requisites to ensure the validity of the redundancy program:
1. a written notice served on both the employees and the Department of Labor and Employment (DOLE) at least one month prior to the intended date of retrenchment
2. payment of separation pay equivalent to at least one month pay or at least one month pay for every year of service, whichever is higher
3. good faith in abolishing the redundant positions 4. fair and reasonable criteria in ascertaining what
positions are to be declared redundant and accordingly abolished
Retrenchment
Resorted primarily to avoid or minimize business losses.
Standards to Justify Retrenchment
1. The losses expected should be substantial and not merely de minimis in extent.
2. The substantial loss apprehended must be
reasonably imminent.
3. It be reasonably necessary and likely to effectively prevent the expected losses. The employer should have taken other measures prior or parallel to retrenchment to forestall losses.
4. The alleged losses if already realized, and the expected imminent losses must be proved by sufficient and convincing evidence. (Oriental
Petroleum & Minerals Corp. v Fuentes, 14 October 2005)
Difference between redundancy and
retrenchment: In redundancy, company has no financial problems; in retrenchment, company suffers from financial problems.
Closure Not Due to Losses
In cases of closure not due to losses, it must NOT be in BAD FAITH.
If the dismissal is based on a just cause under Article 282 but the employer failed to comply with the notice requirement, the sanction to be imposed upon him should be tempered because the dismissal process was, in effect, initiated by an act imputable to the employee.
If the dismissal is based on an authorized cause under Article 283 but the employer failed to comply with the notice requirement, the sanction should be stiffer because the dismissal process was initiated by the employer’s exercise of his management prerogative
Constructive Dismissal
1. No formal dismissal
2. The employee is placed in a situation by the employer such that his continued employment has become UNBEARABLE.
Veterans Security Agency v. Vargas, GR No. 159293. 16 December 2005
Constructive dismissal exists when an act of clear discrimination, insensibility or disdain on the part of the employer has become so unbearable as to leave an employee with no choice but to forego continued employment.
Abandonment, as a just and valid cause for termination, requires a deliberate and unjustified refusal of an employee to resume his work, coupled with a clear absence of any intention of returning to his or her work.
Abandonment is incompatible with constructive dismissal.
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Article 286 applies only when there is a bona fide suspension of the employer’s operation of a business or undertaking for a period not exceeding 6 months.
In security agency parlance, being placed “off detail” or on “floating” status means “waiting to be posted.”
It is the inherent prerogative of an employer to transfer and reassign its employees to meet the requirements of its business. Be that as it may, the prerogative of the management to transfer its employees must be exercised without grave abuse of discretion. The exercise of the prerogative should not defeat an employee's right to security of tenure. The employer’s privilege to transfer its employees to different workstations cannot be used as a subterfuge to rid itself of an undesirable worker.
Art. 284. Disease as ground for termination Disease as Ground for Termination
When his continued employment is prohibited by law or prejudicial to his health or to the health of his co-employees
There is 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 6 months even with proper medical treatment
The requirement for a medical certificate cannot be dispensed with; otherwise, it would sanction the unilateral and arbitrary determination by the employer of the gravity or extent of the employee’s illness and thus defeat the public policy on the protection of labor. (Manly Express
v. Payong, 25 October 2005)
Art. 285. Termination by employee Termination without Just Cause
1. at least 1 month prior notice
2. employee may be held liable for damages for failure to give notice
Termination with Just Cause
1. Grounds
a. serious insult on the honor and person of employee by the employer or his
representative
b. inhumane and unbearable treatment accorded to the employee
c. commission of a crime against person of the employee or any of the immediate members of his family
d. other causes analogous to the foregoing 2. Notice not necessary
Resigning employee not entitled to separation pay, unless company policy gives it.
No Separation Pay in resignation; Exceptions; Waivers and Quitclaims, when valid
Candido Alfaro v. CA, et al., GR No. 140812, 28 August 2001
Generally, separation pay need not be paid to an employee who voluntarily resigns. However, an employer who agrees to expend such benefit as an incident of the resignation should not be allowed to renege in the performance of such commitment.
Not all waivers and quitclaims are invalid as against public policy. If the agreement was voluntarily entered into and represented a reasonable settlement, it is binding on the parties and may not later be disowned, simply because of a change of mind.
