Dear PAO,
I’ve been hired at a certain agency and was deployed to their business partner company. I worked for them for almost one year and six months. I resigned but only got my last payment during my last day at work.

Will I be able to get a backpay if I ask them for it? Thank you for your advice.

Regards,
Michael

Dear Michael,
The response to your question will depend on what you mean by “backpay.” If you are referring to your previously unpaid salaries during the period of your employment, then you may rightfully demand this as part of your compensation for the services you have rendered to the company. On the other hand, if you refer to your separation pay, or payment for your length of service, the law does not require the employer to provide such payment for employees who resigned.

Generally, resignation is a voluntary mode of severance of employer-employee relationship. According to a Supreme Court decision:

“Resignation is defined as the voluntary act of an employee who finds himself in a situation where he believes that personal reasons cannot be sacrificed in favor of the exigency of the service and he has no other choice but to disassociate himself from his employment” (Virgen Shipping Corp. vs. Barraquio, G.R. No. 178127, April 16, 2009 citing Valdez vs. NLRC).

The Labor Code of the Philippines does not contain any provision granting separation pay to voluntary resigning employees. Thus, should your resignation be voluntary as stated herein, the employer is not required to give you a separation pay in consideration for the length of your service.

Separation pay is granted only in cases where the reason for separation from employment is beyond the control of the employee such as in cases of retrenchment or dismissal by the employer. However, there are certain instances when an employee who voluntarily resigns is entitled to a separation pay such as when grant of separation pay to resigning employees has been an established business practice by the employer or when a written agreement to such effect has been made between the employer and employee. As held by the Supreme Court:

“ . . . separation pay need not be paid to an employee who voluntarily resigns. However, an employer who agrees to expend such benefit as an incident of the resignation should not be allowed to renege in the performance of such commitment” (Alfaro vs. Court of Appeals G.R. No. 140812, August 28, 2001).

Thus, if you have such similar agreement or practice with your employer, then you can claim for a separation pay, otherwise the law does not entitle you for one.

However, in case you refer to backpay as previously unpaid salaries, you are entitled and may demand to whatever amount that has not yet been paid to you until your last day of work. Non-payment of your monthly salary is a violation of the labor law and a complaint may be filed for money claims with the National Labor Relations Commission for claims exceeding Five Thousand Pesos (5,000) or with the Department of Labor and Employment regional director or any of its authorized representatives for claims not exceeding such amount (Labor Code Implementing Rules and Regulations, Rule XI, Section 1).

Note however that the Labor Code provides a prescriptive period of three (3) years within which to file your money claims from the time the cause of action arisen otherwise, it shall be forever barred (The Labor Code, Art. 291).

Again, we find it necessary to mention that this opinion is solely based on the facts you have narrated and our appreciation of the same. The opinion may vary when the facts are changed or elaborated.

We hope that we were able to enlighten you on the matter.