Dismissal of Employee Does not Involve his Property in Constitutional Sense

Dismissal of an employee requires observance of due process. There are two aspects of due process, the substantive and the procedural. The usual dispute involves failure to notify the employee to explain the charge, attend hearing/conference, and notice of dismissal.

Does failure to provide notice or opportunity for a hearing to the employee violate his constitutional right to his property? Is his job property in constitutional sense?

Previously, court decisions consider the right of a person to his labor to be property as within the meaning of constitutional guarantees. That is, his labor is his means of livelihood. Thus, he cannot be deprived of his labor or work without due process of law. This is pursuant to the constitutional provision cited earlier.

It is considered that without limitations the State is very powerful. It can take life, liberty or property from any of its citizens. What limits such power is the constitution. Thus, in the 1987 Constitution, it is required that there should be due process of law before the State can deprive an individual of those rights. Further, one cannot be denied of the equal protection of the laws. These guarantees act as limitation against the State or the government.

The question now is if this also applies to private entities like the employer. To resolve this, the Court clarified that the constitutional interpretation does not apply to an employer acting as a private entity. The constitutional guarantee applies only against the State.

Hence, when an employer terminates the services of an employee, it acts as a private entity. There will be no violation of the employee’s property rights under the Constitution. The due process clause of the constitution is a limitation on governmental powers.

The private employer is not a governmental power. Thus, unlike in the past, absence of notice and hearing does not anymore invalidate the termination based on just or authorized cause. Although the employer will be liable for indemnity in the form of nominal damages, the reason it is stressed that notice and hearing are still important.

The case cited below refers to dismissal of an employee for authorized cause. Hence, this discussion should be taken along that context.

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The SC held in the case of Serrano vs. NLRC (G.R. No. 117040, January 27, 2000.) that violation of the notice requirement does not nullify the employee’s dismissal, to wit:

There are three reasons why, on the other hand, violation by the employer of the notice requirement cannot be considered a denial of due process resulting in the nullity of the employee’s dismissal or layoff.

The first is that the Due Process Clause of the Constitution is a limitation on governmental powers. It does not apply to the exercise of private power, such as the termination of employment under the Labor Code.

The second reason is that notice and hearing are required under the Due Process Clause before the

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power of organized society are brought to bear upon the individual. In the case of termination of employment for authorized cause under Art. 298 which requires 30-day prior notice to the Department of Labor and Employment (DOLE) and the employee. Notably, there is no similar requirement for dismissal of an employee who committed an offense or violation of company rules.

In this type of dismissal, the employee is not faced with an aspect of the adversary system. Thus, the 30-day notice period to the DOLE and the employee as mandated by law is to give him time to prepare for the eventual loss of his job and the DOLE an opportunity to determine whether economic causes do exist justifying the termination of his employment. Likewise, it was not intended to afford him an opportunity to be heard on any charge against him, for there is none, according to SC.

The third reason why the notice requirement under Art. 298 cannot be considered a requirement of the Due Process Clause is that the employer cannot really be expected to be entirely an impartial judge of his own cause. This is also the case in termination of employment for a just cause under Art. 282 (i.e., serious misconduct or willful disobedience by the employee of the lawful orders of the employer, gross and habitual neglect of duties, fraud or willful breach of trust of the employer, commission of crime against the employer or the latter’s immediate family or duly authorized representatives, or other analogous cases).