D. Related Employment Concepts

Related Employment Concepts

Concept

Floating status and employment subject to a suspensive condition concern different points in an employment relationship. Floating status concerns an employee whose work has been temporarily suspended. A suspensive condition concerns whether an obligation to employ or to commence work has become effective. In both situations, the label used by the parties is less important than the facts showing when work and the corresponding obligations began, stopped, or resumed. (Labor Code, Art. 301) (Civil Code, Art. 1181) (Manila v. Pinera, G.R. No. 227550, 14 August 2019)¹

Governing provisions

Article 301 of the Labor Code governs a bona fide suspension of a business undertaking, or a temporary interruption of an employee’s work through no fault of the employee. It addresses the effect of that interruption on employment and the employee’s return to work. DOLE Department Order No. 215, series of 2020, also addressed the suspension of employment in the circumstances covered by that issuance. (Labor Code, Art. 301) (DOLE Department Order No. 215, s. 2020)

Under the Civil Code, an obligation subject to a suspensive condition depends on the occurrence of a future and uncertain event. In employment, the question is whether an agreed condition must first occur before the obligation to employ or to start work becomes demandable. The condition must be distinguished from a mere date for reporting to work and from a condition imposed only after employment has already begun. (Civil Code, Arts. 1181 and 1193)

Requisites / Rules

• Temporary interruption: Floating status presupposes an existing employment relationship. The issue is whether the interruption is genuinely temporary and falls within the governing rules on suspension, rather than amounting to a termination of employment. (Labor Code, Art. 301)
• Conditional commencement: A suspensive condition concerns the effect of an uncertain event on an obligation. The parties’ agreement and their actual conduct matter in identifying what, if anything, remained conditional. (Civil Code, Art. 1181) (Manila v. Pinera)¹
• Security of tenure: Neither a temporary-status label nor a contractual condition, by itself, defeats rights that have attached to an employment relationship. The nature of the work and the real terms of engagement remain material. (Samonte v. La Salle Greenhills, Inc., G.R. No. 199683, 10 February 2016)² (Kua v. Elarcosa, G.R. No. 202215, 9 December 2015)³

Distinctions

Ask first whether the employee had already entered employment. If so, a later lack of available work raises a suspension or dismissal issue. If commencement was expressly dependent on an event that has not occurred, the initial question is the effect of that condition. A promised start date, an unmet condition, and a subsequent suspension should not be treated as interchangeable facts. (Labor Code, Art. 301) (Civil Code, Arts. 1181 and 1193)

Bar tip

Set the timeline before applying the rule: identify the agreement, the condition or start date, the actual commencement of work, and any later interruption. Then determine whether the dispute concerns entry into employment or the status of employment that already exists. (Civil Code, Arts. 1181 and 1193) (Labor Code, Art. 301)