In Philippine labor relations, the "Notice to Explain" (NTE) is a fundamental component of procedural due process. It serves as the formal mechanism by which an employer informs an employee of specific charges and provides an opportunity to be heard. However, a frequent point of contention arises when an employer issues an NTE after an employee has already submitted a letter of resignation.
The validity and legal effect of such a notice depend on the timing of the resignation, the nature of the alleged offense, and the status of the employer-employee relationship at the moment the notice is served.
1. The Principle of Continued Jurisdiction
The primary rule under Philippine jurisprudence is that the employer-employee relationship does not terminate the instant a resignation letter is handed over. Unless the resignation is effective immediately and accepted as such, the relationship persists during the notice period (typically 30 days under Article 300 of the Labor Code).
- During the Notice Period: If the NTE is issued while the employee is still serving their 30-day notice, the employer retains full disciplinary authority. The employee is still technically an employee and is bound by company rules and regulations.
- Post-Effectivity: Once the resignation becomes effective—either through the lapse of the notice period or by mutual agreement—the employer loses the legal standing to terminate the employee, as there is no longer a relationship to sever.
2. Management Prerogative vs. Right to Resign
While an employee has the right to resign, this right is not a "get out of jail free" card to avoid administrative liability for misconduct committed during employment.
- Investigatory Power: Employers have the right to investigate and document infractions even if the employee is leaving. An NTE issued after resignation serves to complete the administrative record.
- Clearance and Benefits: The results of an investigation initiated by an NTE can validly affect the employee’s "clearance." While an employer cannot withhold earned wages (back pay), they may legally withhold certain discretionary benefits or use the findings to determine if the employee is entitled to a "clean" exit.
3. The Issue of Mootness
If the purpose of the NTE is to initiate a process for dismissal, the process may become moot if the resignation becomes effective before the investigation concludes.
Legal Reality: An employer cannot "fire" someone who has already legally left. If the dismissal is finalized after the resignation date, the dismissal is generally considered without legal effect, as the relationship had already been dissolved voluntarily.
However, the NTE remains valid for purposes of:
- Determining liability for damages (civil liability).
- Filing criminal charges (if the offense involves theft, fraud, etc.).
- Disqualifying the employee from future re-hire.
4. Voluntary Resignation vs. Pre-empting Dismissal
A common tactic is for an employee to resign "to avoid a tarnished record" once they realize an investigation is imminent.
- Prior to NTE: If a resignation is tendered before an NTE is issued, the employer may still issue the NTE to document the cause of the separation.
- After NTE: If the resignation is filed after receiving an NTE, the employer can choose to accept the resignation or proceed with the disciplinary process. If the employer proceeds and proves the grounds for dismissal before the resignation period ends, the separation is recorded as a Dismissal for Cause, which supersedes the resignation.
5. Potential Pitfalls: Constructive Dismissal
Employers must be cautious. If an NTE is issued for trivial or fabricated reasons immediately following a resignation, the employee might claim Constructive Dismissal. This occurs if the employer’s actions (like an aggressive or baseless NTE) make continued employment during the notice period unbearable, or if the NTE is used as a retaliatory tool for the act of resigning itself.
Summary Table: NTE Status Post-Resignation
| Scenario | Validity of NTE | Legal Consequence |
|---|---|---|
| Notice period is still active | Valid | Employer can proceed with disciplinary action, including dismissal for cause. |
| Resignation is effective immediately | Limited | Cannot result in dismissal, but can be used for clearance and record-keeping. |
| Retaliatory NTE | Invalid | May lead to a claim of constructive dismissal or damages against the employer. |
| Serious Misconduct Found | Valid | Can be used as a basis to deny discretionary bonuses or file separate legal actions. |
Conclusion
A Notice to Explain issued after a tender of resignation is legally valid provided the employer-employee relationship has not yet been fully severed. It represents the employer's exercise of management prerogative to protect its interests and maintain a record of employee conduct. However, once the resignation is final, the NTE transitions from a tool for termination to a tool for documentation and potential civil or criminal recourse.