1 | LM 63 Labor Relations; Post Employment; Just Causes for Termination of Employment

Post Employment

Termination of Employment

Article 293. Security of Tenure. In cases of regular employment, the employer shall not terminate the
services of an employee except for a just cause or when authorized by this Title. An employee who is
unjustly dismissed from work shall be entitled to reinstatement without loss of seniority rights and other
privileges and to his full backwages, inclusive of allowances, and to his other benefits or their monetary
equivalent computed from the time his compensation was withheld from him up to the time of his actual
reinstatement.

Article 294. Regular and Casual Employment. The provisions of written agreement to the contrary
notwithstanding and regardless of the oral agreement of the parties, an employment shall be deemed to
be regular where the employee has been engaged to perform activities which are usually necessary or
desirable in the usual business or trade of the employer, except where the employment has been fixed for
a specific project or undertaking the completion or termination of which has been determined at the time
of the engagement of the employee or where the work or services to be performed is seasonal in nature
and the employment is for the duration of the season.

An employment shall be deemed casual if it is not covered by the preceding paragraph: Provided,
That, any employee who has rendered at least one year of service, whether such services is continuous or
broken, shall be considered a regular employee with respect to the activity in which he is employed and
his employment shall continue while such activity exists.

Two kinds of REGULAR EMPLOYEES

1. Those who are engaged to perform activities which are usually necessary or desirable in the usual
business or trade of the employer; and
2. Those who have rendered at least one year of service, whether continuous or broken, with respect
to the activity in which they are employed.

In other words Regular Status arises from either the nature of work of the employee or the duration of
his employment.

Employment may be TEMPORARY, where it has been fixed for a specific undertaking the completion or
termination of which has been determined at the time of the engagement of the employee or where the
work or services to be performed is seasonal in nature and the employment is for the duration of the
season.

Project Employment

A project employee is one whose employment has been fixed for a specific project or undertaking, the
completion or termination of which has been determined at the time of the engagement of the employee.
ISUCYN-SAC-InM-065
Effectivity August 27, 2015
2 | LM 63 Labor Relations; Post Employment; Just Causes for Termination of Employment

A project employee or a member of a work pool may acquire the status of a regular employee when the
following occur:

1. There is a continuous rehiring of project employees even after cessation of a project; and
2. The tasks performed by the alleged “project employee” are vital, necessary and indispensable to
the usual business or trade of the employer.

Seasonal Employment

Regular seasonal employees are those called to work from time to time. The nature of their relationship
with the employer is such that during off season they are temporarily laid off but during summer season
they are reemployed, or when their services may be needed. They are not strictly speaking, separated
from the service but are merely considered as on leave of absence without pay until they are reemployed.
Their employment relationship is never severed but only suspended. As such those employees can be
considered as in the regular employment of the employer.

Casual Employment

Employment is casual when it is irregular, unpredictable, sporadic and brief and nature, and outside the
usual business of the employer. The work is not permanent nor periodically regular, but occasional or by
chance, and not in the usual course of the employer’s trade or business.

Fixed Period Employment

Employment that will last only for a definite period, as agreed by the parties, is not per se illegal or
against public policy even if this kind of employment is not mentioned in Article 294 of the Code. Such
kind of employment contract may be justified under the Civil Code. It can refer to fixed-term employment
contracts or those to which the parties by free choice have assigned a specific date of termination.

Fixed Period Employment is an employment where a fixed period of employment was agreed upon:
1. Knowingly and voluntarily by the parties,
2. Without any force, duress or improper pressure being brought to bear upon the employee and
3. Absent any other circumstances vitiating his consent, or
4. Where it satisfactorily appears that the employer and employee dealt with each other on more or less
equal terms with no moral dominance whatever being exercised by the former over the latter.

