‭Laya vs. Court of Appeals, G.R. No.

205813, January 10, 2018‬

‭FACTS:‬
‭Petitioner‬ ‭Alfredo‬ ‭F.‬ ‭Laya‬ ‭Jr.‬ ‭was‬ ‭hired‬ ‭by‬‭respondent‬‭Philippines‬‭Veterans‬‭Bank‬‭as‬‭its‬
‭Chief‬‭Legal‬‭Counsel‬‭with‬‭the‬‭rank‬‭of‬‭Vice‬‭President.‬‭Later‬‭on,‬‭the‬‭petitioner‬‭was‬‭informed‬‭thru‬‭a‬
‭letter‬‭by‬‭the‬‭private‬‭respondent‬‭of‬‭his‬‭retirement‬‭effective‬‭on‬‭1‬‭July‬‭2007.‬‭He‬‭then‬‭requested‬‭for‬
‭an‬ ‭extension‬ ‭of‬ ‭his‬ ‭tenure‬ ‭for‬ ‭2‬ ‭more‬ ‭years‬ ‭pursuant‬ ‭to‬ ‭the‬ ‭Bank’s‬ ‭Retirement‬ ‭Plan‬ ‭but‬ ‭was‬
‭denied.‬ ‭According‬ ‭to‬ ‭the‬ ‭petitioner,‬ ‭he‬ ‭was‬ ‭made‬ ‭aware‬ ‭of‬ ‭the‬ ‭retirement‬ ‭plan‬ ‭of‬ ‭respondent‬
‭Philippine‬ ‭Veterans‬‭Bank‬‭(PVB)‬‭only‬‭after‬‭he‬‭had‬‭long‬‭been‬‭employed.‬‭The‬‭petitioner‬‭filed‬‭for‬
‭illegal‬ ‭dismissal.‬ ‭The‬ ‭LA‬ ‭dismissed‬ ‭the‬ ‭complaint.‬‭The‬‭NLRC‬‭affirmed‬‭the‬‭dismissal.‬‭The‬‭CA‬
‭affirmed‬‭the‬‭decision‬‭as‬‭well.‬‭The‬‭SC‬‭of‬‭the‬‭first‬‭division‬‭denied‬‭the‬‭Petition‬‭and‬‭his‬‭motion‬‭for‬
‭reconsideration. Hence, this 2nd for a motion for reconsideration to the Court En banc of the SC.‬

‭ISSUE:‬‭WON the petitioner was validly retired by PVB‬‭at age 60.‬‭(NO)‬

‭ ULING:‬‭The‬‭CA‬‭concluded‬‭that‬‭the‬‭petitioner‬‭had‬‭agreed‬‭to‬‭be‬‭bound‬‭by‬‭the‬‭retirement‬‭plan‬
R
‭of‬ ‭PVB‬ ‭when‬‭he‬‭accepted‬‭the‬‭letter‬‭of‬‭appointment‬‭as‬‭its‬‭Chief‬‭Legal‬‭Counsel.‬‭Obviously,‬‭the‬
‭mere‬‭mention‬‭of‬‭the‬‭retirement‬‭plan‬‭in‬‭the‬‭letter‬‭of‬‭appointment‬‭did‬‭not‬‭sufficiently‬‭inform‬
‭the‬ ‭petitioner‬ ‭of‬ ‭the‬ ‭contents‬ ‭or‬ ‭details‬ ‭of‬ ‭the‬ ‭retirement‬ ‭program.‬ ‭To‬ ‭construe‬ ‭from‬ ‭the‬
‭petitioner's‬ ‭acceptance‬ ‭of‬ ‭his‬ ‭appointment‬ ‭that‬ ‭he‬ ‭had‬ ‭acquiesced‬ ‭to‬ ‭be‬ ‭retired‬‭earlier‬‭than‬‭the‬
‭compulsory‬ ‭age‬ ‭of‬ ‭65‬ ‭years‬ ‭would,‬ ‭therefore,‬ ‭not‬ ‭be‬ ‭warranted.‬ ‭This‬ ‭is‬ ‭because‬ ‭retirement‬
‭should‬ ‭be‬ ‭the‬ ‭result‬ ‭of‬ ‭the‬ ‭bilateral‬ ‭act‬ ‭of‬ ‭both‬ ‭the‬ ‭employer‬ ‭and‬‭the‬‭employee‬‭based‬‭on‬
