PROGRESSIVE DEVELOPMENT CORPORATION AND/OR MRS. JUDY A. ROXAS AND DANTE P. VERAYO, PETITIONERS, VS. NATIONAL LABOR RELATIONS COMMISSION, RHOLANDA ANDRES AND ROY ROMANO, RESPONDE…

This petition for review on certiorari seeks to annul and set aside
the Decision^[1] of the Court of Appeals
dated 24 May 1999 affirming the Resolution^[2] of the National Labor Relations Commission
dated 20 May 1997 which declared that private respondents were constructively
terminated when forced to resign under the retirement program of petitioner
company.

Progressive Development Corporation (PDC) is a corporation organized and
existing under the laws of the Philippines and its co-petitioners Judy A. Roxas
and Dante P. Verayo are its Senior Vice President and former Manager of its
Human Resources Division, respectively.

In 1980 PDC implemented its Employees’ Non-Contributory Retirement Plan
(The Plan) which took effect on 1 April 1980. Thereafter, a number of
employees was retired pursuant to the optional retirement provision of
The Plan –

Section 3. Optional Retirement. – Any
participant with twenty (20) years of service, regardless of age, may be retired
at his option or at the option of the Company and shall be entitled to the
following benefits x x x x

On 8 October 1990, upon request by PDC, Director Augusto G. Sanchez of the
Bureau of Working Conditions, Department of Labor and Employment, confirmed the
validity of The Plan, particularly its provision on optional
retirement.

On 28 November 1994 PDC notified its employees who had rendered more than
twenty (20) years of service in the Company of its decision to retire them
effective 31 December 1994. On 7 December 1994, Jose Riego and private
respondent Rholanda Andres, two (2) of those who were retired, filed a complaint
for illegal retirement and unfair labor practices against petitioners.

Private respondent Rholanda Andres started in the employ of petitioner PDC on
22 October 1971 as a payroll clerk and was billing assistant with a monthly
salary of P5,972.00 when petitioners decided to retire her from employment. She
was then forty-five (45) years old with twenty-three (23) years of service in
the company.

On 2 January 1995 private respondent Roy Romano also filed a similar
complaint against petitioners. He started working with PDC as an elevator
operator on 2 January 1974 and was a tender mechanic at its maintenance
department with a monthly salary of P4,820.00 when he was retired. He was then
thirty-eight (38) years old with twenty (20) years of service in the
company.

The two (2) cases were consolidated. During the pendency of these cases,
complainant Jose Riego desisted from pursuing his claim and accepted his
retirement benefits. In addition, he executed a Release and Quitclaim
that effectively relieved PDC and its officers from obligations under and in
connection with his employment.

Private respondent Andres was Chairman of the Board of Directors of
PDW-LIKHA, a union of rank-and-file employees of PDC, while private respondent
Romano was a member of the union. They contended that their retirement from PDC
was done by the latter as a retaliatory measure for their union activities. They
assailed the validity of The Plan under which they were retired claiming
lack of knowledge thereof absent any collective bargaining agreement and any
applicable employment contract.

On 14 August 1995 petitioners filed a Manifestation and Motion^[3] for the presentation of evidence by both
parties to settle certain factual issues. On 24 August 1995 private respondents,
without denying the early retirement of their co-employees, opposed petitioners’
motion to present evidence and moved to submit the consolidated cases for
resolution on the basis of the pleadings so far submitted.^[4]

On 25 October 1995 the Labor Arbiter upheld the validity of the retirement of
private respondents and dismissed their consolidated complaints.^[5] He ruled that the retirement plan of PDC
was consistent with Art. 287 of the Labor Code as amended which provides that
“[a]ny employee may be retired upon reaching the retirement age
established in the collective bargaining agreement or other applicable
employment contract.” He explained that the phrase “may be retired”
connotes an option given to an employer to retire an employee and such option,
he further declared, was within the discretion of the employer to exercise. The
Labor Arbiter also held that the discretion of the employer extended to the
choice of employees to be retired and choosing private respondents to retire
could not be attributed to their union activities as the other members of the
union who were similarly situated were not retired by PDC.^[6]

On appeal the National Labor Relations Commission (NLRC) modified the
decision of the Labor Arbiter. It declared private respondents to be
constructively terminated when forced to resign under the retirement program of
PDC, ordered their reinstatement with payment of their full wages computed from
the time they were forcibly resigned until actually reinstated, but dismissed
the complaint for unfair labor practice for lack of substantial basis.^[7]

On 4 July 1997 petitioners filed a Motion for Reconsideration^[8] which was denied^[9] by the NLRC on 10 July 1997.

