Termination by Employer

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:
1. serious misconduct or willful disobedience by the employee of the lawful orders of his
employer or representative in connection with his work;
2. gross and habitual neglect by the employee of his duties;
3. fraud or willful breach by the employee of the trust reposed in him by his employer or
duly authorized representatives;
4. 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
5. 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:
1. installation of labor-saving devices;
2. redundancy;
3. retrenchment (reduction of costs) to prevent losses; or
4. the closing or cessation of operation.
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.
DUE PROCESS IN TERMINATION OF EMPLOYMENT

Due process in the context of employment termination is the right of an employee to be notified
of the reason for his or her dismissal and, in case of just causes, to be provided the opportunity
to defend himself or herself.
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.
Dismissals based on just causes involve the two-notice rule:
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.
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.
In Unilever Philippines, Inc. v. Rivera, the Supreme Court laid down the guidelines on how to
comply with procedural due process in terminating an employee, to wit:
(1) The first written notice to be served on the employees should contain the specific causes or
grounds for termination against them, and a directive that the employees are given the
opportunity to submit their written explanation within a reasonable period. "Reasonable
opportunity" under the Omnibus Rules means every kind of assistance that management must
accord to the employees to enable them to prepare adequately for their defense. This should be
construed as a period of at least five (5) calendar days from receipt of the notice to give the
employees an opportunity to study the accusation against them, consult a union official or
lawyer, gather data and evidence, and decide on the defenses they will raise against the
complaint. Moreover, in order to enable the employees to intelligently prepare their explanation
and defenses, the notice should contain a detailed narration of the facts and circumstances that
will serve as basis for the charge against the employees. A general description of the charge will
not suffice. Lastly, the notice should specifically mention which company rules, if any, are violated
and/or which among the grounds under Art. 282 is being charged against the employees.
(2) After serving the first notice, the employers should schedule and conduct a hearing or
conference wherein the employees will be given the opportunity to: (1) explain and clarify their
defenses to the charge against them; (2) present evidence in support of their defenses; and (3)
rebut the evidence presented against them by the management. During the hearing or
conference, the employees are given the chance to defend themselves personally, with the
assistance of a representative or counsel of their choice. Moreover, this conference or hearing
could be used by the parties as an opportunity to come to an amicable settlement.
(3) After determining that termination of employment is justified, the employers shall serve the
employees a written notice of termination indicating that: (1) all circumstances involving the
charge against the employees have been considered; and (2) grounds have been established to
justify the severance of their employment.
PREVENTIVE SUSPENSION
Preventive suspension is generally a legally recognized measure used by an employer to suspend an

employee during an investigation in relation to an incident affecting the workplace.
The basis of issuing a preventive suspension is found in Section 8 of Rule XXIII, Book V of the Omnibus
Rules Implementing the Labor Code, as amended by Department Order No. 9, Series of 1997 which
provides:
“Section 8. Preventive suspension. The employer may place the worker concerned under preventive
suspension only if his continued employment poses a serious and imminent threat to the life or property
of the employer or of his co-workers.”
It is important to note that preventive suspension is not a penalty, but a part of a process to investigate a
questioned action of an employee. This is clarified in a decision of the Supreme Court, where the late
Justice Florentino Feliciano stated then that preventive suspension does not in itself prove that the
employer already finds the employee guilty of the charges he is asked to answer and explain (Soriano v.
NLRC et. al., G.R. No. 75510, October 27, 1987).
This is further explained in another decision of the Supreme Court, wherein according to former Justice
Alicia Austria-Martinez:
“Preventive suspension is a disciplinary measure for the protection of the company’s property pending
investigation of any alleged malfeasance or misfeasance committed by the employee. The employer may
place the worker concerned under preventive suspension if his continued employment poses a serious
and imminent threat to the life or property of the employer or of his co-workers. When, however, it is
determined that there is no sufficient basis to justify an employee’s preventive suspension, the latter is
entitled to the payment of salaries during the time of preventive suspension.” (Gatbonton vs. NLRC, G.R.
No. 146779, January 23, 2006).
Basing on this jurisprudence on preventive suspension, it can be seen that the issuance by an employer
of a preventive suspension is a reasonable and justifiable legal remedy given to him for the purpose of
investigating and/or resolving workplace-related incidents that affect his company’s operations.
“Section 9. Period of suspension. No preventive suspension shall last longer than thirty (30) days. The
employer shall thereafter reinstate the worker in his former or in a substantially equivalent position or
the employer may extend the period of suspension provided that during the period of extension, he pays
the wages and other benefits due to the worker.” (Rule XXIII, Book V, Omnibus Rules Implementing the
Labor Code, as amended by Department Order No. 9, Series of 1997)
And lastly, with regard to salary during the period of the suspension, an employee placed under preventive
suspension is not entitled to the payment of wages. If. however, the basis for suspension is later proven
to be unfounded or invalid, the said employee is entitled to his salary during the whole period of his
suspension. (Gatbonton vs. NLRC)

Termination by Employer

Uploaded by

Copyright:

Available Formats

Termination by Employer

Uploaded by

Document Information

Original Description:

Original Title

Copyright

Available Formats

Share this document

Share or Embed Document

Sharing Options

Did you find this document useful?

Is this content inappropriate?

Copyright:

Available Formats

Termination by Employer

Uploaded by

Copyright:

Available Formats

TERMINATION BY EMPLOYER

DUE PROCESS IN TERMINATION OF EMPLOYMENT

Preventive suspension is generally a legally recognized measure used by an employer to suspend an

You might also like