‭their‬‭voluntary‬‭agreement‬‭that‬‭the‬‭employee‬‭agrees‬‭to‬‭sever‬‭his‬‭employment‬‭upon‬‭reaching‬
‭a‬‭certain‬‭age.‬‭That‬‭the‬‭petitioner‬‭might‬‭be‬‭well‬‭aware‬‭of‬‭the‬‭existence‬‭of‬‭the‬‭retirement‬‭program‬
‭at‬‭the‬‭time‬‭of‬‭his‬‭engagement‬‭did‬‭not‬‭suffice.‬‭His‬‭implied‬‭knowledge,‬‭regardless‬‭of‬‭duration,‬‭did‬
‭not‬‭equate‬‭to‬‭the‬‭voluntary‬‭acceptance‬‭required‬‭by‬‭law‬‭in‬‭granting‬‭an‬‭early‬‭retirement‬‭age‬‭option‬
‭to‬ ‭the‬ ‭employee.‬ ‭The‬ ‭law‬ ‭demanded‬ ‭more‬ ‭than‬ ‭a‬ ‭passive‬ ‭acquiescence‬ ‭on‬ ‭the‬ ‭part‬ ‭of‬ ‭the‬
‭employee,‬‭considering‬‭that‬‭his‬‭early‬‭retirement‬‭age‬‭option‬‭involved‬‭conceding‬‭the‬‭constitutional‬
‭right‬‭to‬‭security‬‭of‬‭tenure.‬‭Furthermore,‬‭the‬‭petitioner's‬‭membership‬‭in‬‭the‬‭retirement‬‭plan‬‭could‬
‭not‬ ‭be‬ ‭justifiably‬ ‭attributed‬ ‭to‬ ‭his‬ ‭signing‬ ‭of‬ ‭the‬ ‭letter‬ ‭of‬ ‭appointment‬ ‭that‬ ‭only‬ ‭listed‬ ‭the‬
‭minimum‬‭benefits‬‭provided‬‭to‬‭PVB's‬‭employees.‬‭Indeed,‬‭in‬‭Cercado‬‭,‬‭we‬‭have‬‭declared‬‭that‬‭the‬
‭employee's‬ ‭consent‬ ‭to‬ ‭the‬ ‭retirement‬‭plan‬‭that‬‭came‬‭into‬‭being‬‭two‬‭years‬‭after‬‭the‬‭hiring‬‭could‬
‭not‬ ‭be‬ ‭inferred‬‭from‬‭her‬‭signature‬‭on‬‭the‬‭personnel‬‭action‬‭forms‬‭accepting‬‭the‬‭terms‬‭of‬‭her‬‭job‬
‭description,‬ ‭and‬ ‭compliance‬ ‭with‬ ‭the‬ ‭company‬ ‭policies,‬ ‭rules‬ ‭and‬ ‭regulations‬ ‭Having‬ ‭thus‬
‭automatically‬‭become‬‭a‬‭member‬‭of‬‭the‬‭retirement‬‭plan‬‭through‬‭his‬‭acceptance‬‭of‬‭employment‬‭as‬
‭Chief‬ ‭Legal‬ ‭Officer‬ ‭of‬ ‭PVB,‬ ‭the‬ ‭petitioner‬ ‭could‬ ‭not‬ ‭withdraw‬ ‭from‬ ‭the‬ ‭plan‬ ‭except‬ ‭upon‬‭his‬
‭termination‬ ‭from‬ ‭employment.‬ ‭It‬ ‭is‬ ‭also‬ ‭notable‬ ‭that‬ ‭the‬ ‭retirement‬‭plan‬‭had‬‭been‬‭in‬‭existence‬
‭since‬‭January‬‭1,‬‭1996,‬‭or‬‭more‬‭than‬‭five‬‭years‬‭prior‬‭to‬‭the‬‭petitioner's‬‭employment‬‭by‬‭PVB.‬‭The‬
‭plan‬‭was‬‭established‬‭solely‬‭by‬‭the‬‭PVB,‬‭and‬‭approved‬‭by‬‭its‬‭president.‬‭As‬‭such,‬‭the‬‭plan‬‭was‬‭in‬
