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For this week, please submit a 4-paged handwritten discussion of the 5 just causes (art 296)

and the 5 authorized causes (arts 297 & 298) of dismissal. Include their elements, if
applicable. Please submit to ms eis not later than saturday next week, sep30. No meeting
today. Thanks


Just causes for dismissal of employee may be defined as those lawful or valid grounds for
termination of employment which arise from causes directly attributable to the fault or
negligence of the erring employee. Just causes are usually serious or grave in nature and
attended by willful or wrongful intent or they reflected adversely on the moral character of the

As opposed to authorized causes under Article 283 wherein the termination of employment is
dictated by necessity of the business, the dismissal under just causes is imposed by the
employer to the erring employee as a punishment for the latters acts or omission.

Just Causes Under the Labor Code

Just causes for termination under the Labor Code is found in Article 282 and enumerated here
as follows:

1. Serious misconduct. Serious misconduct is an improper conduct willful in character and

of such grave nature that transgressed some established and definite rule of action in
relation to the employees work.
2. Willful disobedience to lawful orders. The employees are bound to follow reasonable
and lawful orders of the employer which are in connection with their work. Failure to do
so may be a ground for dismissal or other disciplinary action.
3. Gross and habitual neglect of duties. Gross negligence has been defined as the want or
absence of or failure to exercise slight care or diligence, or the entire absence of care. It
evinces a thoughtless disregard of consequences without exerting any effort to avoid
4. Fraud or willful breach of trust / Loss of confidence. Fraud is any act, omission, or
concealment which involves a breach of legal duty, trust, or confidence justly reposed
and is injurious to another.
5. Commission of a crime or offense. Commission of a crime or offense by the employee
against his employer or any immediate member of his family or his duly authorized
representative, is a just cause for termination of employment.
6. Analogous causes. Other causes analogous to the above grounds may also be a just
cause for termination of employment.

Examples of Analogous Causes

1. Abandonment. Abandonment of job is a form of neglect of duty. There is abandonment
when the employee leave his job or position with a clear and deliberate intent to
discontinue his employment without any intention of returning back.
2. Gross inefficiency. Gross inefficiency is analogous to and closely related to gross neglect
for both involve acts or omissions on the part of the employee resulting in damage to
the employer or to his business. (See Lim vs. NLRC, G.R. No. 118434, July 26, 1996.)
3. Disloyalty/conflict of interest. Disloyalty exists when one asserts an interest, or
performs acts adverse to ones employer, such as secretly engaging in a business which
renders him a competitor and rival of his employer. It constitutes a breach of an implied
condition of the contract of employment. (See Elizalde International vs. Court of
Appeals, G.R. No. L40553 February 26, 1981.)
4. Dishonesty. Acts of dishonesty deemed to be patently inimical to the employer is
analogous to breach of trust and is a valid cause for termination of employment.

No Separation Pay

An employee who is terminated from employment for a just cause is not entitled to payment of
separation benefits. Section 7, Rule I, Book VI, of the Omnibus Rules Implementing the Labor
Code provides:

Sec. 7. Termination of employment by employer. The just causes for terminating the services
of an employee shall be those provided in Article 282 of the Code. The separation from work of
an employee for a just cause does not entitle him to the termination pay provided in Code,
without prejudice, however, to whatever rights, benefits and privileges he may have under the
applicable individual or collective bargaining agreement with the employer or voluntary
employer policy or practice.

Security of tenure is a constitutionally guaranteed right in the Philippines. Thus, for an

employer to validly dismiss an employee, substantive and procedural due process under law
should be complied with. Substantive due process means that the termination must be based
on just and/or authorized causes for dismissal. On the other hand, procedural due process
requires the employer to effect the dismissal in a manner specified in the Labor Code and its
implementing rules (Deoferio v. Intel Technology Philippines, Inc., G.R. No. 202996, June 18,
Under Article 297 (previously Art. 282) of the Labor Code, as amended, the following are
deemed just causes to terminate an employee:

1. Serious misconduct or willful disobedience by the employee of the lawful orders of his
employer or representative in connection with his work;
2. Gross and habitual neglect by the employee of his duties:
3. Fraud or willful breach by the employee of the trust reposed in him by his employer or
duly authorized representative;
4. Commission of a crime or offense by the employee against the person of his employer
or any immediate member of his family or his duly authorize representative; and
5. Other causes analogous to the foregoing.

