Below is a comprehensive discussion on the topic of an employer’s refusal to issue a Certificate of Employment (“COE”) under Philippine labor laws. This article covers the legal basis, importance of the COE, employer obligations, possible grounds for refusal, legal remedies, and practical tips for both employers and employees.

1. What Is a Certificate of Employment (COE)?

A Certificate of Employment is a written statement issued by the employer that provides basic information about an employee’s work history. It typically includes:

Employee’s full name
Position(s) held
Inclusive dates of employment (start date and end date)
Brief description (if any) of duties or responsibilities – though this is usually optional

In the Philippines, a COE is most often used by employees for future employment applications. Employers commonly require applicants to submit a COE from their previous employer as proof of prior work experience and good standing.

2. Legal Basis for Issuance of a COE

While the Labor Code of the Philippines does not have a specific article dedicated solely to the COE, its underlying principles on fair labor practices and Department of Labor and Employment (DOLE) issuances strongly support an employee’s right to obtain a certificate that states the nature and duration of their employment.

DOLE Advisory / Labor Code Principles

Obligation to Provide Documentation
Under general labor law principles, employers must provide documentation that accurately reflects the terms, conditions, and duration of employment. Although not explicitly codified in a single article of the Labor Code, this principle is recognized by DOLE and the Supreme Court in various rulings emphasizing good faith and fair dealing.
Protection of Labor
The constitutional mandate to protect labor includes ensuring workers have access to certificates attesting to prior employment. This ensures that employees are not unduly prejudiced in seeking new opportunities.
Just Treatment
Refusal to issue a COE may be interpreted as bad faith if done without valid reasons, potentially opening the employer to legal or administrative liabilities.

3. Importance of the COE

Employment Verification
Potential employers typically verify work history through a COE. It speeds up hiring processes and authenticates the applicant’s claims regarding tenure and responsibilities.
Employee’s Professional Record
A COE is an essential document to show proof of an employee’s track record, including designations or promotions.
Protects Both Parties
An official record of employment helps clarify any disputes regarding the start and end dates of employment, thereby protecting both employees and employers against future misunderstandings.

4. Employer’s Obligation to Issue a COE

A. General Rule: Employers Must Issue Upon Request

Upon Separation or Resignation
Once an employment relationship ends—whether due to resignation, termination, or retirement—an employee can request a COE. The general practice is that the employer should issue it promptly, typically within a reasonable period (often interpreted by DOLE to be around 3 business days from request, though no strict uniform rule is set in stone).
Even During Employment
In some cases, an employee may request a COE while still employed (for example, for personal or loan purposes). Employers are generally encouraged to comply in good faith.

B. Content of the COE

Only the Basics
The COE typically includes only the employee’s name, the position held, and the inclusive dates of service.
Performance-Related Remarks
While not prohibited, it is uncommon to add evaluations or subjective comments about performance in a COE; a COE is not intended to serve as a character reference. If employers choose to include remarks, they must ensure honesty, accuracy, and fairness to avoid defamation claims.

5. Valid Grounds for Refusal (If Any)

Strictly speaking, there are very few valid grounds for an employer to refuse issuing a COE. The Labor Code and DOLE guidelines lean heavily in favor of granting employees access to employment records. However, employers sometimes refuse on the following bases:

Unsettled Accountabilities or Pending Clearance
Some companies argue that they will only release employment documents (including a COE) after an employee has completed a clearance process (i.e., returned company property, settled monetary accounts, etc.).
- Note: While an employer may delay full clearance or final pay until after accountabilities are settled, most labor authorities discourage outright refusal to issue at least the basic COE. Withholding a COE indefinitely—even if there are unpaid obligations—may be seen as an unreasonable labor practice.
Unclear Identity or Fraud
If there is a legitimate dispute about the identity of the person requesting the COE (i.e., suspected fraud), an employer may understandably delay the issuance of the document until the matter is resolved.
Formal Written Request Requirements
Some companies require employees to fill out a specific form or route a written request through HR. Failure to follow these procedures could delay a COE’s release, although outright refusal is rarely justified if the identity and request are proper.

Key Takeaway: Refusal is generally not acceptable simply because the employee had a conflict with management or had a pending dispute. Employers risk labor complaints if they deny issuing a COE for reasons unrelated to the basic verification of employment details.

