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Today is Tuesday, January 28, 2014
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Republic of the PhilippinesSUPREME COURT
Manila
THIRD DIVISION
G.R. No. 82895 November 7, 1989
LLORA MOTORS, INC. and/or CONSTANTINO CARLOTA, JR., petitioners,
vs.HON. FRANKLIN DRILON in his capacity as the Secretary of the
Department of Labor andEmployment, HON. DANIEL M. LUCAS, DOMINGO H.
ZAPANTA and OSCAR N. ABELLA, in theircapacity as Commissioners of
the National Labor Relations Commission (NLRC) Manila,Second
Division, HON. RICARDO N. OLAIREZ, in his capacity as the Labor
Arbiter of theRegional Arbitration Branch No. I, San Fernando, La
Union and PRIMITIVO ALVIAR,respondents.
Yabes & Associates Law office for petitioners.
Francisco T. Gualberto and Humberto M. Tutaan, Sr. counsel and
Tupas ROI Representatives forAlviar.
FELICIANO, J.:
The subject of the present Petition for certiorari with
Preliminary Injunction is the Resolution 1 dated 20January 1988 of
the public respondent National Labor Relations Commission (NLRC) in
NLRC Case No. RAB-1-0096-85(entitled "Primitivo V. Alviar,
complainant. versus Llora Motors Inc., and/or Constatino Carlota,
respondents").
Sometime in September of 1968, private respondent Primitivo V.
Alviar began his employment with petitioner Llora Motors,Inc. As a
truck driver, Mr. Alviar rendered services to the company eight (8)
hours a day (exluding overtime) seven days aweek, and for his labor
received a salary computed on a per trip basis plus emergency cost
of living allowance (ECOLA). Atthe time he stopped working on 19
April 1985, Mr. Alviar was 65 Years of age.
On 28 October 1985, private respondent Alviar filed with NLRC
Regional Arbitration Branch No. I (San Fernando, La Union)
acomplaint 2 (docketed as NLRC Case No. RAB-I-0096-85) for
"Separation Pay and Non-Payment of Daily Wages" againstpetitioners
Llora Motors and Constantino Carlota, Jr., the company manager. In
a Position Paper 3 he filed in support of hiscomplaint, Mr. Alviar
claimed entitlement to, among other things, ECOLA underpayments
from November 1982 up to April1985 in the amount of P4,709.54 as
well as "retirement benefits," computed at one-half month's pay for
every year of service.
The complaint was opposed by petitioners who, in their own
Position Paper, 4 alleged that all of the employment
benefitsclaimed by private respondent Alviar had already been fully
paid. On the matter of retirement benefits, it was contended
thatMr. Alviar had not been dismissed by Llora Motors, but that
"[s]ometime in the early part of 1985, [Alviar] showed utter lackof
interest in his work [and] would be absent for no apparent reason;
"that "[i]n the meantime, Truck No. 802, assigned tocomplainant,
laid Idle and because of non-use for sometime, it deteriorated so
seriously;" that in the last week of April of1985, Mr. Alviar
reported for work and was then informed that "while Truck 802 has
not been rehabilitated as yet, he couldact as relief driver;" that
"complainant did not like to be a relief driver in the meantime for
since then he did not report forwork;" and that "it was complainant
who abandoned his work since the last week of April 1985 and never
reported sincethen." Neither had Mr. Alviar been retired,
petitioners claimed, "for the simple reason that respondent
corporation does nothave any retirement plan ... [or] any
collective bargaining agreement with the employees for no union
exists within thecompany because the employees, drivers included,
received more than the standard benefits for their labor."
Petitionerscontended further that "records will show that
complainant had received retirement benefits from the Social
Security Systemwhen he retired therefrom in 1983."
Mr. Alviar, in his pleadings submitted before the Labor Arbiter,
did not controvert petitioner's allegations of abandonment
andnon-dismissal. Mr. Alviar there simply alleged that in April of
1985, he "retired from the service due to his old age of
65years."
On 27 January 1987, the respondent Labor Arbiter rendered a
Decision, 5 the dispositive portion of which read:WHEREFORE,
premises all considered, we hereby order the respondents to pay
complainants Primitivo Alviar, as follows:
1. P4,709.54 Unpaid ECOLA differentials 2. 9,985.80 Retirement
benefits(for 17 years) P14,695.34
3. 1,469.53 10% attorney's feesP16,164.87 Total award
and to pay complainant legal interest on the total award to be
compounded annually after ten (10) days from receipt of this
decision.
Respondents are finally ordered to pay complainant through this
Regional Arbitration Branch Office or present proof of compliance
with
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this order within ten (10) days from receipt hereof
SO ORDERED.
An appeal was subsequently interposed with public respondent
NLRC, petitioners there claiming that they had been denied due
process by the LaborArbiter, who had rendered judgment in NLRC Case
No. RAB-1-0096-85 without first conducting formal hearings therein.
In addition, petitioners,reiterating that private respondent Alviar
had neither been dismissed nor retired by the company, questioned
the propriety of the P9,985.80 award ofretirement benefits.
On 20 January 1988, public respondent NLRC issued the disputed
Resolution, affirming the decision of the Labor Arbiter and
ordering dismissal of theappeal. A Motion for Reconsideration was
denied on 28 March 1988. 6
The Petition at bar raises two (2) principal issues: (1) whether
or not petitioners had been denied due process of law by theLabor
Arbiter; and (2) whether or not private respondent Alviar is
legally entitled to receive retirement benefits frompetitioner's,
his former employers.With respect to the first issue, petitioners
allege that failure by the Labor Arbiter to conduct a formal
hearing, prior to rendition of judgment. resulted inviolation of
their constitutional right to due process. We do not agree. This
Court has held in the past that a formal or trial-type hearing is
not at all timesand in all instances essential to due process, 7
the requirements of which are satisfied where parties are afforded
fair and reasonable opportunity to explain theirside of the
controversy at hand. 8 Such opportunity had not here been withheld
from petitioners. The record shows that inresponse to private
respondent Alviar's complaint below and before the Labor Arbiter
rendered his decision of 27 January1987, petitioners submitted on
21 January 1987, petitioners submitted on 21 January 1986 a
Position Paper, complete withannexes, 9 where they had set out and
argued the factual as well as the legal bases of their position.
Petitioners do notclaim that their submissions there were ignored
or disregarded altogether by the Labor Arbiter. The record moreover
showsthat petitioners were given additional opportunity to argue
their case on appeal before public respondent NLRC, in aMemorandum,
10 and Motion for Reconsideration, 11 which pleadings were likewise
considered by that labor agency in thecourse of resolving the case.
All told, the due process argument put forward by petitioners must
fail.
In respect of the second and principal issue, it is urged by
petitioners that the award of retirement benefits to
privaterespondent Alviar is improper, there being no contractual or
statutory basis for such award.
Our Labor Code has only one article that deals with the subject
of "retirement from the service." Article 287 of the Codereads as
follows:
Article 287. Retirement. Any employee may be retired upon
reaching the retirement age established in the Collective
BargainingAgreement or other applicable employment contract.
In case of retirement, the employee shall be entitled to receive
such retirement benefits as he may have earned under existing laws
andany collective bargaining or other agreement. (Emphasis
supplied)
Examination of Article 287 above shows that entitlement to
retirement benefits may accrue either (a) under existing laws or
(b) under a collectivebargaining agreement or other employment
contract. It is at once apparent that Article 287 does not itself
purport to impose any obligation uponemployers to set up a
retirement scheme for their employees over and above that already
established under existing laws. In other words, Article
287recognizes that existing laws already provide for a scheme by
which retirement benefits may be earned or accrue in favor of
employees, as part of abroader social security system that provides
not only for retirement benefits but also death and funeral
benefits, permanent disability benefits, sicknessbenefits and
maternity leave benefits. 12 As is commonplace knowledge, the
Social Security Act provides for retirement benefitswhich
essentially consist of the right to receive a monthly pension for
the rest of the covered employee's life provided that: (1)such
employee had paid at least one hundred twenty (120) monthly
contributions prior to retirement; and (2) has reached theage of
sixty (60) years (if his salary is less than P300.00 a month) or 65
years. The retirement scheme here 'established iscompulsory and
contributory in character on the part of both the employer and the
employee, backed up by criminalsanctions and administered by a
large and elaborate bureaucracy.
Article 287 of the Labor Code recognizes that employers and
employees may, by a colective bargaining or other agreement,set up
a retirement plan in addition to that stablished by the Social
Security law, but prescribes at the same time that suchconsensual
additional retirement plan cannot be substituted for or reduce the
retirement benefits available under thecompulsory scheme
established by the Social Security law. Such is the thrust of the
second paragraph of Article 287 whichdirects that the employee
shall be entitled to receive retirement benefits earned "under
existing laws and any collectivebargaining or other agreement."
It is also important here to examine Section 13 and 14 of Rule,
I, book VI of the Rules and Regulations Implementing theLabor Code
(hereafter, "Implementing rule I"). Implementing Rule I deals with
both termination of services and retirement,being entitled
"Termination of Employment and Retirement." But Sections 13 and 14
of Implementing Rule I are the onlyprovisions which deal with
retirement matters. Under Section 13 which provides as follows:
Sec. 13. Retirement. In the absence of any collective bargaining
agreement or other applicable agreement concerning terms
andconditions of employment which provides for retirement at an
older age, an employee may be retired upon reaching the age of
sixty (60)years. (Emphasis supplied)
where an additional retirement plan has been established by a
collective bargaining agreement, or other applicable agreement (or,
under Section 14, an"established employer policy"), but such plan
fails to specify another, older, age of retirement, an employee may
retire, and may in turn be retired by hisemployer, upon reaching
age sixty (60).
