When Transfer Does Not Amount to Demotion

Not all transfers or re-assignment of work from one office or area of operations to another are demotions.

There is a demotion when there is a downward change in the rank, salary, benefits and other privileges of the employee.

The mere title or position held by an employee in a company does not of itself determine whether a transfer constitutes a demotion.  It is the totality of circumstances in each case such as:

  • the economic significance of the work
  • the duties and responsibilities conferred
  • the rank and salary of the employee
  • and other circumstances

In one case, an employee claimed that the abolition of his position as planning and marketing officer and his appointment as bookkeeper I and assistant branch head of one of the company’s branches is a demotion.

The Supreme Court viewed the functions of his new position vis-a-vis the previous one and eventually came out with a decision stating that the new position entailed great responsibility with supervisory and administrative tasks.  Coupled with the observation that there was no decrease in pay, the Supreme Court did not consider the change in position as a demotion. (Rural Bank of Cantilan v. Julve, Feb 27, 2007).

Learn more about the rules on legal demotions and transfers.

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