In the case of Distribution & Control Products, Inc. vs. Santos, G.R. No. 212616, July 10, 2017 the Supreme Court (SC) held that the settled rule is that in termination proceedings of employees, procedural due process consists of the twin requirements of notice and hearing.

The employer must furnish the employee with two written notices before the termination of employment can be effected: (1) the first apprises the employee of the particular acts or omissions for which his dismissal is sought; and (2) the second informs the employee of the employer’s decision to dismiss him.

The requirement of a hearing is complied with as long as there was an opportunity to be heard, and not necessarily that an actual hearing was conducted.

In Unilever Philippines, Inc. vs. Rivera, the SC laid down the guidelines on how to comply with procedural due process in terminating an employee, to wit:

(1) The first written notice to be served on the employees should contain the specific causes or grounds for termination against them, and a directive that the employees are given the opportunity to submit their written explanation within a reasonable period. “Reasonable opportunity” under the Omnibus Rules means every kind of assistance that management must accord to the employees to enable them to prepare adequately for their defense. This should be construed as a period of at least five (5) calendar days from receipt of the notice to give the employees an opportunity to study the accusation against them, consult a union official or lawyer, gather data and evidence, and decide on the defenses they will

raise against the complaint. Moreover, in order to enable the employees to intelligently prepare their explanation and defenses, the notice should contain a detailed narration of the facts and circumstances that will serve as basis for the charge against the employees. A general description of the charge will not suffice. Lastly, the notice should specifically mention which company rules, if any, are violated and/or which among the grounds under Art. 282 is being charged against the employees.

(2) After serving the first notice, the employers should schedule and conduct a hearing or conference wherein the employees will be given the opportunity to: (1) explain and clarify their defenses to the charge against them; (2) present evidence in support of their defenses; and (3) rebut the evidence presented against them by the management. During the hearing or conference, the employees are given the chance to defend themselves personally, with the assistance of a representative or counsel of their choice. Moreover, this conference or hearing could be used by the parties as an opportunity to come to an amicable settlement.

(3) After determining that termination of employment is justified, the employers shall serve the employees a written notice of termination indicating that: (1) all circumstances involving the charge against the employees have been considered; and (2) grounds have been established to justify the severance of their employment.

Considering that the burden of proving compliance with the procedural requirements lies with the employer, optimum effort should be exerted to obtain proof of compliance.

Hence, in service of the NTE, the employer has to ensure that it has proof that it was received by the employee. The usual approach is directing the employee to receive his copy of the NTE and to affix his signature in the company’s copy to prove receipt.

However, there have been cases where the employee refuses to receive the NTE. In this case, the company should observe the procedure in indicating refusal to receive.

See here the procedure to observe when the employee refuses to receive employer’s notice.

In addition, the company should send another copy by registered mail and keep the registry receipt for future reference.

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Twin Requirements of Notice and Hearing

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Notice to Explain: Contents and Requirements

However, it does not mean that if an employee is on AWOL status he is already terminated from service. AWOL usually constitutes violation of the company policies on vacation leave, sick leave, emergency leave, or the service incentive leave (SIL).

An employee is considered to have committed an act constituting AWOL if he absents from work without prior notice or compliance with the procedures for being absent.

Once an employee fails to report for work without prior approved VL or complying with the “no-call, no-show” policy for emergency or sick leave, there is already a suspicion of AWOL.

Despite such act, the employee still has to be asked to explain in writing his absence through the issuance of the Notice to Explain (NTE). While it does not necessarily follow that a single act of AWOL would result in termination, I personally suggest that the period to respond to the NTE should be five (5) calendar days.

In addition, the NTE is usually coupled with the Return to Work Notice (RTWO) to ensure that the employee is being reminded to comply with the duties.

It is better to have a policy of affording more than ample opportunity to be heard when it comes to employee discipline. At any rate, below is a sample NTE for reference.

For more templates and other disciplinary forms, you may check the HR Forms, Notices, and Contracts Volume 2.

To:             JUAN DELA CRUZ

From:         Malou Pete

HR Manager

Date:          21 September ___________

Subject:     NOTICE TO EXPLAIN FOR AWOL

It appears in company records that you failed to report for work on ____________ September 20____ without any filed and approved VL form.

Upon further checking, you have not also made a call applicable in cases where the employee encounters an emergency. It is our policy that employees who would be absence should promptly notify the company.

In this regard, please explain in writing within five (5) calendar days from this notice why no disciplinary action should be taken against you for the above. Likewise, you are hereby being directed to report for work immediately upon receipt of this notice.

Failure on your part to submit your written explanation within the prescribed period shall be deemed as waiver of your right to due process. For your strict compliance.

MALOU PETE

HR Manager

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Twin Requirements of Notice and Hearing

Procedural Due Process for Other Types of Employment

Notice to Explain: Contents and Requirements

The two-notice rule refers to the two notices required in employee dismissal. These are the first notice or Notice to Explain / NTE or Show Cause, etc., and the Notice of Dismissal, Notice of Termination.

Every company has terminology for the notices issued in dismissal cases. So, it is not about the term being used but the substance and contents of the notices being issued. However, I prefer to use the NTE term for consistency.

The term “twin requirements” refers to the notices and the hearing. The hearing does not require formal hearing seen in courtrooms. Just a usual meeting discussing the charges and allowing the employee being charged to explain would suffice.

However, in the case of Perez vs. PT&T, the Supreme Court (SC) declared that actual hearing is not necessary. Unless it is mandated in the company policy or so demanded by the employee in writing.

At any rate, it is better to overdo the due process compliance than to fall short. Optimizing the ample

opportunity for discussion of the charges would always be a better policy.