That there was some confusion in the mind of the Labor Arbiter
in the case at bar between "termination pay" and "retirement
benefits" would seementirely possible: private respondent Alviar
initially asked for "separation pay" and the Labor Arbiter awarded
him "retirement benefits." That confusionwas perhaps due to the
Labor Arbiter's citing Section 14 of Implementing Rule I, which
reads as follows:
Sec. 14. Retirement benefits. (a) An employee who is retired
pursuant to a bona-fide retirement plan or a in accordance with
theapplicable individual or collective agreement or established
employer policy shall be entitled to all the retirement benefits
providedtherein or to termination pay equivalent at least one-half
month salary for every year of service, whichever is higher, a
fraction of at leastsix (6) months being considered as one whole
year.
(b) Where both the employer and the employee contribute to the
retirement plan, agreement or policy, the employer's total
contributionthereto shall not be less than the total termination
pay to which the employee would have been entitled had there been
no suchretirement fund. In case the employer's contribution is less
than the termination pay the employee is entitled to receive, the
employershall pay the deficiency upon the retirement of the
employee.
(c) This Section shall apply where the employee retires at the
age of sixty (60) years or older. (Emphasis supplied)
Section 14 (a) refers to "termination pay equivalent to at least
one-half (1/2) month for every year of service" while Section 14
(b) mentions "terminationpay to which the employee would have been
entitled had there been no such retirement fund" as well as
"termination pay the employee is entitled toreceive." It should be
recalled that Sections 13 and 14 are found in Implementing rule I
which deals with both "termination of employment" and"retirement."
It is important to keep the two (2) concepts of "termination pay"
and "retirement benefits" separate and distinct from each other.
Terminationpay or separation pay is required to be paid by an
employer in particular situations Identified by the Labor Code
itself or by Implementing rule I. 13Termination pay where properly
due and payable under some applicable provision of the Labor Code
or under Section 4 (b) ofImplementing Rule 1, must be paid whether
or not an additional retirement plan has been set up under an
agreement with the
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employer or under an "established employer policy."
What needs to be stressed, however, is that Section 14 of
Implementing Rule 1, like Article 287 of the Labor Code, does
notpurport to require "termination pay" to be paid to an employee
who may want to retire but for whom no additional retirementplan
had been set tip by prior agreement with the employer. Thus,
Section 14 itself speaks of an employee "who is retiredpursuant to
a bona-fide retirement plan or in accordance with the applicable
individual or collective agreement or establishedemployer policy."
What Section 14 of Implementing Rule I may be seen to be saying is
that where termination pay isotherwise payable to an employee under
an applicable provision of the Labor Code, and an additional or
consensualretirement plan exists, then payments under such
retirement plan may be credited against the termination pay that is
due,subject, however, to certain conditions. These conditions are:
(a) that payments under the additional retirement plan cannothave
the effect of reducing the amount of termination pay due and
payable to less than one-half (1/2) month's salary for everyyear of
service; and (b) the employee cannot be made to contribute to the
termination pay that he is entitled to receive undersome provision
of the Labor Code; in other words, the employee is entitled to the
full amount of his termination pay plus atleast the return of his
own contributions to the additional retirement plan.
The respondents, in defending the award of retirement benefits
granted by the Labor Arbiter and affirmed by the NLRC, invokeAllied
Investigation Bureau, Inc. v. Ople. 14 Examination, however, of
Allied shows that respondents' reliance thereon is quitemisplaced.
In Allied, Victoriano Velasquez had been an employee of the Allied
Investigation Bureau, Inc., a security guardagency, since 1953. In
1976, having reached the age of sixty (60) years, Velasquez
submitted to Allied an application forretirement benefits, which
application was subsequently approved by Allied, although there was
then no collective bargainingagreement or employer policy
establishing an additional retirement plan for employees of the
agency. A controversy arose inrespect of the method adopted by
Allied in computing the amount of retirement benefits it had
undertaken to pay toVelasquez. Instead of basing that amount upon
Velasquez's actual period of employment with the agency (i.e., from
1953 to1976), Allied computed such amount as starting from the date
of effectivity of the Labor Code (i.e., 1 November 1974 to1976).
Acting on the complaint for retirement benefits, the Labor Arbiter
ordered Allied to pay Velasquez on amountcomputed on the basis of
the latter's twenty- three (23) years of service with the agency.
On a Petition for Certiorari, theCourt upheld the Labor Arbiter's
computation of retirement benefits in favor of Velasquez. The
Court, speaking through thenMr. Justice Fernando, said:
1. There is no question that petitioner had agreed to grant
retirement benefits to private respondent. It would, however, limit
suchretirement benefits only from the date of the effectivity of
the Labor Code. That is its contention. The refutation given in the
Comment ofSolicitor General Estelito P. Mendoza is persuasive. As
was pointed out," in the computation thereof, public respondents
actedjudiciously in reckoning the retirement pay from the time
private respondent started working with petitioner since respondent
employee'sapplication for retirement benefits and the company's
approval of the same make express mention of Sections 13 and 14,
rule I, Book VIof the Implementing Rules and Regulations of the
Labor Code as the basis for retirement pay. Section 14 (a) of said
rule provides thatan employee who is retired pursuant to a
bona-fide retirement plan or in accordance with the applicable
individual or collectiveagreement or established employer policy
shall be entitled to all the retirement benefits provided therein
or to termination payequivalent to at least one-half month salary
for every year of service, whichever is higher, a fraction of at
least six (6) months beingconsidered as one whole year." Further it
was stated: 'This position taken by public respondents squares with
the principle that sociallegislation should be interpreted in favor
of workers in the light of the Constitutional mandate that the
State shall afford protection tolabor. 15 (Emphasis supplied)
Because Allied had agreed to pay retirement benefits to
Velasquez, the mode of computation adopted by the Labor Arbiter
which is the generallyaccepted mode of computation in retirement
plans could hardly be regarded as merely arbitrary or capricious.
Thus, while Allied had no collectivebargaining agreement or similar
employment contract establishing a plan under which employees could
retire, its approval of Velasquez's application,although unilateral
and possibly ad hoc, supplied the necessary consensual basis. In
the instant case, Llora Motors consistently resisted the demand
forseparation pay or retirement benefits by private respondent
Alviar, precisely pointing to the fact that there was no collective
bargaining agreement orother contractual basis or any "established
employer policy" that contemplated the grant of such retirement
benefits.
Clearly, there was in the instant case no consensual basis fro
the required payment of additional retirement benefits. 16 The
Labor Arbiter and theNLRC had not declared private respondent
Alviar to have been illegally dismissed by petitioners. neither was
there anypretense on the part of private respondent Alviar that
labor-saving devices had been installed, or that redundancy
orretrenchment or cessation of operations had occurred in Llora
Motors or that he was afflicted by some disabling disease, orthat,
being entitled to reinstatement, he could not be reinstated to this
old position. Under these circumstances, the portionof the Labor
Arbiter's award which required petitioners to pay an amount
equivalent to a half month's pay for every year ofservice of Mr.
Alviar cannot be justified either as (additional) retirement
benefits or as termination pay and hence constitutedan act without
or in excess of jurisdiction.
WHEREFORE, the Decision of the Labor Arbiter dated 27 January
1987 and the Resolution of the National Labor RelationsCommission
dated 20 January 1988 in NLRC Case No. RAB-I-0096-85 are hereby SET
ASIDE and a new decision shall beentered REQUIRING petitioners to
pay private respondent Primitivo Alviar the amount of P4,709.54 for
unpaid ECOLAdifferentials, plus ten percent (10%) thereof as
attorney's fees and to pay private respondent legal interest on the
total award,compounded annually, from the date of petitioners'
receipt of the original (now vacated) decision of the Labor
Arbiter, and untilfull payment of the amount here awarded. No
pronouncement as to costs.
SO ORDERED.
Fernan, C.J., Gutierrez, Jr., Bidin and Cortes, JJ., concur.
Footnotes1 Rollo, pp. 55-58.
2 Id., p. 15.
3 Id., pp. 31-40.
4 Id., pp. 16-22.
5 Id., pp. 42-46.
6 Id., p. 67.
7 Richards v. Asoy, 152 SCRA 45 (1987).
8 Tajonera v. Lamaroza, 110 SCRa 438 (1981).
9 Rollo, pp. 23-30.
10 Id., pp. 47-53.
11 Id., pp. 59-66.
12 See Social Security Act, Republic Act No. 1161 (effective 18
June 1954), as amended by a whole series of Republic Acts,
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Presidential Decrees and Executive Orders: Section 12-B
(Retirement Benefits); 13 (Death Benefits); 13-A (Permanent
DisabilityBenefits); 13-B (Funeral Benefit); 14 (Sickness Benefit);
and 14-A (Maternity Leave Benefit).
13 See Article 283 of the Labor Code dealing with"
1. installation of labor saving devices;
2. redundancy;
3.retrenchment to prevent losses;
4. closing or cessation of operation of the company; and Article
284 referring to
5.termination of services by reason of disease; and Section 4
(b), Rule I, book VI of the Implementing Rules and Regulations
relating tosituations
6. where the reinstatement of the employee to his former
position is required but is not possible because the company has
closed orceased operations or his former position no longer exists
at the time of reinstatement (for reasons not attributable to the
fault of theemployer).
14 91 SCRA 265 (1975).
15 91 SCRA at 268-269.
16 That is, in addition to the retirement benefits provided by
the Social Security Act.
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Today is Tuesday, January 28, 2014
powered by
Republic of the PhilippinesSUPREME COURT
Manila
THIRD DIVISION
G.R. No. 72971 October 15, 1990
ABAQUIN SECURITY AND DETECTIVE AGENCY, INC., petitioner, vs.HON.
