Resignation While Under Employer Investigation in Philippine Labor Law

(Everything you need to know — statutes, rules, and key jurisprudence)

1. Concept in a Nutshell

“Resignation while under investigation” happens when an employee who is already the subject of an ongoing administrative fact-finding or disciplinary process tenders a resignation letter before the proceedings are finished (or, in many cases, before they even start). Two legal questions immediately arise:

Must the employer still process the resignation?
Does the resignation automatically wipe out the alleged offense and the investigation?

Philippine labor law answers both in the negative: an employee may resign at almost any time, but resignation does not extinguish an employer’s right (or duty) to complete an investigation, impose sanctions, or even pursue criminal or civil remedies for misconduct already committed.

2. Statutory Bases

Provision	Key Points
Art. 300, Labor Code (formerly Art. 285)	• An employee may terminate employment by serving a written notice at least 30 days in advance. • Notice period is not required if the resignation is grounded on any of the four “just causes” (serious insult, inhuman treatment, commission of crime against the employee or family, or other causes analogous).
Art. 297–299 (Just & Authorized Causes)	Remind us that employers may validly end employment for just causes even if the employee purports to resign; what matters is the presence of a cause and observance of due process.
Department Order No. 147-15	Codifies the “twin-notice and hearing” procedural due-process requirements in disciplinary dismissals—still applicable if the company decides to dismiss the employee instead of (or in addition to) accepting the resignation.
DOLE Labor Advisory No. 06-20 (Final Pay & COE)	Final pay must be released within 30 days from effectivity of separation “unless the payment has been withheld for a valid reason”—an unresolved shortage, damage claim, or pending investigation is expressly recognized as a valid reason.

3. Supreme Court Jurisprudence

Case	Gist / Doctrine
Eastern Telecommunications Phils., Inc. v. NLRC (G.R. Nos. 74890-91, 23 Mar 1989)	Acceptance of a resignation does not preclude the employer from later dismissing the employee for a just cause discovered before the resignation was accepted.
Intertrod Maritime, Inc. v. NLRC (G.R. No. 81087, 19 Jun 1991)	An employee who resigns to avoid a sure dismissal cannot claim illegal dismissal; voluntary resignation remains voluntary even if motivated by the threat of termination for cause.
XL Shirts Factory v. NLRC (G.R. No. 122779, 23 Jan 1998)	An employer may validly refuse to sign clearance and withhold final pay while a bona fide investigation on company losses is pending.
People’s Broadcasting (Bombo Radyo) v. Pacificar (G.R. No. 179652, 29 Mar 2010)	Even a post-resignation “blacklisting” is allowed if factually justified, provided it is not malicious and the employee was accorded due process.
Bright Maritime Corp. v. Quiazon (G.R. No. 197309, 20 Jan 2016)	Resignation during investigation does not bar the employer’s counter-claims for loss or damage, nor the filing of criminal action.

(The list is representative, not exhaustive; the line of doctrine is remarkably consistent.)

4. Mechanics & Timeline

Tender of Resignation
- Must be in writing and indicate the intended effective date.
- If the employee is under preventive suspension, the 30-day running of notice does not automatically stop; the employer may accept an earlier date or insist on completion of notice.

Employer’s Options Upon Receipt

Option	Practical Effect
Accept immediately	Employment ends on the agreed effective date; the investigation may still continue to determine liabilities (e.g., restitution).
Delay or withhold acceptance	Permissible where there is legitimate business interest (e.g., to preserve evidence, ensure turnover, or finish the fact-finding).
Reject resignation	Rarely done, but allowed if resignation is a ploy to evade accountability and the acts complained of constitute a valid just cause for dismissal. Employer must then serve the twin notices.

