Wesleyan University Phils. v.

Reyes
G.R. No. 181806 | March 12, 2014

FACTS:
Wesleyan University-Philippines is a non-stock, non-profit
educational institution organized under Philippine laws; and
Wesleyan University-Philippines Faculty and Staff Association is sole
bargaining agent of all rank-and-file faculty and staff employees of
petitioner signed a 5-year CBA.
A Memorandum providing guidelines on implementation of
vacation and sick leave credits and vacation leave commutation was
issued by petitioner, through President Atty. Maglaya. Respondent
Pres. De Lara wrote a letter to Atty. Maglaya informing him that
respondent is not amenable to unilateral changes made by
petitioner and questioning guidelines for being contrary to existing
practices and CBA. Petitioner advised respondent to file a grievance
complaint during their Labor Management Committee Meeting.
Petitioner announced its plan of implementing a one-retirement
policy which was unacceptable to respondent.
Unable to settle their differences at grievance level, parties
referred the matter to a Voluntary Arbitrator. Respondent submitted
affidavits showing that there is an established practice of giving two
retirement benefits: one from Private Education Retirement Annuity
Association Plan and another from CBA Retirement Plan. Voluntary
Arbitrator declared that one-retirement policy and Memorandum
dated August 16, 2005 is contrary to law. CA affirmed nullification of
one-retirement policy and Memorandum as these unilaterally
amended CBA.

ISSUE: WON university practice of granting its employees two sets

of Retirement Benefits had already been established. (YES)
RULING:
Article 100 of Labor Code provides for Non-Diminution Rule that
prohibits the employers from eliminating or reducing benefits
received by their employees. It applies only if the benefit is based
on an express policy, a written contract, or has ripened into a
practice. To be considered a practice, it must be consistently and
deliberately made by employer over a long time, with an exception
that is when practice is due to error in construction or application of
a doubtful or difficult question of law. The error, however, must be
corrected immediately after its discovery; otherwise, the rule on
Non-Diminution of Benefits would still apply.
In the case at bar, respondent presented substantial evidence
in form of affidavits supporting its claim that there are two
retirement plans. As gleaned from affidavits, petitioner has been
giving 2 retirement benefits as early as 1997. Petitioner failed to
present evidence to refute veracity of said affidavit, and no
evidence was shown to prove contention that there is only one
retirement plan as the CBA Retirement Plan and the PERAA Plan are
one and the same.
 Moreover, CBA cannot be unilaterally changed. Memorandum
imposes a limitation not agreed upon by parties nor stated in CBA.
It is provided in Sections 1 and 2 of Article XII of CBA that all
covered employees are entitled to 15 days SL and 15 days VL with
pay every year and after 2nd year of service, all unused VL be
converted to cash and paid to employee at the end of each school
year, not later than August 30. Whereas, in the Memorandum, VL
and SL credits are not automatic as leave credits would be earned
on a month-to-month basis. The said Memorandum, therefore, limits
the available leave credits of an employee at the start of school
year. Basic is the rule that when the provisions of the CBA are clear,
the literal meaning of the stipulation shall govern. Any doubt in its
interpretation must be resolved in favor of labor.