Source: http://lawlibrary.chanrobles.com/index.php?option=com_content&view=article&id=81134:gr-199338-2013&catid=1566&Itemid=566
Timestamp: 2019-04-19 11:02:50+00:00

Document:
G.R. No. 199338 - Eleazar S. Padillo v. Rural Bank of Nabunturan, Inc., et al.
ELEAZAR S. PADILLO,** Petitioner, v. RURAL BANK OF NABUNTURAN, INC. and MARK S. OROPEZA, Respondent.
Before the Court is a Petition for Review on Certiorari1 assailing the June 28, 2011 Decision2 and October 27, 2011 Resolution3 of the Cagayan de Oro City Court of Appeals (CA) in CA-G.R. SP No 03669-MIN which revoked and set aside the National Labor Relations Commission's (NLRCs) Resolutions dated December 29, 20094 and March 31, 20105 and reinstated the Labor Arbiter's (LA's) Decision dated March 13, 20096 with modification.
During the latter part of 2007, Padillo suffered a mild stroke due to hypertension which consequently impaired his ability to effectively pursue his work. In particular, he was diagnosed with Hypertension S/P CVA (Cerebrovascular Accident) with short term memory loss, the nature of which had been classified as a total disability.9 On September 10, 2007, he wrote a letter addressed to respondent Oropeza expressing his intention to avail of an early retirement package. Despite several follow-ups, his request remained unheeded.
On March 13, 2009, the LA issued a Decision12 dismissing Padillos complaint but directed the Bank to pay him the amount of P100,000.00 as financial assistance, treated as an advance from the amounts receivable under the Philam Life Plan.13 It found Padillo disqualified to receive any benefits under Article 300 (formerly, Article 287) of the Labor Code of the Philippines (Labor Code)14 as he was only fifty-five (55) years old when he resigned, while the law specifically provides for an optional retirement age of sixty (60) and compulsory retirement age of sixty-five (65). Dissatisfied with the LAs ruling, Padillo elevated the matter to the NLRC.
On December 29, 2009, the NLRCs Fifth Division reversed and set aside the LAs ruling and ordered respondents to pay Padillo the amount of P164,903.70 as separation pay, on top of the P100,000.00 Philam Life Plan benefit.15 Relying on the case of Abaquin Security and Detective Agency, Inc. v. Atienza (Abaquin),16 the NLRC applied the Labor Code provision on termination on the ground of disease particularly, Article 297 thereof (formerly, Article 323) holding that while Padillo did resign, he did so only because of his poor health condition.17 Respondents moved for reconsideration but the same was denied by the NLRC in its Resolution dated March 31, 2010.18 Aggrieved, respondents filed a petition for certiorari with the CA.
On June 28, 2011, the CA granted respondents petition for certiorari and rendered a decision setting aside the NLRCs December 29, 2009 and March 31, 2010 Resolutions, thereby reinstating the LAs March 13, 2009 Decision but with modification. It directed the respondents to pay Padillo the amount of P50,000.00 as financial assistance exclusive of the P100,000.00 Philam Life Plan benefit which already matured on July 11, 2009.
At the outset, it must be maintained that the Labor Code provision on termination on the ground of disease under Article 29724 does not apply in this case, considering that it was the petitioner and not the Bank who severed the employment relations. As borne from the records, the clear import of Padillos September 10, 2007 letter25 and the fact that he stopped working before the foregoing date and never reported for work even thereafter show that it was Padillo who voluntarily retired and that he was not terminated by the Bank.
Thus, given the inapplicability of Article 297 of the Labor Code to the case at bar, it necessarily follows that petitioners claim for separation pay anchored on such provision must be denied.
Further, it is noteworthy to point out that the NLRCs application of Abaquin27 was gravely misplaced considering its dissimilar factual milieu with the present case.
To elucidate, a careful reading of Abaquin shows that the Court merely awarded termination pay on the ground of disease in favor of security guard28 Antonio Jose because he belonged to a "special class of employees x x x deprived of the right to ventilate demands collectively."29 Thus, notwithstanding the fact that it was Antonio Jose who voluntarily resigned because of his sickness and it was not the security agency which terminated his employment, the Court held that Jose "deserve[d] the full measure of the laws benevolence" and still granted him separation pay because of his situation, particularly, the fact that he could not have organized with other employees belonging to the same class for the purpose of bargaining with their employer for greater benefits on account of the prohibition under the old law.
In this case, it cannot be said that Padillo belonged to the same class of employees prohibited to self-organize which, at present, consist of: (1) managerial employees;30 and (2) confidential employees who assist persons who formulate, determine, and effectuate management policies in the field of labor relations.31 Therefore, absent this equitable peculiarity, termination pay on the ground of disease under Article 297 of the Labor Code and the Courts ruling in Abaquin should not be applied.