Non-compliance with the procedural due process at present does not have the fatal consequences it has in the past. Prior to the case of Agabon vs. NLRC, failure to comply with the procedure in employee dismissal could result in illegal dismissal.

The doctrine in Serrano vs. NLRC had already been abandoned in Agabon v. NLRC by ruling that if the dismissal is done without due process, the employer should indemnify the employee with nominal damages.

Thus, for non-compliance with the due process requirements in the termination of employment, the employer can be sanctioned to pay the employee the amount of thirty thousand pesos (PhP 30,000) as damages, whether or not the dismissal is illegal.

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Procedural Due Process for Other Types of Employment

Notice to Explain: Contents and Requirements

Especially in the case of employee dismissal, the law strictly requires adherence to the notice requirements and imposes indemnity for employer’s violation.

In the case of King of Kings Transport, Inc. vs. Mamac, the Supreme Court (SC) laid down the procedural due process required in employee termination. First, there should be notice to explain or NTE. Then a hearing/conference. Finally, a notice of dismissal.

As can be observed, there are several notices in a single act of dismissal. These are know as the two-notice rule. While the holding of hearing / conference is still contentious, it is best to err on the side of caution by holding the same anyway.

In the case of Perez vs. PT&T, G.R. No. 152048, April 7, 2009,  the SC held that a formal or trial type hearing is not at all times and in all instances essential to due process, the requirements of which are satisfied where the parties are afforded fair and reasonable opportunity to explain their side of the controversy. It is deemed sufficient for the employer to follow the natural sequence of notice,

hearing and judgment.

After receiving the first notice apprising him of the charges against him, the employee may submit a written explanation (which may be in the form of a letter, memorandum, affidavit or position paper) and offer evidence in support thereof, like relevant company records (such as his 201 file and daily time records) and the sworn statements of his witnesses.

For this purpose, he may prepare his explanation personally or with the assistance of a representative or counsel. He may also ask the employer to provide him copy of records material to his defense. His written explanation may also include a request that a formal hearing or conference be held.

In such a case, the conduct of a formal hearing or conference becomes mandatory, just as it is where there exist substantial evidentiary disputes or where company rules or practice requires an actual hearing as part of employment pretermination procedure. To this extent, the SC refined the decisions we have rendered so far on this point of law.

In sum, the following are the guiding principles in connection with the hearing requirement in dismissal cases:

(a) “ample opportunity to be heard” means any meaningful opportunity (verbal or written) given to the employee to answer the charges against him and submit evidence in support of his defense, whether in a hearing, conference or some other fair, just and reasonable way.

(b) a formal hearing or conference becomes mandatory only when requested by the employee in writing or substantial evidentiary disputes exist or a company rule or practice requires it, or when similar circumstances justify it.

(c) the “ample opportunity to be heard” standard in the Labor Code prevails over the “hearing or conference” requirement in the implementing rules and regulations.

The 2019 Amendments to the Rules of Court duly recognize the computer printouts as original documents. Thus, computer printouts of text, chat, or any form of electronic medium that is readable may be used as proof of compliance with the procedural due process nowadays. This is just my personal view.

It has to be seen whether the courts also see it this way.

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Twin Requirements of Notice and Hearing

Procedural Due Process for Other Types of Employment

Notice to Explain: Contents and Requirements

Service of the NTE may be done personally or through registered mail. Modern practices that are may be acceptable include sending electronically (through text, chat, or email). However, the sender must ensure that the accounts are indeed that of the employee and there prior conversations that would ensure usage of such account by the employee.

The usual issue is the refusal of some employees to sign any disciplinary notice. In this case, how should the employer ensure that the notices are received considering that it is mandatory requirement in dismissal cases?

The notice served personally should be presented before the employee and a copy left in front of him. In the receiving copy, the person serving should indicate “Refused to Receive” and print and sign his name thereon. He should indicate also the date and time of service.

Further, he should look for two witnesses to attest to the service who should sign therein with their

printed names.

As better practice, the employer should send a copy of the NTE to the last known address of the employee and keep a copy of the registry receipt for future use.

In case the dismissal is challenged and the case goes to labor court, the employer should require the one serving to execute an affidavit of service of such notice.

Learn how to Validly Terminate Employee in the Philippines with this Tutorial Video of Atty. Elvin

Read more on procedural due process discussion by Atty. Elvin:

Read more on procedural due process by Atty. Villanueva:

Twin Requirements of Notice and Hearing

Procedural Due Process for Other Types of Employment

Notice to Explain: Contents and Requirements

Basically, an NTE apprises the employee about the offense being charged. In case of termination, the notices shall be served on the employee’s last known address. This is usually found in the HR databases or 201 file. It is a good practice to update these records or to require employees to provide changes in their personal information.

As a good practice, it is suggested that employers should update the 201 file by requiring employees to update their records periodically especially their place of residence. There are instances wherein employees change residence without informing HR and in effect not updating the 201 file. In such case, whenever a notice is sent to them they would claim that they did not receive it because it was sent to the wrong address.

Learn how to Validly Terminate Employee in the Philippines with this Tutorial Video of Atty. Elvin

Read more on procedural due process discussion by Atty. Elvin:

Read more on procedural due process by Atty. Villanueva:

Twin Requirements of Notice and Hearing

Procedural Due Process for Other Types of Employment

Notice to Explain: Contents and Requirements

For example, the company may issue a notice every six months to employees asking them to update their personal information. Attached to such notice is the form containing entries related to such

information including the employee’s address. The employer may issue a warning that failure of the employee to fill out the form and submit to HR within the prescribed period it shall be deemed that the employee is retaining his record on file.