G.R. No. 108311 . May 18, 1999.
JOSE GABISAY and SABINA GOMEZ, petitioners, vs. NATIONAL LABOR RELATIONS COMMISSION, FIFTH DIVISION, PARATROOPERS SECURITY AGENCY, MAJOR FEDERICO DACANAY, PRESIDENT/EXECUTIVE DIRECTOR, JULIETA SENO, OIC and BISLIG WATER DISTRICT, respondents.

FACTS

Petitioners Jose Gabisay and Sabina Gomez were employed as security guards by Paratroopers Security Agency and assigned to Bislig Water District. They worked daily without rest days or holidays, receiving a monthly salary of P600.00. In May 1987, they filed a complaint with the DOLE for underpayment and non-payment of statutory benefits. The parties settled amicably in June 1987, with petitioners receiving P900.00 and P800.00 respectively and executing an Affidavit of Desistance. Subsequently, on July 22, 1987, the agency informed petitioners of their immediate discharge from service.
Petitioners then filed a complaint for illegal dismissal and monetary claims. The Labor Arbiter ruled in their favor, declaring the dismissal illegal and ordering the payment of separation pay and monetary benefits, holding Paratroopers and Bislig Water District jointly and severally liable. The NLRC reversed this decision. The agency contended the dismissal was due to disciplinary infractions, alleging petitioners were merely “temporarily relieved” for rule violations, and argued the prior settlement barred further claims.

ISSUE

Whether the NLRC committed grave abuse of discretion in reversing the Labor Arbiter’s finding of illegal dismissal and in disregarding the petitioners’ monetary claims.

RULING

Yes, the Supreme Court annulled the NLRC resolution and reinstated the Labor Arbiter’s decision. On the dismissal, the employer bears the burden of proving a valid cause and compliance with due process. The agency’s claim of temporary relief for disciplinary reasons was unsubstantiated. The letter from the agency’s OIC stating petitioners were “terminated effective immediately” constituted a dismissal. The alleged infractions were dubious, as one was cited for an offense occurring after his alleged termination. Critically, no formal notice of charges or a hearing was afforded to petitioners, violating the twin requirements of due process.
Regarding the monetary claims, the prior settlement and Affidavit of Desistance did not constitute a valid waiver of statutory rights. The Court emphasized that such waivers are against public policy unless executed with the assistance of the DOLE or counsel, which was absent here. The claims for underpayment and non-payment of overtime, holiday pay, and other benefits were thus properly awarded. Finally, Bislig Water District was correctly held jointly and severally liable as an indirect employer under Article 106 of the Labor Code, given its service contract with the agency. The Labor Arbiter’s factual findings, supported by evidence, were upheld.