10. PREVENTIVE SUSPENSION.(Gatbonton v. NLRC, 479 SCRA 416 [2006].

10.1 Nature of preventive suspension. –Preventive suspension is a disciplinary

measure for a protection of the company’s property pending investigation of any
alleged malfeasance committed by the employee.

10.2 Requirements.—

The employer may place the worker concerned under preventive

suspension if his continued employment poses a serious and imminent threat to
the life or property of the employer or of his co-workers. However, when it is
determined that there is no sufficient basis to justify an employee’s preventive
suspension, the latter is entitled to the payment of salaries during the time of
preventive suspension.

10.3 Preventive suspension is not a penalty.

10.4 Preventive suspension cannot exceed thirty (30) days.

10.5 When preventive suspension exceeds the maximum period allowed without
reinstating the employee either by actual or payroll reinstatement or when
preventive suspension is for indefinite period, only then will constructive
dismissal set in. (Mandapat v. ADD Force Personnel Services,Inc.,G.R. No.
180285, July 06, 2010, citing Hyatt Taxi Services, Inc.v. Catinoy, G.R.
No.143204, June 26, 2001 and Pido v. NLRC, 516 SCRA 609 [2007].)

11. TEMPORARY LAY-OFF.

There is no specific provision of law which treats of a temporary retrenchment or

lay-off and provides for the requisites in effecting it or a period or duration therefor.
These employees cannot however be forever “temporarily” laid-off. To remedy this
situation, Article 286 may be applied but only by analogy to set a specific period that
employees may remain temporarily laid-off or in floating status (while business operation
are suspended)for only a period of six months.

After six (6) months, the employees should either be recalled to work or
permanently retrenched in accordance with the requirements of law. Failing to comply
with this would be tantamount of dismissing the employees without cause, and holding
employer liable for such illegal dismissal. (Sebuguero v. NLRC, 245 SCRA 532 [1995]).
See also: Mindanao Terminal and Brokerage Service Inc., v. Nagkahuisang Mamumuo sa
Minterbro- Souther Philippines Federation of Labor, etc., G.R.No. 174300,05 December
2012.)
 a floating status of more than six (6) months constitutes constructive dismissal.
(Emeritus Security and Maintenance Systems, Inc., v. Dailig, G.R no. 204761, 02 April
2014, citing Nationwide Security and Allied Services v. Valderama , G.R. No. 186614, 23
February 2011.)

12. TEMINATION OF EMPLOYMENT BY THE EMPLOYEE

“Art. 285. Termination by employee. ---

a. An employee may terminate without just cause the employee-employer

relationship by serving a written notice on the employer at least one (1) month
in advance. The employer upon whom no such notice was served may hold the
employee liable for damages.

b. An employee may put an end to the relationship without serving any notice
on the employer for any of the following just causes:
1. Serious insult by the employer or his representative on the honor and
person of the employee;

2. Inhuman and unbearable treatment accorded the employee by the

employer or his representative;

3. Commission of a crime or offense by the employer or his representative

against the person of the employee or any of the immediate members of his
family; and

