Fired Without Notice? The Two-Notice Rule and Nominal Damages

A valid dismissal needs two things: a valid cause and a valid procedure. In Aldovino v. Gold and Green Manpower (2019), the Supreme Court said that for a valid dismissal "there must be a valid cause and a valid procedure".

For dismissals based on a just cause (for example, serious misconduct or fraud), the procedure is in the rules implementing the Labor Code, Book VI, Rule I, Section 2, as amended by DOLE Department Order No. 147-15. The Supreme Court quoted it in C.P. Reyes Hospital v. Barbosa (2024):

1. First notice. A written notice served on the employee, stating the ground or grounds for termination and giving the employee a reasonable opportunity to explain his or her side.
2. Hearing or conference. The employee, with a lawyer if he or she wants, can respond to the charge, present evidence and rebut the evidence against him or her.
3. Second notice. A written notice of termination, stating that after considering all the circumstances, the grounds have been established.

In Agabon v. NLRC (2004), the Court described it as "two written notices and a hearing or opportunity to be heard if requested by the employee". In C.P. Reyes, the Court said this rule also applies to probationary employees dismissed for a just cause.

The rules quoted in Agabon say the notices "shall be served on the employee's last known address". In that case, the workers had stopped reporting for work and were working for another company. The employer did not follow the notice requirements. It argued that sending notices to their last known addresses would have been useless because they no longer lived there. The Court said this was not a valid excuse, because the law requires the twin notices to be sent to the employee's last known address. Moving away does not remove the employer's duty to send them.

Business reasons, called authorized causes, have a different procedure. Article 298 [283] of the Labor Code, as quoted in Keng Hua Paper Products v. Ainza (2023), requires a written notice on the workers and on the Department of Labor and Employment (DOLE) at least one month before the intended date. See Retrenchment and closure: when is it legal?

The dismissal stays valid, but the employer may be ordered to pay nominal damages. Under Serrano v. NLRC (2000), such a dismissal was "ineffectual" and the employer paid full backwages until a court found that the cause was valid. In Agabon, the Court abandoned that rule. It said the lack of statutory due process "should not nullify the dismissal, or render it illegal, or ineffectual", but the employer should indemnify the employee for the violation.

The Court then set the amounts in two leading cases:

In Jaka, the Court explained why authorized causes cost more: the dismissal "was initiated by the employer's exercise of his management prerogative", while a just-cause dismissal starts with an act of the employee. Later cases followed the same pattern. In Nippon Housing v. Leynes (2011), an employer that declared a position redundant but gave notice late paid ₱50,000. In Abbott Laboratories v. Alcaraz (2013), an employer that dismissed a probationary employee for a valid reason but did not follow its own company procedure paid ₱30,000.

These are amounts the Court found proper in those cases. Agabon said the amount "is addressed to the sound discretion of the court, taking into account the relevant circumstances". They are not a fixed fine.

Then the problem is bigger than missing notices: the dismissal is illegal. In Aldovino, workers were "only verbally dismissed, without any notice given or having been informed of any just cause". The Court found them illegally dismissed and awarded salaries, damages and attorney's fees. See Illegally dismissed: what can you get? and What are the valid reasons to fire an employee?

These are made-up examples to show how the rules work. They are not advice for any real case.

Bea, a cashier, is caught on video taking money from the cash box. Her manager fires her the same day without any notice or hearing. Fraud or breach of trust can be a just cause, so the dismissal may stand. But because the steps were skipped, the employer may be ordered to pay nominal damages, as in Agabon.

Ramil gets a text message: "Wag ka na pumasok bukas." No reason is given, and he has no record of any offense. If his employer cannot prove a valid cause, this is illegal dismissal, not just a missing notice.

A bakery in Iloilo loses money for two years and cuts five workers, but tells them only a week before. If it can prove the losses, the retrenchment may be valid, but the missing one-month notice to the workers and DOLE can lead to nominal damages, as in Jaka.

Joy receives a notice to explain her absences, answers it in writing, attends a meeting with HR and then receives a termination letter that explains the decision. Her employer followed the steps. Whether the ground itself is valid is a separate question.

Talk to a lawyer if you were dismissed without any paper, if you received a notice to explain and need to answer it, or if you are an employer planning a dismissal or a retrenchment. The result depends on the evidence and on the steps actually taken. If you cannot afford a lawyer, see Free legal help in the Philippines for the Public Attorney's Office (PAO) and other options.