DIEGO P. ATIENZA, HON. CLETO T. VILLATUYA, HON. GERONIMO Q.
CUADRA,NATIONAL LABOR RELATIONS COMMISSION and ANTONIO B. JOSE,
respondents.
D. P. Mercado & Associates for petitioner.
FERNAN, C.J.:The instant petition for certiorari raises
primarily the issue of whether or not a security agency may be
required to pay retirement or termination benefits infavor of its
security guard who voluntarily resigned, in the absence of an
agreement, contract or management policy regarding such
benefits.
Petitioner security agency employed private respondent Antonio
B. Jose as a security guard on August 29, 1959. Almost twenty-five
(25) years later or onApril 12, 1984, Jose voluntarily resigned in
view of his failing health and his desire to withdraw his cash
deposits with petitioner. He was then sixty-one(61) years old.
After Jose had executed a certificate of discharge acknowledging
full payment of his services as well as a quitclaim of all demands
againstpetitioner, the latter, relying on the absence of any
management policy or agreement between them regarding retirement or
termination benefits, paidJose only his cash deposits. Feeling
aggrieved, Jose filed before the Arbitration Branch of the National
Labor Relations Commission (NLRC) a complaintagainst petitioner for
separation pay, or in lieu thereof, gratuity benefits equal to
one-half month salary for every year of service and other
benefitsprovided for by law.
Labor Arbiter Domingo V. del Rosario dismissed Jose's complaint
on the following grounds: (a) an employee's enjoyment of retirement
benefits orseparation pay under Article 288 of the Labor Code and
Sections 13 and 14 (a), Rule I, Book VI of the Rules and
Regulations Implementing the LaborCode is subject to the existence
of a retirement plan, individual or collective agreement or
established management policy; (b) Jose cannot claim undersaid
implementing rules benefits which are not granted by the Code,
otherwise the then Ministry of Labor would be guilty of legislative
usurpation; and (c)Jose was put in estoppel when he executed the
certificate of discharge and when he voluntarily resigned. 1
On appeal, the NLRC in its decision of September 30, 1985, set
aside the labor arbiter's decision, disposing, thus:
WHEREFORE, premises considered, the appealed decision is hereby
SET ASIDE and another one enteredordering respondent-appellee to
pay complainant-appellant (herein private respondent Jose) his
retirement ortermination pay as provided for under existing laws
and rules in an amount equivalent to one-half () monthsalary for
every year of service, a fraction of at least six (6) months being
considered as one whole year.
Consequently, respondent-appellee (herein petitioner) is
directed to show proof of immediate compliance to(sic) the mandate
of this Decision after ten (10) days from receipt hereof.
SO ORDERED. 2
The NLRC construed Section 14 (a) of Rule I, Book VI of the
Implementing Rules and Regulations of the Labor Code inrelation to
the second paragraph of Article 288 as entitling a retiring
employee to termination pay of one-half () month forevery year of
service in the absence of any agreement or employer policy on
retirement pay. It ruled that said Section 14 (a)was intended "to
give full effect and application to Article 288 of the Labor Code
(which) covers all retiring employees,regardless of the existence
of any agreement, company policy or otherwise." 3 It added that
under the principle of equity, it isonly just and fair to reward
retiring employees for their long years of faithful service to
their employer. Moreover, the NLRCsaid that Jose's execution of the
certificate of discharge "never implied (his) abdication" or waiver
of the benefits due himunder existing laws on account of the
principle that labor standards are not subject to waiver or any
agreement which woulddeprive the workingman of said benefits.
Hence, the instant petition for certiorari raising the issues of
whether or not a 61-year-old security guard who voluntarilyresigned
is entitled to retirement benefits under Article 288 of the Labor
Code and whether or not Sections 13 and 14 (a),Rule I, Book VI of
the Rules and Regulations Implementing the Labor Code can alter,
repeal or modify said Article 288.
The Court dismissed the instant petition for lack of merit on
December 16, 1985. 4 Expectedly, petitioner filed a motion
forreconsideration reiterating as grounds therefor the two issues
it had raised in the petition and, in addition, the grounds thatthe
aforesaid sections of the implementing rules may not be the sources
of a privilege in favor of private respondent and thatequity
demands that it "be not unduly burdened in paying retirement
benefits to a former employee." 5
Respondents having filed their comments on the motion for
reconsideration, the Court reconsidered the dismissal resolutionin
view of the fact that this case requires the interpretation of
Article 288 of the Labor Code and said Sections 13 and 14 (a)of
Implementing Rule I. 6
The legal provisions involved in this petition provide as
follows:
Art, 288. * Retirement. Any employee may be retired upon
reaching the retirement age established in the collective
bargainingagreement or other applicable employment contract.
In case of retirement, the employee shall be entitled to receive
such retirement benefits as he may have earned under existing laws
andany collective bargaining or other agreement. (Labor Code)
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Sec. 13. Retirement. In the absence of any collective bargaining
agreement or other applicable agreement concerning terms
andconditions of employment which provides for retirement at an
older age, an employee may be retired upon reaching the age of
sixty (60)years.
Sec. 14. Retirement benefits. An employee who is retired
pursuant to a bona-fide retirement plan or in accordance with
theapplicable individual or collective agreement or established
employer policy shall be entitled to all the retirement benefits
providedtherein or to termination pay equivalent at least to
one-half month salary for every year of service, whichever is
higher, a fraction of atleast six (6) months being considered as
one whole year. 7
Construing these provisions in relation to the same issue
presented in this petition, this Court in the case of Llora
Motors,Inc., and/ or Constantino Carlota, Jr. vs. Hon. Franklin
Drilon, et al., 8 clarified that Article 288 (now 287) "does not
itselfpurport to impose any obligation upon employers to set up a
retirement scheme for their employees over and above thatalready
established under existing laws. In other words, Article 287
recognizes that existing laws already provide for ascheme by which
retirement benefits may be earned or accrue in favor of employees,
as part of a broader social securitysystem that provides not only
for retirement benefits but also death and funeral benefits,
permanent disability benefits,sickness benefits and maternity leave
benefits. 9
Llora went further to elucidate on the import of Sections 13 and
14 of Implementing Rule I to end the confusion between theconcepts
"retirement benefits" and "termination pay" inadvertently
engendered by the phraseology of Section 14, which dealswith both.
Thus:
... It is important to keep the two (2) concepts of "termination
pay" and "retirement benefits" separate anddistinct from each
other. Termination pay or separation pay is required to be paid by
an employer in particularsituations Identified by the Labor Code
itself or by Implementing Rule I. Termination pay where properly
dueand payable under some applicable provision of the Labor Code or
under Section 4 (b) of Implementing Rule I,must be paid whether or
not an additional retirement plan has been set up under an
agreement with theemployer or under an "established employer
policy."
What needs to be stressed, however, is that Section 14 of
Implementing Rule I, like Article 287 of the LaborCode, does not
purport to require termination pay to be paid to an employee who
may want to retire but forwhom no additional retirement plan had
been set up by prior agreement with the employer. ... What Section
14of Implementing Rule I may be seen to be saying is that where
termination pay is otherwise payable to anemployee under an
applicable provision of the Labor Code, and an additional or
consensual retirement planexists, then payments under such
retirement plan may be credited against the termination pay that is
due,subject, however to certain conditions. ... 10
Based on the foregoing, there being no individual or collective
agreement between the parties or established employer'spolicy
regarding retirement benefits, petitioner's resistance to private
respondent's claim therefor is legally defensible.
However, it must be noted that the complaint filed by private
respondent prayed primarily for termination benefits and only inthe
alternative for gratuity benefits. In fact, the dispositive portion
of the decision. under review ordered petitioner to payprivate
respondent "retirement or termination pay". In so ordering, the
NLRC reasoned:
... The implementing rule particularly applicable to paragraph
No. 2 Art. 288 is Section 14 (a) of Rule I, BookVI, of the
Implementing Rules and Regulations of the Labor Code. This rule
provides retirement benefits toemployees who have reached the
retirement age, in an amount equivalent either to a bona-fide
retirement plan,a CBA or individual agreement, an established
employer policy, or in the absence of the preceeding
threepractices, a termination pay of at least one-half (1/2) month
salary for every year of service, a fraction of atleast six (6)
months being considered as one whole year. ... 11
Taken in the light of our pronouncements in Llora, the
incorrectness of the interpretation given by the NLRC to Article
288 inrelation to Section 14 (a) of Implementing Rule I is at once
apparent. "While it is true that the contemporaneous
constructionplaced upon a statute by executive officers whose duty
is to enforce it should be given great weight by the courts, still
if suchconstruction is so erroneous, as in the instant case, the
same must be declared as null and void. It is the role of
theJudiciary to refine and, when necessary, correct constitutional
(and/or statutory) interpretation, in the context of
theinteractions of the three branches of the government, almost
always in situations where some agency of the State hasengaged in
action that stems ultimately from some legitimate area of
governmental power (The Supreme Court in ModernRole, C. B. Swisher,
1958, p. 36)." 12 We hasten to add, lest a misimpression is
created, that we are here setting aside asnull and void merely the
interpretation given in the instant case by the NLRC to Section
14(a) of Implementing Rule I inrelation to Article 288 of the Labor
Code, and not Section 14(a) itself which had been given by this
Court in Llora supra aconstruction that is in harmony and
consistent with Article 288 of the Labor Code.