Art. 300. Retirement. Any employee may be retired upon reaching the retirement age established in the collective bargaining agreement 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 and any collective bargaining agreement and other agreements: Provided, however, That an employee's retirement benefits under any collective 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 employee upon reaching the age of sixty (60) years or more, but not beyond sixty-five (65) years which is hereby declared the compulsory retirement age, who has served at least five (5) years in the said establishment, may retire and shall be entitled to retirement pay 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 as one whole year.
Simply stated, in the absence of any applicable agreement, an employee must (1) retire when he is at least sixty (60) years of age and (2) serve at least (5) years in the company to entitle him/her to a retirement benefit of at least one-half (1/2) month salary for every year of service, with a fraction of at least six (6) months being considered as one whole year.
Notably, these age and tenure requirements are cumulative and non-compliance with one negates the employees entitlement to the retirement benefits under Article 300 of the Labor Code altogether.
In this case, it is undisputed that there exists no retirement plan, collective bargaining agreement or any other equivalent contract between the parties which set out the terms and condition for the retirement of employees, with the sole exception of the Philam Life Plan which premiums had already been paid by the Bank.
Neither was it proven that there exists an established company policy of giving early retirement packages to the Banks aging employees. In the case of Metropolitan Bank and Trust Company v. National Labor Relations Commission, it has been pronounced that to be considered a company practice, the giving of the benefits should have been done over a long period of time, and must be shown to have been consistent and deliberate. 34 In this relation, petitioners bare allegation of the solitary case of Lusan cannot assuming such fact to be true sufficiently establish that the Banks grant of an early retirement package to her (Lusan) evolved into an established company practice precisely because of the palpable lack of the element of consistency. As such, petitioners reliance on the Lusan incident cannot bolster their claim.
All told, in the absence of any applicable contract or any evolved company policy, Padillo should have met the age and tenure requirements set forth under Article 300 of the Labor Code to be entitled to the retirement benefits provided therein. Unfortunately, while Padillo was able to comply with the five (5) year tenure requirement as he served for twenty-nine (29) years he, however, fell short with respect to the sixty (60) year age requirement given that he was only fifty-five (55) years old when he retired. Therefore, without prejudice to the proceeds due under the Philam Life Plan, petitioners claim for retirement benefits must be denied.
Nevertheless, the Court concurs with the CA that financial assistance should be awarded but at an increased amount. With a veritable understanding that the award of financial assistance is usually the final refuge of the laborer, considering as well the supervening length of time which had sadly overtaken the point of Padillos death an employee who had devoted twenty-nine (29) years of dedicated service to the Bank the Court, in light of the dictates of social justice, holds that the CAs financial assistance award should be increased from P50,000.00 to P75,000.00, still exclusive of the P100,000.00 benefit receivable by the petitioners under the Philam Life Plan which remains undisputed.
Finally, the Court finds no bad faith in any of respondents actuations as they were within their right, absent any proof of its abuse, to ignore Padillos misplaced claim for retirement benefits. Respondents obstinate refusal to accede to Padillos request is precisely justified by the fact that there lies no basis under any applicable agreement or law which accords the latter the right to demand any retirement benefits from the Bank. While the Court mindfully notes that damages may be recoverable due to an abuse of right under Article 2135 in conjunction with Article 19 of the Civil Code of the Philippines,36 the following elements must, however, obtain: ( 1) there is a legal right or duty; (2) exercised in bad faith; and (3) for the sole intent of prejudicing or injuring another.37 Records reveal that none of these elements exists in the case at bar and thus, no damages on account of abuse of right may he recovered.
Neither can the grant of an early retirement package to Lusan show that Padillo was unfairly discriminated upon. Records show that the same was merely an isolated incident and petitioners have failed to show that any had faith or motive attended such disparate treatment between Lusan and Padillo. lrrefragably also, there is no showing that other Bank employees were accorded the same benefits as that of Lusan which thereby dilutes the soundness of petitioners' imputation of discrimination and bad faith. Verily, it is axiomatic that held f8ith can never be presumed it must be proved by clear and convincing evidence.38 This petitioners were unable to prove in the case at bar.
WHEREFORE, the petition is PARTLY GRANTED. Accordingly, the assailed Court of Appeals' Decision dated June 28, 2011 Decision and October 27, 2011 Resolution in CA-G.R. SP No. 03669-MIN are hereby MODIFIED, increasing the 8Ward of financial assist8nce of F50,000.00 to P75,000.00, exclusive of the P 100,000.00 benefit under the Phil am Life Plan.
