G.R. No. 109390 . March 7, 1996.
JGB AND ASSOCIATES, INC., petitioner, vs. NATIONAL LABOR RELATIONS COMMISSION and ARTURO C. ARROJADO, respondents.

FACTS

Private respondent Arturo C. Arrojado was hired by petitioner JGB and Associates, Inc. for its principal, Tariq Hajj Architects, to work as a draftsman in Saudi Arabia under a two-year contract. On February 25, 1990, before the contract expired, he was terminated on the spot for alleged below-average performance and neglect of duties. He was repatriated to the Philippines three days later. Arrojado filed a complaint for illegal dismissal, seeking payment for the unexpired contract, salary differentials, and a refund for withheld telephone bills. He claimed he performed his duties well, was never reprimanded, and was denied due process. The POEA initially dismissed the illegal dismissal complaint but ordered a refund for the telephone bills.
The NLRC, on appeal, reversed the POEA. It declared the dismissal illegal, ordering petitioner to pay Arrojado salaries for the unexpired contract, salary differentials, and the telephone bill refund. The NLRC found the employer failed to substantiate the grounds for dismissal and that the dismissal was effected without due process. Petitioner now assails the NLRC decision via certiorari, alleging grave abuse of discretion.

ISSUE

Whether the NLRC committed grave abuse of discretion in reversing the POEA and ruling that private respondent was illegally dismissed.

RULING

The Supreme Court dismissed the petition, finding no grave abuse of discretion by the NLRC. In termination cases, the burden of proving just cause rests on the employer. Petitioner failed to discharge this burden. The cited grounds—poor performance and neglect—were not supported by substantial evidence. The employer’s letter merely contained general accusations without specific instances or documentation of prior warnings or a fair evaluation. The purported quitclaim signed by Arrojado upon repatriation was invalid, executed under compulsion as he was a necessitous man with no opportunity to contest his dismissal abroad.
Furthermore, the dismissal violated due process. Arrojado was notified of his termination only on the day it took effect, contrary to the requirement of prior notice. The payment of one month’s “notice pay” could not substitute for the mandatory notice and hearing required by law. For dismissal without just cause and due process, an employee under a fixed-term contract is entitled to payment of salaries for the unexpired portion. The NLRC correctly awarded such payment, with the “notice pay” properly treated as indemnity for the procedural violation. The awards for salary differential and telephone bill refund were also upheld.