Department of Labor and Employment Allows Extension of Suspension of Employment Relationship

The Department of Labor and Employment (“DOLE”), on 23 October 2020, released Department Order No. 215 series of 2020 allowing the extension of the suspension of the employer-employee relationship during the period wherein the operation of a business or undertaking is also bone fide suspended. Article 301 of the Labor Code originally provides that the period of suspension shall not exceed six (6) months.

The Department Order states that in case of war, pandemic, and other similar national emergencies, the employer and employee shall meet in good faith to discuss the extension of the suspension of employment. Such extension of the suspension of the employment relationship shall not exceed six (6) months.

If the employer and employee reach an agreement, the employer must report such agreement to extend the suspension to the DOLE, ten (10) days prior to its effectivity. The extension is subject to the inspection powers of the DOLE.

The Department Order also provides that if the employee finds alternative employment during the extended period of suspension of employment, the employee shall not lose his/her employment unless there is a written, unequivocal and voluntary resignation on his/her part. 

In case retrenchment before or after the extension is necessary, the employee shall be entitled to separation pay as provided in the Labor Code, company policy or collective bargaining agreement, whichever is higher. The employee shall also have priority in the re-hiring if he/she indicates his/her desire to resume work not later than one (1) month from the resumption of operations.

Note that nothing in the said issuance shall be construed to authorize or justify the diminution or reduction of benefits, supplements or payments as provided in existing laws, individual or collective agreement, or employment practices or policies.