In the Philippines, the following are the recognized types of employment: (1) regular; (2)

casual; (3) project; (4) seasonal; (5) fixed-term; and (6) probationary.
Regular and Casual Employment
Pursuant to Article 280 of the Labor Code of the Philippines (“Labor Code”), the primary
standard that determines regular employment is the reasonable connection between the
particular activity performed by the employee and the usual business or trade of the
employer; the emphasis is on the necessity or desirability of the employee’s activity. Thus,
when the employee performs activities considered necessary and desirable to the overall
business scheme of the employer, the law regards the employee as regular.
In addition, the Labor Code also considers as regular employment a casual arrangement when
the casual employee’s engagement has lasted for at least one year, regardless of the
engagement’s continuity. The controlling test in this arrangement is the length of time during
which the employee is engaged. (See Universal Robina v. Acibo, G.R. No. 186439, 15
January 2014)
Project Employment
Project employment contemplates an arrangement whereby “the employment has been fixed
for a specific project or undertaking whose completion or termination has been determined at
the time of the engagement of the employee.” (Article 280, Labor Code of the Philippines)
Since the employee’s services are coterminous with the project, the services of the project
employees are legally and automatically terminated upon the end or completion of the
project.
Seasonal Employment
Seasonal employment applies “where the work or service to be performed is seasonal in
nature and the employment is for the duration of the season.” (Article 280, Labor Code of the
Philippines)
Season employees may also be considered regular employees, thus: “[f]arm workers
generally fall under the definition of seasonal employees. We have consistently held that
seasonal employees may be considered as regular employees. Regular seasonal employees
are those called to work from time to time. The nature of their relationship with the employer
is such that during the off-season, they are temporarily laid off; but reemployed during the
summer season or when their services may be needed. They are in regular employment
because of the nature of their job,and not because of the length of time they have worked.”
(Gapayao v. Fulo, et al., G.R. No. 193493, 13 June 2013)
Fixed-Term Employment
Fixed-term employment is valid when: (a) the fixed period of employment was knowingly
and voluntarily agreed upon by the employer and employee without any force, duress, or
improper pressure being brought to bear upon the employee and absent any other
circumstances vitiating his consent; or (b) it satisfactorily appears that the employer and the
employee dealt with each other on more or less equal terms with no moral dominance
exercised by the former or the latter. (See Caparoso, et al. v. Court of Appeals, G.R. No.
155505, 15 February 2007)
Probationary Employment
Probationary employment exists when the employee, upon his engagement is made to
undergo a trial period where the employee determines his fitness to qualify for regular
employment, based on reasonable standards made known to him at the time of engagement.
The employer shall make known to the employee the standards under which he will qualify
as a regular employee at the time of his engagement. Where no standards are made known to
the employee at that time, he shall be deemed a regular employee. (See Section 6(d),
Implementing Rules of Book VI, Rule VII-A of the Labor Code)
Generally, probationary employment shall not exceed six (6) months from the date the
employee started working. (See Article 281, Labor Code)

Types of employees
There are several classifications of employees and companies can hire one or many types of
employees to perform work. The most common employee classifications include:
 Part-time employees
 Full-time employees
 Seasonal employees
 Temporary employees
 Leased employees

Part-time employees
Part-time employees are individuals who work less than 40 hours a week and are typically
paid by the hour rather than salaried. These employees are still considered legitimate
employees of a company but may not be eligible for benefits.
Related: How Many Hours Per Week is Part-Time?
Full-time employees
Full-time employees are those that work an average of 40 hours a week and are eligible for
benefits. Because the Fair Labor Standards Act does not provide a definition for part-time or
full-time employees, employers are given the liberty to decide how they classify full-time
employment within their organizations. Employers with 50 or more full-time employees must
offer health care coverage to their full-time employees and their dependents.
Seasonal employees
Seasonal employees are those who are hired based on the seasonal needs of a company. For
example, a retail company may hire 10 seasonal employees to cover the increase in business
during peak seasons such as the summer months and holidays. This type of employee is
eligible for Social Security and unemployment benefits as they are not considered permanent
employees.
Related: What Is a Seasonal Job? (And How to Find One)
Temporary employees
Temporary employees are those that are hired on a temporary basis, often for a set period of
time such as six months. They may also be hired to work on a specific project and stop
working for the company when the project is complete. Employers can hire temporary
employees directly or can go through a staffing agency to find employees that fit their needs.
Related: Everything You Need to Know About Being a Temp
Leased employees
A leased employee is an individual who is hired by a staffing agency and then "leased" out to
an organization to complete a specific job. Leased employees typically work with the
company they are leased to for a year or longer. While still considered an employee, leased
workers are on the payroll of the staffing agency and also receive any benefits through the
employment agency rather than the organization they are working for.
What are contingent workers?
Contingent workers are individuals who are outsourced by a business to perform specific
duties on a non-permanent and non-employee basis. They may work remotely or in the office
but are not considered an employee of the company. Contingent workers are typically experts
in their field and are sourced to complete certain projects based on their skillset. Examples of
contingent workers include freelancers, consultants and independent contractors.
Contingent workers often perform under a statement of work provision that is agreed upon at
the onset of the relationship with a company. Once a project is complete, the worker will no
longer work for the company at that time. However, companies may utilize the same
contingent workers on recurring projects if the company was satisfied with the worker's
performance.
How are contingent workers different from employees?
Contingent workers are different from traditional employees in a few key ways, including:
 Contingent workers do not have access to fringe benefits such as health insurance
through the company
 Contingent workers are not salaried
 Contingent workers are required to pay for and file their own taxes with the IRS
 Contingent workers have control over how and when they perform their work