6. Legal Consequences of Refusal

Labor Complaints
Employees can file a complaint with the National Labor Relations Commission (NLRC) or the DOLE Regional Offices for the employer’s refusal to issue a COE. While it may not always lead to large monetary awards, DOLE or NLRC can order the employer to issue the COE and, in some cases, impose administrative fines or penalties if the employer’s refusal is done in bad faith or is part of a broader labor rights violation.
Potential Claims of Bad Faith
If an employer’s refusal is proven to be malicious (e.g., using the withheld COE as leverage or retribution against the employee), the employer may be liable for moral and/or exemplary damages in certain cases.
Unfair Labor Practice (ULP)
While refusing to issue a COE may not always rise to the level of a full-blown ULP (since ULP is strictly defined under the Labor Code primarily in the context of unionism and collective bargaining), a pattern of harassment or discrimination against employees, including withholding needed employment records, can form part of a ULP complaint if intertwined with union activities or workers’ collective rights.

7. Remedies for Employees

Request in Writing
The first step is to submit a formal, written request to the employer or the Human Resources Department. Keep records of follow-ups (letters, emails, or text messages).
Seek Mediation or Conciliation (Single Entry Approach)
If the employer unreasonably refuses, the employee can file a request for assistance under the Single Entry Approach (“SEnA”) with DOLE. SEnA aims to settle labor issues quickly without formal litigation.
File a Complaint with the NLRC or DOLE
If mediation fails, the employee can lodge a formal complaint to compel the employer to issue the COE. This may include claims for damages if bad faith is shown.
Consult a Lawyer
For complex cases—especially if there are other labor claims—seeking legal advice from a reputable labor lawyer or the Public Attorney’s Office (PAO) might be advisable.

8. Best Practices and Practical Tips

A. For Employers

Establish a Clear Policy
Create and disseminate a standard COE request procedure: Who to contact, required forms, and expected time to release.
Issue Promptly and Accurately
Provide COEs within a reasonable period—commonly within 3 working days of the request—or as soon as clearance is completed (if there is a legitimate clearance process in place).
Avoid Overly Negative Statements
A COE is not the place for performance judgments. If there are legitimate issues to be flagged, do it separately or in a reference check, but keep the COE factual.
Document All Communications
Keep records of the employee’s request and the release of the COE to protect against potential legal claims of refusal or delay.

B. For Employees

Follow Official Procedures
Submit your COE request in writing (email or letter) to the correct department or individual.
Politely Follow Up
Maintain a calm and professional tone when inquiring about your COE. Keep a paper trail of communications.
Know Your Rights
If your request is refused without a valid reason, consider seeking help from the DOLE or the NLRC.
Coordinate Clearance (If Applicable)
If the company policy requires clearance, comply as soon as possible to minimize delays in the issuance of the COE.

9. Frequently Asked Questions (FAQs)

Can an employer withhold a COE if the employee has unsettled loans or property not returned?
- Generally, no. Employers can require clearance, but they cannot indefinitely withhold a basic COE if the employee has made a proper request and there is no justifiable reason for refusal.
What if the employer inserts negative remarks in the COE?
- A COE ideally should remain factual and neutral. If the remarks are false or defamatory, the employee may consider legal recourse for damages.
How soon must the employer release the COE after a request?
- There is no specific statutory deadline under the Labor Code. However, DOLE typically expects prompt issuance—commonly around 3 working days—or at most within a “reasonable” time.
Is it mandatory for employers to provide a COE for current employees?
- Although more common at separation, a current employee can request a COE for valid reasons (e.g., for banks or government loans). Employers are encouraged to comply; refusal without valid grounds can still be deemed unreasonable.
Can an employee sue for damages if the employer refuses to issue a COE?
- If the refusal is proven to be in bad faith or malicious, the employee may claim damages. However, each case is decided on its particular facts and evidence.

10. Conclusion

In the Philippine labor context, refusal to issue a Certificate of Employment without a valid legal or factual basis can expose an employer to labor complaints and potential damages. The COE is a straightforward document that verifies a person’s tenure and position, crucial for future employment and personal record-keeping. Employers are generally required to provide it promptly upon request (either after separation or even during employment), reflecting good faith and just labor practices.

Key Takeaway for Employers: Issue COEs promptly and accurately, and avoid using them as leverage in disputes or as a form of retaliation.

Key Takeaway for Employees: You have the right to a COE. If you encounter refusal or unreasonable delay, you can pursue administrative remedies with the DOLE or the NLRC to enforce this right.

Disclaimer: This article is for general informational purposes only and does not constitute legal advice. For specific cases or complex disputes, please consult a qualified labor law practitioner or contact the Department of Labor and Employment for formal guidance.