Tag - termination

Proof Required in Allegation of Fraud in Employee Dismissal Cases

Where the employer claims that the employee’s act constituted fraud which warranted her dismissal, the employer has to submit substantial evidence as proof. Article 297 (c) of Presidential Decree No. 442, also known as the Labor Code of the Philippines, provides that fraud or willful breach by the employee of the trust reposed in him or her by his or her employer or duly authorized representative is a ground for dismissal being a just cause. As held by the Supreme [...]

Employee Benefits in Case of “Bankruptcy” or Liquidation of the Company

“Bankruptcy” is a commonly terms by business owners in the event of non-viability of their business. Such term is not used in Philippine setting although there is an equivalent concept which is insolvency. However, Article 110 of the Labor Code recognizes the scenario of “bankruptcy” is so claimed by the employer. This is discussed in the context of liquidation. Technically, bankruptcy in the US contemplates three different scenarios. They are found in Chapters 7, 11, and 13 of the United [...]

Lack of First Written Notice in Employee Dismissal is Non Compliance with Procedural Due Process

Procedural due process is required in employee dismissal. Failure to comply shall result in the imposition of indemnity in the form of nominal damages. Due process under the Labor Code involves two aspects: first, substantive––the valid and authorized causes of termination of employment under the Labor Code; and second, procedural––the manner of dismissal. In the present case, the CA affirmed the findings of the labor arbiter and the NLRC that the termination of employment of respondent was based on [...]

Admission by Silence in Labor Case

Admission by silence can be taken against the one who slept on the right to speak against the declaration. Thus, when an illegal dismissal case is filed against the company, but the company denies having dismissed the employee, should the company first prove that there was no illegal dismissal in this case? The rule is that “in illegal dismissal cases, the burden of proof is on the employer in proving the validity of dismissal. However, the fact of dismissal, if [...]

Burden of Proving the Fact of Dismissal in Illegal Dismissal Cases

It is axiomatic that in illegal dismissal cases, the employer bears the burden of proving that the termination was for a valid or authorized cause. (Atienza vs. Saluta, G.R. No. 233413, June 17, 2019.) However, there are cases wherein the facts and the evidence do not establish prima facie that the employee was dismissed from employment. Before the employer is obliged to prove that the dismissal was legal, the employee must first establish by substantial evidence the fact of [...]

Termination of Probationary Employee

A probationary employee may be terminated on any of three (3) grounds. These are failure to qualify, just cause, and authorized cause. As a background, a probationary employee is one who is placed on trial by an employer, during which the latter determines whether or not the former is qualified for permanent employment. [See Canadian Opportunities Unlimited, Inc. v. Dalangin, Jr., 681 Phil. 21, 33 (2012), citing International Catholic Migration Commission v. NLRC, 251 Phil. 560 (1989)] By virtue of [...]

Standards to Observe in Alleging Offenses in the Notice to Explain

Issuance of the Notice to Explain (NTE) is one of the steps required in employee dismissal. At least, insofar as avoiding payment of indemnity is concerned for violation of procedural due process. Not observing the proper NTE may also impress upon the tribunal the haphazard nature of the employer in issuing such legal requirement. The last thing that an employer, as respondent in a case, wants is to have a wrong impression in the eyes of the labor tribunal. So, [...]

Redundancy Scheme is Ineffective if there is no Power to Terminate Services

Redundancy is one of the grounds to terminate services under authorized cause in Article 298 of the Labor Code, as amended. Termination letter is usually signed by the individual holding the authority to execute the act. However, in the case of Alfredo American Power Conversion Corporation, et al. vs. Lim, G.R. No. 214291, January 11, 2018, the Supreme Court held, in part, that the termination is ineffective where there is no authority to effect redundancy. In this case, the employee, [...]

Retrenchment of Employees and Criteria Employed

Retrenchment is the termination of employment effected by management during periods of business recession, industrial depression, seasonal fluctuations, lack of work or considerable reduction in the volume of the employer’s business. Resorted to by an employer to avoid or minimize business losses. It is a reduction in manpower, a measure utilized by an employer to minimize business losses incurred in the operation of its business. (Philippine Carpet Employees Association [PHILCEA] vs. Hon. Sto. Tomas, G.R. No. 168719, February 22, [...]

Resigned Employees are not Entitled to Separation Pay

Resignation is provided under Art. 300 of the Labor Code. There is nothing in such article that mandates the payment of separation pay to resigned employee. In a case of Italkarat 18, Inc. vs. Gerasmio, (G.R. No. 221411, September 28, 2020), the Supreme Court held that as a general rule, the law does not require employers to pay employees that have resigned any separation pay, unless there is a contract that provides otherwise or there exists a company practice [...]

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