Be that as it may, we are not prepared to altogether set aside
the award of termination pay, considering that there existsanother
legal basis therefor. As keenly observed by the Solicitor
General:
It may not be improper to state that respondent Jose should be
paid termination pay for reasons analogous tothose contemplated
under Article 285 of the Labor Code, which provides:
Art. 285. Disease as ground for termination. An employer may
terminate the services of anemployee who has been found to be
suffering from any disease and whose continuedemployment is
prohibited by law or is prejudicial to his health as well as to the
health of his co-employees: Provided, That he is paid separation
pay equivalent to at least one (1) month salaryor to one half ()
month salary for every year of service, whichever is greater, a
fraction of at leastsix (6) months being considered as one (1)
whole year.
It is true that respondent Jose voluntarily resigned but he
resigned because, among others, he suffered from illhealth. When
petitioner accepted his resignation, it terminated his services
partly for that reason. 13
Under Article 245 of the Labor Code, "(s)ecurity guards and
other personnel employed for the protection and security of
theperson, properties and premises of the employer shall not be
eligible for membership in any labor organization." As such,they
are a special class of employees in that they are deprived of the
right to ventilate demands collectively. They are subjectto terms
and conditions of employment circumscribed by employment contracts
imposed on them by their employer. Whilethey may make particular
individual demands in said contracts, more often than not, they
fail to do so at the time of hiring.Hence, their only refuge is the
liberality of the law. Private respondent, who was in the employ of
petitioner for almost aquarter of a century and whose reason for
terminating his employment was his failing health, deserves the
full measure of thelaw's benevolence.
WHEREFORE, the petition is DISMISSED. The monetary award in
favor of private respondent Antonio B. Jose is understood
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to be in the concept of termination pay, rather than retirement
benefits.
This decision is immediately executory.
SO ORDERED.
Gutierrez, Jr., Bidin and Cortes, JJ., concur.
Feliciano, J., is on leave.
Footnotes
1 Rollo, pp. 18-21.
2 Rollo, pp. 16-17.
3 Rollo, p. 16.
4 Rollo, p. 22.
5 Rollo, p. 29.
6 Rollo, p. 115.
* Renumbered Art. 287 in subsequent amendments.
7 Rule 1, Book VI, Rules and Regulations Implementing the Labor
Code.
8 G.R. No. 82895, November 7, 1989.
9 p. 7, Decision, underscoring in the original.
10 pp. 10-11, Decision, emphasis in the original.
11 Rollo, p. 15.
12 Insular Bank of Asia and America Employees' Union (IBAAEU)
vs. Inciong, G.R. No. 52415, October 23, 1984, 132 SCRA 663.
13 Rollo, p. 107.
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Today is Tuesday, January 28, 2014
powered by
Republic of the PhilippinesSUPREME COURT
Manila
FIRST DIVISION
G.R. No. 156934 March 16, 2007
ALPHA C. JACULBE, Petitioner, vs.SILLIMAN
UNIVERSITY,Respondent.
D E C I S I O N
CORONA, J.:
Petitioner comes to us via this petition for review on
certiorari1 to challenge a decision2 of the Court ofAppeals (CA)
and the resolution3 affirming it.
Sometime in 1958, petitioner began working for respondents
university medical center as a nurse.4
In a letter dated December 3, 1992,5 respondent, through its
Human Resources Development Office,informed petitioner that she was
approaching her 35th year of service with the university and was
due forautomatic retirement on November 18, 1993, at which time she
would be 57 years old. This was pursuantto respondents retirement
plan for its employees which provided that its members could be
automaticallyretired "upon reaching the age of 65 or after 35 years
of uninterrupted service to the university."6Respondent required
certain documents in connection with petitioners impending
retirement.
A brief exchange of letters7 between petitioner and respondent
followed. Petitioner emphatically insistedthat the compulsory
retirement under the plan was tantamount to a dismissal and pleaded
withrespondent to be allowed to work until the age of 60 because
this was the minimum age at which shecould qualify for SSS8
pension. But respondent stood pat on its decision to retire her,
citing "companypolicy."
On November 15, 1993, petitioner filed a complaint in the
National Labor Relations Commission (NLRC)for "termination of
service with preliminary injunction and/or restraining order."9 On
November 18, 1993,respondent compulsorily retired petitioner.
After the parties submitted their position papers, the labor
arbiter rendered a decision finding respondentguilty of illegal
dismissal and ordered that petitioner be reinstated and paid full
backwages.10 On appeal,however, the NLRC reversed the labor
arbiters decision and dismissed the complaint for lack of
merit.11The NLRC likewise denied petitioners motion for
reconsideration.12 In the assailed decision andresolution, the CA
affirmed the NLRC.
Hence, this petition.
The issues for our consideration are:
1) did respondents retirement plan imposing automatic retirement
after 35 years of servicecontravene the security of tenure clause
in the 1987 Constitution and the Labor Code?
2) did respondent commit illegal dismissal by retiring
petitioner solely by reason of such provisionin its retirement
plan?
Retirement plans allowing employers to retire employees who are
less than the compulsory retirementage of 65 are not per se
repugnant to the constitutional guaranty of security of tenure.
Article 287 of theLabor Code provides:
ART. 287. Retirement - Any employee may be retired upon reaching
the retirement age established inthe collective bargaining
agreement or other applicable employment contract. xxx
By its express language, the Labor Code permits employers and
employees to fix the applicableretirement age at below 60
years.13
However, after reviewing the assailed decision together with the
rules and regulations of respondents
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retirement plan, we find that the plan runs afoul of the
constitutional guaranty of security of tenurecontained in Article
XIII, also known as the provision on Social Justice and Human
Rights.
The CA, in ruling against petitioner, premised its decision to
uphold the retirement plan on her voluntaryparticipation
therein:
The petitioner in this case may, however, argue that the
Pantranco case is not applicable in the case atbar as the
controversy in the said case involves a compulsory retirement on
the basis of the length ofservice rendered by the employee as
agreed in an existing CBA, whereas in the present case, theprivate
respondent compulsorily retired the petitioner not based on a CBA
but on the retirement schemeprovided for in the private respondents
retirement plan. Nonetheless, this argument must fail. Thecontract
fixing for retirement age as allowed under Article 287 of the Labor
Code does not exclusivelyrefer to CBA which provides for an agreed
retirement age. The said provision explicitly allows, as well,other
applicable employment contract to fix retirement age.
The records disclose that the private respondents Retirement
Plan has been in effect for more than 30years. The said plan is
deemed integrated into the employment contract between private
respondent andits employees as evidenced by the latters voluntary
contribution through monthly salarydeductions. Previous retirees
have already enjoyed the benefits of the retirement plan, and ever
sincethe said plan was effected, no questions or disagreement have
been raised, until the same was made toapply to the petitioner.
xxx14 (emphasis ours)
The problem with this line of reasoning is that a perusal of the
rules and regulations of the plan shows thatparticipation therein
was not voluntary at all.
Rule III of the plan, on membership, stated:
SECTION 1 MEMBERSHIP
All full-time Filipino employees of the University will
automatically become members of the Plan,provided, however, that
those who have retired from the University, even if rehired, are no
longer eligiblefor membership in the Plan. A member who continues
to serve the University cannot withdrawfrom the Plan.
xxx xxx xxx
SECTION 2 EFFECTIVITY OF MEMBERSHIP
Membership in the Plan starts on the day a person is hired on a
full-time basis by the University.
SECTION 3 TERMINATION OF MEMBERSHIP
Termination of membership in the Plan shall be upon the death of
the member, resignation ortermination of employees contract by the
University, or retirement from the University.15(emphasis
ours).
Rule IV, on contributions, stated:
The Plan is contributory. The University shall set aside an
amount equivalent to 3% of the basic salariesof the faculty and
staff. To this shall be added a 5% deduction from the basic
salaries of the faculty andstaff.
A member on leave with the University approval shall continue
paying, based on his pay while on leave,his leave without pay
should pay his contributions to the Plan. However, a member, who
has been onleave without pay should pay his contributions based on
his salary plus the Universitys contributionswhile on leave or the
full amount within one month immediately after the date of his
reinstatement.Provided[,] further that if a member has no
sufficient source of income while on leave may pay within sixmonths
after his reinstatement.16
From the language of the foregoing retirement plan rules, the
compulsory nature of both membership inand contribution to the plan
debunked the CAs theory that petitioners "voluntary contributions"
wereevidence of her willing participation therein. It was through
no voluntary act of her own that petitionerbecame a member of the
plan. In fact, the only way she could have ceased to be a member
thereof was ifshe stopped working for respondent altogether.
Furthermore, in the rule on contributions, the repeateduse of the
word "shall" ineluctably pointed to the conclusion that employees
had no choice but tocontribute to the plan (even when they were on
leave).
According to the assailed decision, respondents retirement plan
"ha(d) been in effect for more than 30years."17 What was not
pointed out, however, was that the retirement plan came into being
in 197018 or12 years after petitioner started working for
respondent. In short, it was not part of the terms ofemployment to
which petitioner agreed when she started working for respondent.
Neither did it becomepart of those terms shortly thereafter, as the
CA would have us believe.
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Retirement is the result of a bilateral act of the parties, a
voluntary agreement between the employer andthe employee whereby
the latter, after reaching a certain age agrees to sever his or her
employment withthe former.19 In Pantranco North Express, Inc. v.
NLRC,20 to which both the CA and respondent refer,the imposition of
a retirement age below the compulsory age of 65 was deemed
acceptable becausethis was part of the CBA between the employer and
the employees. The consent of the employees, asrepresented by their
bargaining unit, to be retired even before the statutory retirement
age of 65 was laidout clearly in black and white and was therefore
in accord with Article 287.
