Termination of Employment in the Philippines

Termination of Employment in the Philippines

• Termination procedures in the Philippines are complex and serious, especially for regularized employees.
• The Philippine Constitution prohibits involuntary servitude, except as punishment for a crime.
• Article 285 of the Labor Code grants employees the right to resign. Two types of resignations exist.
• Without cause: Employees need to give a 30-day written notice to their employer. Failure to do so results in liability for damages. This is to enable the employer to find a replacement to prevent work disruption.
• With cause (constructive dismissal or forced resignation): Unbearable/intolerable work conditions are a cause. Causes include hostile work environments, harassment/bullying, unreasonable demands, unsustainable workloads, unfair treatment, discrimination, and breach of employment contracts.

Grounds for Dismissal

• Just Causes (Article 282):
  • Serious misconduct
  • Willful disobedience
  • Gross/habitual neglect of duty
  • Fraud/dishonesty
  • Commission of a crime
• Authorized Causes (Article 283):
  • Business closure/reduction
  • Redundancy
  • Retrenchment
• Health Reasons (Article 284):
  • Incurable disease
  • Disability/illness

Severance Pay

• Severance pay is given when an employee is terminated or laid off due to circumstances beyond their control, such as business closure or redundancy.
• For installation of saving devices or redundancy, the separation pay is one month's pay for every year of service or one month's pay, whichever is higher.
• For retrenchment or closure, the separation pay is one-half month's pay for every year of service or one month's pay, whichever is higher.
• No requirement for separation pay if the closure is due to serious business losses.
• Severance pay aims to support employees during the transition period, helping them offset loss of income and maintain financial stability, and seek new employment opportunities.

Due Process in Termination

• Due process in employment termination means employees are treated fairly and legally.
• Employers must follow a structured procedure, providing the employee with notice, a clear explanation of the reasons for termination, and an opportunity to respond.
• With just cause (like misconduct), the employee gets to know why they're being fired and they get a chance to defend themselves

Regular and Casual Employment

• Employment is regular if the employee performs tasks essential or desirable to the employer's usual business.
• Employment is casual if it does not meet the criteria for regular employment.
• An employee who has served for at least a year, whether continuously or intermittently, is deemed regular in relation to the activity involved.

Probationary Employment

• Probationary employment typically lasts up to six (6) months, unless a longer period is specified.
• Employees can be terminated during this time for just cause or if they fail to meet employer performance standards.
• If an employee continues working after the probationary period, they are deemed a regular employee.

Termination by Employer (Article 282)

• An employer may terminate employment for various reasons: Serious misconduct, willful disobedience, gross/habitual neglect of duty, fraud, dishonesty, or committing a crime.

Termination by Employee (Article 285)

• Employees can terminate without cause by giving one-month written notice.
• Employees can terminate for any just cause, such as serious insult, inhuman/unbearable treatment, or committing a crime.

Retirement

• Employees can be retired upon reaching the retirement age established in the collective bargaining agreement or other applicable employment contract.

Retirement Pay (Article 287)

• In the absence of a retirement plan, employees who have worked for at least five years and reach a certain age receive retirement pay.
• The pay is at least one-half monthly salary for each year of service.

Penalties

• Violating termination procedures can result in fines and imprisonment.

Activity Examples

• Students will work in groups to create a Venn diagram outlining the differences between just and authorized causes of termination.
• Students will role-play termination scenarios to demonstrate how due process should be applied.

Explore the complex procedures surrounding the termination of employment in the Philippines. Understand the rights of employees under the Labor Code, including the grounds for dismissal and resignation processes. This quiz covers just causes for termination and the implications of voluntary and involuntary resignations.