Continuation of Investigation
- Witnesses may still be interviewed, audit completed, and a final administrative decision rendered.
- Possible outcomes after separation:
  - Disallow clearance & forfeit benefits explicitly provided in company policy (e.g., incentive shares, retention bonus).
  - File civil/criminal action (e.g., estafa, qualified theft).
  - No further action if the inquiry clears the employee.
Release of Final Pay & Certificate of Employment (COE)
- Within 30 days from separation unless withheld for a valid reason.
- The COE must state only dates of employment and nature of work unless employee expressly asks for reason for separation. A pending case is usually annotated in an internal HRIS, not on the COE itself.

5. Interaction With Due-Process Rules

Even if employment technically ends via resignation, any disciplinary action that affects rights already earned (e.g., accrued bonuses) or that impairs reputation (e.g., blacklisting) must still observe notice-and-hearing. The accepted practice:

First Notice — Inform the (now former) employee of the acts charged, the evidence, and give at least 5 days to submit a written explanation or attend a hearing.
Hearing / Explanation — May be on-site or remote; counsel may be present.
Second Notice — Communicate the decision: clearance approved/disapproved, amounts forfeited, or cases to be filed.

Failure to observe the above may make the employer liable for nominal damages (P10,000–P50,000 range in recent cases) even if the underlying cause is substantiated.

6. Impact on Government-Mandated Benefits

Benefit	Entitlement When Resigning Under Investigation
SSS unemployment insurance	Not available if separation is by voluntary resignation.
Unused Service Incentive Leave (SIL)	Convertible to cash unless validly forfeited by proven misconduct under CBA/company policy.
13th-Month Pay	Payable in proportion to actual days worked prior to effectivity date of resignation.
Pro-rated bonuses / profit-sharing	Governed strictly by company plan or CBA; a disciplinary finding of fraud or dishonesty almost always disqualifies the employee.

7. Resignation vs. Constructive Dismissal

Employees sometimes argue that they were forced to resign when management “suggested” it during investigation. Jurisprudence holds that to establish constructive dismissal, the employee must prove that the resignation was brought about by:

Clear, unambiguous acts of discrimination, insupportable demotion, or reduced pay, or
A threat of dismissal without just cause or due process.

Where the records show a pending, good-faith disciplinary inquiry for a serious offense, courts almost always rule that resignation was voluntary.

8. Criminal & Civil Exposure After Resignation

Resignation does not bar criminal prosecution (e.g., qualified theft, falsification) because the State, not the employer, is the offended party.
Prescription of crimes is unaffected.
Employers should file a separate civil action for recovery of shortages or damages; the NLRC does not have jurisdiction over pure money claims when no employer-employee relationship exists, except if the claim is closely intertwined with earned labor benefits.

9. Practical Guidance

For Employees

For Employers

• Give a clear, dated resignation letter; keep proof of receipt.
• Offer to participate in the audit to show good faith.
• Request a provisional COE if final clearance will take time.
• Avoid signing quitclaims until final pay details are complete.

• Acknowledge receipt of resignation in writing stating: “Subject to the results of ongoing investigation.”
• Continue fact-finding even after effectivity; keep transcripts, audit reports, CCTV logs.
• Decide within a reasonable period (30–60 days) whether to forfeit benefits or pursue legal action.
• Release undisputed wages and SIL pay on time; document any hold-back with specific reasons.

10. Key Take-Aways

Resignation is a unilateral right, but acceptance by the employer (express or implied) is still required for effectivity.
Ongoing investigations survive the resignation; the employer keeps its prerogative to discipline or sue.
Final pay may be withheld only while there is a bona fide, well-documented dispute on liabilities.
Due process never disappears. Even ex-employees must be heard before sanctions that affect earned rights or reputation are imposed.
Both sides should memorialize every step in writing to minimize future litigation.

11. Disclaimer

This article is for educational purposes and does not substitute for individualized legal advice. Specific circumstances (e.g., CBA provisions, company policies, or pending criminal complaints) can materially change the outcome. For concrete situations, consult competent Philippine labor counsel or the nearest DOLE field office.