UNIVERSITY OF THE EAST, PETITIONER, VS. HON. MINISTER OF LABOR AND U.E. FACULTY ASSOCIATION, RESPONDENT.

This petition for certiorari seeks to nullify the order of
the Minister of Labor and Employment directing the University of the East to
pay the faculty members concerned retirement benefits in accordance with their
collective bargaining agreement, in addition to the payment of separation pay
according to the Termination Pay Law.

On April 23, 1983 and May 4, 1983, the then president of the
University of the East (UE) announced the phase-out of the College of
Secretarial Education and the High School Department respectively, starting
with the school year 1983-1984 on the grounds of lack of economic viability and
financial losses.

The respondent UE Faculty Association opposed the phase-out,
contending that such action contravened the law because it constitutes union
busting.  The association also emphasized
the alleged failure of the petitioner to present evidence substantiating the
alleged losses.

The parties tried to find a solution for the problems attending
the phase-out but were unsuccessful. 
Hence, the private respondent filed a notice of strike with the Bureau of
Labor Relations (BLR) on August 4, 1983. 
The BLR conducted several conciliation proceedings but when no amicable
settle­ment was reached by the parties, the respondent Minister issued an order
assuming jurisdiction over the case and directing the BLR to receive evidence
in connection with the dispute.

On September 25, 1985, the respondent Minister issued the
questioned order.  He ruled that the
phase­-out of the two departments was arbitrary.  According to the respondent Minister, nowhere
in the submissions of the petitioner was there any evidence or allegation that
the departments concerned had contributed the most to the university’s
financial losses and neither was there evidence that their closure would
reverse the trend.  The public respondent
further found violations of Articles 278 and 284 of the Labor Code because the
petitioner did not serve the neces­sary one month termination notice to the
private respondent prior to the phase-out. 
Finally, the respondent Minister ruled that the accrued benefits under
the collective bargaining agreement (CBA) are not affected by the phase-out of
the two departments.  Hence, the
petitioner is liable for the payment of separation pay in addition to the
payment of retire­ment benefits to those entitled under the CBA.  The dispositive portion of the questioned
order provides:

“WHEREFORE, respondent University of the East is hereby
directed to pay all affected faculty members of the College Secretarial
Education and the High School Department a separation pay of one month or
one-half month pay for every year of service whichever is higher plus one month
compensation in addition to said separation pay in lieu of notice.

In addition to the termination pay, the University is likewise
directed to pay retirement benefits to all affected faculty members who, in
accordance with the collective bargaining agreement, are retireable prior to or
at the time of the phase-out.” (Rollo, p. 59).

The petitioner filed a motion for reconsideration but the same
was denied on February 14, 1986.  Hence,
it filed this petition raising the sole issue of whether or not the respondent
Minister of Labor and Employment committed grave abuse of discretion amount­ing
to lack of jurisdiction in awarding both retirement benefits and separation pay
to the faculty members affected by the phase-out.

The petitioner maintains that there can only be one mode of
termination of employment with respect to one and the same employee.  It argues that the faculty members of the
phased out departments cannot be considered retired and, therefore, entitled to
retire­ment benefits and at the same time retrenched with the right to
separation pay.  The petitioner cites the
case of Soberano v. Hon. Secretary of Labor, (99 SCRA 549) where this Court
ruled that retirement from service is distinct from dismissal or termination of
employment and that retirements which are agreed upon by the employer and the
employee in their collective bargaining agreement are not dismissals as
contemplated under the termination pay law.

The public respondent argues that the faculty members affected by
the phase-out were awarded sepa­ration pay because the petitioner failed to
show that their separation from employment was due to a valid or authorized
cause; while the award for retirement benefits was by virtue of the provisions
of the CBA, regardless of the cause of separation.

We rule for the respondents.

Under Article 284 of the Labor Code, the termi­nation of
employment of any employee arising from retrenchment to prevent losses shall
entitle the employee affected thereby to separation pay equivalent to one (1)
month pay or at least one-half (1/2) month pay for every year of service,
whichever is higher.  (Columbia
Development Corporation v. Minister of Labor and Employment, 146 SCRA 421,
429).

The respondent Minister found that the petitioner failed to
present evidence as to the university’s actual losses and what caused
them.  It, therefore, failed to satisfy
the burden under Article 278(b) of the Labor Code of proving that the
termination of employees was for a valid or authorized cause, in this case to
prevent losses.  No evidence was
presented to show that it was the operation of the two departments which resulted in financial losses.  A complete statement of the university’s
finances was not submitted.  The Minister
of Labor further ruled that the private respondents concerned were entitled to
separation pay and one-month pay in lieu of the required notice which the
petitioner likewise failed to give.  The
employees were thus deprived of the opportunity to look for other employment.

The petitioner, however, takes exception to the respondent
Minister’s order that in addition to separation benefits, retirement benefits
may also be awarded to the private respondent pursuant to the CBA.  It maintains that the award of separation pay pursuant to the Termination Pay
Law necessarily excludes retirement benefits.

In the case of Batangas Laguna Tayabas Bus Co. v. Court of
Appeals (71 SCRA 470, 482-483) we ruled:

“But petitioner contends that private respondent can only
avail himself of either separation pay or retirement benefits but not both,
citing in support thereof, the ruling of this Court in the case of Cipriano v. San Miguel.  (24 SCRA 703) The foregoing ruling cannot be
made to apply to the present suit because in said case it is so expressly
provided in the Labor Agreement that:

‘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, whichever
is the greater amount.’