On 24 October 1997 petitioners filed with this Court a petition for
certiorari under Rule 65 of the Rules of Court.^[10] On 25 January 1999, after respondents had
filed their comments, the Court referred the petition to the Court of Appeals
for appropriate action and disposition.

On 24 May 1999 the Court of Appeals denied the petition and affirmed the
decision of the NLRC. Hence, this petition.

Clearly, the resolution of the issue on whether private respondents were
illegally retired rests upon the determination of whether the retirement program
of petitioner company is valid.

As a general rule, the factual findings and conclusions of
quasi-judicial agencies such as the NLRC are accorded great weight and
respect upon appeal, and even finality, as long as they are supported by
substantial evidence or that amount of relevant evidence which a reasonable man
might accept as adequate to justify a conclusion. But this is true only when
they do not come under the established exceptions. One of these is where the
findings of the NLRC and the Labor Arbiter are contrary to each other, as in the
instant case. Consequently, there is a necessity for this Court to examine the
records and the evidence presented to determine which findings of the NLRC and
the Labor Arbiter should be preferred as more conformable with the evidentiary
facts.

Accordingly, a careful examination of the records shows that the findings of
the Labor Arbiter are more in harmony with the evidence on record. The
retirement plan under which private respondents were retired is valid for it
forms part of the employment contract of petitioner company. Director Augusto G.
Sanchez of the Bureau of Working Conditions of the DOLE recognized and affirmed
the validity of The Plan. Thus –

Considering therefore the fact that your client’s retirement plan now
forms part of the employment contract since it is made known to the employees
and accepted by them, and such plan has an express provision that the
company has the choice to retire an employee regardless of age, with twenty (20)
years of service, said policy is within the bounds contemplated by the Labor
Code. Moreover, the manner of computation of retirement benefits depends on the
stipulation provided in the company retirement plan

This pronouncement made by no less than the DOLE must be given substantial
weight, as what the Labor Arbiter did, in the absence of any contrary evidence.
Moreover, the undisputed fact that a number of employees of petitioner company
had availed of The Plan since its effectivity only confirms that The
Plan has already been part of the employment contract of petitioner company
for a long time. Private respondents, particularly Andres, may not now feign
ignorance of The Plan considering that she was the chairman of the union
of rank-and-file employees of petitioner company and, as such, was considered to
be familiar with the policies of the company.

Obviously, private respondents failed to substantiate their allegation that
The Plan was invalid. The NLRC was thus incorrect in ruling in their
favor by declaring that they were illegally retired. Hence, the affirmation by
the Court of Appeals of the Decision of the NLRC must likewise be declared
erroneous.

The Court notes that private respondents, in attacking the validity of The
Plan, might have been motivated by their belief that they were retired by
reason of their union activities. But, both the Labor Arbiter and the NLRC
dismissed their allegation of unfair labor practice for apparent lack of
substantial basis.

WHEREFORE, the petition is GRANTED. The Decision of
the Court of Appeals affirming the Resolution of the NLRC is
MODIFIED. The dismissal of the complaint for unfair labor
practice STANDS while its declaration that private respondents
were illegally retired is SET ASIDE. The Decision of the Labor
Arbiter declaring the validity of the retirement plan of petitioner company and
ordering the dismissal of the consolidated complaints of private respondents is
REVIVED and AFFIRMED.

SO ORDERED.

Mendoza, Quisumbing, Buena, and De Leon, Jr., JJ., concur.

^[2] Resolution, 20 May 1997,
penned by Commissioner Ireneo B. Bernardo, concurred in by Presiding
Commissioner Lourdes C. Javier; Rollo, pp. 53-60.

^[3] Rollo, pp. 38-40.

^[4] Id., pp. 43-44.

^[5] Decision penned by Labor
Arbiter Geobel A. Bartolbac.

^[6] Ibid.

^[7] See Note 2.

^[8] Rollo, pp. 61-65.

^[9] Id., pp. 67-68.

^[10] Docketed as G.R. No. 130938.