Amicus Curiae

The never-ending tug of war between management prerogative and labor rights has long been recognized in our jurisdiction. While it may be true that the constitutional bias has always been in favor of the working class, it cannot be denied that management also has its own rights which are limited by labor laws, as well as principles of equity and substantial justice.

Management prerogative is the employer’s inherent right to regulate all aspects of employment including the right to: hire, assign and transfer work, control the time, place and manner of work, discipline, and to dismiss.

In the exercise of the management’s power to hire, the employee, as a general rule, is considered as a regular employee entitled to security of tenure. However, management may exercise its prerogative to halt the employee’s regularization and in the meantime, place him under probation. This allows the employer to assess whether the employee was able to adequately perform his duties which is the inherent and implied standard for a probationary employee to be regularized.

Probationary employment refers to an arrangement where the probationary employee is hired on a trial basis to afford the employer an opportunity to observe the fitness of a probationary employee while at work, and to ascertain whether he will become a proper and efficient employee.

For a probationary employment to be valid, a probationary employee must be apprised, at the time he is hired, of the standards by which he will qualify as a regular employee.

Article 296 (formerly, 281) of the Labor Code states that “Probationary employment shall not exceed six months from the date the employee started working, unless it is covered by an apprenticeship agreement stipulating a longer period. The services of an employee who has been engaged on a probationary basis may be terminated for a just cause or when he fails to qualify as a regular employee in accordance with reasonable standards made known by the employer to the employee at the time of his engagement. An employee who is allowed to work after a probationary period shall be considered a regular employee.”

Thus, at the onset of the engagement, the employee must be apprised of his probationary status and the reasonable standards which he must meet in order to be regularized. Otherwise, he will be considered a regular employee. For instance, if the employer informs the newly hired employee that he will be “under observation for six months,” the employee will still be considered as a regular employee since the standards in order to obtain regular status was not clearly conveyed to him.

As a general rule, therefore, the employee must be informed of the reasonable standards to qualify for regular employment. The exception arguably is when the job is self-descriptive such as maids, cooks, drivers, or messengers.

Aside from informing the definite standards, the employer must also inform the employee of the length of the probationary period. The law, which states that “probationary employment shall not exceed six months,” provides for a maximum period which may be shortened by the employer’s waiver. However, employees who continue to be employed beyond the said period ceases to be probationary employees and become regular employees. Parenthetically, the Supreme Court interpreted six months as equivalent to 180 days.

Nevertheless, this does not mean that the law strictly prohibits the extension of probationary period beyond the six-month period. This can be extended as long as the employer provides sufficient justification and there is mutual consent.

It must be noted that the employer need not keep the probationary employee in its employ if cause/s for dismissal is/are present. Thus, a probationary employee may be dismissed at any time before expiration of the six months as long as it is for a just or authorized cause under Articles 297 and 298 (formerly, 282 and 283) of the Labor Code, as amended.

The difference between regular and probationary employees is that the latter may also be dismissed for another ground — failure to qualify as a regular employee based on the reasonable standards conveyed to him at the time of his engagement.

Section 2, Rule I, Book VI of the Implementing Rules of the Labor Code provides that if the termination is brought by the failure of an employee to meet the standards of the employer in the case of probationary employment, it shall be sufficient that a written notice is served to the employee within a reasonable time from the effective date of termination. Thus, the twin notice and hearing requirements for just cause dismissals are not required since the employee, at the outset of his engagement, knows that he will be under observation and his performance would be under his superior’s scrutiny.

While the Constitution and the Labor Code are inclined to favor the working class, both do not however overlook the indispensable role and rights of management. After all, management is the hen or goose which lays the golden egg.

The views and opinions expressed in this article are those of the author. This article is for general informational and educational purposes only and not offered as and does not constitute legal advice or legal opinion.


Zyra G. Montefolca is an Associate of the Angara Abello Concepcion Regala & Cruz Law Offices (ACCRALAW), Davao Branch. (6382) 224-0996