SC: Employer may fire worker who fails to meet quota

Work quota is a very important aspect of an employment relationship. Under the law, it is an element of faithful and diligent performance of duty. In other words, failure to meet work quota (also known as work goals or minimum productivity standards) may be considered as neglect of duty. In fact, in a multitude of cases, the High Court has ruled that gross inefficiency of an employee is equal to gross neglect of duty.

Although employees have rights, employers also have prerogatives, one of which is the right to return on investment. An unproductive employee causes loss of profit to the employer; such employee may be removed from work if the latter finds that minimum productivity standards are not met.

In the 2014 case of International School Manila v. ISAE, a teacher was held guilty of gross inefficiency meriting her dismissal on the basis of the Court’s finding that she failed to measure up to the standards set by the school in teaching Filipino classes.

In a 2012 case of Reyes-Rayel v. PLTHC, the validity of the dismissal of therein petitioner who was the CHR Director for Manufacturing of therein respondent's company, which was grounded on his inefficiency and ineptitude, was affirmed by the Court. This decision was on the basis of the Court’s finding that petitioner, on two occasions, gave wrong information regarding issues on leave and holiday pay which created confusion among employees in the computation of salaries and wages.

In another 2012 case, the Realda case, Realda, a machine operator of therein respondent's company, was dismissed on the ground, inter alia, of inefficiency. In affirming the validity of his dismissal, the Supreme Court pronounced that "the petitioner’s failure to observe Graphics, Inc.'s work standards constitutes inefficiency that is a valid cause for dismissal. Failure to observe prescribed standards of work, or to fulfill reasonable work assignments due to inefficiency may constitute just cause for dismissal. Such inefficiency is understood to mean failure to attain work goals or work quotas, either by failing to complete the same within the allotted reasonable period, or by producing unsatisfactory results.”

In that case of Buiser v. Leogardo, Jr., Buiser’s failure to meet the sales quota assigned to each of them was deemed a just cause for their dismissal, regardless of the permanent or probationary status of their employment. Failure to observe prescribed standards of work, or to fulfill reasonable work assignments due to inefficiency, well constitutes a just cause for dismissal.
Finally, according to the 2012 case of Aliling v. Feliciano, an employee’s failure to meet sales or work quotas falls under the concept of gross inefficiency, which in turn is analogous to gross neglect of duty that is a just cause for dismissal under Article 282 of the Labor Code. However, in order for the quota imposed to be considered a valid productivity standard and thereby validate a dismissal, management’s prerogative of fixing the quota must be exercised in good faith for the advancement of its interest. The duty to prove good faith, however, rests with the employer as part of its burden to show that the dismissal was for a just cause. The employer must show that such quota was imposed in good faith.