MANILA — The Supreme Court has nullified a set of quitclaims signed by security guards employed by Corporate Protection Services, Phils., Inc. after it was found out that the company intended to defraud its employees.

In a decision of the 2nd Division promulgated on April 3, 2024, the high court ordered the company to reinstate the employees and pay their back wages and other benefits.

The court noted that the employees reported for 12 hours daily, including holidays, and were not paid special salaries such as holiday pay, rest day pay, service incentive leave pay, 13th month pay and emergency cost of living allowance.  

After the employees complained, they eventually agreed to settle their grievances when the company offered to pay all their money claims if they submitted signed resignation letters.

The National Labor Relations Commission and the Court of Appeals ruled that the quitclaims and resignation letters were invalid.

“The Supreme Court ruled in favor of the employees, finding that the quitclaims they signed were void for being executed by CORPS with an intent to defraud,” the SC said in a statement.

The high court reiterated that for a quitclaim to be valid, there must be no fraud or deceit on the part of any party; the reason for the quitclaim is credible and reasonable; and the contract is not contrary to law.

The SC stated that the employees signed the quitclaims in the honest belief that they would be paid their money claims in full.

“The court also ruled that CORPS constructively dismissed the employees, finding that CORPS, through fraud, induced them to sign the resignation letters and that CORPS attempted to disguise their dismissal as a voluntary termination of employment,” the SC said.