Floating Status Presupposes that there are More Employees than Work
Floating status is implicitly recognized in Article 301 of the Labor Code which speaks of situations of temporary retrenchment or lay-off due to valid operation issues.
Article 301 provides that the bonafide suspension of the operation of a business 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 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.
This situation applies not only in security services but also in other industries.
In all cases however, the temporary lay-off wherein the employees cease to work should not exceed six months, in consonance with Article 301 of the Labor Code. After six months, the employees should either be recalled to work or permanently retrenched following the requirements of the law. Otherwise, the employees are considered as constructively dismissed from work and the agency can be held liable for such dismissal.
Placing employees in a valid “floating status” presupposes that there are more employees than work. In ICT Marketing Services, Inc. vs. Sale the Supreme Court (SC) elaborated on the concept of “floating status.”
In the ICT case, in placing the employee on “floating status,” the company further acted arbitrarily and unfairly, making life unbearable for her. In so doing, it treated her as if she were a new hire; it improperly disregarded her experience, status, performance, and achievements in the company; and most importantly, the employee was illegally deprived of her salary and other emoluments. For her single absence during training for the Bank of America account, she was refused certification, and as a result, she was placed on floating status and her salary was withheld.
Clearly, according to the SC, this was an act of discrimination and unfairness considering that she was not an inexperienced new hire, but a promising and award winning employee who was more than eager to
Acquire Mastery of HR/Labor Doctrines, Rules and Principles with Atty. Elvin’s HR Bundle Books at Discounted Rate
succeed within the company. This conclusion is not totally baseless, and is rooted in her outstanding performance at the Washington Mutual account and her complaint regarding the incentives, which only proves her zeal positive work attitude, and drive to achieve financial success through hard work. But instead of rewarding her, the company unduly punished her; instead of inspiring her, the employer dashed her hopes and dreams; in return for her industry, idealism, positive outlook and fervor, the company left her with a legacy of, and awful examples in, office politicking, intrigue, and internecine schemes.
In the case of Telus International Philippines, Inc. vs. De Guzman [G.R. No. 202676, December 04, 2019], there is no basis to place the employee on “floating status” in the first place since the company continued to hire new CSRs/TSRs during the period, as shown by its paid advertisements and placements in leading newspapers seeking to hire new CSRs/TSRs and other employees.
True enough, the placing of an employee on “floating status” presupposes, among others, that there is less work than there are employees; but if the company continued to hire new CSRs/TSRs, then surely there is a surplus of work available for its existing employees: there is no need at all to place the employee on floating status.
If any, the employee with her experience, knowledge, familiarity with the workings of the company, and achievements – should be the first to be given work or posted with new clients/accounts, and not new hires who have no experience working for the company or who have no related experience at all.
Placing an employee on floating status presents dire consequences for him or her, occasioned by the withholding of wages and benefits while he or she is not reinstated. Due to the grim economic 
consequences to the employee, the employer should bear the burden of proving that there are no posts available to which the employee temporarily out of work can be assigned.”
However, Telus has failed miserably in this regard, according to the SC. Telus did not provide any valid justification or presented proof that there was indeed a deficit of account that bars the immediate transfer of De Guzman or that the company was sustaining losses that would justify placing De Guzman on floating status. Hence, the unwarranted acts of Telus evidently constitute proof of the constructive dismissal of De Guzman.
To say that Telus merely exercised its rights and that any inconvenience or injury that De Guzman may have suffered resulted merely in damnum absque injuria which cannot legally give rise to a cause of action for constructive dismissal, is abhorrent considering the fact that his being placed on a “floating status” without valid reasons violated his security of tenure and resulted in unfavorable economic consequences to De Guzman.
Learn how to Validly Terminate Employee in the Philippines with this Tutorial Video of Atty. Elvin 
Read more on procedural due process discussion by Atty. Elvin:
Read more on procedural due process by Atty. Villanueva:
Twin Requirements of Notice and Hearing