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employees from subsequently claiming benefits to which they are legally entitled.[50]
In Am-Phil Food Concepts, Inc. v. Padilla,[51] this Court held that quitclaims do not
negate charges for illegal dismissal:
The law looks with disfavor upon quitclaims and releases by employees
pressured into signing by unscrupulous employers minded to evade legal
responsibilities. As a rule, deeds of release or quitclaim cannot bar
employees from demanding benefits to which they are legally entitled or
from contesting the legality of their dismissal. The acceptance of those
benefits would not amount to estoppel. The amounts already received by the
retrenched employees as consideration for signing the quitclaims should,
however, be deducted from their respective monetary awards.[52]
Here, the parties entered into the Compromise Agreement to terminate the case for
underpayment of wages, which petitioners had previously filed against respondents in
Taiwan. The object and foundation of the Compromise Agreement was to settle the
payment of salaries and overtime premiums to which petitioners were legally entitled.
Hence, it should not be construed as a restriction on petitioners' right to prosecute
other legitimate claims they may have against respondents.
Paragraph 7 of the Compromise Agreement, which stipulates that petitioners "shall give
up other rights of compensation . . . [and] shall not ask for any compensation based on
any other causes[,]"[53] cannot bar petitioners from filing this case and from being
indemnified should respondents be adjudged liable. Blanket waivers exonerating
employers from liability on the claims of their employees are ineffective.[54]
Besides, at the time the parties' Compromise Agreement was executed, respondents
had just terminated petitioners from employment. Petitioners, therefore, had no other
choice but to accede to the terms and conditions of the agreement to recover the
difference in their salaries and overtime pay. With no means of livelihood, they signed
the Compromise Agreement out of dire necessity.
II
Respondents further justify the dismissal by arguing that petitioners voluntarily severed
their employment when they signed the Compromise Agreement.
This argument is also untenable.
Under the Labor
authorized cause
Articles 297 and
termination either
Code, employers may only terminate employment for a just or
and after complying with procedural due process requirements.
300 of the Labor Code enumerate the causes of employment
by employers or employees:
ARTICLE 297. [282] Termination by employer. — An employer may
terminate an employment for any of the following causes:
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