MOIT, ROMEL JOHN M.

Rivera vs. San Miguel Brewery Corp.

G.R. No. L-26197
July 20, 1968

Facts:

Rivera was employed by San Miguel as a security

guard for approximately 10 years and 9 months. He was
separated for physical disability due to illness.

He was paid a total of ₱930.35 as retirement. The

amount of ₱331.40 representing the contribution of San
Miguel to the SSS during the period from September 1957 to
March 1963 was deducted from the retirement benefits of
Rivera. San Miguel, being fully company financed, required
no contribution whatsoever from Rivera.

Rivera, however, later filed with the Cagayan de Oro

MTC a complaint against the San Miguel for collection of
separation pay and recovery of a sum of money, including
actual, moral and exemplary damages and attorney’s fees.
Nevertheless, San Miguel, traversing the allegations upon
them, was found out to have already paid its obligation to
Rivera in accordance with law.

Issue:

Whether San Miguel had the right to deduct the

amount of ₱331.40 from the retirement benefits and/or
separation pay of Rivera, and thus recover its contribution to
the SSS.

Ruling:
 Yes, San Miguel has the right to deduct the amount of
₱331.40 from the total amount of the retirement benefits

Where San Miguel has paid the amount of ₱331 as its

contribution to the SSS for and in behalf of Rivera, such
company has therefore the right to deduct the same amount
from the total amount of retirement benefits.

This situation has been envisaged by Sec. 9 of the

Social Security Act to the effect that the total contribution of
the employer to his private benefit plan and to the SSS shall
be the same as his contribution to his private plan before the
compulsory coverage.

What is prohibited is the deduction of the contribution

of the employer from the compensation of his employees, or
the recovery from said employees of the contribution of the
employer to SSS with respect to their coverage.

An employer is not prevented from deducting the

contributions it had paid to a private plan which it has
integrated with the SSS for to allow the employee to enjoy
the full amount of retirement pay under the private plan and
all the benefits due to him without spending any single cent.

Thus, in the case at bar, the total of the retirement

benefits due to Rivera under the private plan of San Miguel
was actually ₱1,261.75. But, since it is San Miguel who had
paid the amount of ₱331.40 as its contribution to the SSS for
and in behalf of Rivera, it has therefore the right to deduct
the latter amount from the total amount of the retirement
benefits, leaving a balance of ₱930.35, which was then paid
to Rivera.