Employment Law: Deduction from Allowances and Performance Scores Due to Absence

What legal recourse can employees take against a company that deducts from their skills allowance and affects their performance scores every time they are absent?

In the Philippines, employment laws are designed to protect the rights and welfare of workers. One critical area of concern is the policies related to employee compensation and performance evaluation, particularly when these are affected by absences. Understanding the legal framework governing these issues is essential for both employers and employees to ensure compliance with the law and to safeguard employee rights.

Deductions from Allowances

Legal Provisions

The Labor Code of the Philippines provides the primary legal basis for employment policies, including those related to compensation. Under Article 100 of the Labor Code, "Non-diminution of Benefits," employers are prohibited from reducing the benefits, including allowances, that are already being enjoyed by the employees. This means that any company policy that results in the reduction of an employee's skills allowance due to absences may be legally questionable.

Permissible Deductions

However, there are certain permissible deductions under specific conditions:

1. Authorized by Law: Deductions required by law, such as taxes or social security contributions.
2. Authorized by the Employee: Deductions with written authorization from the employee for insurance premiums, union dues, or similar obligations.
3. Judicial Orders: Deductions mandated by a court order.

Unlawful Deductions

If a company implements a policy that reduces skills allowance due to absences without falling into any of the permissible categories, this could be considered an unlawful deduction. Employees affected by such policies may seek recourse by filing a complaint with the Department of Labor and Employment (DOLE).

Impact on Performance Scores

Performance Appraisal Systems

Performance appraisals are essential for evaluating employee efficiency and contributions. However, the manner in which these evaluations are conducted must adhere to fair and reasonable standards. Policies that unduly penalize employees for absences can be seen as discriminatory if they do not account for legitimate reasons such as illness, family emergencies, or other valid circumstances.

Fairness and Reasonableness

For performance appraisal systems to be considered fair:

1. Transparency: Employees must be informed about how their performance is measured and how absences impact their scores.
2. Consistency: The criteria used must be applied consistently to all employees.
3. Due Process: Employees should have the opportunity to explain their absences and provide necessary documentation, such as medical certificates.

Legal Recourse

Employees who feel that their performance scores have been unfairly affected by a company's absence policy can file a grievance through their company's internal mechanisms. If the issue is not resolved, they can escalate it to DOLE for further mediation or adjudication.

Practical Steps for Employees

1. Documentation: Keep detailed records of all absences, including reasons and any supporting documents like medical certificates.
2. Communication: Clearly communicate with your employer regarding the reasons for your absences and how they should be considered in performance evaluations.
3. Grievance Filing: Use internal grievance mechanisms first. If unresolved, file a complaint with DOLE.
4. Legal Advice: Consider seeking legal advice from a labor lawyer to understand your rights and the best course of action.

Conclusion

Employers must ensure that their policies on deductions and performance appraisals comply with the labor laws of the Philippines. Unlawful deductions from allowances and unfair impact on performance scores due to absences can be contested through proper legal channels. Employees should be aware of their rights and take appropriate steps to address any grievances related to these issues.