UNSATISFACTORY PERFORMANCE RATING MADE AFTER THE PROBATIONARY EMPLOYEE WAS TERMINATED IS ILLEGAL

Master Labor Law Essentials by Joining Atty. Elvin’s Upcoming Seminar on 28 November 2024

In a Supreme Court Decision dated April 16, 2024 it ruled that C.P. Reyes Hospital’s termination of probationary employee Geraldine M. Barbosa (Barbosa) was illegal.

Barbosa signed a six-month probationary employment contract with C.P. Reyes Hospital, during which time she would train as a Staff Nurse, then as a Ward Head Nurse, and finally as a Training Supervisor.

However, three months after Reyes Hospital terminated her probationary employment, citing negative performance feedback.

This prompted Barbosa to file a complaint for illegal dismissal against C.P. Reyes Hospital.

The Labor Arbiter ruled that Barbosa was illegally dismissed, finding that the numerical passing marks given by her evaluators showed she successfully met C.P. Reyes Hospital’s standards.

The NLRC reversed the Labor Arbiter Decision. On certiorari, the Court of Appeals reinstated the Labor Arbiter’s ruling in favor of Barbosa.

The Supreme Court affirmed the CA Decision, denying C.P. Reyes Hospital’s petition for review on certiorari, ruling that Barbosa was illegally dismissed. Thus, Barbosa is entitled to backwages.

The SC held that probationary employment may be terminated when the employee fails to qualify as a regular employee in accordance with reasonable standards made known by the employer to the employee at the time of engagement.

However, in Barbosa’s case, the SC found her dismissal baseless since she obtained the passing grades needed to meet the standards for regularization based on the probationary employment contract.

The SC found C.P. Reyes Hospital’s claims of unsatisfactory performance not genuine as they were only issued two weeks after Barbosa had already been terminated and without an accompanying performance evaluation.

Since Barbosa was illegally dismissed, she is entitled to reinstatement, full backwages, and other benefits.

To determine the amount of backwages due Barbosa, the SC harmonized conflicting jurisprudence.

The SC held that illegally dismissed probationary employees, like regular employees, are entitled to backwages up to their actual reinstatement and not only until the end of their probationary period.

In case reinstatement is not feasible, backwages shall be computed from the time compensation was withheld up to the finality of the Decision in the illegal dismissal case.

The SC pronounced that both the Constitution and the Labor Code did not distinguish between regular and probationary employees in guaranteeing the right to security of tenure.

It added that the mere lapse of the probationary period without regularization does not by itself sever the employment relationship. Without any valid grounds to dismiss a probationary employee, there is no basis to terminate the employment. Thus, the employee is entitled to work even beyond the probationary period.

The SC thus ruled that backwages should be computed from January 1, 2014, when compensation was withheld from her, until the finality of the Court’s decision.