Performance Evaluation Procedure for Regularization Imposed by Employer for Probationary Employees Must be Strictly Observed

Performance Evaluation Procedure for Regularization Imposed by Employer for Probationary Employees Must be Strictly Observed

Performance evaluation may be required by the company to gauge the probationary employees. This is the basis to determine whether he is fit for regularization. As such, the company/employer may provide the procedure for performance evaluation. This should be followed by the employer otherwise, the probationary employee can be deprived of due process.

The post below is based on the book Guide to Valid Dismissal of Employees (pp. 49-50)

Employer’s failure to follow its own performance evaluation procedure may result in deprivation of procedural due process even if there is evidence of failure to qualify and service of notice.

Hence, in the case of Abbott Laboratories Philippines, et. al. vs. Alcaraz, (G.R. No. 192571, July 23, 2013),  the company’s procedure mandates, inter alia, that the job performance of a probationary employee should be:

  1. Formally reviewed and discussed with the employee at least twice: first on the third month and second on the fifth month from the date of employment.
  2. The company is also required to come up with a Performance Improvement Plan during the third month review to bridge the gap between the employee’s performance and the standards set, if any.
  3. In addition, a signed copy of the performance evaluation form should be submitted to HRD as the same would serve as basis for recommending the confirmation or termination of the probationary employment.

The company failed to follow the above-stated procedure in evaluating the probationary employee.

There was no evidence that a signed copy of the evaluation form was submitted to the HRD. It was not even shown that such form was completed to formally assess the employee’s performance. Neither was the performance evaluation discussed with her during the third and fifth months of her employment. Nor did the company come up with the necessary Performance Improvement Plan to properly gauge the employee’s performance with the set company standards. Hence, the Court ruled that the dismissal in this case was procedurally infirm.

According to the Court, while it is the company’s management prerogative to promulgate its own company rules and even subsequently amend them, this right equally demands that when it does create its own policies and thereafter notify its employee of the same, it accords upon itself the obligation to faithfully implement them.

Indeed, a contrary interpretation would entail a disharmonious relationship in the work place for the laborer should never be mired by the uncertainty of flimsy rules in which the latter’s labor rights and duties would, to some extent, depend.

In this light, while there lies due cause to terminate probationary employment for failure to meet the standards required for regularization, and while it must be further pointed out that the company had satisfied its statutory duty to serve a written notice of termination, the fact that it violated its own company procedure renders the termination of probationary employment procedurally infirm, warranting the payment of nominal damages.

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