Simplified Question: If your company relocates, do you have to move with them?
In the Philippines, when a company decides to relocate its operations, employees may wonder about their rights and obligations. A critical concern is whether employees are required to move to the new location or if they have the right to refuse without facing negative consequences, such as termination or loss of benefits.
1. Contractual Obligations and Employer’s Right to Relocate
The first thing to consider is the employment contract. If the contract specifically includes a clause that obligates the employee to relocate if the company moves, the employee may be legally bound to follow this provision. However, such clauses must be clear and explicitly agreed upon by both parties at the time of signing the contract.
If there is no relocation clause in the contract, the employer cannot force the employee to move. The employer must provide the employee with the choice to relocate or to refuse.
2. Right to Refuse and Entitlement to Separation Pay
Employees who refuse to relocate due to a company's decision to transfer operations are generally entitled to separation pay. Under Philippine law, if an employee chooses not to relocate, this is typically considered an involuntary separation from the company, which entitles the employee to severance benefits. The Department of Labor and Employment (DOLE) mandates that employees in this situation receive separation pay equivalent to at least one month’s salary or half a month’s salary for every year of service, whichever is higher.
3. Legitimate Grounds for Refusal
Employees may have legitimate reasons for refusing to relocate, such as family obligations, financial constraints, or personal preferences. Employers are encouraged to consider these factors and negotiate terms that might be more acceptable to the employee, such as offering additional compensation, temporary housing, or other benefits to ease the transition.
4. Obligations of the Employer
When a company decides to relocate, the employer has certain obligations under the law. They must notify the employees in advance, typically 30 days before the move. This notice should include the reason for the relocation, the new location, and the options available to the employee, including the possibility of severance pay if the employee chooses not to move.
Additionally, employers must provide assistance to those who agree to relocate, which may include covering moving expenses, temporary housing, or adjusting salaries to account for the cost of living differences in the new location.
5. Legal Remedies for Employees
If an employer tries to force relocation without proper notice or without honoring the terms of the employment contract, employees may seek redress through the National Labor Relations Commission (NLRC). Employees can file a complaint for constructive dismissal if they feel that the forced relocation was equivalent to termination or if they were pressured to resign due to the relocation.
Conclusion
In summary, employees in the Philippines have the right to refuse relocation without losing their entitlement to separation pay. Employers cannot unilaterally impose relocation without considering the terms of the employment contract and the rights of the employees. It is essential for both parties to communicate openly and consider all legal obligations and rights when a company decides to relocate its operations.