In this case, neither the CA nor the respondent cited any
agreement, collective or otherwise, to justify thelatters
imposition of the early retirement age in its retirement plan,
opting instead to harp on petitionersalleged "voluntary"
contributions to the plan, which was simply untrue. The truth was
that petitioner had nochoice but to participate in the plan, given
that the only way she could refrain from doing so was to resignor
lose her job. It is axiomatic that employer and employee do not
stand on equal footing,21 a situationwhich often causes an employee
to act out of need instead of any genuine acquiescence to
theemployer. This was clearly just such an instance.
Not only was petitioner still a good eight years away from the
compulsory retirement age but she wasalso still fully capable of
discharging her duties as shown by the fact that respondents board
of trusteesseriously considered rehiring her after the effectivity
of her "compulsory retirement."22
As already stated, an employer is free to impose a retirement
age less than 65 for as long as it has theemployees consent. Stated
conversely, employees are free to accept the employers offer to
lower theretirement age if they feel they can get a better deal
with the retirement plan presented by the employer.Thus, having
terminated petitioner solely on the basis of a provision of a
retirement plan which was notfreely assented to by her, respondent
was guilty of illegal dismissal.
At this point, reinstatement is out of the question.1awphi1.nt
Petitioner is now 71 years old andtherefore well over the statutory
compulsory retirement age. For this reason, we grant her separation
payin lieu of reinstatement. It is also for this reason that we
modify the award of backwages in her favor, to becomputed from the
time of her illegal dismissal on November 18, 1993 up to her
compulsory retirementage.
WHEREFORE, the petition is hereby GRANTED. The decision of the
Court of Appeals in CA-G.R. SPNo. 50445 is REVERSED and SET ASIDE.
The October 25, 1994 decision of the labor arbiter
findingrespondent guilty of illegal dismissal is REINSTATED, with
the MODIFICATION that, in lieu ofreinstatement, petitioner is
awarded separation pay, the award of backwages to be computed from
thetime of her illegal dismissal up to her compulsory retirement
age.
SO ORDERED.
RENATO C. CORONAAssociate Justice
WE CONCUR:
REYNATO S. PUNOChief JusticeChairperson
ANGELINA SANDOVAL-GUTIERREZAssociate Justice
ADOLFO S. AZCUNAAsscociate Justice
CANCIO C. GARCIAAssociate Justice
C E R T I F I C A T I O N
Pursuant to Section 13, Article VIII of the Constitution, I
certify that the conclusions in the above decisionhad been reached
in consultation before the case was assigned to the writer of the
opinion of the CourtsDivision.
REYNATO S. PUNOChief Justice
Foonotes
1 Under Rule 45 of the Rules of Court.
2 Dated July 11, 2002 in CA-G.R. SP No. 50445, penned by
Associate Justice Amelita G.Tolentino and concurred in by Associate
Justices Ruben T. Reyes (now Presiding Justice) and
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Renato C. Dacudao of the Eighth Division of the Court of
Appeals; rollo, pp. 149-158.
3 Dated January 20, 2003 in CA-G.R. SP No. 50445, penned by
Associate Justice Amelita G.Tolentino and concurred in by Associate
Justices Ruben T. Reyes (now Presiding Justice) andRenato C.
Dacudao of the Eighth Division of the Court of Appeals; id., p.
197.
4 Id., p. 15.
5 Id., pp. 60-61.
6 Id., p. 135.
7 Id., pp. 62-70.
8 Social Security System.
9 Rollo, pp. 55-59.
10 Id., pp. 88-97.
11 Id., pp. 116-120.
12 Id., pp. 129-132.
13 Pantranco North Express, Inc. v. NLRC, 328 Phil. 470
(1996).
14 Supra note 2, at 155-156.
15 Rollo, p. 134.
16 Id., p. 135.
17 Supra note 2, at 156.
18 Rollo, p. 133.
19 Soberano v. Clave, G.R. Nos. L-43753-56 & L-50991, 29
August 1980, 99 SCRA 549.
20 Id.
21 Mercury Drug Co., Inc. v. CIR, 155 Phil. 636 (1974).
22 Id., pp. 79-80.
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Republic of the Philippines
Supreme Court
Manila
THIRD DIVISION
ALBERTO P. OXALES, G.R. No. 152991
Petitioner,
Present:
YNARES-SANTIAGO, J.,
Chairperson,
- versus - QUISUMBING*
AUSTRIA-MARTINEZ,
AZCUNA,** and
REYES, JJ.
Promulgated:
UNITED LABORATORIES, INC.,
Respondent. July 21, 2008
x - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -
- - - - - - - - - - - - - - - - - - - x
D E C I S I O N
REYES, R.T., J.:
HOW should a private company retirement plan for employees be
implemented vis--vis The Retirement Pay Law (Republic Act
No.7641)?
Papaano ipapatupad ang isang plano ng pribadong kompanya para sa
pagreretiro ng mga empleyado sa harap ngBatas ng Pagbabayad sa
Pagreretiro (Batas Republika Blg. 7641)?
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We address the concern in this appeal by certiorari of the
Decision[1] of the Court of Appeals (CA) affirming the
Resolution[2]and Decision[3] of the Labor Arbiter and the National
Labor Relations Commission (NLRC), respectively, dismissing
petitionerAlberto P. Oxales complaint for additional retirement
benefits, recovery of the cash equivalent of his unused sick
leaves, damages,and attorneys fees, against respondent United
Laboratories, Inc. (UNILAB).
The Facts
Sometime in 1959, UNILAB established the United Retirement Plan
(URP).[4] The plan is a comprehensive retirement programaimed at
providing for retirement, resignation, disability, and death
benefits of its members. An employee of UNILAB becomes amember of
the URP upon his regularization in the company. The URP mandates
the compulsory retirement of any member-employeewho reaches the age
of 60.
Both UNILAB and the employee contribute to the URP. On one hand,
UNILAB provides for the account of the employee an
actuarially-determined amount to Trust Fund A. On the other hand,
the employee chips in 2% of his monthly salary to Trust Fund B.
Uponretirement, the employee gets both amounts standing in his name
in Trust Fund A and Trust Fund B.
As retirement benefits, the employee receives (1) from Trust
Fund A a lump sum of 1 months pay per year of service based on
themembers last or terminal basic monthly salary,[5] and (2)
whatever the employee has contributed to Trust Fund B, together
with theincome minus any losses incurred. The URP excludes
commissions, overtime, bonuses, or extra compensations in the
computationof the basic salary for purposes of retirement.
Oxales joined UNILAB on September 1, 1968. He was compulsorily
retired by UNILAB when he reached his 60th birthday onSeptember 7,
1994, after having rendered service of twenty-five (25) years,
eleven (11) months, and six (6) days. He was thenDirector of
Manufacturing Services Group.
In computing the retirement benefits of Oxales based on the 1
months for every year of service under the URP, UNILAB took
intoaccount only his basic monthly salary. It did not include as
part of the salary base the permanent and regular bonuses,
reasonablevalue of food allowances, 1/12 of the 13th month pay, and
the cash equivalent of service incentive leave.
Thus, Oxales received from Trust Fund A P1,599,179.00, instead
of P4,260,255.70. He also received P176,313.06, instead
ofP456,039.20 as cash equivalent of his unused sick leaves. Lastly,
he received P397,738.33 from his contributions to Trust Fund B.
Insum, Oxales received the total amount of P2,173,230.39 as his
retirement benefits.
On August 21, 1997, Oxales wrote UNILAB, claiming that he should
have been paid P1,775,907.23 more in retirement pay andunused leave
credits. He insisted that his bonuses, allowances and 13th month
pay should have been factored in the computation ofhis retirement
benefits.[6]
On September 9, 1997, UNILAB wrote[7] back and reminded Oxales
about the provision of the URP excluding any commissions,overtime,
bonuses or extra compensations in the computation of the basic
salary of the retiring employee.
Disgruntled, Oxales filed a complaint with the Labor Arbiter for
(1) the correct computation of his retirement benefits, (2)
recoveryof the cash equivalent of his unused sick leaves, (3)
damages, and (4) attorneys fees. He argued that in the computation
of hisretirement benefits, UNILAB should have included in his basic
pay the following, to wit: (a) cash equivalent of not more than
five (5)days service incentive leave; (b) 1/12th of 13th month pay;
and (c) all other benefits he has been receiving.
Efforts were exerted for a possible amicable settlement. As this
proved futile, the parties were required to submit their
respectivepleadings and position papers.
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Labor Arbiter, NLRC and CA Dispositions
On June 30, 1998, Labor Arbiter Romulus A. Protasio rendered a
decision dismissing the complaint, thus:
WHEREFORE, premises considered, judgment is hereby rendered
dismissing the instant complaint for lack of merit.
SO ORDERED.[8]
The Labor Arbiter held that the URP clearly excludes commission,
overtime, bonuses, or other extra compensation. Hence, thebenefits
asked by Oxales to be included in the computation of his retirement
benefits should be excluded.[9]
The Arbiter also held that the inclusion of the fringe benefits
claimed by Oxales would put UNILAB in violation of the terms
andconditions set forth by the Bureau of Internal Revenue (BIR)
when it approved the URP as a tax-qualified plan. More, any
overpaymentof benefits would adversely affect the actuarial
soundness of the plan. It would also expose the trustees of the URP
to liabilities andprejudice the other employees. Worse, the BIR
might even withdraw the tax exemption granted to the URP.[10]
Lastly, the LaborArbiter opined that the URP precludes the
application of the provisions of R.A. No. 7641.[11]
Oxales appealed to the NLRC. On February 8, 1999, the NLRC
affirmed the decision of the Labor Arbiter, disposing as
follows:
WHEREFORE, in view thereof, the instant appeal is hereby
dismissed for lack of merit and the appealed decision is
orderedaffirmed.