Types of contingent workers

The following are the common types of contingent workers hired by individuals and
companies:
 Contract workers
 Independent contractors
 Interns
 Consultants

Contract workers
A contract worker is a person who is retained by an organization for a set period of time to
perform a specific task or duty. How much the contract worker will be paid is also pre-
determined and may be paid before, during or after the worker has completed their job.
Independent contractors
An independent contractor is a person or firm sourced by a company to perform work or
services. Independent contractors may work on a permanent basis for the company or they
may work on a single project or as-needed. These workers are responsible for paying their
own taxes and are not eligible for benefits through the companies they work with.
Independent contractors may also be referred to as freelancers, subcontractors or contractors.
Examples of an independent contractor include actors, freelance writers and auctioneers.
Interns
An intern is a person who performs work for a company on a paid, unpaid or partially-paid
basis in exchange for the work experience gained. Many high school and college students
participate in internships to prepare for their careers after school. Internships typically last for
a few months and after this time some interns are asked to become permanent employees by
the company.
Consultants
A consultant is a self-employed person who offers professional advice in their area of
expertise. For example, a consultant may specialize in education, law or marketing and
provide companies with expert advice in an attempt to help the company improve in these
specific areas. Consultants provide their services on a temporary basis but may be utilized
repeatedly by a company based on the organization's consulting needs.

Employees

An employee is a worker hired by a company to perform specific duties in exchange for a fee,
typically in the form of hourly or monthly wages. Companies commonly use Employment
Agreements to outline job descriptions, compensation and other details.

Full-Time Employees

Full-time employees work a minimum amount of hours specified by their employer. There is
no official definition of full-time employment, but in the United States, full-time employees
generally work at least 36 hours a week. They can be salaried employees, meaning they earn
a fixed amount per month, or paid hourly.

Full-timers are more likely to be granted benefits (such as healthcare, paid time off, etc.) not
afforded to other worker classes. For some businesses, providing these benefits to employees
may be legally required.

Part-Time Employees

Part-time employees typically work fewer than 36 hours a week and often have a more
flexible schedule. Although they may work 40-hour weeks, seasonal employees that only
work portions of the year are considered part-timers. Part-time workers are generally not
entitled to employee benefits.

Temporary Employees

Temps are employed only for a specified period of time. They may work part-time or full-
time hours, but they generally are not eligible to receive employee benefits. Many are hired
through temporary employment agencies, and some are hired as “temp to permanent,” which
allows for permanent hire after a probationary period.

At-Will Employees
The majority of American workers are at-will employees. At-will employees can work part-
time or full-time hours, but they can be dismissed for any reason and without warning (except
in Montana). Likewise, at-will employees have the right to quit or strike at their convenience
without notice.

Leased Employees

Leased employees are employed by professional employer organizations (PEOs) and are

offered to outside companies to perform HR work. Lease terms can be relatively short or may
last more than a year. Management of leased employees is the job of the company,
while payroll, taxes and other fees are obligations handled by the PEO.

Job-Share Employees

Job-share employees are two or more employees who share one full-time job. They typically
split 40-hour work weeks and enjoy employee benefits prorated by share.

Independent Contractors

Independent contractors provide goods or services to a company under terms specified in a

contract or a verbal agreement, such as an Independent Contractor Agreement. They can be
individual persons, companies or corporations. They generally lack control over their
schedule and are expected to work as and when needed.

Unlike employees, they do not have income taxes withheld from their pay; instead, they are
required to file an IRS Form 1099-MISC at the end of the year to report their earnings. They
are typically required to fund their own benefits and furnish all their supplies, which can then
be used as tax deductions. Because of these tax restrictions, businesses must be careful when
classifying workers as contractors or employees, as misclassification can lead to steep IRS
fines. To avoid fines and penalties, see our W-2 vs. 1099 Wizard to make sure your business’
workers are classified and reported correctly. For help with taxes when hiring contractors, see
our guide to filing 1099s.

