Comments on Labor Advisory No. 6 - Re: Certificate of Employment

Last 31 January 2020, the Department of Labor and Employment issued Labor Advisory No. 6, Series of 2020. Under the said advisory, a COE is defined as "a certificate from the employer specifying the dates of an employee's engagement and the termination of his/her employment and the type or types of work in which he/she is employed. For purposes of [the said] advisory, an employee whose employment is not yet terminated may also ask for a Certificate of Employment."

Said labor advisory also clearly stated that "[t]he employer shall issue a certificate of employment within three (3) days from the time of the request by the employee." Moreover, it mentions that [a]ny Issue or claim dispute arising out or relating to the payment of final pay, or issuance of certificate of employment, shall be filed before the nearest DOLE Regional/Provincial/Field Office which has jurisdiction over the workplace, for conciliation and subject to DOLE's existing enforcement mechanism."

However, as earlier stated in our previous issue, it appears that there is no clarification made as to the following matters:

1) Right of the employer to impose fees on the issuance of any subsequent COE upon request of the present or former employee, after the 1st request for COE.

2) Prescriptive period as to how long upon resignation of the employee, is the employer required under existing laws to issue a COE.

3) What can be the employer's basis for issuance of a COE for old employees whose employment has been severed long ago, without remaining records with the company.

Our labor laws are mostly interpreted, in case of any ambiguity, in favor of the employee. Jurisprudence also guides us that in upholding the rights of employees in our procedural and substantive due process, our company policies must always be just, fair and reasonable.

As to the first, it appears that it is the burden of the employer, be it present or past, to justify the imposition of fees for the issuance of COE to a requesting present or past (resigned) employee. Although, the employer may incur administrative fees for time and effort spent to recover old records of a resigned employee, it is incumbent upon the employer to justify the amount of fees to be imposed, if any. The same rationale also applies for a subsequent request for the issuance of a COE for present or resigned employees.

It is prudent to have the following drawn up into a written company policy: a) procedures for request; b) the forms required to be fillled up; c) the content to be stated in the COE; d) the fees to be imposed (if any), e) authorities and signatories required for approval; as well as the f)grounds for refusal; for the issuance of a COE.

As to the second, the Labor Code specifically provides for a prescriptive period of 3 years for money claims; and 4 years for claim/complaints for illegal dismissal; from the time the cause of action occurred. However, for purposes of requests for issuance of COE, it appears that if we apply just, fair and reasonable policy guidelines, it is again incumbent upon the employer to justify should it refuse or deny issuance of a COE to a requesting present or resigned employee. This, notwithstanding, that an employee, even those who have already resigned, who has not yet undergone the company's clearance procedure, is still entitled for the issuance of a COE. It must be emphasized that a COE is not equivalent to a clearance. An employee may still be held liable for any pending civil, criminal or administrative liability, even after being issue with a COE. Suffice it to say that, it is still the employer who needs to justify with fair and reasonable grounds, why it can no longer issue a COE to a resigned employee after a period of time has lapsed, eg. more than 4 years from resignation.

As to the third, other acceptable and available means can be resorted to by the employer as basis for the issuance of a COE for long resigned employees. Online SSS, PhilHealth, BIR and Pag-ibig records may be resorted to.Testimonies of old employees and the 201 personal file records of the requesting resigned employee may also be available. After all, just, fair and reasonable grounds are upon the shoulders of the employer to justify its refusal or denial of issuance of a COE, or to provide any possible injury, damage or negative legal implication the issuance of a COE to a resigned employee may be caused to the company.

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