SO ORDERED.[12]
The NLRC ruled that the interpretation by Oxales of R.A. No.
7641 is selective. He only culled the provisions that are
beneficial to him,putting in grave doubt the sincerity of his
motives. For instance, he claims that the value of the food
benefits and other allowancesshould be included in his monthly
salary as multiplicand to the number of his years of service with
UNILAB. At the same time,however, he does not intend to reduce the
1 month salary as multiplier under the URP to under R.A. No.
7641.[13]
The NLRC agreed with the Labor Arbiter that the provisions of
R.A. No. 7641 do not apply in view of the URP. The NLRC alsotook
into account the fact that the benefits granted to Oxales by virtue
of the URP was even higher than what R.A. No. 7641requires.[14]
His motion for reconsideration having been denied, Oxales filed
with the CA a petition for certiorari under Rule 65.
In a decision promulgated on April 12, 2002, the CA dismissed
the petition. The CA ruled that the petition of Oxales calls for a
reviewof the factual findings of the Labor Arbiter as affirmed by
the NLRC. It is not the normal function of the CA in a special
civil action forcertiorari to inquire into the correctness of the
evaluation of the evidence by the Labor Arbiter. Its authority is
confined only to issues ofjurisdiction or grave abuse of
discretion.[15]
Just like the Labor Arbiter and the NLRC, the CA also held that
R.A. No. 7641 is applicable only in the absence of a retirement
plan oragreement providing for the retirement benefits of employees
in an establishment.[16]
Finally, the CA denied the claim of Oxales to moral and
exemplary damages. According to the appellate court, he failed to
prove thepresence of bad faith or fraud on the part of UNILAB. His
mere allegations of having suffered sleepless nights, serious
anxiety, and
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mental anguish are not enough. No premium should be placed on
the right to litigate.[17]
Left with no other option, Oxales filed the present recourse
under Rule 45 of the 1997 Rules of Civil Procedure.[18]
Issues
In his Memorandum,[19] Oxales raises the following issues for
Our disposition, to wit:
1. WHETHER OR NOT THE COURT OF APPEALS SERIOUSLY ERRED IN NOT
FINDING THAT ACCORDING TO PREVAILINGJURISPRUDENCE, SUCH ERRORS IN
THE COMPUTATION OF RETIREMENT BENEFITS OF PETITIONER SHOULD
BECORRECTED IN A SPECIAL ACTION FOR CERTIORARI;
2. WHETHER OR NOT THE COURT OF APPEALS SERIOUSLY ERRED IN NOT
FINDING THAT THE NLRC COMMITTED GRAVEABUSE OF DISCRETION IN
INCORRECTLY INTERPRETING THE URP TO EXCLUDE SEVERAL REMUNERATIONS
FROM THESAID SALARY BASE;
3. WHETHER OR NOT THE COURT OF APPEALS SERIOUSLY ERRED AND
COMMITTED GRAVE ABUSE OF DISCRETION INTOTALLY IGNORING THE ISSUE
AND IN NOT FINDING THAT THE NLRC COMMITTED GRAVE ABUSE OF
DISCRETION ININCORRECTLY INTERPRETING THE URP TO EXCLUDE PERMANENT
AND REGULAR ALLOWANCES FROM THE SALARYBASE FOR COMPUTING RETIREMENT
BENEFITS OF PETITIONER;
4. WHETHER OR NOT THE COURT OF APPEALS SERIOUSLY ERRED IN NOT
FINDING THAT THE NLRC COMMITTED GRAVEABUSE OF DISCRETION IN
INCORRECTLY INTERPRETING THE URP TO EXCLUDE PERMANENT AND
REGULARREMUNERATIONS MISLABELED AS BONUSES FROM THE SALARY BASE FOR
COMPUTING THE RETIREMENT BENEFITSOF THE PETITIONER;
5. WHETHER OR NOT THE COURT OF APPEALS ERRED IN NOT FINDING THAT
THE NLRC COMMITTED GRAVE ABUSE OFDISCRETION IN INCORRECTLY
INTERPRETING THE URP TO EXCLUDE ONE TWELFTH (1/12th) OF THE
STATUTORYTHIRTEENTH MONTH PAY FROM THE SALARY BASE FOR COMPUTING
RETIREMENT BENEFITS;
6. WHETHER OR NOT THE COURT OF APPEALS SERIOUSLY ERRED IN THE
INTERPRETATION OF R.A. NO. 7641 WHEN ITCONCLUDED THAT THE SAID LAW
IS APPLICABLE ONLY IN THE ABSENCE OF RETIREMENT PLAN OR
AGREEMENTPROVIDING FOR THE RETIREMENT BENEFITS OF EMPLOYEES IN AN
ESTABLISHMENT;
7. WHETHER OR NOT THE COURT OF APPEALS SERIOUSLY ERRED IN NOT
FINDING THAT THE DEFINITION OF SALARYUNDER THE IMPLEMENTING RULES
OF R.A. NO. 7641 SHOULD BE INTERPRETED TO INCLUDE THE PERMANENT
ANDREGULAR REMUNERATIONS OF PETITIONER IN THE SALARY BASE FOR
COMPUTING RETIREMENT BENEFITS;
8. WHETHER OR NOT THE LABOR ARBITER, THE NLRC, AND COURT OF
APPEALS COMMITTED GRAVE ABUSE OFDISCRETION IN IGNORING AND NOT
RESOLVING THE ISSUES REGARDING PETITIONERS UNPAID CASH EQUIVALENT
OFTHE UNUSED SICK LEAVE CREDITS;
9. WHETHER OR NOT THE COURT OF APPEALS SERIOUSLY ERRED IN NOT
RULING THAT THE NLRC GRAVELY ABUSEDITS DISCRETION IN ITS FAILURE TO
PROPERLY INTERPRET THE URP IN DETERMINING THE EMPLOYMENT PERIOD
OFPETITIONER FOR THE PURPOSE OF COMPUTING RETIREMENT BENEFITS;
10. WHETHER OR NOT THE COURT OF APPEALS SERIOUSLY ERRED IN NOT
RULING THAT THE NLRC COMMITTED GRAVEABUSE OF DISCRETION IN NOT
REINSTATING THE MEDICAL RETIREMENT BENEFITS OF PETITIONER;
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11. WHETHER OR NOT THE COURT OF APPEALS SERIOUSLY ERRED AND
GRAVELY ABUSED ITS DISCRETION INTOTALLY AND ARBITRARILY IGNORING
THE ISSUE AND IN NOT FINDING THAT THE NLRC COMMITTED GRAVE ABUSE
OFDISCRETION IN RENDERING A DECISION IN VIOLATION OF THE
CONSTITUTIONAL REQUIREMENTS WHICH IN EFFECTDENIED PETITIONERS RIGHT
TO DUE PROCESS;
12. WHETHER OR NOT THE COURT OF APPEALS SERIOUSLY ERRED AND
GRAVELY ABUSED ITS DISCRETION INLIKEWISE RENDERING A DECISION IN
VIOLATION OF THE CONSTITUTIONAL REQUIREMENT THAT DECISIONS
SHOULDEXPRESS CLEARLY AND DISTINCTLY THE FACTS OF THE CASE AND THE
LAW ON WHICH IT IS BASED;
13. WHETHER OR NOT THE COURT OF APPEALS SERIOUSLY ERRED IN NOT
GRANTING MORAL AND EXEMPLARYDAMAGES AND ATTORNEYS FEES TO
PETITIONER;
14. WHETHER OR NOT THE SUPREME COURT SHOULD GRANT PETITIONER
UNPAID RETIREMENT PAY, UNPAID CASHEQUIVALENT OF UNUSED LEAVE
CREDITS, REINSTATEMENT OF MEDICAL BENEFITS, MORAL AND
EXEMPLARYDAMAGES, AND ATTORNEYS FEES.[20] (Underscoring
supplied)
The issues posed by Oxales may be compressed as follows: first,
whether in the computation of his retirement and sick
leavebenefits, UNILAB should have factored such benefits like
bonuses, cash and meal allowances, rice rations, service incentive
leaves,and 1/12 of the 13th month pay; second, whether R.A. No.
7641 is applicable for purposes of computing his retirement
benefits; andthird, whether UNILAB is liable for moral damages,
exemplary damages, and attorneys fees.
Our Ruling
The clear language of the URP should be respected.
A retirement plan in a company partakes the nature of a
contract, with the employer and the employee as the contracting
parties. Itcreates a contractual obligation in which the promise to
pay retirement benefits is made in consideration of the continued
faithfulservice of the employee for the requisite period.[21]
The employer and the employee may establish such stipulations,
clauses, terms, and conditions as they may deem convenient.[22]
InAllgeyer v. Louisiana,[23] New York Life Ins. Co. v. Dodge,[24]
Coppage v. Kansas,[25] Adair v. United States,[26] Lochner v.
NewYork,[27] and Muller v. Oregon,[28] the United States Supreme
Court held that the right to contract about ones affair is part
andparcel of the liberty of the individual which is protected by
the due process of law clause of the Constitution.
The obligations arising from the agreement between the employer
and the employee have the force of law between them and shouldbe
complied with in good faith.[29] However, though the employer and
the employee are given the widest latitude possible in thecrafting
of their contract, such right is not absolute. There is no such
thing as absolute freedom of contract. A limitation is provided
forby the law itself. Their stipulations, clauses, terms, and
conditions should not be contrary to law, morals, good customs,
public order,or public policy.[30] Indeed, the law respects the
freedom to contract but, at the same time, is very zealous in
protecting thecontracting parties and the public in general. So
much so that the contracting parties need not incorporate the
existing laws in theircontract, as the law is deemed written in
every contract. Quando abest, proviso parties, adest proviso legis.
