Probationary Period in the Philippines

PUBLISHED ON: October 15, 2020
LAST UPDATED ON: May 1, 2021

Probationary Period is the period of employment of an employee wherein he or she is assessed in terms of their performance in accordance with reasonable standards made known to the employee by the employer.

Defining Probationary Period

What is indicated in the Labor Code of the Philippines regarding Probationary Period? The term does not explicitly appear in the Labor Code. However, it is referred to as Probationary employment:

Art. 281. Probationary employment. Probationary employment shall not exceed six (6) 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.

Book 6, Title I, Labor Code of the Philippines

However, commonly. Probationary period is referring to the time (period) of the probationary employment. Probationary employment is the employment status of the employee. Article 281 of the Labor Code of the Philippines should always be kept in mind when managing probationary employees.

During the Probationary period, the period is both a training period wherein the employee is coached in the performance of the duties and responsibilities as well as being assessed in terms of his or her performance.

Upon the expiration of this period, the employer determines whether or not the employee is qualified to be a regular employee. This means that the employee is now determined to be fit and capable of performing the duties and responsibilities of the position if he is a regular employee.

How long is the probationary period?

The probationary period shall not exceed six (6) months from the start of the employment date. However, this is only the general length provided by the Labor Code.

Can a Probationary Employee be regularized prior to the end of the six (6) month period?

Yes, a Probationary Employee may be regularized within a shorter period than the six (6) month period. Similarly to the previous paragraph, there is no provision that does not prohibit such action. In fact, this policy is actually more favorable for the employee.

Can the Probationary Period be beyond the six (6) month period?

Yes, the six (6) month period is only a general standard to be abided by. However, the Employer has the burden of proof to prove that it takes more than six (6) months. This is one of the more tricky parts as there should be a basis as to the length of the period and not simply that the company was circumvent the law.

Should there be a basis in the period, the employee should be informed at the start of his employment that the Probationary Period is longer than the six (6) months mandated by the LaborCode.

Performance Assessment of a Probationary Employee

Inform Reasonable Standards at the time of Engagement: At the start of the employment, the employer should inform the employee of the reasonable standards that he should abide by in which the reasonable standards shall be the basis of his regularization. This is the most crucial step as it it the aspect that is explicitly stated in the provision.

Company Policies: The HR Officer should inform the employee of the rules and regulations and other company policies to the Probationary Employee. It is optimal if the Probationary Employee signs or acknowledges the receipt of the employee handbook or at least an Employee Orientation has been conducted.

Performance on the job: Performance indicators should be explicitly made known to the Probationary Employee in the conduct of his duties and responsibilities. Likewise to the previous, such performance indicators should be acknowledged in writing and the employee is updated of the status of employment.

A one-one Supervisor-Employee consultation or meeting is also recommended and such meeting should be documented.

The nature of the probationary employment means that the employee is consistently being monitored and assessed in terms of performance. Due Process is being followed if the employee is being informed of the status of his or her performance.

Termination of Employment for Probationary Employees

Does a probationary employee have Security of Tenure?

It is a misconception that a probationary employee does not have Security of Tenure. However, they only enjoy a limited version of the right to Security of Tenure compared to Regular employees.

According to Section 6, Title I, Book Six of the Omnibus Rules Implementing the Labor Code of the Philippines:

(c) The services of an employee who has been engaged on probationary basis may be terminated only for a just cause or when authorized by existing laws, or when he fails to qualify as a regular employee in accordance with reasonable standards prescribed by the employer.
(d) In all cases involving employees engaged on probationary basis, the employer shall make known to the employee the standards under which he will qualify as a regular employee at the time of his engagement.

Can the employment of a Probationary Employee be terminated prior to the mandated six (6) month period?

Yes, the employment of the person may be terminated prior to the six (6) month period as there is no ruling that precludes such. Article 281 of the Labor Code of the Philippines only mandates the maximum period of the probationary period and does not mandate that the whole period should be used.

What is the notice period for the termination of employment of a Probationary Employee for just or Authorized Cause?

The notice period for the Termination of Employment should follow the usual processes in the termination as there should be due process afforded to them.

What is the notice period for the termination of employment of a Probationary Employee due to performance?

In the case of PDI v. Magtibay and PDIEU, only a week's notice was given to the employee regarding the termination of his employment. This is under the presumption that due process has been afforded to the probationary employee.

Due process is being done when the employee is assessed or informed about the status of his performance. This continuous appraisal ensures that the employee fully informed of the state or probability of him being regularized.

Compensation and Benefits

Are probationary employees entitled to Holiday Pay?

Yes, probationary employees are entitled to Holiday Pay. There are employment classifications that are eligible for Holiday pay however they are not included in the list that are exempted from being entitled to Holiday Pay.

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