Freelancers

Freelance workers are typically individuals hired as independent contractors to perform a

specific duty.

Subcontractors
Subcontractors are, in most cases, companies or individuals contracted to perform part or all
of another person or company’s contractual duties.

Others

Tenure

Generally speaking, tenure is the length of time an employee has spent with a specific
company. In academia, however, a tenured professor or teacher is a senior academic with a
contractual right not to have his/her position terminated without just cause. Highly qualified
educators are initially placed on “tenure track,” which guarantees consideration for eventual
tenure.

Tenure was partially developed to foster a sense of security for innovative professors, giving
them academic freedom to speak out against a university or public opinion for the sake of
controversial findings or research.

Apprentices

Typically, apprenticeships are training periods for skilled tradesmen. Apprentices work under
the guidance of journeymen and masters who teach skills necessary to gain licenses for
independent working. Upon completion, apprentices become journeymen and
eventually master tradesmen.

Interns

Similar to apprentices, interns work under the guidance of higher-level employees. Interns,

however, are trained for white-collar and professional careers. They are typically college
students, but interns can also be high school students or post-graduates.

Interns can work part-time or full-time hours and generally have a specified period of
employment that can last a few weeks to upwards of a year. They can be paid (either hourly
or as a stipend) or unpaid, which typically includes an offer for university credits. Those
considering hiring an unpaid intern should consult the FLSA regulations regarding
internships to protect themselves from legal issues.

You have a number of choices when trying to build a team. And while some may be less
expensive or require less management than others, the most important factor when hiring is
finding a person who fits your culture and taking the necessary steps to protect your business
in the process. For more help with the process check out our article on the six steps you must
take when hiring or our infographic on independent contractors.
Easy, accurate, done. That’s payroll, perfected.

Handle withholdings, employee classifications, benefit deductions and more with

QuickBooks Payroll.

What are the just causes for termination of an employee?

According to Article 282 of the Philippines Labor Code, the following just causes by
the employee can be the basis for firing an employee in the Philippines: serious misconduct
or willful disobedience. gross and habitual neglect of duty. fraud or deliberate breach of trust

Termination of Employment means to sever the employer-employee relationship, and put an

end on an employee’s current work. It can be made by the Employee through Resignation
or by the Employer for just or authorized causes, as provided in the Labor Code of the
Philippines.

Termination by Employee

Resignation

Resignation is the voluntary act of an employee who is in a situation where one believes that
personal reasons cannot be sacrificed in favor of the exigency of the service, and one has no
other choice but to dissociate oneself from employment. It is a formal pronouncement or
relinquishment of an office, with the intention of relinquishing the office accompanied by the
act of relinquishment. As the intent to relinquish must concur with the overt act of
relinquishment, the acts of the employee before and after the alleged resignation must be
considered in determining whether in fact, he or she intended to sever from his or her
employment (Iladan v. La Suerte International Manpower Agency, Inc., et.al., G.R. No.
203882, dated January 11,2016).

Separation from Employment can either be voluntary (without just cause) or involuntary

(with just cause).

Voluntary separation is based solely on the decision of the employee to terminate his
employment, even for personal reasons. It is voluntarily tendered by the resigning employee.
For this type of separation, the employee who wants to resign is required to submit a written
resignation letter at least thirty (30) days before the effectivity date of his resignation. Failure
to do so, the resigning employee may be held liable for damages.

In case of involuntary separation  with just cause(s), the resigning employee is not required to
submit a written notice or resignation letter to his employer. Article 300 (b) of the Labor
Code of the Philippines provides for the aforementioned just causes, to wit:
 “(b) An employee may put an end to the relationship without serving any
notice on the employer for any of the following just causes:

1. Serious insult by the employer or his representative on the honor and person
of the employee;

2. Inhuman and unbearable treatment accorded the employee by the employer

or his representative;

3. Commission of a crime or offense by the employer or his representative

against the person of the employee or any of the immediate members of his
family; and

4. Other causes analogous to any of the foregoing.”

An employee who voluntarily resigns is not entitled to separation pay unless otherwise
stipulated in an employment contract or collective bargaining agreement, or sanctioned by
established employer practice or policy. The Labor Code is devoid of any provision which
grants separation pay to employees who voluntarily resign (CJC Trading, Inc., et.al., v.
NLRC, et.al., G.R. No. 115884, dated July 20,1995).

Termination by Employer             

Termination by an Employer may be for a just cause or authorized cause, as the case may be.
In doing so, the employer must comply with due process.

Just Causes

A dismissal based on just cause means that the employee has committed a wrongful act or
omission. Article 297 of the Labor Code of the Philippines provides for said just causes, to
wit:

“a. Serious misconduct or willful disobedience by the employee of the lawful

orders of his employer or representative in connection with his work;

b. Gross and habitual neglect by the employee of his duties;

c. Fraud or willful breach by the employee of the trust reposed in him by his
employer or duly authorized representative;

d. Commission of a crime or offense by the employee against the person of his

employer or any immediate member of his family or his duly authorized
representatives; and

e. Other causes analogous to the foregoing.”

