Probationary Employment

Who is a probationary employee?

A probationary employee is one who, for a given period of time, is being observed and evaluated to determine whether or not he is qualified for permanent employment. A probationary appointment affords the employer an opportunity to observe the skill, competence and attitude of a probationer. The word probationary┬Ł, as used to describe the period of employment, implies the purpose of the term or period. While the employer observes the fitness, propriety and efficiency of a probationer to ascertain whether he is qualified for permanent employment, the probationer at the same time, seeks to prove to the employer that he has the qualifications to meet the reasonable standards for permanent employment. (Escorpizo vs. University of Baguio Faculty Education Workers Union, G.R. No. 121962 [1999])

What is the governing law?

Probationary employment is governed by Article 281 of the Labor Code, which reads:

ART. 281. Probationary Employment. – Probationary employment shall not exceed six (6) months from the date the employee started working, unless it is covered by an apprenticeship agreement stipulating a longer period. The services of an employee who has been engaged on a probationary basis may be terminated for a just cause or when he fails to qualify as a regular employee in accordance with reasonable standards made known by the employer to the employee at the time of his engagement. An employee who is allowed to work after a probationary period shall be considered a regular employee.

What are the grounds for terminating a probationary employee?

Article 281 states that a probationary employee can be legally terminated: (1) for a just cause; or (2) when the employee fails to qualify as a regular employee in accordance with the reasonable standards made known to him by the employer at the start of the employment. The limitations in dismissing a probationary employee are:

First, this power must be exercised in accordance with the specific requirements of the contract.

Second, the dissatisfaction on the part of the employer must be real and in good faith, not feigned so as to circumvent the contract or the law;

Third, there must be no unlawful discrimination in the dismissal.

New Case

In the recent case of Dusit Hotel Nikko vs. Gatbonton (G.R. No. 161654, 5 May 2006), the Supreme Court found that the employer failed to present proof that the employee was evaluated or that his probationary employment was validly extended.

In this case, the employee was hired for a 3-month probationary period (the period provided by law is six months, but this may be shortened or, in appropriate cases, extended by agreement between the employer and the employee). For its defense, the employer claimed that the 3-month probationary employment was extended for another 2 months because the employee was not yet ready for regular employment. The employer presented, as proof, a Personnel Action Form containing the recommendation.

However, the Supreme Court noted that the Personnel Action Form: (1) was prepared on only in the fourth month, well after the 3-month period provided under the contract of employment; (2) the recommended action was actually termination of probationary employment, and not extension of probation period; (3) the action form did not contain the results of the respondent’s evaluation; (4) the action form spoke of an attached memo that allegedly contains the recommendation for extension, but the memo was not presented; (5) the action form did not bear the respondent’s signature.

Therefore, in the absence of any evaluation or valid extension, there is no basis to show if the employee indeed failed to meet the standards of performance previously set.

Effect of validly terminating a probationary employment

At the expiration of the probationary period, the status of the employee becomes regular. Since the employee in the Dusit Hotel Nikko case was not dismissed for a just or authorized cause, his dismissal was illegal, and he is entitled to reinstatement without loss of seniority rights, and other privileges as well as to full backwages, inclusive of allowances, and to other benefits or their monetary equivalent computed from the time his compensation was withheld from him up to the time of his actual reinstatement.

May a probationary employment be extended?

In Mariwasa Manufacturing, Inc. vs. Leogardo (G.R. No 74246, 26 January 1989), the Supreme Court stated that the extension of the probationary period was ex gratia, an act of liberality on the part of the employer affording the employee a second chance to make good after having initially failed to prove his worth as an employee. Such an act cannot unjustly be turned against said employer’s account to compel it to keep on its payroll one who could not perform according to its work standards. By voluntarily agreeing to an extension of the probationary period, the employee in effect waived any benefit attaching to the completion of said period if he still failed to make the grade during the period of extension.

105 thoughts on “Probationary Employment

  1. Joy2009

    Hi

    I’m on my sixth month.When I went to the office to work.They just told me that I am terminated na daw! I did not receive any notification or kung ano ang grounds ko.

