THIRD DIVISION
[G.R. No. 141868.
JOSE B. CRUZ, RODOLFO C. DELOS SANTOS, VICENTE A. RIGOS, GREGORIO A. LINGAL AND ALICIA P. FRANCISCO, petitioners, vs. PHILIPPINE GLOBAL COMMUNICATIONS, INC. AND/OR ALFREDO PARUNGAO, respondents.
D E C I S I O N
SANDOVAL-GUTIERREZ, J.:
May a retrenched employee still claim his retirement benefits after receiving his separation pay? This is the basic issue for our resolution in the instant case.
At bar is a petition for review on certiorari under Rule 45 of the 1997 Rules of Civil Procedure, as amended, assailing the Decision[1] dated July 30, 1999 and Resolution[2] dated February 4, 2000 rendered by the Court of Appeals in CA-G.R. SP No. 50654, entitled “Jose B. Cruz, Rodolfo C. Delos Santos, Vicente A. Rigos, Gregorio A. Lingal, and Alicia P. Francisco vs. National Labor Relations Commission (Second Division), Philippine Global Communications, Inc. and/or Alfredo Parungao.”
The facts as borne by the records are:
Philippine Global Communications, Inc., respondent, is a corporation engaged in the principal business of communications through telex and telegram, with various branches nationwide.
As a result of a decline in the volume of recorded messages sent
via telex and telegram, respondent suffered substantial financial losses
equivalent to P2,221,804.00 in 1993 and P4,536,626.00 in 1994.
With this development, respondent adopted an organizational
streamlining program that resulted in the closure of its branches and
termination from the service of forty-two (42) workers. Among them were Jose B. Cruz, Rodolfo C. Delos Santos, Vicente A. Rigos, Gregorio A.
Lingal and Alicia P. Francisco, petitioners,
who occupied managerial,
supervisory and confidential positions.
In separate letters dated
Eventually, respondent paid petitioners their separation pay at the rate of 1 ˝ months salary per year of service.[3]
Then after having been paid their separation pay, they executed and signed a “Release, Waiver and Quitclaim.”
However, on October 17, 1995, petitioners filed with the Labor Arbiter a complaint for payment of retirement benefits, damages and attorney’s fees against respondent and its president, Alfredo Parungao, docketed as NLRC NCR Case No. 00-10-06979-95.
On
“WHEREFORE, judgment is hereby rendered finding merit in complainants’ claim for retirement benefits, and orders respondents to pay each of the complainants, one and a half month salary for every year of service, as provided by respondent’s Retirement Plan, to wit:
1. Jose B. Cruz - 35
years in service x one and half month salary for every year of service
equivalent to P 1,980,108.00;
2. Rodolfo C. delos P1,099,543.15;
3. Vicente A. Rigo – 27
years in service x one and a half month salary for every year of service
equivalent to P 1,198,025.86
4. Gregorio A. Lingal –
31 years in service x one and a half month salary for every year of service
equivalent to P 1,542,920.85;
5. Alicia P. Francisco –
13 years in service x one and a half month salary for every year of service
equivalent to P 331,007.00.
Or the total sum of P 6,151,606.84 plus ten (10%) percent of
the total money claims awarded as attorney’s fees.
All other claims are dismissed for lack of merit.
SO ORDERED.”
Upon appeal by the parties, the National Labor Relations
Commission (NLRC), in a Decision dated
On
Hence, petitioners filed with this Court a petition for certiorari which we referred to the Court of Appeals pursuant to our ruling in St. Martin’s Funeral Home vs. NLRC.[4]
On
“x x x, the pivotal issue at bar is whether or not the National Labor Relations Commission acted without in excess of jurisdiction or with grave abuse of discretion in declaring that petitioners are not entitled to retirement benefits under PHILCOM’s Retirement Plan in addition to their separation pay. The answer must inevitably be in the negative as we find said decision and resolution to be in accord with law and jurisprudence.
Petitioners contend that the public respondent erred when it adopted the ruling in the case of Cipriano vs. San Miguel, 24 SCRA 703 where the employees’ claims for retirement benefits in addition to separation pay were denied in view of a stipulation in the retirement plan that employees who are separated from the service for any reason other than misconduct or voluntary resignation shall be entitled to the benefits under the said retirement plan or to the severance pay provided by law. They also contend that the applicable provision should be Section 4, Article VI of the PHILCOM’s Retirement Plan which reads:
Section 4 – Involuntary Separation
“A member whose services may be terminated by the Company for any
reason other than just cause or voluntary resignation shall be entitled to
benefit determined in accordance with the retirement benefit formula provided
in Article V hereof. However, if the termination is due to redundancy, the
employee will be paid one and one-half months pay for every year of service (as
amended on
Petitioners’ contention holds no water. The above quoted provision
should not be interpreted singly but should be read together with the other
provisions of the Retirement Plan in question to determine the intent of he
Plan. Thus, the meaning to be gathered from the agreement as a whole will
control rather than that to be obtained from a particular part, and effect must
be given to every part of the instrument if possible (Badayos vs. Court of Appeals, 207 SCRA 209).
