Floating Status Philippines

Dear Attorney,

I have been placed on floating status by my employer without any clear reason. I am unsure about my rights regarding this situation and how long it can legally continue. Could you please advise me on the legality of this status and the appropriate steps I can take?

Sincerely,
Concerned Employee

Insights

In Philippine labor law, "floating status" refers to a temporary suspension of work due to business-related reasons, such as the lack of available work or operational interruptions. This status is often applied to workers in industries such as security services, manufacturing, and construction, where the availability of projects or clients directly impacts the need for workers.

Legal Basis

The legal foundation for floating status comes from Article 301 of the Labor Code of the Philippines, which allows an employer to temporarily lay off employees for valid reasons, such as lack of work, without terminating their employment. However, the law strictly limits this temporary layoff period to six months. Beyond six months, if no work is made available, the employer may be liable for constructive dismissal, giving the employee the right to claim separation pay or other remedies.

Rights of the Employee

1. Duration Limit: An employee can only be placed on floating status for up to six months. After this period, if no work is provided, it may be considered constructive dismissal, allowing the employee to file a complaint for illegal dismissal.

2. Justifiable Cause: The employer must have a valid business reason for placing an employee on floating status. These may include the suspension of operations, waiting for new projects, or economic downturns affecting the business.

3. No Dismissal Without Cause: During the floating period, the employment relationship remains intact. The employer is not permitted to terminate employment without just or authorized cause, as outlined in Articles 282 and 283 of the Labor Code.

Employer's Responsibilities

1. Notification: The employer must notify the employee about the floating status, explaining the reasons and expected duration. Failing to provide clear communication could be grounds for questioning the validity of the floating status.

2. Separation Pay: If after six months, the employer cannot reinstate the employee, the employer may be obligated to provide separation pay, as the situation may now be regarded as a constructive dismissal.

Legal Remedies

If an employee believes they are being placed on floating status unjustly or beyond the allowable period, they may file a complaint with the Department of Labor and Employment (DOLE) or the National Labor Relations Commission (NLRC). The primary remedies available include reinstatement or separation pay, depending on the circumstances of the case.

Employees on floating status should keep detailed records of any communication with their employer, as well as the length of time they have been on this status, in case a legal dispute arises.