Article 295. Probationary Employment. Probationary Employment shall not exceed six (6) months
from the date the employment started working, unless it is covered by an apprenticeship agreement
stipulating a longer period. The services of an employee who has been engaged on a probationary basis
may be terminated for a just cause or when he fails to qualify as a regular employee in accordance with
reasonable standards made known by the employer to the employee at the time of his engagement. An
employee who is allowed to work after a probationary period shall be considered a regular employee.

Characteristics of Probationary Employment?

ISUCYN-SAC-InM-065
Effectivity August 27, 2015
3 | LM 63 Labor Relations; Post Employment; Just Causes for Termination of Employment

1. It is an employment for a trial period;

2. It is a temporary employment status prior to regular employment;
3. It arises through a contract with the following elements:
a. The employee must learn and work at a particular type of work
b. Such work calls for certain qualifications
c. The probation is fixed
d. The employer reserves the power to terminate during or at the end of the trial period
e. And if the employee has learned the job to the satisfaction of the employer, he becomes a regular
employee.

Termination of Employment

Article 296. Termination by Employer. An employer may terminate an employment for any of the
following causes:
(a) Serious misconduct or willful disobedience by the employee of the lawful orders of his employer
or representative in connection with his work;
(b) Gross and habitual neglect by the employee of his duties;
(c) Fraud or willful breach by the employee of the trust reposed in him by his employer or duly
authorized representative;
(d) 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 representative; and
(e) Other causes analogous to the foregoing.

Substantive Due Process- the employee’s dismissal is justified by a lawful and valid reason.
Procedural Due Process- due process which requires ample opportunity for the worker to explain his
side before he is dismissed.

Just Causes
Serious Misconduct
An improper or wrong conduct; the transgression of some established and definite rule of action, a
forbidden act, a dereliction of duty, willful in character, and implies wrongful intent and not mere error in
judgment. To be serious within the meaning and intendment of the law, the misconduct must be of such
grave and aggravated character and not merely trivial or unimportant.

Example of serious misconduct

1. Sexual harassment
2. Fighting within the company premises
3. Uttering obscene, insulting or offensive words against a superior
4. Falsification of time records
5. Gross immorality

Willful Disobedience

When willful disobedience of the employer’s lawful orders a just cause for termination?
ISUCYN-SAC-InM-065
Effectivity August 27, 2015
4 | LM 63 Labor Relations; Post Employment; Just Causes for Termination of Employment

Two requisites must concur:

1. The employees assailed conduct must have been willful or intentional, the willfulness being
characterized by a wrongful and perverse attitude.
2. The disobeyed orders, regulations or instructions of the employer must be:
a. Reasonable and lawful
b. Sufficiently made known to the employee
c. Must pertain to or be in connection with the duties which the employee has been engaged
to discharge.

Negligence

Negligence is a just cause for termination when it is gross and habitual.

Gross negligence implies a want or absence of or failure to exercise slight care of diligence of the entire
absence of care it evinces thoughtless disregard of consequences without exerting any effort to avoid
them. However, such neglect must not only be gross but habitual in character.

Habitual neglect implies repeated failure to perform one’s duties over a period of time, depending upon
the circumstance.

Some forms of neglect of duty:

1. Habitual tardiness and absenteeism
2. Abandonment:
a. Failure to report for work or absence without justifiable reason
b. Clear intention to sever employer employee relationship manifested by some overt acts.

Abandonment

As a just cause for termination means deliberate, unjustified refusal of an employee to resume his
employment.

Fraud; Breach of Trust/Loss of Confidence

When is breach of trust/loss of confidence a just cause for termination?

