Equipoise Rule in Illegal Dismissal Cases: When Doubt Favors the Employee

When evidence in a labor case is equally balanced — or in equipoise — Philippine law tilts the scales in favor of the employee. This principle, rooted in the constitutional policy of affording greater protection to labor, was recently reaffirmed by the Supreme Court in Hubilla v. HSY Marketing Ltd., Co. (G.R. No. 207354, January 10, 2018). The case also clarified important procedural rules on verification of pleadings and the scope of judicial review of labor tribunal findings.

The Facts

In May and June 2010, dozens of employees of Novo Jeans & Shirt & General Merchandise aired grievances against their employer on a radio program. They were referred to the Department of Labor and Employment. The employees claimed that on June 7, 2010, they were barred from entering their workplaces. The next day, the company sent them show-cause letters, but the employees insisted they had already been dismissed.

The employer, for its part, claimed the employees voluntarily left their jobs. It presented "sample letters" of show-cause notices but no proof that each employee actually received one.

The Issue

The central question was whether the employees were illegally dismissed. Before reaching the merits, the Court addressed two procedural matters: whether the Court of Appeals could re-examine factual findings of the National Labor Relations Commission (NLRC), and whether a verification signed by counsel based on facts relayed by clients was valid.

The Ruling

The Supreme Court ruled in favor of the employees, finding they were illegally dismissed.

On the equipoise rule. When both parties fail to present substantial evidence, the evidence is in equipoise, and doubts must be resolved in favor of labor. The employer bears the burden of proving that dismissal was for a valid cause and that due process was observed. Here, the employer failed to prove receipt of the notices by each employee, and it failed to establish abandonment — which requires proof of both failure to report for work and a clear intent to sever the employment relationship.

On review of factual findings. The Court of Appeals may review NLRC factual findings when these were arrived at arbitrarily or without substantial evidence, or when the Labor Arbiter and NLRC make contradictory findings. However, the Court of Appeals itself remains subject to review by the Supreme Court.

On verification. A verification based on facts relayed by clients to counsel is insufficient. The affiant must have personal knowledge of the facts or rely on authentic records. The Court also held that sole proprietorships cannot authorize counsel to sign certifications against forum shopping, since they have no separate legal personality from their proprietors.

Practical Takeaways

• In illegal dismissal cases, the employer bears the burden of proving valid cause and due process.
• The equipoise rule applies when evidence is equally balanced — doubt is resolved in favor of the employee.
• Abandonment requires proof of both unjustified absence and clear intent to sever employment; mere absence is not enough.
• Verification of pleadings must be based on personal knowledge or authentic records, not facts relayed by clients.
• Employees who air grievances in public forums exercise constitutional rights; dismissal for that reason alone is invalid.

This article is general information and not legal advice. For your specific situation, consult a lawyer or ask ASG Legal AI.