BAHR 211 | HUMAN RESOURCE MANAGEMENT

MS. PRINCESS G. COLE, MBA

Lesson 8 | The Process of Employment Separation

Separation of Employment

ART. 279. Security of tenure. In regular employment cases, 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 his full-back wages, 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. (As amended by Section 34, Republic Act No. 6715, March 21,
1989).

ART. 280. Regular and casual employment. The provisions of a written agreement to the contrary
notwithstanding and regardless of the parties' oral agreement and employees shall be deemed
to be regular where the employee has been engaged to perform activities that 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 employee's engagement, where the work or
service to be performed is seasonal. The employment is for the duration of the season.

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

ART. 282. Termination by employer. An employer may terminate employment for any of the
following causes:
a) Serious misconduct or willful disobedience by the employee of his employer's lawful orders
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 his employer; any immediate
member of his family or his duly authorized representatives; and
e) Other causes are analogous to the foregoing.

ART. 283. Closure of establishment and reduction of personnel. The employer may also terminate
the employment of any employee due to the installation of labor-saving devices, redundancy,
retrenchment to prevent losses or the closing or cessation of operation of the establishment;
undertaking unless the closing is to circumvent the provisions of this title, by serving a written notice
on the workers and the Ministry of Labor and Employment at least one (1) month before the
intended date thereof. In case of termination due to the installation of labor-saving devices or
redundancy, the worker affected thereby shall be entitled to a separation pay equivalent to at
least his one (1) month pay or at least one (1) month pay for every year of service, whichever is
higher. In case of retrenchment to prevent losses and in cases of closures or cessation of
operations of establishment or undertaking not due to serious business losses or financial reverses,
the separation pay shall be equivalent to one (1) month pay or at least one-half (1/2) month pay

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for every year of service, whichever is higher. A fraction of at least six (6) months shall be
considered one (1) whole year.

ART. 284. Disease as a ground for termination. An employer may terminate the services of an
employee who is 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-employees: Provided, That he is
paid separation pay equivalent to at least one (1) month salary or to one-half (1/2) month salary
for every year of service, whichever is greater, a fraction of at least six (6) months being considered
as one (1) whole year.

ART. 285. Termination by the employee.

a) An employee may terminate without just cause the employee-employer relationship by

serving a written notice on the employer at least one (1) month in advance. The employer
upon whom no such notice was served may hold the employee liable for damages.

b) An employee may end the relationship without serving any notice on the employer for any
of the following just causes:

1. Serious insult by the employer or his representative on the honor and person of the
employee;
2. The inhuman and unbearable treatment accorded the employee by the employer
or his representative;
3. Commission of a crime or offense by the employer or his representative against the
person of the employee; any of the immediate members of his family; and
4. Other causes are analogous to any of the foregoing.

ART. 286. When employment not deemed terminated. The bonafide suspension of a business's
operation or undertaking for a period not exceeding six (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 losing 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 his relief from the military or civic duty.
ART. 287. Retirement. Any employee may be retired upon reaching the retirement age established
in the collective bargaining agreement or another applicable employment contract.

In case of retirement, the employee shall be entitled to receive such retirement benefits as he
may have earned under existing laws and any collective bargaining agreement and other
agreements: Provided, however, that an employee’s retirement benefits under any collective
bargaining and other agreements shall not be less than those provided therein.

In the absence of a retirement plan or agreement providing for retirement benefits of employees
in the establishment where an employee upon reaching the age of sixty (60) years or more, but
not beyond sixty-five (65) years which is hereby declared the compulsory retirement age, who has
served at least five (5) years in the said establishment. Thus, may retire and shall be entitled to
retirement pay equivalent to at least one-half (1/2) month salary for every year of service, a
fraction of at least six (6) months being considered as one whole year.

Unless the parties provide for broader inclusions, the term 'one-half (1/2) month salary' shall mean
fifteen (15) days plus one-twelfth (1/12) of the 13th-month pay and the cash equivalent of not
more than five (5) days of service incentive leaves.

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Retail, service, and agricultural establishments or operations employing not more than ten (10)
employees or workers are exempted from this provision's coverage. Violation of this provision is
hereby declared unlawful and subject to the penal provisions under Article 288 of this Code.

Types of Separation

1. Layoff – the separation of an employee-initiated by the employer due to business reverses,

the introduction of labor-saving devices, or the reduction in the demand for particular skills,
act of management as temporary measures during the period of business recession,
industrial depression or seasonal fluctuation.

2. Resignation – this is when employees voluntarily decided to end their employment with an
organization. Resignation can result from any of the following causes.

Dissatisfaction caused by:

a. wages and working condition
b. Misunderstanding with superior or fellow workers
c. Inconvenient work hours
d. For better job opportunities,
e. Personal reasons such as;
f. Desire to continue one’s studies
g. Physical and health conditions.
h. Family circumstances

3. Retirement – this is when the employee has satisfied certain conditions under existing laws
and or provisions of collective bargaining agreements or upon reaching the retirement
age (Voluntary 60) 65 years compulsory are separated from employment with entitlement
to retirement benefits.

4. Termination – when the employer forces the employee to leave the organization.

a) Just Cause. Based on acts attributable to an employee's own wrongful actions or

negligence

b) Authorized Cause. Refers to lawful grounds for termination which do not arise from
fault or negligence of the employee.

GROUNDS FOR TERMINATION BY THE EMPLOYER (Just Cause)

1. Serious misconduct/willful disobedience by the employee in connection with his work

2. Habitual neglect by the employee of his duties.
3. Fraud/willful breach by the employee of the trust reposed in him by the employer.
4. Commission of crime/offenses by the employee against the person of his employees, any
immediate member of his family.

Authorized Cause

1. Installation of labor-saving devices

2. Redundancy
3. Retrenchment or prevent loses
4. Closure or cessation of operation of the establishment
5. Disease
Due Process in Termination of Employment

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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.

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.