annum, plus his salaries for the unexpired portion of the employment contract or
for three (3) months for every year of the unexpired term, whichever is less
The illegal dismissal of Lacerna entitles her to the full reimbursement of
placement fee with interest at twelve percent (12%) per annum, plus salaries for
the unexpired portion of her employment contract or for three months for every
year of the unexpired term, whichever is less. Thus, the Court of Appeals was
correct in ordering AIMS to pay HK$11,010.00 corresponding to three months of
her salary or its equivalent in the Philippine Peso at the time of payment, plus
placement fee of P18,0000.00.
The Court of Appeals, however, erred in awarding moral and exemplary
damages inasmuch as Lacerna failed to prove that AIMS and Proxy are guilty of
bad faith. While it is true that they were not able to justify Lacerna’s dismissal, the
same does not automatically amount to bad faith. Moral and exemplary damages
cannot be based solely upon the premise that the employer dismissed the employee
without cause or due process. The termination must be attended with bad faith, or
fraud, or was oppressive to labor or done in a manner contrary to morals, good
customs or public policy and that social humiliation, wounded feelings, or grave
anxiety resulted therefrom. Similarly, exemplary damages are recoverable only
when the dismissal was effected in a wanton, oppressive or malevolent manner.
To merit the award of these damages, additional facts showing bad faith are
necessary[15] but Lacerna failed to plead and prove the same in this case. Hence,
the awards of moral and exemplary damages should be deleted.
The award of attorney’s fees is sustained. In actions for recovery of wages
or where an employee was forced to litigate and thus incurred expenses to protect
his rights and interests, a maximum of ten percent (10%) of the total monetary
award by way ofattorney’s fees is justified under Article 111 of the
Labor Code, Section 8, Rule VIII, Book III of its Implementing Rules, and
paragraph 7, Article 2208 of the Civil Code. There need not be any showing that
the employer acted maliciously or in bad faithwhen it withheld the wages. There
need only be a showing that the lawful wages were not paid accordingly and that
the employee was forced to file a case, as in the instant case.[16]
WHEREFORE, the petition is PARTLY GRANTED. The May 31, 2005
Decision of the Court of Appeals in CA-G.R. SP No. 73276 is AFFIRMED with
the MODIFICATION that the awards of moral and exemplary damages
are DELETED for lack of basis.