In illegal dismissal_ cases, the fundamental rule is that when an employer interposes the defense of resignation, the burden to prove that the employee indeed voluntarily resigned   necessarily rests upon the employer.

Thus, the SC held in the following case, as follows:

Carolina’s Lace Shoppe vs. Maquilan
G.R. No. 219419, April 10, 2019

Resignation; Resignation that is in the nature of a quitclaim; Resignation letter that contains statements freeing the employer from liability supports allegation of involuntariness; Quitclaim; A quitclaim that does not indicate that the amount received indicates full and final settlement may not be valid


Gloria Maquilan (Gloria) and Joy Maquilan (Joy) were employed by Carolina’s Lace Shoppe (CLS) as sales clerk and beader, respectively.

In April 2008, the Department of Labor and Employment (DOLE) inspected CLS. Upon inspection, one of the latter’s employees, Santiago A. Espultero (Espultero) told the labor inspector that he was receiving a daily wage of P250.00. Thereafter, Espultero was terminated from his employment by CLS’ manager Claudine Mangasing (Mangasing). In order to receive a “separation pay” amounting to P60,000.00 despite his 17 years in service, Espultero was allegedly made to sign a quitclaim.

One month thereafter, Gloria was dismissed from the service for no reason given. Like Espultero, she was allegedly made to sign a quitclaim in order to claim her “separation pay” amounting to P15,000.00 despite her three years in service. The same fate happened to Joy, daughter of Gloria, who was dismissed from the service and was forced to sign a quitclaim as she received P4,000.00 as “separation pay.”

Gloria, Joy, Espultero, and Eminda B. Tagalo (Tagalo) were constrained to file a case for illegal dismissal with money claims and damages against CLS, Mangasing and sole proprietor Lourdes Ragas (Ragas) (collectively as Maquilan, et al.).

For their part, respondents claimed that Gloria, Joy and Espultero were not illegally dismissed as they voluntarily resigned, evidenced by their resignation letters.

LA Ruling:

The Labor Arbiter found Gloria and Joy to have been illegally dismissed as they were forced to resign from their respective employments.

Accordingly, CLS and Ragas were ordered to pay their backwages, separation pay, and other money claims. Consequently, an appeal was filed by Maquilan, et al. before the NLRC.

NLRC Ruling:

The NLRC granted the appeal and set aside the decision of the LA.

The NLRC gave credence to the resignation letters of Gloria and Joy and found that the same were voluntarily executed.

A motion for reconsideration was filed by Gloria and Joy, which was denied for lack of merit. Aggrieved, Gloria and Joy raised the matter before the CA via a Petition for Certiorari under Rule 65 of the Rules of Court.

CA Ruling:

The CA granted the petition and reinstated the ruling of the Labor Arbiter.

In disposing so, the CA held that the tenor of the resignation letters, the quitclaims executed by Gloria and Joy, and their subsequent acts belied their clear intents to sever from their respective employments. Hence, it was found that they were illegally dismissed from the service,

Gloria and Joy filed a Motion for Reconsideration, while CLS, Ragas and Mangasing filed a Motion for Partial Reconsideration. The CA denied both motions. Hence, the petition before the SC.


Whether or not a resignation preceded by DOLE inspection, with statements freeing the employer from liability and execution of quitclaim that does not comply with legal requirements is voluntary

Whether or not a quitclaim that does not indicate that the employee received the amount as full and final settlement is valid

SC Ruling:

The SC denied the petition.

In illegal dismissal_ cases, the fundamental rule is that when an employer interposes the defense of resignation, the burden to prove that the employee indeed voluntarily resigned   necessarily rests upon the employer.

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Citing Fortuny Garments vs. Castro, the case of Torreda vs. Investment and Capital Corporation of the Philippines discusses how an employee’s,act of severing from employment may be measured. The act of the employee before and after the alleged resignation must be considered to determine whether in fact, he or she intended to relinquish such employment.

