Dear Attorney,

I was recently dismissed from my job without being informed of the reason, and I am also having difficulty claiming my salary. I believe my employer’s actions were unfair and have caused me significant stress. Can you advise on what legal recourse I may have in this situation?

Sincerely,
Concerned Employee

Insights

In the Philippines, employment rights are protected under the Labor Code, which governs all forms of employment, including the termination of employees. One of the most common issues is unlawful termination, where an employee is dismissed without just cause or without being afforded due process.

1. Legal Grounds for Termination

The Labor Code of the Philippines specifies that employers can only terminate an employee for just causes or authorized causes. Just causes include serious misconduct, gross and habitual neglect of duties, fraud or willful breach of trust, commission of a crime against the employer or his family, and other analogous causes. Authorized causes, on the other hand, include redundancy, retrenchment, closure of business, or disease.

If an employee is dismissed for any reason not explicitly covered under these categories, it may be considered an unlawful termination.

2. Due Process in Termination

Even when a just or authorized cause exists, due process must still be followed. In cases of termination for just cause, the employee must receive two notices:

First Notice: This is a written notice specifying the acts or omissions constituting the grounds for dismissal.
Second Notice: After giving the employee the opportunity to respond to the first notice, if the employer determines that termination is appropriate, a final notice is issued formally terminating the employee.

In the case of authorized causes (such as redundancy or retrenchment), the employer must provide:

A 30-day prior written notice to both the employee and the Department of Labor and Employment (DOLE).
Separation pay, which varies depending on the cause of termination.

Failure to comply with these procedural requirements constitutes a violation of the employee’s right to due process, rendering the dismissal illegal.

3. Unpaid Wages

Non-payment of wages is another serious concern. Under the Labor Code, employees must be paid the full amount of wages due to them, regardless of the mode of termination. If an employee is terminated, their outstanding wages, benefits, and any separation pay must be settled promptly.

Failure to pay wages, especially after termination, violates the employee’s rights under Article 113 of the Labor Code, which prohibits any deduction from an employee’s wages without their consent. This is a labor standards violation and can result in penalties for the employer.

4. Legal Remedies for Unlawful Termination

Employees who believe they have been unlawfully dismissed can file a complaint with the National Labor Relations Commission (NLRC) or seek assistance from the Department of Labor and Employment (DOLE).

If the NLRC finds that the termination was unjust or illegal, the employee may be entitled to the following remedies:

Reinstatement to their former position without loss of seniority rights.
Full back wages from the time of dismissal until reinstatement.
If reinstatement is not possible, the employee may be awarded separation pay in lieu of reinstatement.

In addition, if the dismissal is determined to be without just cause and due process was not observed, the employee may be awarded moral and exemplary damages depending on the gravity of the employer’s misconduct.

5. Filing a Complaint with the NLRC

To file a complaint for illegal dismissal, the following steps must be taken:

Filing a Complaint: The employee must file a complaint with the NLRC, along with the relevant documentation, such as the termination notice (if any), employment contract, pay slips, and other relevant records.
Mediation and Arbitration: The NLRC will attempt to mediate the dispute between the employer and the employee. If mediation fails, the case will go through arbitration, where both parties will present their evidence.
Decision and Appeal: After arbitration, the labor arbiter will issue a decision. Either party may appeal the decision to the NLRC en banc, and subsequently to the Court of Appeals, if necessary.

6. Stress and Emotional Distress Claims

While Philippine labor law does not typically award compensation for emotional distress arising from wrongful termination, employees may still seek damages if they can prove that the employer’s actions were particularly egregious or malicious. For example, in cases of constructive dismissal—where an employee is forced to resign due to unbearable working conditions—courts have awarded moral and exemplary damages.

7. Employer Obligations under Philippine Law

Employers in the Philippines are bound by the following obligations under the Labor Code:

Payment of Wages: Employers must pay all outstanding wages, including any accrued benefits such as 13th month pay and unused leave credits.
Issuance of a Certificate of Employment: Upon separation, whether voluntary or involuntary, the employer must issue a Certificate of Employment (COE) upon request by the employee.
Separation Pay (if applicable): For employees terminated for authorized causes, separation pay must be provided as prescribed by law. For instance, employees terminated due to retrenchment are entitled to at least one month’s salary or half a month’s salary for every year of service, whichever is higher.

8. Preventive Suspension and its Misuse

There are instances where employers place employees under preventive suspension pending an investigation of misconduct. However, this suspension must be limited to a maximum of 30 days, unless a justifiable reason exists to extend it. Any misuse of preventive suspension, such as extending it indefinitely, may also be grounds for filing a labor complaint.

9. Small Claims Court for Unpaid Wages

For unpaid wages and smaller claims, employees may also opt to file a case in Small Claims Court, which provides a quicker and more streamlined process. This is often an option for recovering unpaid wages or salary, especially when the amount involved is below the threshold for NLRC complaints. However, the complexity of the case might still necessitate filing with the NLRC if it involves more than just monetary claims, such as wrongful termination.

Conclusion

In summary, unlawful termination and non-payment of wages are serious violations under Philippine labor law. Employees who find themselves in such a situation have several legal remedies at their disposal, including filing a complaint with the NLRC, seeking reinstatement or separation pay, and claiming damages for any undue hardship caused by the employer’s actions. It is critical for employees to understand their rights under the Labor Code and pursue legal action if these rights are infringed.