1. It applies only to cases involving:

a. Employees occupying positions of trust and confidence (confidential and managerial employee’s) – to this
class belong managerial employees, i.e., those vested with the powers or prerogatives to lay down
management policies and/or to hire, transfer, suspend, lay‐off, recall, discharge, assign or discipline
employees or effectively recommend such managerial actions
b. Employees routinely charged with the care and custody of the employer’s money or property – to this
class belong cashiers, auditors, property custodians, etc., or those who, in the normal and routine exercise
of their functions, regularly handle significant amounts of money or property. (Mabeza v. NLRC, G.R. No.
118506 April 18, 1997)
2. The loss of trust and confidence must be based on willful breach.
ISUCYN-SAC-InM-065
Effectivity August 27, 2015
5 | LM 63 Labor Relations; Post Employment; Just Causes for Termination of Employment

Note: A breach is willful if it is done intentionally, knowingly, and purposely without justifiable excuse, as
distinguished from an act done carelessly, thoughtlessly, heedlessly, or inadvertently (De la Cruz v. NLRC,
G.R. No. 119536, Feb. 17, 1997)
3. The act constituting the breach must be “work‐related” such as would show the employee concerned to
be unfit to continue working for the employer. (Gonzales V. NLRC, G.R. No. 131653, Mar. 26, 2001)
4. It must be substantial and founded on clearly established facts sufficient to warrant the employee’s
separation from employment. (Sulpicio Lines Inc. V. Gulde, G.R. No. 149930, Feb. 22, 2002)
5. Fraud must be committed against the employer or his representatives, e.g.:
a. Falsification of time cards
b. Theft of company property
c. Unauthorized use of company vehicle

Guidelines for the Doctrine of Loss of Confidence to apply.

1. Loss of confidence should not be simulated (reasonable basis for loss of trust and confidence)
2. Not used for subterfuge for causes which are improper and/or illegal and unjustified
3. Not arbitrarily asserted in the face of overwhelming evidence to the contrary
4. Must be genuine, not a mere afterthought to justify earlier action taken in bad faith and
5. The employee involved holds a position of trust and confidence

What is the totality of infractions doctrine?

It is the totality, not the compartmentalization of company infractions that the employee has committed,
which justifies the penalty of dismissal. (MERALCO v. NLRC, G.R. No. 114129, Oct. 24, 1996)
Note: Where the employee has been found to have repeatedly incurred several suspensions or warnings
on account of violations of company rules and regulations, the law warrants their dismissal as it is akin to
“habitual delinquency”. (Villeno v. NLRC, G.R. No. 108153, Dec. 26, 1995)

Guidelines to determine the validity of termination

Gravity of the offense
1. Position occupied by the employee
2. Degree of damage to the employer
3. Previous infractions of the same offense
4. Length of Service

Commission of a Crime
What do you mean by “commission of a crime or offense” as a just cause for termination of an employee?
It refers to an offense by the employee against the person of his employer or any immediate member of
his family or his duly authorized representative and thus, conviction of a crime involving moral turpitude
is not analogous thereto as the element of relation to his work or to his employer is lacking.
Note: A criminal case need not be actually filed. Commission of acts constituting a crime itself is
sufficient.

Analogous Causes

What is required for an act to be included in analogous cases of just causes of termination?

ISUCYN-SAC-InM-065
Effectivity August 27, 2015
6 | LM 63 Labor Relations; Post Employment; Just Causes for Termination of Employment

Must be due to the voluntary and/or willful act or omission of the employee (Nadura v. Benguet
Consolidated, G.R. No. L‐17780, Aug. 24, 1962), e.g.:
1. Violation of company rules and regulations
2. Drunkenness
3. Gross inefficiency
4. Illegally diverting employer’s products
5. Failure to heed an order not to join an illegal picket
6. Violation of safety rules and code of discipline

Doctrine of Incompatibility?
Where the employee has done something that is contrary or incompatible with the faithful performance
of his duties, his employer has a just cause for terminating his employment. (Manila Chauffeur’s League v.
Bachrach Motor Co., G.R. No. L‐47071, June 17, 1940)

Assignment:
Read and be able to discuss next meeting:
Chua--‐Cua v. Clave, 189SCRA 117

ISUCYN-SAC-InM-065
Effectivity August 27, 2015