    Thanks

    Reply
  2. cindy090709

    im 182 days with my employer yesterday (march 08, 2010)..my sup told me that im a regular employee by default coz im more than 6 months..she informed me, with that status ill be given another 2 months to prove myself.. i must admit that my scores were really low.. if in case my scores will not go up, she told me that i may be transfered to another department or be terminated…is it legal to extend another months for a full regularization & can they still terminate me if i will not get higher scores coz im regular employee by default?..
    your help will be gladly appreciated..many thanks..

    Reply
  3. arjaybriol@yahoo.com

    good day sir,
    Im rj i become a probitionary this last march 28,2010 as a company guard and so on this last may 5,2010 i was in my post the hr manager call me to there office and telleng me that i was early endo she said that the president wanted to endo me because he dont want my performance.is that fair for me as a probitionaty to early endo on very early without telleng or giving me a warning about my performance?

    Reply
  4. zarahhaze

    hello sir!
    i am thankful i found your site. i really need legal advice.i have just dismissed from work, actually 11 of us. now, we think the grounds thrown to us are unfair because some of our colleagues have the same grounds but they still remain in the institution… some of those grounds are the ff: 1.) we are not yet married, 2.) we are not yet finished with our masters degree, and some do not start schooling yet. i have been a contractual employee in the institution for 2 years, continues contract for 2 years, all is contractual. Every semester, we just renew our contract. Now, the administration fired us out on the last day of our contract without any notice that they won’t renew our contract for the next school year. they just told us that they won’t renew our contract for the first semester of the next school year with those grounds and just come back if we comply all those grounds. we have asked advice from DOLE and they passed us to the NLRC. We are advice to file illegal dismissal and backwages, and we did so. Now, i want to ask if we have fight on the case since we are only contractual.
    Thank you! i will be waiting for your response on this matter! God bless!!

    Reply
  5. HRM

    Hi Sir,

    Can I use the sample above, “ex gratia” to extend one of our employees probationary period to another 3 months? We did an assessment on his 5th month and another one on his 6th month. Still, we can’t tell or decide and we feel the time is not enough to determine if he is fit or not to be a regular employee.

    Many thanks.

    Reply
  6. mitch

    Hi Sir,

    Good day!

    Im an ESL Teacher who works in Japanese company here in Cebu. I would like to ask about my regularization rights, because just this month i signed a regularization contract but the problem is that my basic pay is still the same as my probationary pay. My questions are: Is it stated in the regularization law that as a regular employee my salary should increase? If it will how much percentage will it be? and if the company will not agree on it what legal actions should i take?

    Please do help me in, i really am not knowledgeable about our law.

    Thank you very much and more power

    Reply
  7. wifey

    Hi, Sir. I would like to seek advice regarding this matter that our family is currently undergoing. My husband was diagnosed with severe obstructive sleep apnea and is currently undergoing treatment for his condition. This means that he involuntarily dozes off during daytime(daytime fatigue). Unfortunately, this has been affecting his work badly. He is on his 5th month of probationary period at this certain company. He was advised by their HR personnel to make a letter of appeal on why they should retain my husband in the company and continue with the rest of his probationary status. I guess his co-workers and bosses thinks that him dozing off means that he is slacking off. My question is, is it legal for the company to terminate his employment based on their perception that he is incompetent. We have necessary documents to support that his episodes of “sleeping at work” is due to his sleep apnea and we’re currently doing something about it(meaning spending a big amount of money on the treatment). Based on his productivity, he is doing well, but he believes that this is overshadowed by the fact that some people in his office would see him doze off (note: my husband received several merit awards from his previous employer despite him having this condition). Is there a law here in the Philippines protecting people with sleep apnea against discrimination and unjust termination? I believe in the US there are certain laws pertaining to the protection of laborers diagnosed with sleep disorders such as this. Thank you very much.