Under Section 6, Article XI of PHILCOM’s Retirement Plan which reads:
ARTICLE XI
MISCELLANEOUS PROVISIONS
Section 6 – Effect of Social
Legislation
a) Social Security and Workmen’s Compensation – The benefits payable under this Plan shall be in addition to such benefits which the Member shall be entitled under the Social Security and Workmen’s Compensation Acts.
b) Adjustment of
Benefits payments – Except only as provided in paragraph (a) of this Section,
in the event the company is required under the law or by lawful order of
competent authority, to pay to the Member benefits or emoluments similar or
analogous to those already provided in the Plan, the member concerned shall not
be entitled to both what the law or the lawful order of competent authority
requires the company to give and the benefits provided by the Plan, but shall
only be entitled to whichever is the greatest among them, it being understood
however that for the purpose of determining whichever benefits is greatest, it
is the total benefits required to be paid under the law or lawful order of
competent authority or the Plan that shall be reckoned. The benefit provided by
this Plan may be reduced or amended in an equitable manner by the company by
the value of any present or future contract such as collective bargaining, law,
e.g. termination pay provisions or lawful order of competent authority.
The aforesaid Section 6(b) Article XI, of the Retirement Plan is explicit and leaves no doubt as to the intention to prohibit the recovery of both separation pay and retirement benefits. The public respondent NLRC thus correctly pointed out that ‘there is no further doubt that the payment of separation pay is a requirement of the law, i.e. the Labor Code, which is a social legislation. The clear intent of Article XI, section 6 is to input the effects of social legislation in the circulation of Retirement benefits due to retiring employees (p. 238, Rollo). The Retirement Plan itself clearly sets forth the intention of the parties to entitle employees only to whatever is greater between the Retirement Benefits then due and that which the law requires to be given by way of separation pay. To give way to complainant’s demands would be to totally ignore the contractual obligations of the parties in the Retirement Plan, and to distort the clear intent of the parties as expressed in the terms and conditions contained in such plan’ (Ibid., p. 240).
x x x
After a judicious review of the case at bench, We find that the conclusions reached by respondent NLRC in its questioned decision and resolution are supported by substantial evidence, or that amount of evidence which a reasonable mind may accept as adequate to justify a conclusion. Succinctly put, with no showing that the public respondent NLRC gravely abused its discretion, or otherwise acted without jurisdiction or in excess the same, We are bound by its findings.
WHEREFORE, premises
considered, the instant petition is hereby DENIED
DUE COURSE and DISMISSED for
lack of merit. The decision dated
SO ORDERED.”
On
Petitioners, in the instant petition for review on certiorari,
contend that the Court of Appeals erred in relying upon our ruling in Cipriano
vs. San Miguel [5]
that the employee separated from the service is entitled to either the
amount prescribed in the retirement plan or the separation pay provided by law,
whichever is higher. Petitioners invoke Section 4, Article VI of
respondent’s Retirement Plan (of which they are members) expressly providing
that retirement benefits may be granted to them in addition to their separation
pay. They likewise call our attention to
Aquino vs. NLRC[6] holding that payment of separation benefits does
not exclude payment of retirement benefits.
For its part, respondent
maintains that payment of both separation pay and retirement benefits is
proscribed under Section 6(b), Article XI of its Retirement Plan. Thus, the NLRC’s and the Court of Appeals’
reliance on Cipriano vs. San Miguel [7] is in order.
In Cipriano,[8] this
Court, through Mr. Chief Justice Concepcion, ruled that regular employees who
were separated from the service are entitled either to the amount
prescribed in the retirement plan or the separation pay provided by law,
whichever is higher. This is pursuant
to the agreement between the company and the labor union, of which plaintiff is
a member, thus:
“Plaintiff’s contention is
manifestly devoid of merit. His right to the benefits of the aforementioned
plan came into existence by virtue of the agreement between the defendant and
the labor union, of which plaintiff is a member. Admittedly, said right is
subject to the limitations prescribed in the agreement, Article X of which
reads:
‘Regular employees who are
separated from the service of the company for any reason other than misconduct
or voluntary resignation shall be entitled to either 100% of the benefits provided in Section 2, Article VIII
hereof, regardless of their length of service in the company or to the
severance pay provided by law, which ever
is the greater amount.’