Art. 286. When employment not deemed terminated
The bona-fide suspension of the operation of a business or undertaking for a period not exceeding 6 months, or the fulfillment by the employee of a military or civic duty shall not terminate employment. In all such cases, the employer shall reinstate the employee to his former position without loss of seniority rights if he indicates his desire to resume his work not later than one (1) month from the resumption of operations of his employer or from his relief from the military or civic duty.
Temporary Lay-off
Must not exceed 6 months.
Options of employer (i.e. security agency) in case of pull out by client:
1. retrenchment – must give notice 1 month before retrenchment; pay separation pay
2. closure – must comply with 1 month advanced notice; no need to pay separation pay
Abandonment
means the deliberate, unjustified refusal of an employee to resume his/her employment
Two elements must be proved
1. the intention to abandon
2. an overt act from which it may be inferred that the employee has no more intent to resume his/her work
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This is negated by immediate filing of an action for ILLEGAL DISMISSAL.
Employment Not Deemed Terminated
a. bona fide suspension of the operation of a business/undertaking for a period of not more than 6 months
b. fulfillment by the employee of a military or civic duty
Employer shall reinstate the employee to his former position without loss of seniority rights IF employee indicates his desire to resume his work not later than 1 month from resumption of operations of his employer or his relief from the military or civic duty
Preventive Suspension
justified where the employee’s continued employment poses a serious and imminent threat to the life or property of the employer or of his co-workers (there is a REASONABLE POSSIBILITY of the employee posing such a threat)
must not exceed 1 month
It is only for the purpose of investigating the offense to determine whether he is to be dismissed or not. IT IS NOT A PENALTY.
if more than 1 month, the employee must be actually reinstated or reinstated in the payroll officers liable only if with malice and bad faith
Floating Status
It is legal, such as in the case of security guards who have no assignment.
Such a status should not exceed six-months; if it does, it amounts to a dismissal.
D. DUE PROCESS Art. 277. Miscellaneous Provisions
(b) Subject to the constitutional right of workers to security of tenure and their right to be protected against dismissal except for a just and authorized cause and without prejudice to the requirement of notice under Article 283 of this Code, the employer shall furnish the worker whose employment is sought to be terminated a written notice containing a statement of the causes for termination and shall afford the latter ample opportunity to be heard and to defend himself with the assistance of his representative if he so desires in accordance with company rules and regulations promulgated pursuant to guidelines set by the Department of Labor and Employment. Any decision taken by the employer shall be without prejudice to the right of the worker to
contest the validity or legality of his dismissal by filing a complaint with the regional branch of the National Labor Relations Commission. The burden of proving that the termination was for a valid or authorized cause shall rest on the employer. The Secretary of the Department of Labor and Employment may suspend the effects of the termination pending resolution of the dispute in the event of a prima facie finding by the appropriate official of the Department of Labor and Employment before whom such dispute is pending that the termination may cause a serious labor dispute or is in implementation of a mass lay- off.
In cases of dismissal, employer has the burden of proof to show that the dismissal falls under the just and authorized causes. (Tolentino v.
PLDT, GR No. 160404, 08 June 2005)
Due process refers to the process to be followed; burden of proof refers to the amount of proof to be adduced
In money claims, the burden of proof as to the
amount to be paid the employee rests upon the employer since he is in custody of documents that would be able to prove the amount due, such as the payroll.
In cases of just and authorized causes, due process must be observed.
Due Process Requirements under Art. 277 (b)
Just Causes (282) Authorized Causes
(283)
Twin Notice (Before and After Investigation - notice of the charge - notice that employee
is guilty (after investigation) Investigation
One notice only - notice to employee1 month before installation of LSD, retrenchment, or closure - 1 month advanced notice to DOLE
Non-compliance with due process requirements
Before the Agabon case, the doctrine in Serrano v.
NLRC (GR No. 117040, 27 January 2000) was
followed. It states that termination due to authorized cause without giving the notice required under the Labor Code is not a violation of due process. It is valid although declared irregular / ineffectual. He shall however be entitled to SEPARATION PAY AND BACKWAGES.
Agabon v. NLRC, 17 November 2004 modifies