Verily, the acts preceding and subsequent to the employee’s resignation must be taken into consideration. Here, prior to her resignation, there was no indication that Gloria intended to relinquish her employment. Such alleged resignation actually took place after the DOLE conducted an inspection, which yielded to an information that CLS was not giving its employees their due wages. A month after such inspection, like the employee who reported such labor standards violation, Gloria was separated from employment by virtue of a resignation letter. In this regard, there was no clear intention on the part of Gloria to relinquish her employment.

As to her acts after her resignation, Gloria filed a complaint for illegal dismissal and money claims 12 days thereafter. On this note, the SC reiterated that such act of filing said complaint is difficult to reconcile with vountary resignation. Moreover, a reading of the resignation letter executed by Gloria finds significance as it contained statements freeing the employer from liabilities.

Citing the case of Mobile Protective & Detective Agency, the SC ruled that resignation letters which are in the nature of a quitclaim, lopsidedly worded to free the employer from liabilities reveal the absence of voluntariness. Moreover, the quitclaim contained in the resignation letter does not contain stipulations required for its efficacy.

In the case of Flight Attendants and Stewards Association of the Philippines (FASAP) vs. Philippine Airlines, Inc., the SC reiterated the ruling in EDI-Staffbuilders International, Inc. vs. National Labor Relations Commission which laid down the basic contents of a valid and effective quitclaim.

Thus, in order to prevent disputes on the validity and enforceability of quitclaims and waivers of employees under Philippine laws, said agreements should contain the following:

  1. A fixed amount as full and final compromise settlement;
  2. The benefits of the employees if possible with the corresponding amounts, which the employees are giving up in consideration of the fixed compromise amount;
  3. A statement that the employer has clearly explained to the employee in English, Filipino, or in the dialect known to the employees – that by signing the waiver or quitclaim, they are forfeiting or relinquishing their right to receive the benefits which are due them under the law; and
  4. A statement that the employees signed and executed the document voluntarily, and had fully understood the contents of the document and that their consent was freely given without any threat, violence, duress, intimidation, or undue influence exerted on their person.

Admittedly, the quitclaim does not indicate that Gloria received the amount of Pl 5,000.00 as full and final settlement. Similarly, there was nothing which indicates that said amount constitutes said full and final settlement. The quitclaim was also couched in general terms and the tenor of the same does not show that Gloria understood the importance of the same considering that on the same day that she resigned, she immediately relieved respondents from their liabilities. There was also no indication that Gloria intends to give up her claimed benefits in consideration of a fixed compromise amount. It must be emphasized that Gloria was constrained to receive the amount of PhP5,000.00 as she was eight months pregnant at that time and lives with no other means aside from her employment with CLS’.

As to Joy, there was no indication that she intended to voluntarily resign. There was no execution of a resignation letter, but merely a quitclaim, which likewise does not contain the above-mentioned stipulations as the same was a standard clearance and quitclaim form which Joy merely filled out. The manner by which Joy’s name and the effectivity date of her cessation from employment were written, bore the same style and strokes with the entries pertaining to the computation of the amount paid to her; such entries were obviously written by one of CLS ‘s employees. It is apparent, therefore, that the entries in the whole document were written by the same person and Joy was merely asked to sign the same. In addition, the day after she signed the alleged quitclaim, she immediately filed a complaint for illegal dismissal.

While the resignation letter of Gloria and quitclaim signed by Joy appear to have been notarized, the fact of such notarization is not a guarantee of the validity of the contents. The presumption of regularity as regards notarized documents is not absolute and may be rebutted by clear and convincing evidence to the contrary. In this case, the presumption cannot be made to apply because of the following circumstances: (1) Gloria and Joy denied appearing before a notary public; (2) Gloria and Joy did not understand the textual import and effects of the documents notarized; (3) the consideration therein was not fixed; (4) the executions by Gloria and Joy of the notarized documents appear questionable; and (5) Gloria and Joy did not intend to resign from CLS.

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