In the Philippines, security of tenure is a constitutionally protected right. Under the Labor Code, an employer cannot terminate the services of an employee except for a just cause or an authorized cause, and only after observing due process. When an employee is terminated without these requirements, it constitutes Illegal Dismissal, and the primary recourse is filing a complaint with the National Labor Relations Commission (NLRC).

1. Grounds for Illegal Dismissal

A dismissal is illegal if it lacks either substantive or procedural due process:

Lack of Substantive Due Process: The termination did not arise from a valid ground.
Just Causes: Serious misconduct, willful disobedience, gross and habitual neglect of duties, fraud, or commission of a crime against the employer.
Authorized Causes: Retrenchment, redundancy, installation of labor-saving devices, or closure of business (usually requires separation pay).
Lack of Procedural Due Process: The "Twin-Notice Rule" was not followed:

First Notice: A written notice specifying the grounds for termination and giving the employee an opportunity to explain (usually within at least 5 calendar days).
Hearing/Conference: An opportunity for the employee to present evidence or rebut the charges.
Second Notice: A written notice of the final decision to dismiss.

2. Where to File

The complaint must be filed with the Regional Arbitration Branch (RAB) of the NLRC that has jurisdiction over the workplace.

Prescriptive Period: A complaint for illegal dismissal must be filed within four (4) years from the time the cause of action accrued (the date of dismissal).

3. The Step-by-Step Process

Step 1: Filing the Complaint

The process begins by filling out a Pro-Forma Complaint Form at the NLRC. The complainant (employee) will specify the following:

Name and address of the complainant and respondent (employer).
Nature of the claims (e.g., Illegal Dismissal, Unpaid Wages, 13th Month Pay, etc.).

Step 2: Mandatory Conciliation and Mediation (SENA)

Before the case is assigned to a Labor Arbiter, it undergoes the Single Entry Approach (SENA). A Single Entry Assistance Officer (SEADO) facilitates a conference to see if the parties can reach an amicable settlement. If no settlement is reached within 30 days, the case is "referred" for compulsory arbitration.

Step 3: Mandatory Conciliation-Mediation

Once the case is assigned to a Labor Arbiter (LA), another round of mandatory conferences is held to encourage settlement. If the parties still cannot agree, the Labor Arbiter will direct them to submit their respective Position Papers.

Step 4: Submission of Position Papers

This is the most critical stage. Both parties submit a Position Paper, which includes:

A detailed statement of facts.
The legal arguments supporting their claims or defenses.
Supporting evidence (affidavits, payslips, termination notices, contracts).
Note: No actual trial or "day in court" is usually required; the Labor Arbiter generally decides based on the written submissions.

Step 5: The Decision

After the submission of the Position Paper (and a possible Reply or Rejoinder), the case is deemed submitted for decision. The Labor Arbiter has 30 calendar days to issue a ruling.

4. Remedies and Reliefs

If the Labor Arbiter rules that the dismissal was illegal, the employee is entitled to:

Reinstatement: Returning to the former position without loss of seniority rights.
Full Backwages: Payment of wages, inclusive of allowances and other benefits, computed from the time compensation was withheld up to the time of actual reinstatement.
Separation Pay: If reinstatement is no longer viable (e.g., "strained relations" between the parties), the employer may be ordered to pay separation pay (usually one month's salary for every year of service) in lieu of reinstatement.
Moral and Exemplary Damages: Awarded if the dismissal was done in a wanton, oppressive, or malevolent manner.
Attorney’s Fees: Usually 10% of the total monetary award.

5. Appeals Process

To the NLRC Commission: The losing party may appeal the Labor Arbiter's decision to the NLRC Commission within 10 calendar days from receipt of the decision. If the employer appeals a monetary award, they must post a cash or surety bond equivalent to the amount of the judgment.
To the Court of Appeals: If the NLRC appeal is denied, the aggrieved party can file a Petition for Certiorari under Rule 65.
To the Supreme Court: The final recourse is a Petition for Review on Certiorari under Rule 45.

Important Note on Execution: The reinstatement aspect of the Labor Arbiter's decision is immediately executory, meaning the employer must take the employee back (physically or through payroll reinstatement) even while the case is being appealed.