With regard to just cause stated in Article 297 (a) of the Labor Code of the Philippines, the
Supreme Court in the case of Maula v. Ximex Delivery Express, Inc., G.R. No. 207838, dated
January 25,2017, ruled that:

“Misconduct is improper or wrong conduct; it is the transgression of some

established and definite rule of action, a forbidden act, a dereliction of duty,
 willful in character, and implies wrongful intent and not mere error in
judgment. The misconduct, to be serious within the meaning of the Labor
Code, must be of such a grave and aggravated character and not merely trivial
or unimportant. Thus, for misconduct or improper behavior to be a just
cause for dismissal, (a) it must be serious; (b) it must relate to the
performance of the employee’s duties; and (c) it must show that the
employee has become unfit to continue working for the employer.”
(Emphasis Supplied)

 For just cause stated in Article 297 (b) of the Labor Code of the Philippines, gross
negligence implies a want or absence of or failure to exercise even slight care or diligence, or
the entire absence of care. It evinces a thoughtless disregard of consequences without
exerting any effort to avoid them. Habitual neglect implies repeated failure to perform one’s
duties for a period of time, depending upon the circumstances (Alaska Milk Corporation,
et.al., v. Ponce, G.R. No. 228412, dated July 26, 2017).

For just cause stated in Article 297 (c) of the Labor Code of the Philippines, the Supreme
Court in the case of Philippine Plaza Holdings, Inc. v. Episcope, G.R. No. 192826, dated
February 27,2013, ruled that:

“In order for the said cause to be properly invoked, certain requirements must
be complied with namely, (1) the employee concerned must be holding a
position of trust and confidence and (2) there must be an act that would
justify the loss of trust and confidence. x x x Primarily, it is apt to point out
that proof beyond reasonable doubt is not required in dismissing an employee
on the ground of loss of trust and confidence; it is sufficient that there lies
some basis to believe that the employee concerned is responsible for the
misconduct and that the nature of the employee’s participation
therein rendered him absolutely unworthy of trust and confidence
demanded by his position.”(Emphasis Supplied)

Further, for the just cause stated in Article 297 (d) of the Labor Code of the
Philippines, means commission of any crime or offense punishable under the Revised Penal
Code of the Philippines or under any special laws against the employer, his authorized agent
or the employer’s immediate family.  A final conviction is not needed for an employee to be
terminated under this just cause.

Lastly, for just cause stated in Article 297 (e) of the Labor Code of the Philippines, the
phrase “other causes analogous to the foregoing” may include the following:

1. Violation of company rules and regulations;

2. Theft of property owned by a co-employee, as distinguished from theft of property
owned by the employer.
3. Incompetence, inefficiency or ineptitude.
4. Failure to attain work quota.
5. Failure to comply with weight standards of employer.
6. “Attitude problem” is analogous to loss of trust and confidence.” (Chan, Joselito G.,
Bar Reviewer on Labor Law, 2017 Third Revised Edition, pg.312-313)

In case of termination due to any of the abovementioned just causes, the twin-notice

requirement and hearing is required. It means that the employer shall serve a first notice to
the employee which contains the specific ground(s) for his termination, a directive that the
employee is given the opportunity to submit his written explanation within the reasonable
period of five (5) days from receipt of notice, and contains a detailed narration of the facts
and circumstances as basis for the charge against him. After serving the first notice, the
employer shall schedule, and conduct a hearing or conference wherein the employee will be
given the opportunity to be heard or to explain, and clarify his defenses against the charge
against him. After determining that the termination of employment is justified, a second
written notice shall be served to the employee indicating all the circumstances involved, and
that grounds have been established to justify the termination of his employment.

Authorized Causes

 A dismissal based on authorized cause means that there exists a ground which the law itself
allows or authorizes to be invoked to justify the termination of an employee even if he has
not committed any wrongful act or omission.The authorized causes as provided in Art 298 of
the Labor Code of the Philippines are as follows:

a. Installation of labor-saving devices;

b. Redundancy;
c. Retrenchment to prevent losses; or
d. Closing or cessation of operation of the establishment or undertaking.

Another authorized cause is when the employee is suffering from a disease as provided
in Article 299 of the Labor Code of the Philippines,  to wit:

“An employer may terminate the services of an employee who has been found
to be suffering from any disease and whose continued employment is
prohibited by law or is prejudicial to his health as well as to the health of his
co-employees.”

For termination of employment due to any of the abovementioned authorized causes, the
concerned employee, who was terminated from work, is entitled to separation pay.