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May separation pay be awarded despite the validity of dismissal?

  • Writer: Legis Lative
    Legis Lative
  • Feb 24
  • 2 min read


As an exception, case law allows the grant of separation pay or financial assistance to a legally dismissed employee as a measure of social justice or on grounds of equity.

In Philippine Long Distance Telephone Co. v. NLRC (PLDT) 247 Phil. 641 (1988), the Court allowed the grant when the employee was validly dismissed for causes other than serious misconduct or those reflecting on his moral character.


The payment of separation pay and reinstatement are exclusive remedies.

The payment of separation pay replaces the legal consequences of reinstatement to an employee who was illegally dismissed.


To award separation pay in lieu of reinstatement to an employee who was never dismissed by his employer would only give imprimatur to the unacceptable act of an employee who is facing charges related to his employment, but instead of addressing the complaint against him, he opted to file an illegal dismissal case against his employer.


Sources:

Claudia’s Kitchen, Inc. v. Tanguin, G.R. No. 221096, June 28, 2017

Philippine Long Distance Telephone Co. v. NLRC (PLDT) 247 Phil. 641 (1988)

Bani Rural Bank Inc. v. De Guzman, et al., 721 Phil. 84,100 (2013).


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