Termination of Employment a) A notice of intent to dismiss specifying the ground

for termination, and giving said employee reasonable

opportunity within which to explain his or her side;
1. What is the right to security of tenure?
b) A hearing or conference where the employee is
The right to security of tenure means that a regular given opportunity to respond to the charge, present
employee shall remain employed unless his or her evidence or rebut the evidence presented against him
services are terminated for just or authorized cause or her;
and after observance of procedural due process.
c) A notice of dismissal indicating that upon due
2. May an employer dismiss an employee? What consideration of all the circumstances, grounds have
are the grounds? been established to justify termination.

Yes. An employer may dismiss an employee on the B. In a termination for an authorized cause, due
following just causes: process means a written notice of dismissal to the
employee specifying the grounds at least 30 days
a) serious misconduct; before the date of termination. A copy of the notice
shall also be furnished the Regional Office of the
b) willful disobedience; Department of Labor and Employment (DOLE) where
the employer is located.
c) gross and habitual neglect of duty;
6. What is the sanction if the employer failed to
d) fraud or breach of trust; observe procedural due process in cases of legal
and authorized termination?
e) commission of a crime or offense against the
employer, his family or representative; In cases of termination for just causes, the employee is
entitled to payment of indemnity or nominal damages
in a sum of not more than 30,000 pesos (Agabon vs.
f) other similar causes.
NLRC, 442 SCRA 573); in case of termination for
authorized causes, 50,000 pesos (Jaka Food
3. Are there other grounds for terminating an Processing vs. Darwin Pacot, 454 SCRA 119).
employment? What are they?
7. May an employee question the legality of his or
Yes. The other grounds are authorized causes: her dismissal?

a) installation of labor-saving devices; Yes. The legality of a dismissal may be questioned

before the Labor Arbiter of a Regional Arbitration
b) redundancy; Branch of the National Labor Relations Commission
(NLRC), through a complaint for illegal dismissal. In
c) retrenchment to prevent losses; establishments with a collective bargaining agreement
(CBA), the dismissal may be questioned through the
d) closure and cessation of business; and grievance machinery established under the CBA. If the
complaint is not resolved at this level, it may be
submitted to voluntary arbitration.
e) disease / illness.
8. In cases of illegal dismissal, who has the duty of
4. Before terminating the services of an employee, proving that the dismissal is valid?
what procedure should the employer observe?
The employer.
An employer shall observe procedural due process
before terminating one’s employment.
9. Suppose the employer denies dismissing the
employee, who has the duty to prove that the
5. What are the components of procedural due dismissal is without valid cause?
process?
The employee must elaborate, support or substantiate
A. In a termination for just cause, due process involves his or her complaint that he or she was dismissed
the two-notice rule: without valid cause (Ledesma, Jr. vs. NLRC, 537
SCRA 358, October 19, 2007).
10. On what grounds may an employee question Full backwages refer to all compensations, including
his or her dismissal? allowances and other benefits with monetary
equivalent that should have been earned by the
An employee may question his or her dismissal based employee but was not collected by him or her because
on substantive or procedural grounds. of unjust dismissal. It includes all the amounts he or
she could have earned starting from the date of
dismissal up to the time of reinstatement.
The substantive aspect pertains to the absence of a
just or authorized cause supporting the dismissal.
15. What is separation pay?
The procedural aspect refers to the failure of the
employer to give the employee the opportunity to In termination for authorized causes, separation pay is
explain his or her side. the amount given to an employee terminated due to
installation of labor-saving devices, redundancy,
11. What are the rights afforded to an unjustly retrenchment, closure or cessation of business or
dismissed employee? incurable disease.

Separation pay may also be granted to an illegally

An employee who is dismissed without just cause is
entitled to any or all of the following: dismissed employee in lieu of reinstatement.

