Title
Aldovino vs. Gold and Green Manpower Management and Development Services, Inc.
Case
G.R. No. 200811
Decision Date
Jun 19, 2019
Workers hired for Taiwan jobs faced contract changes, unpaid overtime, and illegal dismissal. SC ruled in their favor, declaring a law clause unconstitutional and awarding damages, fees, and salary reimbursement.
illegal dismissal
salaries
unexpired portion
A

Case Summary (G.R. No. L-15092)

Procedural History

Petitioners filed administrative/labor claims in the Philippines for illegal dismissal, underpayment, human trafficking, illegal signing of papers, reimbursement of placement fees, moral and exemplary damages, and attorney’s fees. The Labor Arbiter (April 8, 2010) dismissed the illegal dismissal claim but awarded financial assistance; the NLRC (July 29, 2010) affirmed non‑illegality and struck the financial assistance. Petitioners sought certiorari at the Court of Appeals; the CA (Sept. 29, 2011) reversed, declaring the dismissals illegal and ordering reimbursement of placement fees and payment of salaries for the unexpired portion of the contracts or “for three (3) months for every year of the unexpired term, whichever is less.” The CA denied reconsideration (Jan. 26, 2012). Petitioners filed a Petition for Review on Certiorari to the Supreme Court.

Issues Presented

  1. Whether the Compromise Agreement and the corresponding quitclaims executed in Taiwan barred petitioners from prosecuting their labor claims in the Philippines; 2) Whether petitioners were illegally dismissed and therefore entitled to reimbursement of placement fees and other damages; and 3) Whether the “three (3) months for every year of the unexpired term, whichever is less” cap as reinstated in Section 7 of R.A. No. 10022 has the force and effect of law.

Governing Constitutional and Statutory Law

The case is decided under the 1987 Philippine Constitution (notably Article XIII, Section 3 guaranteeing protection of workers and security of tenure) and the Labor Code (Article 294 on security of tenure). The Court applies the lex loci contractus principle to determine applicable law because the employment contracts were perfected in the Philippines; thus Philippine labor statutes and public policy govern. Relevant statutory provision at issue: Section 7 of Republic Act No. 10022 (amending Section 10 of R.A. No. 8042), particularly the clause reinstating the three‑month cap.

Enforceability of the Compromise Agreement and Quitclaim

The Court held that the Compromise Agreement and the attendant quitclaims executed by petitioners in Taiwan do not bar their subsequent labor claims in the Philippines. Legal principle applied: quitclaims and releases executed by employees under economic duress or pressured circumstances are contrary to public policy and generally ineffective to preclude claims for the full measure of workers’ legal rights. The Compromise Agreement’s object was the settlement of underpayment claims adjudicated in Taiwan and cannot be construed as a blanket waiver extinguishing distinct claims for illegal dismissal, reimbursement of placement fees, moral/exemplary damages, and attorney’s fees under Philippine law. The petitioners signed the compromise out of dire necessity after termination and deprivation of livelihood, circumstances that negate the effectiveness of the waiver.

Nature of the Dismissal and Failure to Observe Due Process

The Court found the termination of petitioners’ employment to be without just or authorized cause under the Labor Code. Evidence showed petitioners were told they were no longer employed, were immediately escorted to pack their belongings, abandoned at a train station, and deprived of opportunity to be heard. Employers bear the burden of proving that a dismissal is valid; respondents failed to meet this burden. The two‑notice rule and opportunity to be heard required by substantive and procedural due process were not complied with; the purported voluntary severance via the Compromise Agreement did not transform the dismissal into a lawful resignation.

Reimbursement of Placement Fees and Salary Remedies

Because the dismissals were illegal, petitioners are entitled to statutory remedies. The Court affirmed the CA’s order for full reimbursement of placement fees with interest at 12% per annum, as provided by Section 7 of R.A. No. 10022. Regarding salary for the unexpired portion of their employment contracts, the Court recognized petitioners’ entitlement to recover salaries corresponding to the actual unexpired portion of their contracts, as the three‑month cap is unconstitutional (see analysis below). The Court modified the CA’s award to remove the unconstitutional cap and to require payment based on the actual unexpired contract period.

Awards of Moral and Exemplary Damages and Attorney’s Fees

The Court awarded moral damages (P50,000 each) and exemplary damages (P25,000 each) on the basis that the dismissals were attended by bad faith, oppressive conduct, and actions contrary to public policy. The forced signing of a new piece‑rate contract, underpayment, deprivation of overtime, confiscation of documents, abandonment, and sheltering without means evidenced bad faith and oppression, warranting moral and exemplary damages. Attorney’s fees were awarded at ten percent of the petitioners’ respective monetary awards; this award is supported by Civil Code Article 2208 provisions permitting recovery of attorney’s fees where exemplary damages are awarded, where defendant acted in gross and evident bad faith in refusing to satisfy a plainly valid claim, and in actions for recovery of wages. Legal interest of six percent per annum was imposed on the total monetary awards (except the placement fee reimbursement), while the placement fee

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