Prescription Periods Under Philippine Law

Short answer: Yes—but only within strict time limits. In the Philippines, the deadline (prescriptive period) depends on what you’re claiming and why you were separated. Miss the window and the claim is time-barred.

The Three Core Clocks

1) Illegal dismissal (the action itself)

Deadline: 4 years from the date of dismissal.
Why: Courts treat illegal dismissal as an injury to rights under the Civil Code.
What it covers: Filing an illegal dismissal case lets you seek reinstatement (or separation pay in lieu of reinstatement) plus back wages and damages. These monetary consequences are incidental to the dismissal case.

Practical takeaway: If your central claim is “my dismissal was illegal,” file it within 4 years of being fired. Your back wages and separation pay (in lieu) are remedies that ride with that 4-year action.

2) Pure money claims arising from employment (not anchored on illegal dismissal)

Deadline: 3 years from accrual (when the amount became due).
Examples: Unpaid wages, overtime pay, service incentive leave pay, 13th month differentials, separation pay for authorized causes (e.g., redundancy/retrenchment/closure) that was due at termination but not paid.

Practical takeaway: If you’re not contesting the legality of termination (or you lost the illegal-dismissal angle), but you’re chasing specific unpaid benefits, you generally have 3 years from when each item fell due.

3) Unfair labor practice (ULP)

Deadline: 1 year from the act.
Examples: Union-busting, interference with self-organization, company-dominated unions.

Practical takeaway: ULP is on the fastest clock—act within a year.

Separation Pay vs. Back Wages: Know the Difference

Back wages: Compensation you would have earned had you not been illegally dismissed.
- Coverage: From dismissal until actual reinstatement; if reinstatement isn’t ordered (or is not feasible), until the finality of the judgment that awards separation pay in lieu of reinstatement.
- Prescription anchor: Typically follows the 4-year illegal dismissal action when claimed as a remedy to illegal dismissal.
Separation pay:
- As a remedy for illegal dismissal (in lieu of reinstatement): Court-awarded, usually one month pay per year of service (judicially crafted standard; may vary in special situations). Tied to the 4-year illegal dismissal action.
- For authorized causes (redundancy, retrenchment to prevent losses, closure not due to serious misconduct, disease): Statutory or regulatory formula (commonly ½ or 1 month pay per year of service, depending on the ground). If not paid at termination and you’re not pursuing illegal dismissal, it’s a 3-year money claim from the date it fell due.

When Do Claims “Accrue”?

Illegal dismissal: On the date of dismissal (the 4-year clock starts).
Back wages (incident to illegal dismissal): The right flows from the illegal dismissal; you protect it by filing the illegal dismissal case within 4 years.
Separation pay for authorized causes: Accrues on termination—if unpaid, the 3-year clock starts that day.
Other wage/benefit items: On the date each item became due (each pay period can have its own small clock).

Interrupting or Tolling Prescription

Certain acts stop the clock and restart it:

Judicial action: Filing a case with the NLRC Labor Arbiter interrupts prescription for the causes of action pleaded.
Extrajudicial demand: A written demand to the employer (e.g., formal letter, notarized demand) interrupts the period under the Civil Code.
Administrative conciliation: A filed labor complaint or a documented request for assistance (e.g., through DOLE’s SEnA) typically serves as extrajudicial demand and can interrupt prescription.
Acknowledgment/partial payment: If the employer recognizes the debt or pays partially, the clock may restart.

Tip: Keep proof—receipts, registry return cards, email headers, SEnA referral forms, or docket stamps. These are your lifelines if prescription is raised as a defense.

Laches vs. Prescription

Prescription is a statutory deadline; miss it and the claim is legally barred.
Laches is an equitable doctrine penalizing inexcusable delay.
Rule of thumb: Filing within the statutory prescriptive period generally defeats a laches defense, though extreme facts can still invite equitable arguments.

Filing Venues & What to Plead

Illegal dismissal & monetary consequences (back wages, separation pay in lieu): NLRC (Labor Arbiter) jurisdiction.
Pure money claims without illegal dismissal: Usually NLRC, though some small/simple claims can go through DOLE Regional Offices via summary procedures (practical route choice depends on amounts, facts, and desired remedies).
ULP: Also with the Labor Arbiter.

Plead smart:

If you’re seeking back wages and separation pay in lieu, frame the case as illegal dismissal (protecting the 4-year period).
If the dispute is only about unpaid separation pay from redundancy, that’s a 3-year money claim—plead the authorized cause, the due formula, and the employer’s non-payment at termination.