4. Other causes analogous to any of the foregoing.”

12.1 Resignation, defined. ---

Voluntary resignation is defined as the act of an employee, who friends himself in
a situation in which he belies that personal reasons cannot be sacrificed in favor of the
exigency of the service; thus, he has no other choice but to disassociate himself from his
employment. (Alfaro v. Court of Appeals, 363 SCRA 799 [2001]).
NOTE: In termination of employment by the employee: The intent relinquish must
concur with the overt act of relinquishment. (Mendoza v. HMS Credit Corp., et al., G.R.
No. 187232, 17 April 2013; citing San Miguel Properties v. Gucaban, 654 SCRA 18
[2011[).
12.2 If resignation is not voluntary, the same can be deemed to be a constructive
dismissal. ---
In St. Michael Academy v. National Labor Relations Commission (292 SCRA
478 [1998]), the supreme court ruled that mere allegations of threat or force do not
constitute substantial evidence to support a finding of forced resignation. We enumerated
the requisites for intimidation as follow: (1) that the intimidation caused the consent to be
given; (2) that the threatened act be unjust or unlawful; (3) that the threat be real or
serious, there be being evident disproportion between the evil and the resistance which is
forced on the person to do as the lesser evil; and (4) that it produces a well-grounded fear
from the fact that the person from whom it comes has the necessary means or ability to
inflict the threatened injury to his person or property. (See also: Mandapat v. ADD Force
Personnel Services, Inc., G.R No. 180285, July 2010.)
12.3 There can be no valid resignation where the act was made under compulsion, or
under circumstances approximating compulsion, such as when the employee’s act
of handing in his resignation was a reaction to circumstances leaving him no
alternative but to resign. (Metro Transit organization, Inc. v. NLRC, 348 Phil. 334
[1998]; cited in Peñaflor v. Outdoor Clothing Manufacturing Corporation, G.R.
No. 177114, January 21, 2010.)
12.4 Expressions of gratitude cannot possibly come from an employee who is just
forced to resign as they belie allegations of coercion. (Globe telecom v. Crisologo,
529 SCRA 811 [2007] citing St. Michael Academy v. NLRC, ibid.)
12.5 Voluntary resignation, once accepted, cannot be withdrawn without the
consent of the employer. (Intertrod Maritime, Inc. v. NLRC, 198 SCRA 318
[1991].)
12.5.1 The acceptance by the Company of the employee’s resignation rendered the same
effective. Upon such acceptance, it may not be unilaterally withdrawn without the
consent of the employer. When the employee later signified the intention of
continuing his or her work, it was already up to the employer to accept the
withdrawal of his or her resignation. The mere fact the withdrawal was not
accepted does not constitute illegal dismissal, the acceptance of the withdrawal of
the resignation being the employer’s sole prerogative. (BMG Record [Phils.], Inc.
v. Aparecio, 532 SCRA 300 [2007]; Emphasis Supplied.)
12.5.2 As held in Intertrod Maritime, Inc. v. NLRC, ibid.:
“Once an employee resigns and his resignation is accepted, he no longer
has any right to the job. If the employee later changes his mind, he must
ask for approval of the withdrawal of his resignation from his employer,
as if he were re-applying for the job. It will then be up to the employer to
determined whether or not his service would be continued. If the employer
accepts said withdrawal, the employee retains his job. If the employer
does not x x x the employee cannot claim illegal dismissal for the
employer has the right to determined who his employee will be. To say
that an employee who has resigned is illegally dismissed, is to encroach
upon the right of the employers to hire persons who will be of service to
them. “(BMG Records (Phils.), Inc. v. Aparecio, 532 SCRA 300 [2007];
Emphasis supplied.)
12.6 General rule: An employee who voluntarily resigns is not entitled to separation
pay.
 Exemption: Unless stipulated in an employment contract or CBA or sanctioned
by established employer practice or policy. (CJT Trading, Inc. v. NLRC, 246
SCRA 724 [1995]; Alfaro v. Court of Appeals, 363 SCRA 799 [2001].)\
12.7 Voluntary resignation and illegal dismissal are adversely opposed modes of
terminating employment relations, in that the presence of one precludes that of the
other. (Alfaro v. court of Appeals, ibid.)

12.8 Resignation as a defense in termination cases. ---

Citing Mora v. Avesco (G.R. No. 177414, November 14, 2008, 571 SCRA 226),
the Supreme Court ruled that should the employer interpose the defense of
resignation, it is still incumbent upon the employer to prove that the employee
voluntarily resigned. (Peñaflor v. Outdoor Clothing Manufacturing Corporation,
G.R. No. 177114, April 13 2010).
12.9 (Resignation letters), with the allegations of coercion later made by complainant,
are belied by words of gratitude coming from the employee who is just forced to
resign. (Auza, Jr., et al . v. MOL Phil., Inc., G.R. No. 175481, 21 November 2012;
citing globe Telecomv. Crisologo, 529 SCRA 811 [2007].)

13. RETIREMENT. (R.A 7641, approved on 9 December 1992.)

13.1 Age requirement:
Compulsory- upon reaching 65 years of age; with at least five (5) years of service.
Optional- upon reaching 60 years of age; with at least 5 years of service; at the
option of the employee.
13.2 Components of Retirement Pay:
a.) 15 days based on the employee’s latest salary;
b.) One-twelfth (1/12) of the 13th month pay; and
c.) Cash equivalent of the five (5) days service incentive leave.
Computation: 22.5 days x number of year of service. (Capitol Wireless
v. Confessor, 264 SCRA 68 [1996]).
22.5 days is computed at 15 days PLUS 2.5 days representing 1/12 of the
th
13 month pay PLUS 5 days of service incentive leave.
13.3 Republic Act. No. 7641 or the retirement pay law shall apply to all employees in
the private sector, regardless of their position, designation or status and
irrespective of the method by which their wages are paid. They shall include part-
time employees, employees of service and other job contractors and domestic
helpers or persons in personal service of another. However, the law does not
cover employees of retail, service and agricultural establishments or operations
employing not more than (10) employees or workers and employees of the
 National Government and its political subdivisions, including Government owned
and/or controlled corporations, if they are covered by the Civil Service Law and
its regulations. (Postigo v. Phil., Tuberculosis Society, 479 SCRA 628 [2006]).
13.4 The retirement pay payable under Acticle. 287 of the Labor Code as amended by
Rep. Act No. 7641 should be considered apart from the retirement benefit
claimable under the social security law or the GSIS law. (ibid).