Thus in said case the employee was entitled
to either the amount prescribed in the plan or the severance pay provided by
law whichever is the greater amount.  In
the present case, there is nothing in the labor agreement entered into by
petitioner with the Batangas Transportation Employees Association of which
private respondent is a member barring the latter from recover­ing whatever
benefits he is entitled to under the law in addition to the gratuity benefits
under the labor agreement between him and his employer.  Neither is there any provision in the
Termination Pay Law (Republic Act No. 1052, as amended by Republic Act No.
1787) that an employee who receives his termination pay upon sepa­ration from the service without cause is precluded
from recovering any other benefits agreed upon by him and his employer.  In the absence of any such prohibition, both
in the aforesaid Labor Agreement and the Termination Pay Law the private
respondent has the right to recover from the petitioner whatever benefits he is
entitled to under the Termination Pay Law in addition to other benefits conferred
upon him by the aforesaid labor agreement.”

Therefore, if there is no provision contained in the collective
bargaining agreement to the effect that benefits received under the Termination
Pay Law shall preclude the employee from receiving other benefits from the
agreement, then said employee is entitled to the benefits embodied in the
agreement in addition to whatever benefits are mandated by statute.  In the case at bar, there is no such
provision.  We cannot presume that it
forms an implicit part of either the CBA or the law.  Sepa­ration pay arising from a forced
termination of employment and benefits given as a contractual right due to many
years of faithful service are not neces­sarily antagonistic to each other,
especially where there are strong equitable considerations as in this
case.  Article VIII-8.2 of the CBA
provided:

“Art. VIII-8.2.  In case of unusual circums­tances, such as
decrease in enrollment, or the closure of any College or Department of the
University, etc., which may warrant the reduction of the number of faculty
members in any rank, faculty members whose services are terminated shall be
granted the retirement benefits, if they are entitled thereto, provided that
the services of those with less years of service shall be terminated
first.  Those who have not yet met the
requirements for retirement as to length of service will also be con­sidered as
retired and will be given the retirement pay provided in the Rules on
retirement of the University based on the actual length of their services.  This retirement privilege, however, shall not
apply to faculty members who may be transferred from one College or Department
to another of the University.” (Rollo, p. 115).

Clearly, the only situation contemplated in the CBA wherein an
employee shall be precluded from receiving retirement benefits is when said employee is not
separated from service but transferred instead from one college or department
to another.  There is no provision to the
effect that teachers who are forcibly dismissed are not entitled to retirement
benefits if the MOLE awards them separation pay.  Furthermore, since the above provision has
become in effect part of the petitioner’s policy, the same should be enforced
separately from the provisions of the Termination Pay Law.  As we have ruled in Philippine Overseas
Drilling and Oil Development Corporation v. Ministry of Labor, (146 SCRA
79, 89):

“Be that as it may, the finding of the respondent Director,
that there was a company policy
to grant separation benefit or pay equivalent to one (1) month pay for every
year of service to employees who were similarly situated as private respondent,
is supported by substantial evidence which means ‘such relevant evidence as a reasonable mind might accept as
adequate to support a conclusion.’ (Ang Tibay v. CIR, 69 Phil. 635; Canete v. Workmen’s Compensation Commission,
May 8, 1985, 136 SCRA 302, 308). 
Documents to this effect were presented by private respondent at the
hearing on January 24, 1980 as Annexes ‘D’ thru ‘D-7’ of his position paper.

“”Having found that there was a company policy to that
effect, respondent Director correctly held that private respondent was legally
entitled to a sepa­ration benefit or pay equivalent to one (1) month pay for
every year of service, notwithstanding the fact that he had voluntarily
resigned.  He applied a basic principle
permeating the Labor Code and its Implementing Rules and Regulations.  (Tiangco v. Leogardo, Jr., May 16, 1983, 122
SCRA 267, 272-273; Marcopper Mining Corporation v. Ople, June 11, 1981 105 SCRA
75, 83; Oceanic Pharmacal Employees Union (FFW) v. Inciong, November 7, 1979,
94 SCRA 270, 275).  After having served
petitioner for ten years, private respon­dent deserved his separation benefit
or pay.”

The case of Soberano v. Clave, supra, cited by herein
petitioner does not apply to the case at bar. 
In Soberano, the employees concerned either voluntarily retired
or were retired upon reaching the age of sixty pursuant to their collective
bargaining agreement.  We, thus, ruled
that voluntary or compulsory retirement under such an agreement cannot in any
sense be deemed a dismissal without cause as to justify the application of the
Termination Pay Law.  In the present
case, the herein faculty members were “retired” or considered
“as retired” not because of the mutual agreement of the employer and
employee pursuant to the collective bargaining agreement but against the
employees’ will and over their vehement charges of discrimination.  It was the unilateral act of the employer,
petitioner herein, which “retired” them because they were supposed to
be responsible for the university’s continued hemorrhaging.  In the former case, the employees voluntarily
retired with benefits while in the latter, the faculty members were actually
dismissed against their will and on the basis of unproved causes.  Both law and equity are on the side of the
teachers.

WHEREFORE, IN VIEW OF THE FOREGOING, the petition is
hereby DISMISSED for lack of merit.  The
temporary restraining order issued on June 18, 1986 is LIFTED.

SO ORDERED.

Fernan, (Chairman), Feliciano, Bidin, and Cortes, JJ., concur.