Pursuant thereto, plaintiff was
entitled to ‘either’ the amount prescribed in the plan or the severance pay
provided by law, whichever is the greater amount.’ In other words, he had a
right to one of the two benefits, not to both, at the same time. The
exclusion of one by the other is clearly deducible, not only from the terms
‘either’ and ‘or’ used in the agreement,
but, also, by the qualifying phrase ‘whichever is the greater amount.’ x x x.”
In Aquino vs. NLRC,[9] citing University of the East vs. Minister of
Labor[10] and
Batangas Laguna Tayabas Bus Co. vs. Court of Appeals,[11] we ruled that if there is no prohibition both in
the Retirement Plan and the Collective Bargaining Agreement, the employee has
the right to recover from the employer his separation pay and retirement
benefits, thus:
“The Court feels that if the
private respondent really intended to make the separation pay and the retirement
benefits mutually exclusive, it should have sought inclusion of the
corresponding provision in the Retirement Plan and the Collective Bargaining
Agreement so as to remove all possible ambiguity regarding this matter.
x x x. Knowing this, he should
have made it a point to categorically provide in the Retirement Plan and the
CBA that an employee who had received separation pay would no longer be
entitled to retirement benefits. Or to put it more plainly, collection of
retirement benefits was prohibited if the employee had already received
separation pay.”
Clearly, under the above
cases, the right of the concerned employees to receive both retirement benefits
and separation pay depends upon the provisions in the Retirement Plan.
Does respondent’s Retirement Plan
provide that petitioners are entitled to both separation pay and retirement
benefit?
Section 6 (b), Article XI of
the Retirement Plan provides:
“ARTICLE XI
MISCELLANEOUS PROVISIONS
x x x
Sec. 6. Effect of Social
Legislation
x x x
b) Adjustment of Benefits Payments.- x x x, in the event the
Company is required under the law or by lawful order of competent authority to
pay to the Member benefits or emoluments similar or analogous to those already
provided in the Plan, the Member concerned shall no be entitled to both what
the law or the lawful order of competent authority requires the Company to give
and the benefits provided by the Plan, but shall only be entitled to whichever
is the greatest among them, x x x.”
Thus, petitioners are
entitled only to either the separation pay provided under Article 283 of
the Labor Code, as amended, or retirement benefits prescribed by the
Retirement Plan, whichever is higher.
Under Article 283 of the
Labor Code, as amended, affected employees, in case of retrenchment or cessation
of operations, are always given termination or separation pay equivalent to one
month pay or at least ˝ month pay for every year of service, whichever is
higher.
Under Section 4, Article VI[12] of respondent’s Retirement Plan, the employees
are entitled to a retirement pay equivalent to one and a half (1 ˝) months pay
for every year of service computed on the basis of their basic monthly salary
at the time of retirement.
Here, respondent opted to pay
petitioners separation benefits computed under the Retirement Plan, the same
being higher than what Article 283 of the Labor Code, as amended, provides.
As we held in Cipriano
and Aquino, the employees’ right to payment of retirement benefits
and/or separation pay is governed by the Retirement Plan of the parties. Under the Retirement Plan before us,
petitioners are not entitled to both separation pay and retirement benefits.
We, therefore, rule that the
Court of Appeals did not err in concluding that petitioners, having received
from respondent their separation pay, are no longer entitled to retirement
benefits.
WHEREFORE, the petition is DENIED. The assailed Decision dated
SO ORDERED.
Vitug, (Chairman),
[1] Annex “E” of the Petition for Review, Rollo at 330-342.
[2] Annex “I”, id. at 394-396.
[3]
Petitioner Cruz served the respondent company for thirty-five (35) years with a
monthly salary of P37,960.00.
Petitioner Delos Santos, on the other hand, was employed with the
respondent company for twenty-nine (29) years with a monthly salary of P24,875.00.
While petitioner Rigos commenced his twenty-seven (27) years of employment on P30,125.00. Petitioner Lingal was employed on P
33,287.50. Finally, petitioner Francisco was employed for thirteen (13) years
(since P17,025.00.
[4]
G.R. No. 130866,
[5]
G.R No. L-24774,
[6]
G.R No. 87653,
[7] Supra.
[8] Supra.
[9]
G.R. No. 87653,
[10]
G.R. No. L-74007,
[11]
G.R. No L-38482,
[12] Section 4, Article VI
of the said Retirement Plan provides:
“ARTICLE VI
DEATH AND DISABILITY BENEFITS
x x x
Section 4 – Involuntary
Separation
A member whose services may be terminated by the Company for any reason
other than just cause or voluntary resignation shall be entitled to benefit
determined in accordance with the retirement benefit formula provided in
Article V hereof. However, if
the termination is due to redundancy, the employee will be paid one and one
half months pay for every year of service. (as amended on
x x x.”