When the provision ofthe party is lacking, the provision of the law
supplies it. Kung may kulang na kondisyon sa isang kasunduan, ang
batas angmagdaragdag dito.
Viewed from the foregoing, We rule that Oxales is not entitled
to the additional retirement benefits he is asking. The URP is
very
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clear: basic monthly salary for purposes of computing the
retirement pay is the basic monthly salary, or if daily[,] means
the basicrate of pay converted to basic monthly salary of the
employee excluding any commissions, overtime, bonuses, or
extracompensations.[31] Inclusio unius est exclusio alterius. The
inclusion of one is the exclusion of others. Ang pagsama ng
isa,pagpwera naman sa iba.
The URP is not contrary to law, morals, good customs, public
order, or public policy to merit its nullification. We,
thus,sustain it. At first blush, the URP seems to be
disadvantageous to the retiring employee because of the exclusion
of commissions,overtime, bonuses, or extra compensations in the
computation of the basic monthly salary. However, a close reading
of its provisionswould reveal otherwise. We quote with approval the
explanation of the NLRC in this regard, viz.:
x x x the United Retirement Plan of the respondent [Unilab] has
a one and one-half months salary for every year of service as the
basisof entitlement. Under the new law, only one-half month of the
retirees salary inclusive however, of not more than five (5) days
ofservice incentive leave and one-twelfth (1/12) of the 13th month
pay are used as the bases in the retirement benefits
computation.
Mathematically speaking therefore, complainants [Oxales]
benefits received amounting to P1,599,179.00 under Trust Fund
Atogether with the cash equivalent of his unused leaves which has
an amount of P176,313.06 and his contribution in the Trust Fund
Bamounting to P397,738.33 are way above the entitlement he could
have received under Republic Act 7641, otherwise known as theNew
Retirement Law.[32] (Underscoring supplied)
Both law[33] and jurisprudence[34] mandate that if the terms of
a contract are clear and leave no doubt upon the intention of
thecontracting parties, the literal meaning of its stipulations
shall control. Thus, if the terms of a writing are plain and
unambiguous, thereis no room for construction, since the only
purpose of judicial construction is to remove doubt and
uncertainty.[35] Only where thelanguage of a contract is ambiguous
and uncertain that a court may, under well-established rules of
construction, interfere to reach aproper construction and make
certain that which in itself is uncertain.[36] Where the language
of a contract is plain and unambiguous,its meaning should be
determined without reference to extrinsic facts or aids.[37]
R.A. No. 7641 does not apply in view of the URP which gives to
the retiring employee more than what the law requires;
thesupporting cases cited by Oxales are off-tangent.
R.A. No. 7641, otherwise known as The Retirement Pay Law, only
applies in a situation where (1) there is no collective
bargainingagreement or other applicable employment contract
providing for retirement benefits for an employee; or (2) there is
a collectivebargaining agreement or other applicable employment
contract providing for retirement benefits for an employee, but it
is below therequirements set for by law. The reason for the first
situation is to prevent the absurd situation where an employee, who
is otherwisedeserving, is denied retirement benefits by the
nefarious scheme of employers in not providing for retirement
benefits for theiremployees. The reason for the second situation is
expressed in the latin maxim pacta privata juri publico derogare
non possunt. Private contracts cannot derogate from the public law.
Ang kasunduang pribado ay hindi makasisira sa batas publiko. Five
(5)reasons support this conclusion.
First, a plain reading of the Retirement Pay Law. R.A. No. 7641
originated from the House of Representatives as House Bill 317which
was later consolidated with Senate Bill 132. It was approved on
December 9, 1992 and took effect on January 7, 1993.[38] Amending
Article 287 of the Labor Code, it provides as follows:
Art. 287. Retirement. Any employee may be retired upon reaching
the retirement age established in the collective
bargainingagreement or other applicable employment contract.
In case of retirement, the employee shall be entitled to receive
such retirement benefits as he may have earned under existing
lawsand any collective bargaining agreement and other agreements:
Provided, however, that an employees retirement benefits under
anycollective bargaining and other agreements shall not be less
than those provided herein.
In the absence of a retirement plan or agreement providing for
retirement benefits of employees in the establishment, an
employeeupon reaching the age of sixty (60) years or more, but not
beyond sixty-five (65) years which is hereby declared the
compulsoryretirement age, who has served at least five (5) years in
the said establishment, may retire and shall be entitled to
retirement pay
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equivalent to at least one-half (1/2) month salary for every
year of service, a fraction of at least six (6) months being
considered asone whole year.
Unless the parties provide for broader inclusions, the term
one-half (1/2) month salary shall mean fifteen (15) days plus
one-twelfth(1/12) of the 13th month pay and the cash equivalent of
not more than five (5) days of service incentive leaves.
(Underscoringsupplied)
Second, the legislative history of the Retirement Pay Law. It
may be recalled that R.A. No. 7641 traces back its history in
thecase of Llora Motors, Inc. v. Drilon.[39] In this case, the
Court held that the then Article 287 of the Labor Code[40] and
itsImplementing Rules[41] may not be the source of an employees
entitlement to retirement pay absent the presence of a
collectivebargaining agreement or voluntary company policy that
provides for retirement benefits for the employee.[42]
Third, the legislative intent of the Retirement Pay Law. A
reading of the explanatory note of Representative Alberto S. Veloso
wouldshow why Congress sought to pass the Retirement Pay Law: many
employers refuse or neglect to adopt a retirement plan for
theiremployees because of the absence of any legal compulsion for
them to do so, thus:
When the Labor Code came into effect in 1974, retirement pay
had, as a matter of course, been granted to employees in the
privatesector when they reach the age of sixty (60) years. This had
practically been the rule observed by employers in the country
pursuant tothe rules and regulations issued by the then Minister of
Labor and Employment to implement the provisions of the Labor Code,
moreparticularly, where there is no provision for the same in the
collective bargaining agreement or retirement plan of the
establishment.
At present, however, such benefit of retirement pay is no longer
available where there is no collective agreement thereon or
anyretirement plan at all. This is so because, in a decision of the
Supreme Court (Llora Motors vs. Drilon and NLRC, et al., G.R.
No.82895, November 7, 1989), it was held that the grant of such
benefit under the rules implementing the Labor Code is not
supported byany express provision of the Labor Code itself. In
short, there is no specific statutory basis for the grant of
retirement benefits foremployees in the private sector reaching the
age of 60 years.
Since the time of such nullification by the Supreme Court of
said implementing rules on retirement pay for private sector
employees,many employers simply refuse or neglect to adopt any
retirement plan for their workers, obviously emboldened by the
thought that,after said ruling, there is no longer any legal
compulsion to grant such retirement benefits. In our continuous
quest to promote socialjustice, unfair situations like this,
productive of grievance or irritants in the labor-management
relations, must immediately be correctedor remedied by legislation.
(Underscoring supplied)
Fourth, the title of the Retirement Pay Law. The complete title
of R.A. No. 7641 is An Act Amending Article 287 of
PresidentialDecree No. 442, As Amended, Otherwise Known as the
Labor Code of the Philippines, By Providing for Retirement Pay to
QualifiedPrivate Sector in the Absence of Any Retirement Plan in
the Establishment. Res ipsa loquitur. The thing speaks for itself.
Isangbagay na nangungusap na sa kanyang sarili.
Fifth, jurisprudence. In Oro Enterprises, Inc. v. National Labor
Relations Commission,[43] the Court held that R.A. No. 7641is
undoubtedly a social legislation. The law has been enacted as a
labor protection measure and as a curative statute that absent
aretirement plan devised by, an agreement with, or a voluntary
grant from, an employer can respond, in part at least, to the
financialwell-being of workers during their twilight years soon
following their life of labor.[44]
In Pantranco North Express, Inc. v. National Labor Relations
Commission,[45] the Court held that Article 287 of the Labor
Codemakes clear the intention and spirit of the law to give
employers and employees a free hand to determine and agree upon the
termsand conditions of retirement,[46] and that the law presumes
that employees know what they want and what is good for them
absentany showing that fraud or intimidation was employed to secure
their consent thereto.[47]
Lastly, in Brion v. South Philippine Union Mission of the
Seventh Day Adventist Church,[48] the Court ruled that a reading of
Article287 of the Labor Code would reveal that the employer and
employee are free to stipulate on retirement benefits, as long as
these donot fall below floor limits provided by law.[49]
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We are aware of the several cases cited by Oxales to support his
claim that the computation of his retirement benefits shouldnot
have been limited to the basic monthly salary as defined by the
URP. However, these cases negate, rather than support, his
claim.
In Villena v. National Labor Relations Commission,[50] the
compulsory retirement of Villena was, in fact, an illegal
dismissalin disguise. Thus, the Court ordered the Batangas, Laguna,
Tayabas Bus Co. to pay Villena his full backwages, allowances,
andother benefits for a period of three (3) years after his illegal
dismissal on April 24, 1987, until he reached the compulsory
retirementage plus his retirement benefits equivalent to his gross
monthly pay, allowances and other benefits for every year of
service up to agesixty (60), which is the normal retirement age for
him.[51]
The distinction between Villena with the instant case is readily
apparent. The Court used the regular compensation of Villena
incomputing his retirement benefits because the provision of the
CBA for rank-and-file employees is inapplicable to him, being
amanagerial employee. The Villena case was also decided before the
passage of R.A. No. 7641.
