Failure to Give Notice in Illegal Dismissal Cases Is a Procedural Lapse, Not Unlawful, SC clarifies

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Facts: Employees of Holy Face Cell Corporation, operating as Tres Pares Fast Food, were informed on January 14, 2011, that the restaurant would close on January 19, 2011. The employees attempted to discuss the closure with the company's president, Hayden Kho, Sr., but were unsuccessful. The restaurant closed as scheduled, leading the employees to file a complaint for illegal dismissal, seeking separation pay and other benefits.


Supreme Court Ruling: The Supreme Court ruled that the failure to provide notice of closure constitutes a violation of procedural due process but does not amount to an unlawful or criminal act. The Court stated:

"The failure to give notice is not an unlawful act because the law does not define such failure as unlawful."


Consequently, the Court found no basis to hold Kho personally liable for the corporate liabilities arising from the case.


Reasoning: The Court emphasized that non-compliance with the notice requirement results in a procedural defect termed illegal dismissal due to the failure to adhere to mandatory procedural requirements. However, this procedural lapse does not equate to an unlawful or criminal act. Absent evidence that Kho, as a corporate officer, willfully and knowingly assented to patently unlawful acts, acted in bad faith, or was grossly negligent in directing the corporation's affairs, he cannot be held personally liable for the company's obligations.


⚖️ G.R. No. 237246, July 24, 2019

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