Illegal Dismissal Complaint Process in the Philippines
A comprehensive step‑by‑step guide for workers, employers, HR officers, and advocates
1. Constitutional and Statutory Foundations
| Source | Core principle |
|---|---|
| Art. XIII, Sec. 3, 1987 Constitution | Workers enjoy security of tenure; they may only be dismissed for lawful cause and with due process. |
| Labor Code of the Philippines (Pres. Decree 442, as amended) | Art. 297‑302 (just & authorized causes), Art. 301 (reinstatement), Art. 305 (illicit termination suits), Art. 229‑233 (NLRC jurisdiction & procedure). |
| Dept. Order 147‑15 / Dept. Order 174‑17 | Implementing rules on termination and due process. |
| R.A. 10396 & DOLE Department Circular 02‑20 | Institutionalizes Single‑Entry Approach (SEnA)—mandatory 30‑day conciliation‑mediation before any NLRC filing (with narrow exemptions). |
2. What Counts as “Illegal Dismissal”?
- No Just or Authorized Cause – The ground invoked is absent or unproven.
- Lack of Procedural Due Process – Even with a valid cause, dismissal is defective if the employer failed to:
- issue a first notice (charge/notice to explain);
- give the employee a meaningful opportunity to be heard (written explanation, hearing, or conference);
- issue a second notice (decision specifying the facts and legal basis).
- Constructive Dismissal – Acts or policies that effectively force an employee to resign (e.g., demotion, diminution of pay/benefits, hostile environment).
Burden of proof always rests on the employer. Failure to prove both cause and proper procedure results in liability.
3. Valid Grounds for Termination
| Just Causes (Art. 297) | Authorized Causes (Art. 298‑299) |
|---|---|
| Serious misconduct | Installation of labor‑saving devices |
| Willful disobedience | Redundancy |
| Gross & habitual neglect | Retrenchment to prevent losses |
| Fraud or breach of trust | Closure/cessation of business |
| Commission of a crime vs. employer/co‑workers | Disease not curable within 6 months |
| Analogous causes | – |
For authorized causes, employers must: (a) serve two 30‑day written notices—to the employee and the DOLE Regional Office; and (b) pay statutory separation pay.
4. Prescriptive Period
- Four (4) years from the date of dismissal (Civil Code Art. 1146 applied by jurisprudence).
- Money claims (e.g., unpaid wages) must be filed within three (3) years from accrual (Labor Code Art. 306).
5. Mandatory Single‑Entry Approach (SEnA)
- Request for Assistance (RFA). File at any DOLE/SEnA Desk (can be outside the region of employment).
- 30‑day conciliation‑mediation. A SEnA Officer facilitates settlement; periods may be extended by 7 days once.
- Outcome:
- Settlement Agreement—final and binding, enforceable by NLRC via motion.
- Referral to NLRC—if unresolved or respondent refuses to participate, the complainant receives a Referral Certificate (prerequisite to filing a complaint).
Exceptions: Cases involving urgent strikes/lockouts, inter/intra‑union disputes, or those already docketed with the NLRC skip SEnA.
6. Filing the NLRC Complaint
- Venue: Appropriate Regional Arbitration Branch (RAB) where the employee worked or resides.
- Complaint Form: Include names/addresses of parties, nature of claims, reliefs sought.
- Docket & Filing Fees: None for purely reinstatement cases; otherwise ≈ ₱500 + ₱10/₱1000 of monetary award.
- Service of Summons by Sheriff or accredited courier.
7. Proceedings before the Labor Arbiter
| Stage | Key Points & Timeframes (NLRC 2023 Rules of Procedure) |
|---|---|
| a. Mandatory Conferences | 2 settings within 30 days of filing; explore settlement & define issues. |
| b. Submission of Position Papers | Parties attach affidavits & evidence; no strict technical rules. |
| c. Clarificatory Hearing (optional) | At Arbiter’s discretion for factual issues. |
| d. Decision | Within 30 calendar days from submission for resolution (extended in complex cases). |
Typical Remedies Awarded
- Actual reinstatement (or payroll reinstatement) plus full backwages from dismissal until reinstatement.
- Separation pay in lieu of reinstatement (1‑month salary/year of service, unless project/fixed‑term).
- Nominal damages (≈ ₱30 000–₱50 000) for procedural lapses even when dismissal is substantively valid.
- Moral & exemplary damages when employer acted in bad faith.
- 10 % attorney’s fees when employee is compelled to litigate.
- Interests per Bangko Sentral rates (currently 6 % p.a.) on monetary awards.
