Labor Law
specifying the ground for termination, and
Module 5
Termination of Employment
➢ An employer may terminate an employment
ONLY if the is legal cause for termination and
it has followed the procedures required for
the cause of termination.
➢ Employment where the employer may
dismiss an employee at any time, without
cause and by mere notice or salary in lieu of
notice, is NOT allowed under the Philippine
labor law.
➢ An employee may terminate his
employment for any reason by serving a
written notice to his employer at least one
month in advance. If the employee does not
give any notice, the employer may hold the
employee liable damages. Under Article 300
of the Labor Code, the employee may
terminate his employment without need of
any notice like serious insult of the employer
on the honor and person of the employee.
➢ Right to security of tenure
o The right to secure tenure means
that a regular employee shall remain
employed unless his or her services
are terminated for just or authorized
cause and after observance of
procedural due process.
➢ An employer shall observe procedural due
process before terminating one’s
employment. In a termination just cause,
due process involves
a) Notice to dismiss with intent to dismiss
giving said employee reasonable
opportunity within which to explain his or
her side.
b) A hearing of coherence where the employee
is given opportunity to respond to the
charge present evidence or rebut the
evidence presented against him/her.
c) A notice of dismissal indicating that upon
due consideration of all the circumstances
gourds have been established
TERMINATION OF EMPLOYMENT
In termination for an authorized cause, due process
means a written notice of dismissal to the employee
specifying the grounds at least 30 days before the
date of termination. A copy of the notice shall also
be furnished the Regional Office of the Department
of Labor and Employment (DOLE) where the
employer is located.
CAUSE OF DISMISSAL
➢ Just Causes
➢ Authorized Causes
Note: Dismissing employees is the act by the
employer of terminating their employment on the
ground of just causes and after observance of
substantive and procedural due process.
While a management prerogative, it is subject to the
two-fold limitations of good faith and employee
rights.
➢ Dismissal: The Highest form of penalty
➢ Penalties usually range from verbal
reprimand, written warning, suspension, to
dismissal. Thus, dismissal is the highest form
of the penalty that an employer may impose
 as a penalty for an erring employee as this
will result in the severance of the employer-
employee relationship.
➢ Penalty: Commensurate of the Offense
➢ The Supreme Court has repeatedly help that
the penalty of dismissal should be exercised
humanely and considerately, as well as to
ensure that sanction is commensurate to the
offense.
➢ “Although we recognize the inherent right of
the employer to discipline its employees, we
should still ensure the employer to discipline
its employee, we should still ensure the
employer exercises the prerogative
discipline humanely and considerately, and
that the sanction imposed is commensurate
to the offense involved and to the degree of
the infraction. The discipline exacted by the
employer should further consider the
employee’s length of service and the
number of infractions during his
employment. The employer should never
forget that always at sake in entirely
dependent on his earnings.”
DONGONS vs Rapid Movers and Forwarders
Co. Inc. G.R. No. 163431, 28 August 2013)
JUST CAUSES FOR TERMINATION OF
EMPLOYMENT ARE AS FOLLOWS
➢ Serious misconduct or willful disobedience
by the employee of the lawful orders of his
employer or representative in connection
with his work.
➢ Gross and habitual neglect by the employee
of his duties.
➢ Fraud or willful breach by the employee of
the trust reposed in him by his employer or
duly authorized representative.
➢ Commission of crime or offence by the
employee against the person of his employer
or any immediate member of his family or
his duly authorized representative
➢ Other Causes analogous to the foregoing.
AUTHORIZED CAUSES FOR TERMINATION
OF EMPLOYMENT ARE FOLLOWS:
➢ Installation of labor-saving devices
➢ Redundancy
➢ Retrenchment of prevent losses
➢ Closing or cessation of operation of the
establishment or undertaking
➢ Diseases, where the continued employment
of the afflicted employee is prohibited by
law or is prejudicial to his health as well as to
the health and his co-employees
TERMINATION OF EMPLOYMENT BY THE
EMPLOYER WITHOUT A LEGAL CAUSE
➢ The illegally dismissed employee is entitled
to reinstatement without loss of seniority
rights and other privileges, to payment of full
back wages, inclusive of allowances and of
other benefits or their monetary equivalent
computed from the time compensation was
withheld until actual reinstatement, and to
payment of damages.
PROCEDURES FOR DISMISSAL
➢ In exercising the management prerogative of
dismissal of an employee from work due to a
just cause, the Labor Code requires the
employee informing him of the charges
against him.
➢ After serving the notice, the employer must
afford the employee an opportunity to be
heard where the employee can answer the
charges with the assistance of counsel, if he
so desires. If the employer decides to dismiss
the employee, it must serve another written
 notice to the employee to inform him of its ➢ Employees generally have the right to self-
decision to dismiss him. organization and the right to form, join or
➢ When termination of employment due to an assists labor unions for purposes of
authorized cause, the employer must serve collective bargaining. There are, however
a written notice to each affected employee certain limitation to the right to form, join or
DOLE at least one month before the assists labor union.
intended effective date of the termination. ➢ Managerial employees and confidential
➢ For employment termination by reason of employee are not eligible to form, join or
disease, there must also be certification by a assist labor unions.
competent public health authority that the ➢ Supervisory employee is not eligible for
disease cannot be cured within a period of membership in the collective bargaining
six months even with proper medical units and/ or labor unions of their own.
treatment.
➢ In all cases of authorized cause employment
termination, the employee is entitled to
receive separation pay is equivalent to half-
month’s salary for every year of service or
one-month’s salary for every salary for every
year of service depending on the authorized
cause of employment termination.
➢ When the employee is dismissed without
management observing the appropriate
procedures, the employee is entitled to
nominal damages, the amount of which is
subject to discretion of the court, even if
there is a just or authorized cause for
employment termination. For this purpose,
the court will take into consideration the
relevant circumstances of each case,
particularly the gravity of the due process
violation.
➢ The nominal damage serves as a penalty
upon the employer for its failure to comply
with the requirements of procedural due
process for employment termination.

LABOR RELATIONS
➢ Employees right to self -organization is
enriched in the 1987 Philippine Constitution,
Likewise, it is the policy of the Philippines to
promote the free and responsible exercise of
the right to self-organization.