Constructive Dismissal

Constructive Dismissal

Constructive dismissal is an illegal form of dismissal which does not involve any written or verbal statement that the employee is dismissed from service. But the treatment on the employee by the employer is inhumane, prejudicial, and inconvenient such that the former is left with no choice but to involuntarily quit his work.

The post below is based on the book Guide to Valid Dismissal of Employees Second Edition.

Constructive dismissal is defined as quitting or cessation of work because continued employment is rendered impossible, unreasonable or unlikely; when there is a demotion in rank or a diminution of pay and other benefits.

Aptly called a dismissal in disguise or an act amounting to dismissal but made to appear as if it were not, constructive dismissal may, likewise, exist if an act of clear discrimination, insensibility, or disdain by an employer becomes so unbearable on the part of the employee that it could foreclose any choice by him except to forego his continued employment.

The test is whether a reasonable person in the employee’s position would have felt compelled to give up his position under the circumstances.

In the case of Tan Brothers Corporation of Basilan City vs. Escudero (G.R. No. 188711, July 3, 2013) , the Court held that the fact that the employee was deprived of office space, was not given further work assignment and was not paid her salaries until she was left with no choice but stop reporting for work all combine to make out a clear case of constructive dismissal.

There is involuntary resignation due to the harsh, hostile, and unfavorable conditions set by the employer.

Constructive Dismissal vs. Voluntary Resignation

The test of constructive dismissal is whether a reasonable person in the employee’s position would have felt compelled to give up his employment/position under the circumstances.

On the other hand, resignation is the voluntary act of an employee who is in a situation where one believes that personal reasons cannot be sacrificed in favor of the exigency of the service, and one has no other choice but to dissociate oneself from employment.

It is a formal pronouncement or relinquishment of an office, with the intention of relinquishing the office accompanied by the act of relinquishment. As the intent to relinquish must concur with the overt act of relinquishment, the acts of the employee before and after the alleged resignation must be considered in determining whether he or she, in fact, intended to sever his or her employment.

Constructive Dismissal vs. Abandonment of Work

In one case, the employees reasoned out that their failure to report for work was due to harassment or discrimination which resulted in constructive dismissal.

The Court however, held that the employees having failed to substantiate their claim of constructive dismissal, should be deemed to have abandoned their work, thus, their dismissal is warranted.

Abandonment is the deliberate and unjustified refusal of an employee to resume his employment, without any intention of returning. It is a form of neglect of duty, hence, a just cause for termination of employment by the employer.

For abandonment to be a valid ground for dismissal, two elements must then be satisfied: (1) the failure to report for work or absence without valid or justifiable reason; and (2) a clear intention to sever the employer-employee relationship. The second element is the more determinative factor and must be evinced by overt acts.

The Court further held that the abovementioned elements are present in said case. First, the employees’ failure to report for work was without justifiable reason. Their allegation of discrimination and harassment lacks factual basis, thus, under the circumstances, it was found that their absences were unjustified and without any valid reason. Second, their overt act of writing letters informing their company that they considered themselves constructively dismissed was a clear manifestation of their intention to desist from their employment.

Too, their defiance and disregard of the memorandum sent by the company requiring them to explain their unauthorized absences demonstrated a clear intention on their part to sever their employer-employee relationship. This is particularly true with one of the complainants who, even before unilaterally terminating his employment with the company, had already sought regular employment elsewhere and in fact was set to join a competitor.

Further, they filed a complaint for constructive dismissal without praying for reinstatement. By analogy, we point to the doctrine that abandonment of work is inconsistent with the filing of a complaint for illegal dismissal is not applicable where the complainant does not pray for reinstatement and just asks for separation pay instead.

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