DTI’s Lopez backs separation pay for resigning employee

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Ramon M. Lopez

TRADE SECRETARY Ramon M. Lopez said he supports a separation pay provision in the proposed Security of Tenure (SoT) bill even in case of resignation, expanding the benefit to cover more forms of worker departure.

Mr. Lopez told BusinessWorld that employees who leave their companies regardless due to resignation should be entitled to such payments, saying they enhance worker security.

“We can consider giving automatic granting of separation pay,” he said.

Under the law, only certain forms of worker departure trigger the payment of separation benefits, including involuntarily dismissal or illegal retrenchment.

Resigning workers are not entitled to separation pay unless the payout is provided for in a collective bargaining agreement (CBA) or company policy. “In a way may security of tenure siya (a worker has security of tenure) ‘pag maganda ang separation pay (if he can look forward to separation pay),” he said.

Other provisions Mr. Lopez has proposed for the SoT include making pensions portable for workers who change jobs — Gillian M. Cortez