Marcos, et. al. vs.

NLRC AND Insular Life Assurance (1995)

HELD:
FACTS:
Release and Quitclaim INVALID, petitioners were
Petitioners herein have served respondent Insular for more
ENTITLED to the service awards.
than 20 years in multiples of five (20-30 years). They were
terminated due to redundancy and thus were given special
A deed of release or quitclaim cannot bar an employee from
redundancy benefits. But they were denied their service
demanding payment to which he is entitled. Quitclaims are
awards which was set apart from the redundancy fund. They
against public policy and are therefore null and void. The
were made to sign a quit claim, which they complied, but
Court does not believe that petitioners signed the Release
they still submitted a letter of protest. They inquired from the
and Quitclaim voluntarily, as the subsequent submission of a
DOLE-LS on the validity of the denial of their service awards,
letter of protest and the inquiry before the NLRC
to which DOLE decided in their favour. The service awards
contradicted their willingness to execute the quitclaim.
were part of the Employee’s Manual and were therefore
company policies. The award was earned on the anniversary
The special redundancy package could not have covered the
date. Even if the employees were separated from service
service awards, and respondent’s actions estopped it from
before the anniversary date, they were still entitled to the
claiming such. Service awards are not bonuses. They are
material benefits of the award.
stated in the Employees Manual, which is contractual in
nature therefor the law between the parties. It is company
However, respondent still refused to pay this. On its 80th
policy and has been in practice by the company.
anniversary, the company approved an anniversary
equivalent of one-month salary to its employees. The
petitioners alleged that they were entitled to this.

The LA ruled in petitioners’ favour, but NLRC reversed this,

upholding the validity of the quitclaim they signed voluntarily.

ISSUE:
W/N the quitclaim was invalid and if so, petitioners would be
entitled to their service award.