100
SCRA 691 [1980]).”9
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9 No. L-68147, June 30, 1988, 163 SCRA 279, 284-285.
10 Batangas Laguna Tayabas Bus Co. v. Court of Appeals, No. L-38482, June 18,
1976, 71 SCRA 470, 480.
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