BACOLOD-MURCIA MILLING COMPANY, INC., PETITIONER, VS. NATIONAL LABOR RELATIONS COMMISSION AND ELENA CANETE, RESPONDENTS.

At issue in this petition for certiorari is the manner of
computation of the retirement pay of private respondent Elena Canete who was in the employ of petitioner Bacolod-Murcia Milling Company, Inc. for thirty-four (34)
years.

In her complaint against petitioner Company for underpayment of
retirement benefits and moral damages, Canete alleged
that on October 14, 1985, she was paid her retirement benefits in the amount of
P21,457.00, after taking into consideration her twenty-five years of service as
a seasonal worker (cane scaler) from October 6, 1951
to April 30, 1976 and the last nine years as a permanent employee (family
planning motivator) from May 1, 1976 to August 30, 1985.  The Company computed her retirement pay in
accordance with the “mixed service credit” computation under Section 9, Article
XVII of the Collective Bargaining Agreement between petitioner Company and the
Allied Workers’ Association of the Philippines,
Bacolod-Murcia Central Chapter (NACUSIP) of which Canete was a member.^[1]

Canete claims that this was
erroneous.  The computation of her
retirement pay should have been based on
Section 7 of the same article which provides that permanent employees
who have rendered thirty years of service or more are entitled to 100% of one
month’s base pay for every year of service beginning with the first year.  Hence, she was underpaid in the amount of P17,415.20.

Both the Executive Labor Arbiter of the Regional Arbitration
Branch and the National Labor Relations Commission agreed with Canete.  In the
assailed resolution dated December
29, 1987, respondent Labor Tribunal affirmed the decision of the
Labor Arbiter ordering petitioner Company to pay Canete
P17,415.00 representing the differential in her retirement benefit.  (Canete’s last pay
of P38.11 per day multiplied by 30 equals P1,143.38 per month.  This amount multiplied by 34 years equals
P38,872.20.  Considering that Canete had received P21,457.00, she was underpaid of her
retirement pay in the amount of
P17,415.20).^[2]

In the instant petition,
petitioner Company contends that the Labor Tribunal committed grave abuse of discretion in granting the
retirement pay differential in favor of Canete, in
derogation of the binding effect of the Collective Bargaining Agreement despite
public respondent’s pretended adherence to Section 7 of Article XVII
thereof.  Petitioner maintains that for
purposes of computing Canete’s retirement benefits,
public respondent should not have relied primarily on Section 7 of Article XVII of the CBA which provides:

“Section 7.  – Benefit.  – The benefit under this plan is the cash
equivalent in accordance with the following schedule for permanent employees:

Years of Service                                             Retirement
Pay

20 years                                              50%
of 1 month’s base pay

per year of  service

beginning with the first year

21 “                              55%                             – do –

22 “                              60%                             – do –

23 “
                             65%                             – do
–

24 “                              70%                             – do –

25 “                              75%                             – do –

26 “                              80%                             – do –

27 “                              85%                             – do –

28 “                              90%                             – do –

29 “                              95%                             – do –

30 “                              100%                           – do –

“The pay referred to shall be construed to be the last rate of the
employee upon retirement.

“In case of death, however, the amount shall not be less than
P500.00.”

because while Canete
served as a permanent employee for nine years, prior to that, she was only a
seasonal worker for twenty-five years.

Petitioner submits that in determining the correct retirement
pay, Canete’s twenty-five year service as a seasonal laborer should have been
taken into account and divided by two in accordance with the mixed service
credit computation under Section 9 which states:

“Section 9.  Computation of
benefit for Seasonal Employees- Except as provided for in Sections 3, 5 and 6
in this Article, seasonal employees may qualify under voluntary retirement upon
having established 20 years of seasonal service.

“For purposes, however, of computing the benefit due seasonal
employees, the formula is as follows:

“Number of years of seasonal service, multiplied by the percentage
of a month’s base pay per schedule under Section 7, divided by two (2) equals
the amount of retirement
benefit.

“Provided, finally, that in cases of mixed service credit, only the
services corresponding to seasonal employment shall be divisible by two (2).”
(Emphasis supplied).

The petition is meritorious.

While under prevailing jurisprudence,^[3]
Canete may be considered as in regular employment
even during those years when she was merely a seasonal worker, that legal
conclusion will hold true only in cases involving the determination of an
employer-employee relationship or security of tenure.  But for retirement purposes, the distinction
between a seasonal and a regular
worker must be drawn in view of the materiality of the length of service being
rendered by the employee in a year.  To
equate the seasonal worker with a regular employee and grant him the same
retirement benefits is grossly unfair to the regular employee who has rendered
service throughout the entire year.

Indeed, by the very nature of his work, the seasonal laborer
cannot enjoy the same retirement privileges
as the regular worker.  The seasonal
laborer works only for a fraction of the year. 
And more often than not, he is allowed by his employer to seek
employment elsewhere during off-season or temporary lay-off for economic
necessity.  This is the set-up endemic or
peculiar to the sugar industry — which is precisely the reason why the CBA in
the case at bar has differentiated among the three types of employees of
petitioner Company, namely, the seasonal worker, the regular worker and the
mixed seasonal and regular worker.  To
follow the unrealistic interpretation given by respondent Labor Tribunal will
negate and render inutile and superfluous the difference recognized by said
Agreement because all employees would then retire under Section 7 as all of
them are considered regular.  This
completely ignores the indubitable fact that there are employees like Canete who worked in the fields as seasonal workers but
were later promoted and became members of the regular work force.  It is exactly for Canete
and those similarly situated that the stipulation on mixed service credit has
been incorporated in the CBA.  And at the
risk of being redundant, it must be stressed that the CBA is the law between
the parties and when not contrary to law, morals and public policy, must be
given effect.

While it may be a laudable gesture for the Court to “lean over backwards” in favor of labor,
such magnanimity must not go as far as to cause a clear injustice to management which is entitled under the law to as much
protection and concern as labor.

WHEREFORE, the petition is granted.  The questioned resolution by respondent
National Labor Relations Commission dated December 29, 1987 is hereby REVERSED and SET ASIDE.  The complaint filed by private respondent
Elena Canete for retirement benefits and payment of
moral damages against petitioner Bacolod-Murcia
Milling Company, Inc. is ordered DISMISSED. 
This decision is immediately executory.  No costs.

SO ORDERED.

Gutierrez, Jr., Bidin, Davide, Jr., and
Romero, JJ., concur.

^[1]
RAB VI Case No. 0372-85.

^[2]
Rollo, p. 45.

^[3]
Manila Hotel Company v. Court of Industrial Relations, No. L-18873, September 30, 1963, 9 SCRA 184; Visayan Stevedore Trans. Company v. CIR, No. L-21696,
February 25, 1967, 19 SCRA
426; ICAWO v. CIR, No. L-21465, March
31, 1966, 16 SCRA 562.