PHILIPPINES Law and Practice Contributed by: Rashel Ann C Pomoy and Paolo Miguel Consignado, Villaraza & Angangco
the operations and/or shut-down of the establishment of the employer. It requires the following conditions to be permissible: • the management’s decision to close or cease busi - ness operations; • such decision is made in good faith; and • there is no other option available to the employer except to close or cease operations. 7.2 Notice Periods Notice Requirements and Periods In cases of termination based on just cause, the employer must observe due process, which involves issuing two written notices. • The first notice should contain: (a) the specific causes or grounds for termination as provided for under Article 297 of the Philip - pine Labour Code and company policies, if any; (b) a detailed narration of the facts and circum - stances that will serve as the basis for the charge against the employee; and (c) a directive that the employee is given the op - portunity to submit a written explanation within a reasonable period, which is construed as at least five calendar days from receipt of notice. • After this, the employer must ensure the employee has an opportunity to be heard, either verbally or in writing, with counsel if they desire. A formal hearing is not necessary, except under any of the following circumstances: • when requested by the employee in writing; • when substantial evidentiary disputes exist; • when a company rule or practice requires it; or • when similar circumstances justify it. If the employer determines that dismissal is justified after considering the employee’s explanation, a sec - ond notice is issued confirming that all relevant facts have been taken into account and that valid grounds for termination exist. Both notices must be delivered personally or sent to the employee’s last known address.
Thus, external advice or authorisation for just causes is not required, as the process involves the employer and employee. Due process for authorised causes shall be deemed complied with upon service of a written notice speci - fying the ground/s for termination to the employee and the appropriate Regional Office of the Department of Labour and Employment (DOLE) at least 30 days before the termination takes effect. External notifica - tion to the DOLE is mandatory. Non-compliance with due process without affording the employee proce - dural due process will not render the dismissal inef - fectual, but will entitle the employee to an indemnity of PHP50,000 in the form of nominal damages. While disease is deemed an authorised cause for ter - mination, case law has held that due process in ter - mination due to disease is similar to due process for just cause termination. Specifically, the employer must furnish the employee with two written notices, namely: • a first notice informing the employee of the grounds for termination and allowing them to respond; and • a second notice informing the employee of the decision to terminate their employment. As mentioned in 7.1 Grounds for Termination , the employer must also obtain a certification from a com - petent public health authority stating that the disease is of such a nature or at such a stage that it cannot be cured within six months, even with proper medical treatment. Severance/Separation Pay Separation pay is generally only required for author - ised causes, the amounts of which are provided as follows: • separation pay equivalent to at least one month’s pay or at least one month’s pay for every year of service, whichever is higher: (a) installation of labour-saving devices; or (b) redundancy; and
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