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In this second type of resignation, the employee need not serve a written notice. Forced
resignation is not allowed and is considered “constructive” dismissal – a dismissal in
disguise. Employee retirement is either voluntary or compulsory under Art. 287 of the
Labor Code.
Reinstatement means restoration of the employee to the position from which he or she
has been unjustly removed.
Reinstatement without loss of seniority rights means that the employee, upon
reinstatement, should be treated in matters involving seniority and continuity of
employment as though he or she had not been dismissed from work.
When a Labor Arbiter rules for an illegal dismissal, reinstatement is immediately
executory even pending appeal.
Full Backwages
Full backwages refer to all compensations, including allowances and other benets with
monetary equivalent, that should have been earned by the employee but was not
collected by him or her because of unjust dismissal. It includes all the amounts he or
she could have earned starting from the date of dismissal up to the time of
reinstatement.
In cases of illegal dismissal, a dismissed employee who has found another job may still
be entitled to collect full backwages from his or her former employer. Full backwages is
a form of penalty imposed by law on an employer who illegally dismisses his or her
employee. The fact that the dismissed employee may already be employed and earning
elsewhere does not extinguish the penalty.
The former position of the employee no longer exists at the time of reinstatement
In that case, the employee shall be given a substantially equivalent position in the same
establishment without loss of seniority rights and to backwages from the time
compensation was withheld up to the time of reinstatement.
Separation Pay
In authorized cause terminations, separation pay is the amount given to an employee
terminated due to retrenchment, closure, or cessation of business or incurable disease.
The employee is entitled to receive the equivalent of one month pay or one-half month
pay, whichever is higher, for every year service.
In just cause terminations, separation pay is also the amount given to employees who
have been dismissed without just cause and could no longer be reinstated.
During the pendency of the termination case, an employee may be retained in his
or her work.
An employee may be retained in his or her work even during the pendency of a
termination case under the following circumstances:
1. Upon serving the preventive suspension period of 30 days; and 2. Upon management
prerogative allowing the employee to be retained at work and his or her continued
employment poses no serious nor imminent threat to the life or property of the employer
or his or her co-employees.