Worked Timelines (Illustrations)

Illegal dismissal path (4 years + remedies)
- Dismissed: 10 January 2021
- Deadline to file illegal dismissal: 10 January 2025
- Back wages: Run from 10 Jan 2021 to reinstatement; if not reinstated, up to judgment finality awarding separation pay in lieu.
- Separation pay in lieu: Typically 1 month per year of service (court-awarded), computed at the latest salary rate.
Authorized-cause separation pay unpaid (3 years)
- Redundancy effective: 30 June 2022
- Separation pay due: 30 June 2022 (same day)
- Deadline to sue for unpaid separation pay: 30 June 2025 (3 years)
Overtime differentials (3 years, rolling)
- Unpaid OT in March 2022: Prescribes March 2025
- Unpaid OT in April 2022: Prescribes April 2025, etc.

Interruptions matter: A written demand sent on 01 June 2024 interrupts the 3-year period and restarts it from that date for the claims it specifically covers.

Special Populations & Nuances

Seafarers: Contractual and statutory rules interact. Many disability/illness claims prescribe 3 years from repatriation under the standard employment contract; wage-type claims still fall under the 3-year money-claims rule.
Project/seasonal employees: Establish end-of-project or end-of-season dates to compute accrual.
Government employees: Typically under Civil Service rules and a different remedial scheme/jurisdiction (not the NLRC).
Fixed-term contracts: If contesting a sham fixed-term arrangement, treat it like illegal dismissal; file within 4 years from termination.
Company policies or contracts that shorten prescription: Clauses that undercut statutory periods are generally ineffective.

Evidence Checklist

Employment contract, payslips, payroll summaries, time records
Termination letter / notice of authorized cause
Proof of last salary rate (for computing separation pay and back wages)
Written extrajudicial demand(s) and delivery proof
SEnA referral/conciliation records or NLRC docket stamps
Any employer acknowledgment or partial payment

Sample Computation Pointers (at a glance)

Back wages:
- Base = monthly pay (plus regular allowances deemed wage-integrated) × months from dismissal to reinstatement/finality
- Add regular COLA or guaranteed differentials when legally mandated
- Less amounts already paid for the same period (to avoid double recovery)
Separation pay (authorized causes):
- Redundancy/closure not due to serious losses: Usually 1 month per year of service (or company practice if more favorable).
- Retrenchment/disease: Often ½ month per year of service.
- Fraction of at least 6 months counts as one whole year.
Separation pay in lieu of reinstatement (illegal dismissal):
- Common benchmark: 1 month per year of service, using the last salary rate.

(Exact formulas can vary by statute, regulation, CBA, or controlling jurisprudence.)

Strategy Map

Identify the theory: Illegal dismissal (4 years) vs. pure money claims (3 years) vs. ULP (1 year).
Mark the accrual date: Dismissal date, termination date, or each due date.
Interrupt early: Send a written demand or file at SEnA/NLRC to stop the clock.
Choose venue & relief: NLRC for dismissal and money consequences; DOLE routes for certain simple/limited money claims.
Assemble proofs: Salary rate, notices, time records, demands, acknowledgments.
Compute both: (a) separation pay (if applicable) and (b) back wages; prepare alternative prayers (reinstatement or separation pay in lieu).

FAQs

Q: I was dismissed 5 years ago. Can I still claim back wages?

If you did not file an illegal dismissal case within 4 years, the action is prescribed. Back wages as a remedy typically prescribes with the illegal dismissal action.

Q: The company closed and didn’t pay separation pay. It’s been 2 years.

That’s a 3-year money claim from the date of closure/termination. You’re still within time; act now.

Q: I filed a SEnA request 2 years after dismissal, then nothing happened. Did that help?

Yes—properly documented SEnA filings or written demands can interrupt prescription. Keep the proof. File your NLRC case promptly to avoid new prescription issues.

Q: My employer gave partial payment a year ago.

Acknowledgment/partial payment can restart the prescription period for the covered amounts.

Q: Can the company’s handbook limit me to 6 months to sue?

Clauses shortening statutory prescriptive periods are generally unenforceable.

Bottom Line

Illegal dismissal: 4 years from dismissal (includes back wages and possible separation pay in lieu).
Money claims (including unpaid separation pay for authorized causes): 3 years from when due.
ULP: 1 year from the act.
Interrupt the clock with a clear written demand or by filing; keep proof.

If timing is tight, file now and refine computations as the case progresses.