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Termination by Employer
According to Article 282 of the Labor Code, an employer can terminate an employee for just
causes, which could be any of the following:
serious misconduct or willful disobedience by the employee of the lawful orders of his
employer or representative in connection with his work;
gross and habitual neglect by the employee of his duties;
fraud or willful breach by the employee of the trust reposed in him by his employer or
duly authorized representatives;
commission of a crime or offense by the employee against the person of his employer or
any immediate member of his family or his duly authorized representatives; and
other similar causes.
Employers can also terminate an employee based on authorized causes like business and
health reasons. Art. 283 of the Labor Code states that an employee can be terminated due to
business reasons such as:
For termination of employment based on health reasons, employers are allowed to terminate
employees found suffering from any disease and whose continued employment is prohibited by
law or is prejudicial to his health as well as to the health of his co-workers (Art. 284, Labor
Code). The employer must obtain from a competent public health authority a certification that
the employee’s disease is of such a nature and at such a stage that it can no longer be cured
within a period of six (6) months even with medical attention.
Voluntary Resignation
This type of termination is strengthened by the provisions of Art. 285 of the Labor Code
which recognizes two kinds of termination an employee can initiate – without just cause and
with just cause. If the resignation is without just cause, the employee must give a one (1) month
advance written notice for resignation (commonly referred to as a “resignation letter”) to the
employer to enable them to look for a replacement and prevent work disruption. If the employee
fails to provide a resignation letter, he or she runs the risk of incurring liability for damages.
If the resignation is with just cause, however, the employee need not serve a resignation
notice. Art. 285 indicate the just causes for resignation as follows:
The due process is different for both authorized and just causes. Just cause involves a
two-notice rule while authorized cause requires a 30-day notice. If due process is not accorded to
the employee before termination of the employment or the termination itself is declared illegal,
the employee is entitled to receive reinstatement and full backwages (Art. 279, Labor Code). If
reinstatement is no longer possible where the dismissal was unjust, separation pay may be
granted.
1. A written notice, commonly referred to as a notice to explain specifying the grounds for
termination and giving the employee ample opportunity to explain their side;
2. A hearing or conference to allow the employee to respond to the charge/s, present
evidence, or rebut the evidence presented against them; and
3. A notice of decision indicating the justification for termination as well as the
corresponding sanctions (if any) after due consideration of all evidence.
Due Process for Authorized Causes
Dismissals based on authorized causes involve the following:
1. Submission of a written notice of dismissal to the employee specifying the grounds for
dismissal at least 30 days before the date of termination; and
2. A copy of the notice which shall be provided to the Regional Office of the Department of
Labor and Employment (DOLE) where the employer is located.
Can an employee be placed under suspension while the investigation and/or hearing for the
charges filed against them is ongoing?
-Yes, but only on grounds where the employee’s continued presence inside the company
premises poses a serious and imminent threat to the life or property of the employer and/or the
other employees in the company. The suspension, commonly referred to as “preventive
suspension”, shall not last for more than thirty (30) days.
the substantive aspect pertains to the absence of a just or authorized cause supporting the
dismissal; and
the procedural aspect refers to the failure of the employer to give the employee the
opportunity to explain their side.
Suppose the employer denies dismissing the employee, who has the duty to prove that the
dismissal is without valid cause?
-The employee must elaborate, support, or substantiate their complaint that they were dismissed
without valid cause.
In cases of illegal dismissal, who has the duty of proving that the dismissal is valid?
-The employer.
What is the sanction if the employer failed to observe procedural due process in cases of legal
and authorized termination?
-The employee is entitled to payment of indemnity or nominal damages in a sum of not more
than 30,000 pesos in cases of termination for just causes and not more than 50,000 pesos for
authorized causes.
Can an employee be reinstated to their previous position if they were proven to be illegally
dismissed?
-Yes. When a Labor Arbiter rules for an illegal dismissal, reinstatement is immediately
executory even when pending approval by the employer. The employee should be treated in a
matter involving seniority and continuity of employment as though they had not been dismissed
from work.
The period of service is deemed to have lasted up to the time of closure of the establishment. The
employee has the right to claim backwages to cover the period between dismissal from work and
business closure.
What is meant by full backwages?
-Full backwages refer to all compensations, including allowances and other benefits with
monetary equivalent that should have been earned by the employee but was not collected
because of unjust dismissal. It includes all the amount they could have earned starting from the
date of dismissal up to the time of reinstatement.
However, if the strike was staged for a purpose not recognized by law, an employee who
knowingly participates in the commission of illegal acts during the strike may be declared to
have lost their employment status.
An exhaustive list of the labor policies in the Philippines, including those with regard to
Employee Separation, can be found in the official government publication of the Labor Code of
the Philippines.