Dear Atty. Kathy,
We are a group of employees who were dismissed in 2011 and filed an illegal dismissal case in 2012, which is still pending before the court. The employer is claiming that the contract with the principal expired, so we could not report for work anymore. Is this a valid reason to terminate our employment? Also, the employer is trying to settle the case with us, by offering separation pay to finally close the case. But our group is split — some want the separation pay and some want to go back to their work with the employer. A friend who had a similar case told me that since it has been a long time, the court will just rule to give us separation pay. Is this correct?
John
***
Dear John,
The expiration of contract is not a just or authorized cause to dismiss an employee. The just or authorized causes to dismiss an employee are provided for in Articles 297 to 299 of the Labor Code, as follows:
Article 297. Termination by employer. An employer may terminate an employment for any of the following causes:
a. Serious misconduct or willful disobedience by the employee of the lawful orders of his employer or representative in connection with his work;
b. Gross and habitual neglect by the employee of his duties;
c. Fraud or willful breach by the employee of the trust reposed in him by his employer or duly authorized representative;
d. Commission of a crime or offense by the employee against the person of his employer or any immediate member of his family or his duly authorized representatives; and
e. Other causes analogous to the foregoing.
Article 298. Closure of establishment and reduction of personnel. The employer may also terminate the employment of any employee due to the installation of laborsaving devices, redundancy, retrenchment to prevent losses or the closing or cessation of operation of the establishment or undertaking unless the closing is for the purpose of circumventing the provisions of this Title, by serving a written notice on the workers and the Ministry of Labor and Employment at least one month before the intended date thereof. In case of termination due to the installation of labor-saving devices or redundancy, the worker affected thereby shall be entitled to a separation pay equivalent to at least his one month pay or to at least one month pay for every year of service, whichever is higher. In case of retrenchment to prevent losses and in cases of closures or cessation of operations of establishment or undertaking not due to serious business losses or financial reverses, the separation pay shall be equivalent to one-month pay or at least one-half month pay for every year of service, whichever is higher. A fraction of at least six months shall be considered one whole year.
Article 299. Disease as ground for termination. An employer may terminate the services of an employee who has been found to be suffering from any disease and whose continued employment is prohibited by law or is prejudicial to his health as well as to the health of his co-employees: Provided, that he is paid separation pay equivalent to at least one month salary or to one-half month salary for every year of service, whichever is greater, a fraction of at least six months being considered as one whole year.
As ruled by the Supreme Court, nowhere in these just or authorized causes mention expiration of contract. Thus, it was illegal for the employer to terminate your employment due to the expiration of contract with the principal.
Since it appears that you were illegally dismissed, you shall be entitled to reinstatement without loss of seniority rights and other privileges, and to full backwages, inclusive of allowances and to other benefits or their monetary equivalent computed from the time your compensation was withheld up to the time of actual reinstatement. If reinstatement is not possible, however, the award of separation pay is proper.
Based on your narration, you were dismissed in 2011, or 13 years ago. In such cases, where a long time has passed since the termination of employment, for practical reasons and to serve the best interest of the parties, the Court deems it proper to award separation pay instead of reinstatement. Thus, instead of reinstatement, you may be entitled to separation pay equivalent to one month’s salary for every year of service, from the date of the illegal dismissal until the finality of the court’s decision.
(Ernesto C. Luces, et al. versus Coca-Cola Bottlers Phils. Inc., et al., G.R. 213816, 02 December 2020)
Atty. Kathy Larios