13.5 Difference between Termination of Employment and Retirement

While termination of employment and retirement from service are
common modes of ending employment, they are manually exclusive with varying
judicial bases and resulting benefits from the service is contractual (i.e., based on
the bilateral agreement of the employer and employee), while termination of
employment is statutory (i.e., governed by the Labor Code and other related laws
as to its grounds, benefits and procedure). The benefits resulting ffrom
termination vary, depending on the cause. For retirement, Article 287 of the Labor
Code gives leeway to the parties to stipulate above or floor benefits. (General
Milling Corporation v. Viajar, G.R. No. 181783, 30 January 2013; Cting
Quevedo v. Benguet Eletric Cooperative, Inc. 599 SCRA 438 [2009]).

13.6 Difference Between Voluntary And Involuntary Retirement

Voluntary retirement cuts employment ties leaving no residual employer
liability, involuntary retirement amounts to a discharge, rendering the employer
liable for termination without cause. The employee`s intent is the focal point of
analysis. In determining such intent, the fairness of the process governing the
retirement decision, the payment of stipulated benefits, and the absence of badges
of intimidation or coercion are relevant parameters.(ibid.)

13.7 May an employer unilaterally retire an employee earlier than the legally
permissible ages under the Labor Code? (Lourdes A.Cercado v.UNIPROM,
Inc.,G.R. No.188154, 13 October 2010.)
Retirement is the result of a bilateral act of the parties, a voluntary
agreement between the employer and the employee whereby the latter, after
reaching a certain age, agrees to sever his or her employment with the former.
Acceptance by the employees of an early retirement age option must be
explicit, voluntary, free, and uncompelled. While an employer may unilaterally
retire an employee earlier than the legally permissible ages under the Labor Code,
this prerogative must be exercised pursuant to mutually instituted early retirement
plan. In other words, only the implementation and execution of the option maybe
unilateral, but not the adoption and institution of the retirement plan containing
such option. For the option to be valid, the retirement plan containing it must
voluntarily assented to by the employees or at least by a majority of them through
a bargaining representative.
 The following pronouncements in Jaculbe v. Silliman University (518 SCRA 445
[2007] are elucidating:
“[A]n employer is free to impose a retirement age less than 65 for as long
as it has the employees consent. Stateted conversely, employees are free to accept
the employers offer to lower the retirement age if they feel they can get a better
deal with the retirement plan presented by the employer.”

13.8 In the following cases, the retirement plans in issue were the result of
negotiations and eventual agreement between the employer and the
employees.
In Pantranco North Express, Inc., v. NLRC, (328 Phil.470[1996]), the
court upheld the retirement of private respondent pursuant to a Collective
Bargaining Agreement (CBA) allowing Pantranco to compulsorily retire
employees upon completing 25 years of service to the company. Interpreting
Article 287, the court ruled that the Labor Code permits employers and employees
to fix the applicable retirement age lower 60 years of age. The Court also held that
there was no illegal dismissal involved, since it was the CBA itself that
incorporated the agreement between the employer and the bargaining agent with
respect to the terms and conditions of employment. Hence, when the private
respondent ratified the CBA, he concurrently agreed to conform to and abide by
its provisions. Thus, the Court stressed “[p] providing in a CBA for compulsory
retirement of employees after twenty five (25) years of service is legal and
enforceable so long as the parties agree to governed by such CBA. “
Similarly in Philippine Airlines, Inc., (PAL) v. Airlines Pilots Association
of the Philippines (APAP) (424 Phil. 356[2002]), the retirement plan contained in
the CBA between PAL and APAP was declared valid. The Court explained that
by their acceptance of the CBA, APAP and its members are obliged to abide by
the commitments and limitations they had agreed to cede to management.
The foregoing pronouncements served as guiding principles in the recent Cainta
Catholic School v. Cainta Catholic School Employees Union (CCSEU) (489
SCRA 468 [2006]), where in the compulsory retirement of two teachers was
upheld as valid and consistent with the CBA provision allowing an employee to
be retired by the school even before reaching the of 60, provided that he /she had
rendered 20 years of service.
In Progressive Development Corporation v. NLRC (398 Phil., 433
[2000]), although the retirement plan was not embodied in a CBA, its provisions
were made known to the employees union. The validity of the retirement plan was
sustained on the basis of the finding of the Directors of the Bureau of Working
Conditions of the Department of Labor and Employment that it was expressly
made known to the employees and accepted by them.
It is axiomatic that a retirement plan giving the employer the option to
retire its employees below the ages provided by law must be assented to and
accepted by the latter, otherwise, its adhesive imposition will amount to a
deprivation of property without due process of law.