Query: Can an employer in the Philippines withhold an employee's last pay if the employee goes AWOL (Absent Without Leave)?

In the Philippines, employment relationships are governed by the Labor Code, which outlines the rights and obligations of both employers and employees. One common issue that arises is whether an employer can withhold an employee's last pay if the employee goes AWOL (Absent Without Leave).

Employee’s Right to Last Pay

Under Philippine law, an employee who resigns or is terminated is entitled to receive their final pay, which typically includes unpaid wages, prorated 13th month pay, unused leave credits, and other benefits. The obligation to pay the final wages is mandated by the Labor Code of the Philippines and reinforced by the Department of Labor and Employment (DOLE).

Grounds for Withholding Pay

While employers have a duty to release the final pay, there are circumstances under which they may withhold it. One such situation is if the employee has incurred financial obligations to the company, such as loans or advances that have not been settled. However, the employer cannot unilaterally decide to withhold the entire final pay without due process.

AWOL and Final Pay

An employee who goes AWOL breaches their employment contract and the terms agreed upon with the employer. Despite this breach, the employer cannot simply withhold the final pay without following the proper legal procedures. The employer must:

Issue a Notice to Explain: The employer should formally notify the employee, asking them to explain their unauthorized absence. This ensures that the employee has an opportunity to present their side.
Conduct an Administrative Hearing: If the employee fails to respond or provide a satisfactory explanation, the employer should conduct a hearing to determine if the absence constitutes a justifiable ground for disciplinary action.
Serve a Notice of Decision: After the hearing, the employer must issue a formal decision regarding the employee’s AWOL status and the corresponding disciplinary action, if any.

Legal Remedies for Employees

If an employee believes that their final pay is being unjustly withheld, they can file a complaint with the DOLE. The DOLE has the authority to investigate and mediate disputes between employers and employees. If necessary, the employee can escalate the matter to the National Labor Relations Commission (NLRC) for adjudication.

Employer’s Compliance

To avoid legal complications, employers should:

Ensure compliance with the due process requirements for terminating an employee due to AWOL.
Calculate the final pay accurately, including all due benefits and deductions.
Release the final pay within the prescribed period, typically within 30 days from the employee’s last working day.

Conclusion

In the Philippines, while employers have the right to discipline employees who go AWOL, they must still comply with legal procedures before withholding final pay. Employees are protected by labor laws ensuring they receive their earned wages and benefits, even if they are terminated for just causes like AWOL. Employers must navigate these situations carefully to avoid legal repercussions and ensure fair treatment of their employees.