** Eleazar Padillo passed away last February 24, 2012 and had been substituted in this case by his heirs Anita Giuillena Paldillo. Lynette Padillo Banayo, Earvin G. Padillo, Marco Antonio G. Padillo, Anileebeth G. Padillo and Patrick Ray G. Padillo. See rollo, pp. 187-198, 221.
2 Id. at 20-36, penned by Associate Justice Pamela Ann A. Maxino, with Associate Justices Edgardo T. Lloren and Zenaida T. Galapate-Laguilles, concurring.
3 Id. at 44-47. Amended by CA Resolution dated November 28, 2011.
4 ld. at 92-99. Penned by Commissioner Proculo T. Sarmen, with Presiding Commissioner Salic B. Dumarpa and Dominador B. Medroso. Jr., concurring.
6 Id. at 79-85. Penned by Labor Arbiter Miriam A. Libron-Barroso.
8 Id. at 22, 69.
10 Id. at 23, 63.
14 As amended by Republic Act No. 8558 and further renumbered to Article 300 pursuant to Republic Act No. 10151.
16 G.R. No. 72971, October 15, 1990, 190 SCRA 460.
17 Supra note 4, at 96.
20 G.R. No. 169191, June 1, 2011, 650 SCRA 64.
24 Art. 297. Disease as Ground for Termination. An employer may terminate the services of an employee who has been found to be suffering from any disease and whose continued employment 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 salary or to one-half month salary for every year of service, whichever is greater, a fraction of at least six (6) months being considered as one (1) whole year.
It is always my desire to be a good employee in your company. Working with RBN is a great honor and privilege that is why I remain faithful and loyal throughout my 31 years of service. RBN had given me the chance to prove my ability in my work and with the people Im working with whom I called my second family.
Unfortunately, I just lately had a mild stroke due to hypertension and that causes me with some memory lapses that I am having a hard time to pursue with working in the bank. Though I am trying so hard to refresh and recover my memories with the nature of my job. Yet, I dont want that my co-workers and the operation of the bank might be affected with the adjustments I had undergone. I finally had decided then, that I have to take a rest of my body and mind for total recovery.
With this regard, I am applying for an early retirement to hopefully regain normal health conditions. I am also requesting for the settlement of my retirement benefits with my employment in RBN. As a father, I am looking forward that my application and request will be granted soon so that the education of my two children in high school and one in college may not be affected of my becoming retired from employment. So as to aid the lifetime support of my daily requirements of medication.
I am very hopeful for your kind consideration and understanding.
26 Supra note 20, at 70.
x x x While therefore under the old rules, security guards were barred from joining a labor organization of the rank and file, under RA 6715, they may now freely join a labor organization of the rank and file or that of the supervisory union, depending on their rank. By accommodating supervisory employees, the Secretary of Labor must likewise apply the provisions of RA 6715 to security guards by favorably allowing them free access to a labor organization, whether rank and file or supervisory, in recognition of their constitutional right to self-organization.
29 Supra note 16, at 468.
30 See Article 253 (formerly, Article 245) of the Labor Code, as amended.
31 See San Miguel Corporation Supervisors and Exempt Union v. Laguesma, G.R. No. 110399, August 15, 1997, 277 SCRA 370, 374.
32 AN ACT AMENDING ARTICLE 287 OF PRESIDENTIAL DECREE NO. 442, AS AMENDED, OTHERWISE KNOWN AS THE LABOR CODE OF THE PHILIPPINES, BY PROVIDING FOR RETIREMENT PAY TO QUALIFIED PRIVATE SECTOR EMPLOYEES IN THE ABSENCE OF ANY RETIREMENT PLAN IN THE ESTABLISHMENT.
33 AN ACT AMENDING ARTICLE 287 OF PRESIDENTIAL DECREE NO. 442, AS AMENDED, OTHERWISE KNOWN AS THE LABOR CODE OF THE PHILIPPINES, BY REDUCING THE RETIREMENT AGE OF UNDERGROUND MINE WORKERS FROM SIXTY (60) TO FIFTY(50).
34 G.R. No. 152928, June 18, 2009, 589 SCRA 376, 384.
35 Art. 21. Any person who willfully causes loss or injury to another in manner that is contrary to morals, good customs or public policy shall compensate the latter for the damage.
36 Art. 19. Every person must, in the exercise of his rights and in the performance of his duties, act with justice, give everyone his due, and observe honesty and good faith.
37 Albenson Enterprises Corp. v. Court of Appeals, G.R. No. 88694, January 11, 1993, 217 SCRA 16, 25.
38 Gatmaitan v. Gonzales, G.R. No. 149226, June 26, 2006, 492 SCRA, 591, 604, citing Fernando v. Sto. Tomas, G.R. No. 112309, July 28, 1994, 234 SCRA 546.

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