    Reply
  8. Pingback: “At-Will” Employment and Due Process in Labor Law at Philippine e-Legal Forum

  9. keikei

    Good day!

    Is it a valid memo if you are warned thru e-mail? No printed papers and signature or so and no verbal agreement between employer and employee regarding that.
    Let’s say the company policy indicated that an employee is only allowed a maximum of 3 memos, what if those so-called memo’s were only sent thru e-mail, wasn’t even discussed. The employee just received it and the employer didn’t even require a feedback or at least an acknowledgement that the employee has received it and that he/she noted it or understood why he/she received that email.
    What if the employee already received that kind of mail 3x, does the employer have the right to terminate the employee under those circumstances?

    Reply
  10. reka

    Hi Sir!

    Could you please give me an advice on my current employment situation? I’m exactly on my 5th month of my probationary period today, Jan. 2, 2012, and on this same day, I decided to give a letter to inform my employer that I’ve decided to extend my service to the company up until the end of my probationary contract only, Feb. 2,2012. (My last month will also serve as my 30 days turn over period.)
    My question is: if ever my employer does not accept my letter of intent to end contract, do they still have a hold on me even after the end of my probationary contract expired? My immediate superior told me that there is a difference between a probationary contract and the typical 6 month non-probationary contract.

    I hope you could help me on this. Thanks! ­čÖé

    Reply
  11. laishetemasu

    Hi Sir,

    I am working in a call center company for more than 180 days or six months,my rating did not pass the required score to become a regular employee and I have not signed an agreement that I will be given and extension if ever I will not pass the required score.Is it true that I am already considered a regular employee?If I was just given an extension what should be the correct process?

    Reply
  12. ABDONICHIE

    Gudevning Sir..

    I am a probationary employee and has worked for a certain company for 2 months and I decided to resign. Right now, the company is holding my salary.. Is it right for them to do that? Could I demand for my salary?
    Am I required to stay for at least one month?or would a 2-week notice be enough?

    Reply
  13. rahsc_07

    Contract Terminated by Employer.

    A new employee has been hired by an outsourcing company (employer) and been handed out to our client.

    After a week, he/she was forced by my employer to resign because of the skills did not fit on the project said by the client.

    Factors to consider:
    1. He/she passed the interview made by the employer
    2. He/she passed the interview made by the client

    Another issue was the schedule.

    The employer and the employee agreed that there will be no Sunday work during the interview and before signing the contract. The employer told the employee that there will be Sunday work but it will be a rare case and it can be arranged with the client Team Lead if the schedule was appointed to him/her, by swapping.

    After the client orientation to the employee on the 2nd day. The schedule agreement was not mentioned to the client by the employer. Then the next day, the client decided to report the issue to the employer.

    The employer decided to wave the contract and pay the employee amounting half month of his/her salary. And will provide a Quit Claim to be signed before giving the money.

    Can you please help the employee with this case?

    Reply
  14. Rannie

    From what I’ve read so far, from this blog site as well as other online sources, probationary status can indeed be extended, but only if notice is duly given prior to expiration of the six-month probationary period, NOT after it has expired. The head of our HR, a lawyer, says that that provision of the “Herrera Law” covers only rank-and-file employees, not officers. Therefore, officers can be terminated anytime. Is that statement factual or accurate? Thanks!

    Reply
  15. michael paul

    I’m an employee at an English language school. I have been working in this academy for 1 year and 2 months.The last time i signed my contract was in November 2011. The said contract only lasted for 2 months, that is, from November until the end of December. After the end of the contract, the company did not let me sign another new contract. However, the company wanted me to sign a new contract after one and a half months without any further explanations.Instead, I was verbally notified by my Head teacher that I wouldn’t be able to receive my salary if I didn’t sign the said contract. Despite that fact, I did not sign a new contract. My questions now are; first, Am I already considered as a regular employee in this company?(knowing that I’ve already been working for more than a year). Second, Is there a strong possibility that the company will terminate my status since i did not sign a new contract? Third, What advice could you give me?

    Reply

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