In Planters Products, Inc. v. National Labor Relations
Commission,[52] the petitioning employees were given termination
benefitsbased on their basic salary. However, Planters Products,
Inc. had integrated the allowances of its remaining employees into
theirbasic salary. Thus, it was the basic salary that increased.
Also, it was the basic salary as increased (not the basic salary
andallowances) which still formed the basis for the computation of
the termination benefits of the remaining employees of the company.
The Court held that fairness demanded that the terminated employees
receive the same treatment.[53] Clearly, such situation isabsent
here.
In Manuel L. Quezon University v. National Labor Relations
Commission,[54] the issue raised was whether respondents are
entitledto the retirement benefits provided for under R.A. No.
7641, even if petitioner has an existing valid retirement plan. The
Court held thatthe coverage of the law applies to establishments
with existing collective bargaining or other agreements or
voluntary retirementplans whose benefits are less than those
prescribed under the proviso in question.[55]
Admittedly, this Court held in the case of Songco v. National
Labor Relations Commission[56] that not only the basic salary but
alsothe allowances (like transportation and emergency living
allowances) and earned sales commissions should be taken
intoconsideration in computing the backwages and separation pay of
the employee. However, a closer examination of the case wouldshow
that the CBA[57] between Zuellig and F.E. Zuellig Employees
Association, in which Songco was a member, did not contain
anexplicit definition of what salary is. Neither was there any
inclusions or exclusions in the determination of the salary of the
employee. Here, the URP has an explicit provision excluding any
commissions, overtime, bonuses, or extra compensations for purposes
ofcomputing the basic salary of a retiring employee. Too, the
Songco case was decided before the passage of R.A. No. 7641.
Clearly then, R.A. No. 7641 does not apply because the URP
grants to the retiring employee more than what the law gives. Under
the URP, the employee receives a lump sum of 1 pay per year of
service, compared to the minimum month salary for everyyear of
service set forth by R.A. No. 7641.
Oxales is trying to have the best of both worlds. He wants to
have his cake and eat it too: the 1 months formula under the
URP,and the inclusion of the value of food benefits and other
allowances he was entitled to as employee of UNILAB with his
monthly salaryas the multiplicand of his number of years in the
service. This he should not be permitted to do, lest a grave
injustice is caused toUNILAB, and its past and future retirees.
We agree with the NLRC observation on this score:
As an illustration, Complainant claims that his monthly salary
as the multiplicand of his number of years in the service
shouldinclude the value of the food benefits and other allowances
he was entitled while in the employ of respondent. However, he did
noteven, by implication, intend to reduce the 1 month salary as
multiplier under the URP to under the law he invoked. This is a
sign ofcovetousness, unfair both to the employer and those
employees who have earlier retired under said plan.[58]
Oxales is not entitled to the reinstatement of his medical
benefits, which are not part of the URP. Corollarily, he is not
also
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entitled to moral damages, exemplary damages, and attorneys
fees.
Oxales claims that UNILAB unilaterally revoked his medical
benefits, causing him humiliation and anxiety. This, he
argues,entitles him to moral damages, exemplary damages, plus
attorneys fees.
We cannot agree. The records bear out that after Oxales retired
from UNILAB, he chose to join a rival company, LloydsLaboratories,
Inc. As UNILAB correctly puts it, [i]f any employer can legally and
validly do the supreme act of dismissing a disloyalemployee for
having joined or sympathized with a rival company, with more reason
may it do the lesser act of merely discontinuing abenefit
unilaterally given to an already-retired employee.[59] As a retired
employee, Oxales may not claim a vested right on thesemedical
benefits. A careful examination of the URP would show that medical
benefits are not included in the URP.
Indeed, while there is nothing wrong in the act of Oxales in
joining a rival company after his retirement, justice and fair play
woulddictate that by doing so, he cannot now legally demand the
continuance of his medical benefits from UNILAB. To rule otherwise
wouldresult in an absurd situation where Oxales would continue to
receive medical benefits from UNILAB while working in a rival
company. We note that these medical benefits are merely
unilaterally given by UNILAB to its retired employees.
We are not unaware of this Courts pronouncement in Brion v.
South Philippine Union Mission of the Seventh Day
AdventistChurch.[60] However, Oxales plight differs from Brion
because the URP does not expressly cover medical benefits to
retirees. Incontrast, the retired employee in Brion had acquired a
vested right to the withheld benefits.
The claim of Oxales to moral damages, exemplary damages, and
attorneys fees must also be denied for want of basis in law
orjurisprudence. On this score, We echo the pronouncement of the
Court in Audion v. Electric Co., Inc. v. National Labor
RelationsCommission,[61] to wit:
Moral and exemplary damages are recoverable only where the
dismissal of an employee was attended by bad faith or fraud,
orconstituted an act oppressive to labor, or was done in a manner
contrary to morals, good customs or public policy. The
personclaiming moral damages must prove the existence of bad faith
by clear and convincing evidence for the law always presumes
goodfaith. It is not enough that one merely suffered sleepless
nights, mental anguish, serious anxiety as the result of the
actuations of theother party. Invariably, such action must be shown
to have been willfully done in bad faith or with ill motive, and
bad faith or ill motiveunder the law cannot be presumed but must be
established with clear and convincing evidence. Private respondent
predicated hisclaim for such damages on his own allegations of
sleepless nights and mental anguish, without establishing bad
faith, fraud or ill motive as legal basis therefor.
Private respondent not being entitled to award of moral damages,
an award of exemplary damages is likewise baseless. Where theaward
of moral and exemplary damages is eliminated, so must the award for
attorneys fees be deleted. Private respondent has notshown that he
is entitled thereto pursuant to Art. 2208 of the Civil Code.[62]
(Citations omitted)
Here, there was no dismissal, as Oxales was retired by UNILAB by
virtue of the URP. He was also paid his complete
retirementbenefits.
Epilogue
It is not disputed that Oxales has worked tirelessly for UNILAB.
For one thing, he has spent a considerable amount of years with
thecompany. For another, he has contributed much to its growth and
expansion. However, even as We empathize with him in his time
ofgreat need, it behooves Us to interpret the law according to what
it mandates.
We reiterate the time-honored principle that the law, in
protecting the rights of the laborer, authorizes neither oppression
nor self-destruction of the employer. While the Constitution is
committed to the policy of social justice and the protection of the
working class,management also has its own rights, which are
entitled to respect and enforcement in the interest of fair play.
Out of its concern forthose with less privilege in life, this Court
has inclined more often than not toward the employee and upheld his
cause with his conflictswith the employer. Such favorable
treatment, however, has not blinded the Court to rule that justice
is in every case for the deserving. Justice should be dispensed in
the light of the established facts and applicable law and
doctrine.[63]
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WHEREFORE, the appealed Decision is AFFIRMED. No costs.
SO ORDERED.
RUBEN T. REYES
Associate Justice
WE CONCUR:
CONSUELO YNARES-SANTIAGO
Associate Justice
Chairperson
LEONARDO A. QUISUMBING MA. ALICIA AUSTRIA-MARTINEZ Associate
Justice AssociateJustice
ADOLFO S. AZCUNA
Associate Justice
A T T E S T A T I O N
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I attest that the conclusions in the above Decision had been
reached in consultation before the case was assigned to the
writerof the opinion of the Courts Division.
CONSUELO YNARES-SANTIAGO
Associate Justice
Chairperson
C E R T I F I C A T I O N
Pursuant to Section 13, Article VIII of the Constitution and the
Division Chairpersons Attestation, I certify that the conclusions
in theabove Decision had been reached in consultation before the
case was assigned to the writer of the opinion of the Courts
Division.
REYNATO S. PUNO
Chief Justice
* Vice Associate Justice Minita V. Chico-Nazario. Justice
Nazario is on official leave per Special Order No. 508 dated June
25,2008.
** Designated as additional member vice Associate Justice
Antonio Eduardo B. Nachura per raffle dated June 25, 2008.
JusticeNachura participated as Solicitor General in the present
case.
[1] Rollo, pp. 122-128; Annex A. CA-G.R. SP No. 55528. Penned by
Associate Justice Juan Q. Enriquez, Jr., with AssociateJustices
Delilah Vidallon-Magtolis and Eliezer R. De Los Santos,
concurring.
[2] Id. at 170-182; Annex O. NLRC-CA 016627-98. Penned by
Commissioner Alberto R. Quimpo, with Commissioners Rogelio I.Rayala
and Vicente S.E. Veloso, concurring.
[3] Id. at 163-169; Annex N. NLRC-NCR Case No. 00-08-06073-97.
Penned by Labor Arbiter Romulus S. Protasio.
[4] Annex C.
[5] United Retirement Plan, Art. V, Sec. 1(a).
[6] Annex L.
[7] Annex L-1.
[8] Rollo, p. 169.
[9] Id. at 168.
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[10] Id. at 168-169.
[11] Id. at 169.
[12] Id. at 181.
[13] Id. at 179-180.
[14] Id. at 178-179.
[15] Id. at 126.
[16] Id. at 127.
[17] Id. at 126-127.
[18] Id. at 11-120.
[19] Id. at 438-568.
[20] Id. at 456-458.
[21] Brion v. South Philippine Union Mission of the Seventh Day
Adventist Church, G.R. No. 135136, May 19, 1999, 307 SCRA497,
504.
[22] See Civil Code, Art. 1306.
[23] 165 US 578, 591.
[24] 246 US 357, 373, 374.
[25] 236 US 1, 10, 14.
[26] 208 US 161.
[27] 198 US 45, 49.
[28] 208 US 412, 421.
[29] See Civil Code, Art. 1159; Pichel v. Alonzo, G.R. No.
L-36902, January 30, 1982, 111 SCRA 341; De Cortes v.
Venturanza,G.R. No. L-260