Payment of Damages as Hazard in Employee Termination

Payment of Damages as Hazard in Employee Termination

In previous post, the consequences of termination of employment were discussed. There are many other adverse scenarios that can result out of employee dismissal that the employer should understand and prepare for.

Learn the legally defensible way to craft Disciplinary Notices

The reason employee dismissal should be handled with extra care is the possibility of wreaking financial
havoc on the company and setting a bad precedent among employees.

One of the hazards of employee termination is the payment of various forms of damages when the employer loses the case.

Below is the discussion based on the book Guide to Valid Dismissal of Employees (pp. 10-12)

Valid Dismissal of Employees by Atty Elvin B. VillanuevaDamages Another consequence of illegal dismissal is the payment of damages. Wanton disregard of the employer of the rules on valid dismissal and violation of the right to security of tenure of employees may result in the payment of different kinds of damages.

If the dismissal is done in bad faith, willful and without any just cause, then the employer can be held liable for damages. In the language of the Supreme Court, the employer may be liable for damages if, in terminating the employment, it also committed an antisocial and oppressive abuse of its right to investigate and dismiss its employee in violation of Article 1701 of the Civil Code.

While the Labor Code may have made mention of damages in some of its provisions, such as the ones found in Articles 217 and 247 thereof, the basis, however, of the award for damages in illegal termination cases, including the amount thereof, is the Civil Code.

Damages come in the following classification:

1. Actual or compensatory;

2. Moral;

3. Nominal;

4. Temperate or moderate;

5. Liquidated; or

6. Exemplary or corrective.

Whatever appropriate damages the court may award in favor of the dismissed employee, it will surely hurt the pocket of the employer.

Hence, there is wisdom in knowing the basic rules of termination and dismissal of employee. Not only to avert the unnecessary financial impact on the part of the employer but also to spare the employee from harsh, prejudicial and unjust dismissal.

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