To comply with procedural due process when terminating an employee for a just cause, the
following should be done:

1. The first written notice to be served on the employees should contain the specific
causes or grounds for termination against them, and a directive that the employees are
given the opportunity to submit their written explanation within a reasonable period or
at least five (5) calendar days.
2. After serving the first notice, the employers should schedule and conduct a hearing or
conference wherein the employees will be given the opportunity to: (1) explain and
clarify their defenses to the charge against them; (2) present evidence in support of
their defenses; and (3) rebut the evidence presented against them by the
3. After determining that termination of employment is justified, the employers shall serve
the employees a written notice of termination indicating that: (1) all circumstances
involving the charge against the employees have been considered; and (2) grounds have
been established to justify the severance of their employment. [King of Kings Transport,
Inc. v. Mamac, 553 Phil. 108 (2007)].
Labor Laws in the Philippines allow employers to terminate employees. The termination, however, must
not be based on mere whim or caprice of the employer against his employee. It must stand on
reasonable ground for the termination to be considered legal. These grounds are called the Authorized
Causes of Termination.

Differentiated from the Just Causes of Termination, Authorized causes are those which do not arise from
fault or negligence of the employee. These authorized causes are attributable to the employer and are
anchored on management prerogative. Enumerated as the authorized c1auses are: 1) Installation of
Labor-Saving Devices, 2) Redundancy, 3) Retrenchment to Prevent Losses, 4) Closure or Cessation of
Operation and 5) Disease.

Installation of labor-saving devices concerns the introduction of machinery or automation processes in

the work system in order to improve productivity.

Redundancy happens when there is an overlap of the services rendered by employees than what is
required in the business. This may result from decreased volume of business or the dropping of a
product or service previously offered by the company.

Retrenchment to prevent losses involves the preemptive cutting of costs in salaries and wages in order
to avoid perceivable business losses. The losses perceived must be serious, actual and real.

Closure or cessation of business points to the actual shutting down of a business. The closure
may be total or partial, as when only a department ceases its operations. The cessation of business is
essential to thwart the establishments further financial drain.

Lastly, an employee may be terminated because of the affliction of a disease. The continued
employment of the sick person must be prejudicial to his health and his co-workers. The disease must
also be one that is not curable within 6 months even with proper medical treatment.

Proper due process must be observed when dismissing employees due to authorized causes. If the
basis is installation of labor-saving devices, redundancy, retrenchment to prevent losses and closure or
cessation of operations, the employer is mandated to serve written notice to both the employee and the
concerned Regional Office of the Department of Labor at least 30 days before the effectivity of the

In addition, the termination for an authorized cause must be attended with good faith. There must also be
a fair and reasonable criteria in the selection of employee termination. In the appropriate cases,
separation pay must be paid to the employee at the time of his dismissal from work.
On the other hand, the following are the authorized causes of termination under Articles 298
and 299 (previously Arts. 283 and 284, respectively) of the Labor Code:

1. Installation of labor-saving devices;

2. Redundancy;
3. Retrenchment to prevent losses;
4. Closing or cessation of operation of the establishment or undertaking unless the closing
is for the purpose of circumventing the provisions of the Title; and
5. Suffering from any disease and whose continued employment is prohibited by law or is
prejudicial to his health as well as to the health of his co-employees.

To comply with procedural due process when terminating an employee for authorized causes,
the following must be observed: (1) the employer should serve a written notice both to the
employees and to the Department of Labor and Employment at least one month prior to the
intended date of termination; and (2) the employer should pay the employee separation pay
under the Labor Code.