“At-Will” Employment and Due Process in Labor Law

Among the first concepts that we have to extensively discuss with foreign clients is the absence of “at-will employment” under Philippine labor law. “At-will employment” basically refers to an employment arrangement wherein either the employer or the employee can terminate the relationship even without cause. In the Philippines, the employer can only terminate an employee for cause and after complying with due process.

Termination for cause. Termination may be based on just causes (e.g., serious misconduct or willful disobedience, gross and habitual neglect, loss of trust and confidence, commission of a crime) or authorized causes (e.g., retrenchment, redundancy, installation of labor saving device, serious business losses). There are other reasons for the cessation of employment, including the expiration of a fixed-term contract or project employment. This requires a more extensive discussion, perhaps in another article.

Due process requirements. The employer must comply with procedural requirements in terminating an employee. The employer is required to furnish the employee with two written notices and, as a general rule, conduct an administrative hearing. The first written notice, commonly known as the show-cause notice, informs the employee of the charges and requires him to explain. The second written notice contains the decision of the company.

Any termination without cause is considered as illegal dismissal, which entitles the employee to backwages and reinstatement (or separation pay in certain instances). A termination for cause, but without due process, renders the employer liable for damages.

In sum, a manager or the Chief Executive Officer cannot simply call a worker to his office and, right there and then, tell the employee, “You’re fired!” It does not matter if the employee is rank-and-file, a supervisor or a manager. Even a probationary employee is entitled to due process.

10 thoughts on ““At-Will” Employment and Due Process in Labor Law

  1. Pingback: will Employment and Due Process in Labor Law | News articles - Featuring key to success

  2. willingslave

    I would just like to ask if its justifiable to suspend a employee for 15 working days due to losing an O.R? I would also like to inquire on how should employers imply salary deductions? Can employers deduct the total incurred salary on each payday? Is it justifiable to deduct the employees salary even if he will not have any money for the next 15 days?

  3. jvclem

    I worked as consultant assigned in private company (client) under an IT provider company.

    Me and our client are agreed to end up my stay with them due to performance level issue. My provider is asking me for a revenue liabilities loss due to terminating my contract with them. Prior to this one, client already inform them about this issue and the provider does not make any actions until such time that me and our client both agreed to end it up.

    But pinipilit pa rin kasi ng provider na pumasok pa rin daw ako until a certain period but me and our client agreed to end it up already.

    My question is, do I have a legal obligation to them (provider) to pay the amount of my entire contract or equivalent considering na ayaw na ng client sa service ko sa kanila due to a certain issues?

    Right now kasi, the provider is claiming also for this amount from me as they insist that this is under my contract with them na kapag hindi natapos yung contract ay may certaim amount ako na dapat bayaran.

    Ano po ba ang aking karatan para dito? Ang gusto ko lang naman kasi is to end up my employment contract with them (Provider and Client) without any financial obligation to settle kasi hindi na rin naman maganda ang working relationship namin between me and the client.

    1. Charm


      I have the same case with jvclem. Since i have submitted immediate resignation, the company will deduct an amount of Php350 x 30 days = Php10,500 from my last pay (backpay).

      I am a regular employee and does not have any bond amount with the company.
      Is this legal?


  4. robertjohn28

    I am angry with the firm who are not paying overtime correctly, Even they are abused to employees etc.

  5. kareengrace.lacorte

    Can an employer deny the issuance of BIR 2316 if the resigned employee still has existing payables to them?

  6. Ariel

    I just want to ask my previous work is in the hospitality industry. I file a resignation letter last year and it take effect October 15, 2015.Now this is the start of my long story…the mgt. Hold my resignation up to December 2015 because peak season daw so I agree then the owner ask me if I can stay pa for one month that’s January 2016 and I agree din. Nagkabilihan pero Hindi nag change ng company name kasi yung one of the old owner yung bumili ng stock of the other owners. That was happened December 2015 pero nag bigay sila ng gratuity fee for all the employees kaso saakin 2,000 lng kasi daw resigned ako. Tapos now naman don sa BIR form ko ang refund ko 56.00.Samantalang nong 2014 ang narefund ko is 3,500.00. Ang tanung ko po makatarungan po ba itong ginawa saakin?

  7. miguel

    i was terminated by my company a few days ago for just reasons. i’m not contesting my violation of company rules my question is, they gave me the written termination notice on “payday” itself. we usually get our pay around 6pm in the evening and the company gave me my termination notice around 9pm. HR said they are holding my pay for that particular pay period and will include it in my “last pay”,after i’m done processing my clearance. my question is, is it legal for them to do so? because i feel that when everyone got their pay in their ATM at 6pm, technically i was still employed because the termination notice wasn’t given to me yet. I need your advice on this.

    Thank you.

  8. Teresita

    Is it legal to stipulate in the contract that the employer can terminate an employee without cause? The employment is under a Memorandum of Agreement.


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