No separation pay over voluntary resignation unless stipulated by employer

Persida Acosta

Persida Acosta

Dear PAO,
I just resigned from my job because my husband left to work abroad. I just want to know if I am entitled to separation pay?

Dear Betty,
The concept of separation pay was explicitly explained by the Supreme Court in the case of A’ Prime Security Services, Inc. vs. National Labor Relations Commission (G.R. No. 93476, March 19, 1993) as follows:

“Separation pay is defined as the amount that an employee receives at the time of his severance from the service and is designed to provide the employee with the wherewithal during the period that he is looking for another employment.

“Under the Labor Code, it is payable to an employee whose services are validly terminated as a result of retrenchment, closure of business or disease. It is also settled that separation pay may be awarded as a measure of social justice in those instances where the employee is validly dismissed but for causes other than serious misconduct or those involving moral turpitude.”

Also, an illegally dismissed employee may receive separation pay in lieu of reinstatement, if the same is not feasible because of the strained relationship, among others, between him and his/her employer (Bani Rural Bank Inc. vs. Teresa de Guzman, G.R. No.170904, November 13, 2013).

On the other hand, an employee who voluntarily resigns from employment is not entitled to separation pay unless, however, there is a stipulation for payment of such in the employment contract or Collective Bargaining Agreement (CBA), or payment of the amount is sanctioned by established employer practice or policy (Travelaire & Tours Corp. and/or Christine B. Ojeda vs. National Labor Relations Commission and Nenita I. Medelyn, G.R. No. 131523 August 20, 1998)

Thus, in the absence of the foregoing exceptions, you are not entitled to separation pay, since you voluntarily resigned from your work.

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.

Editor’s note: Dear PAO is a daily column of the Public Attorney’s Office. Questions for Chief Acosta may be sent to


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