16. How much is the separation pay?

a) reinstatement without loss of seniority rights;

In cases of installation of labor-saving devices or

b) in lieu of reinstatement, an employee may be given
redundancy, the employee is entitled to receive the
separation pay of one month pay for every year of
equivalent of one month pay or one month for every
service (Golden Ace Builders, et. al vs. Jose Talde,
year of service, whichever is higher.
May 5, 2010, GR No. 187200);

In cases of retrenchment, closure or cessation of

c) full backwages, inclusive of allowances and other
business or incurable disease, the employee is entitled
benefits or their monetary equivalent from the time
to receive the equivalent of one month pay or one-half
compensation was withheld up to the time of
month pay for every year of service, whichever is
reinstatement;
higher.
d) damages if the dismissal was done in bad faith
(Aurora Land Project Corp. vs NLRC, 266 SCRA 48). In case of separation pay in lieu of reinstatement, the
employee is entitled to receive the equivalent of one
month pay for every year of service.
12. What is reinstatement?
17. Is proof of financial losses necessary to justify
Reinstatement means restoration of the employee to retrenchment?
the position from which he or she has been unjustly
removed.
Yes. Proof of actual or imminent financial losses that
are substantive in character must be proven by the
Reinstatement without loss of seniority rights means employer to justify retrenchment (Lopez Sugar Central
that the employee, upon reinstatement, should be vs. NLRC, 189 SCRA 179).
treated in matter involving seniority and continuity of
employment as though he or she had not been
18. Are there other conditions before an employee
dismissed from work.
may be dismissed on the ground of redundancy?
When a Labor Arbiter rules for an illegal dismissal,
Yes. It must be shown that there is:
reinstatement is immediately executory even pending
appeal by the employer (Article 223 of the Labor Code,
as amended). a) Good faith in abolishing redundant position; and

13. In what forms may reinstatement pending b) Fair and reasonable criteria in selecting employees
appeal be effected? to be dismissed, such as but not limited to less
preferred status (e.g. temporary employee), efficiency
and seniority (Asian Alcohol Corp. vs. NLRC, 305
Reinstatement pending appeal may be actual or by
SCRA 416);
payroll, at the option of the employer.

14. What is meant by full backwages? c) A one-month prior notice is given to the employee
and DOLE Regional Office as prescribed by law.
19. May the services of an employee be terminated
due to disease?

Yes. The employer may terminate employment on

ground of disease only upon the issuance of a
certification by a competent public health authority that
the disease is of such nature or at such stage that it
cannot be cured within a period of six months even
with proper medical treatment.

20. What is constructive dismissal?

Constructive dismissal refers to an involuntary

resignation resorted to when continued employment
becomes impossible, unreasonable or unlikely; when
there is a demotion in rank or a diminution in pay; or
when a clear discrimination, insensibility or disdain by
an employer becomes unbearable to an employee or
an unwarranted transfer or demotion of a employee, or
other unjustified action prejudicial to the employee. The
employer has to prove that such managerial actions do
not constitute constructive dismissal (Blue Dairy Corp.
vs. NLRC, 314 SCRA 401)

21. May an employee be placed on floating status?

Yes, provided it is permitted under circumstances for a

period of not more than six (6) months. Beyond this
period, floating status becomes constructive dismissal
which entitles the employee to separation pay (Phil.
Industrial Security Agency Corp. vs. Virgilio Dapiton
and NLRC, 320 SCRA 124)

22. When an employee resigned voluntarily, is he

or she entitled to separation pay?

No. An employee is not entitled to separation pay when

he or she resigns voluntarily, unless it is a company
practice or provided in the CBA (Hanford Philippines
Inc. vs. Shirley Joseph, 454 SCRA 786, March 31,
2005).

23. Are quitclaims valid?

Yes, provided that these are voluntarily signed and the

consideration is reasonable and is not against the law
or public policy. (More Maritime Agencies vs. NLRC,
307 SCRA 189)

Quitclaims entered into by union officers and some

members do not bind those who did not sign it (Liana’s
Supermarket vs. NLRC, 257 SCRA 186)