Probationary Employment Period and Contract
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Probationary employment refers to a status of employment where the employee is on trial period to determine whether he can be made a regular employee.
Article 296 of the re-numbered Labor Code provides that probationary employment shall not exceed six (6) months from the date the employee started working, unless it is covered by an apprenticeship agreement stipulating a longer period.
Does this mean that the employer cannot dismiss the probationary employee until after six (6) months?
No. The employer can dismiss the employee who fails to meet the reasonable standards made known to him at the time of engagement at any time prior to the end of six months. Provided that this is in accordance with the periodic evaluation duly established or agreed upon by the parties in the contract or as referred to in the company policy.
For instance, the parties may agree that the periodic evaluation shall be monthly and that each time the employee should obtain a rating of at least 85%. Any rating below that shall be considered as a failure.
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The parties may further agree that the employer, instead of terminating the probationary employee right after the first month of evaluation, may give another chance. This will result in another evaluation after one month. The parties can also agree that if the result is still a failure, then another chance can be accorded by the employer.
As a result of the successive failure and the chances given, the probationary employee may be terminated and the employer cannot be accused of being arbitrary in its exercise of prerogative. The company as employer can establish that much leeway has been given but the employee still failed to meet the standards agreed upon.
Hence, termination may occur on the 4th or even 5th month of the probationary period as this span of time can show the sequence of events in terms of results and chances or opportunities given to improve.
Logically, it is difficult to establish the chances or opportunities extended if termination occurs on the first month. Unless, of course, the probationary employee committed acts constituting just cause for dismissal
Learn How to Validly Dismiss Errant Employees within the standards of the Labor Code
under Art. 297 of the Labor Code, which is a totally different matter.
The rules on termination of probationary employee under Art. 296 of the Labor Code does not preclude the employer from terminating the employment under Art. 297 (just cause) and Art. 298 (authorized cause).
It bears noting that regardless of the form of employment agreed upon (probationary, fixed-term, project, seasonal, regular, casual), the grounds for termination stated in Art. 297 and 298 serve as overarching justification in addition to the specific grounds laid down by law for each form of employment.
Of course, this is not to mention that parties can mutually agree to extend the probationary employment beyond the six months consistent with the ruling in Buizer vs. Leogardo (G.R. No. L-63316 July 31, 1984). Read the following articles on extension of probationary period with sample notices and probationary contract in Filipino/Tagalog:
- Extension by mutual agreement with sample notice of extension
- Sample probationary contract with clause on mutual extension of probationary period in the event of employee’s failure to qualify
Ensure that your probationary employment contract is aligned with labor laws to avoid labor complications. Buy Word editable employment contracts template that are aligned with labor laws.
See related video on probationary employment below:
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