8. Appeal to the NLRC Commission
| Parameter | Rule |
|---|---|
| Who may appeal? | Aggrieved party (employer or employee). |
| Period | Ten (10) calendar days from receipt of Labor Arbiter Decision. |
| Requirements (employer‑appellant) | (a) Verification & Memorandum of Appeal; (b) Appeal bond—cash, surety, or property bond equal to monetary award; (c) Appeal & legal research fees. |
| Effect | Perfection of appeal does NOT stay reinstatement. Employer must reinstate or place employee on payroll immediately under Art. 229. |
| NLRC Decision | Due within 20 days from submission; may grant, deny, or modify award. |
| Motion for Reconsideration | One MR allowed within ten (10) days; NLRC resolves in 10 days. |
9. Judicial Review
- Petition for Certiorari under Rule 65
- Filed with the Court of Appeals (CA) within 60 days from notice of NLRC Resolution.
- Alleges grave abuse of discretion. Requires verified petition, attachments, and ₱3 000 docket fee.
- Petition for Review on Certiorari under Rule 45
- Filed with the Supreme Court within 15 days from receipt of CA decision (extendible once).
- Raises pure questions of law.
10. Execution of Judgment
- After finality (10 days from NLRC/CA/SC decision, or upon denial of MR), the Labor Arbiter issues a Writ of Execution.
- Sheriffs may levy bank accounts, garnish receivables, seize personalty, or auction real property of the employer.
- Reinstatement Pending Appeal is self‑executory; employee may move for immediate reinstatement even while case is on appeal.
11. Settlement & Compromise
- At any stage—even after finality—parties may compromise, subject to NLRC approval if rights are affected.
- Quitclaims are valid when (a) executed voluntarily, (b) with full comprehension, and (c) for reasonable consideration; otherwise, they may be annulled.
12. Special Situations
| Category | Peculiar Rules |
|---|---|
| Probationary Employees | May be dismissed for failure to meet standards communicated at hiring; still entitled to two‑notice rule. |
| Project / Seasonal Employees | Term automatically ends with project; dismissal before completion follows regular rules. |
| Fixed‑term Employment | Ends on agreed date; illegal dismissal arises if employer terminates early without cause. |
| Overseas Filipino Workers (OFWs) | Wrongful termination claims go to NLRC or POEA, but monetary relief is limited to salaries for unexpired portion (max. 3 months for fixed appointments prior to R.A. 10022; now full unexpired portion). |
| Managerial Employees | Still covered by due process, but standard of “loss of trust” is broader. |
| Union Officers | May only be terminated for serious misconduct or willful breach of trust and confidence. |
13. Practical Checklist for Employees
- Gather evidence: employment contract, payslips, e‑mails, CCTV clips, witness statements.
- Act promptly: attend SEnA within 30 days; observe prescriptive periods.
- Compute potential award: monthly pay × months of dismissal → backwages; 1 month salary per year of service → separation pay (if applicable).
- Budget filing costs: minimal at Arbiter level; higher if employer appeals.
- Consider settlement: weigh speed & certainty vs. full recovery through litigation.
14. Common Employer Pitfalls
- Skipping the first notice (mere “show cause” after penalty is decided).
- Relying on “quitclaims” for ongoing employees to waive causes of action.
- Failure to reinstate pending appeal—exposes company officers to contempt and solidary liability.
- Posting an insufficient surety bond—strips NLRC of jurisdiction over appeal, causing decision to become final.
15. Estimated Timeline (Illustrative)
| Stage | Calendar Days (typical) |
|---|---|
| SEnA | 30 – 37 |
| NLRC filing → Arbiter Decision | 90 – 120 |
| Employer appeal → NLRC Resolution | 60 – 90 |
| CA Certiorari | 180 – 365 |
| SC Review | 365 + |
16. Cost Exposure Illustration (Sample)
Employee dismissed after 6 years, ₱25 000 monthly wage.
| Component | Formula | Amount |
|---|---|---|
| Backwages | ₱25 000 × 30 months (litigation period) | ₱750 000 |
| 13th‑Month Differential | ₱25 000 × (30/12) | ₱62 500 |
| Separation pay (in lieu) | ₱25 000 × 6 months | ₱150 000 |
| Nominal damages | – | ₱30 000 |
| Attorney’s fees (10 %) | – | ₱99 250 |
| Total | ≈ ₱1 091 750 + 6 % legal interest p.a. |
17. Key Take‑Aways
- Document everything—for both sides, the paper trail wins illegal‑dismissal suits.
- Observe the twin‑notice rule—process lapses cost money even when the ground is solid.
- SEnA is not optional—failing to undergo it can dismiss or suspend the complaint.
- Reinstatement pending appeal is automatic—employers ignore it at their peril.
- Time bars matter—4‑year window for dismissal, 3 years for money claims.
18. Final Word
The Philippine scheme balances managerial prerogative with labor rights through clear substantive causes, procedural safeguards, and a multi‑layered dispute‑resolution ladder (SEnA → NLRC → Courts). Navigating it successfully demands prompt action, accurate documentation, and—in many situations—professional legal assistance. While this guide covers “everything you need to know,” each case turns on its specific facts; consult a lawyer or accredited labor representative before making irrevocable decisions.
(This article is for educational purposes and does not constitute legal advice. Laws and rules cited are current as of 20 April 2025.)