‭the‬‭nature‬‭of‬‭a‬‭contract‬‭of‬‭adhesion,‬‭in‬‭respect‬‭to‬‭which‬‭the‬‭petitioner‬‭was‬‭reduced‬‭to‬‭mere‬
‭submission‬‭by‬‭accepting‬‭his‬‭employment,‬‭and‬‭automatically‬‭became‬‭a‬‭member‬‭of‬‭the‬‭plan.‬
‭With‬ ‭the‬ ‭plan‬ ‭being‬ ‭a‬ ‭contract‬ ‭of‬ ‭adhesion,‬ ‭to‬ ‭consider‬ ‭him‬ ‭to‬ ‭have‬ ‭voluntarily‬ ‭and‬ ‭freely‬
‭given‬ ‭his‬ ‭consent‬ ‭to‬ ‭the‬ ‭terms‬ ‭thereof‬ ‭as‬ ‭to‬‭warrant‬‭his‬‭being‬‭compulsorily‬‭retired‬‭at‬‭the‬
‭age‬ ‭of‬‭60‬‭years‬‭is‬‭factually‬‭unwarranted.‬ ‭To‬‭stress,‬‭company‬‭retirement‬‭plans‬‭must‬‭not‬‭only‬
‭comply‬ ‭with‬ ‭the‬ ‭standards‬ ‭set‬ ‭by‬ ‭the‬ ‭prevailing‬ ‭labor‬ ‭laws‬ ‭but‬ ‭must‬ ‭also‬ ‭be‬ ‭accepted‬ ‭by‬ ‭the‬
‭employees‬‭as‬‭commensurate‬‭to‬‭their‬‭faithful‬‭services‬‭to‬‭the‬‭employer‬‭within‬‭the‬‭requisite‬‭period.‬
‭Although‬‭the‬‭employer‬‭could‬‭be‬‭free‬‭to‬‭impose‬‭a‬‭retirement‬‭age‬‭lower‬‭than‬‭65‬‭years‬‭for‬‭as‬‭long‬
‭its‬ ‭employees‬ ‭consented,‬ ‭the‬‭retirement‬‭of‬‭the‬‭employee‬‭whose‬‭intent‬‭to‬‭retire‬‭was‬‭not‬‭clearly‬
‭established,‬ ‭or‬ ‭whose‬ ‭retirement‬ ‭was‬ ‭involuntary‬ ‭is‬ ‭to‬ ‭be‬ ‭treated‬ ‭as‬ ‭a‬ ‭discharge.‬ ‭Hence,‬ ‭the‬
‭petition is granted and reverses the decision of the CA.‬
‭ OCTRINE:‬ ‭An‬ ‭employee‬‭in‬‭the‬‭private‬‭sector‬‭who‬‭did‬‭not‬‭expressly‬‭agree‬‭to‬‭the‬‭terms‬‭of‬
D
‭an‬‭early‬‭retirement‬‭plan‬‭cannot‬‭be‬‭separated‬‭from‬‭the‬‭service‬‭before‬‭he‬‭reaches‬‭the‬‭age‬‭of‬‭65‬
‭years.‬‭The‬‭employer‬‭who‬‭retires‬‭the‬‭employee‬‭prematurely‬‭is‬‭guilty‬‭of‬‭illegal‬‭dismissal,‬‭and‬‭is‬
‭liable‬ ‭to‬ ‭pay‬ ‭his‬ ‭backwages‬ ‭and‬ ‭to‬‭reinstate‬‭him‬‭without‬‭loss‬‭of‬‭seniority‬‭and‬‭other‬‭benefits,‬
‭unless‬ ‭the‬ ‭employee‬ ‭has‬ ‭meanwhile‬ ‭reached‬ ‭the‬ ‭mandatory‬ ‭retirement‬ ‭age‬ ‭under‬ ‭the‬ ‭Labor‬
‭Code,‬ ‭in‬ ‭which‬ ‭case‬ ‭he‬ ‭is‬ ‭entitled‬ ‭to‬ ‭separation‬ ‭pay‬ ‭pursuant‬ ‭to‬ ‭the‬ ‭terms‬ ‭of‬ ‭the‬ ‭plan,‬ ‭with‬
‭legal interest on the backwages and separation pay reckoned from the finality of the decision.‬