Facts:

The case at hand involves petitioners Conrado M. Aquino, Napoleon B. Aromin, Roberto A. Gaspan, and Nicardo P. Blanquisco against the National Labor Relations Commission (NLRC) and Otis Elevator Company, encapsulated in G.R. No. 87653. The events transpired when the petitioners, who were employees of Otis Elevator Company, received notice of their termination due to a company-wide initiative aimed at streamlining operations, consolidating functions, reducing manpower, and cutting non-essential spending. The termination notice, dated February 11, 1992, clarified that each petitioner would receive in lieu of notice one month’s equivalent salary, regular allowances, earned or unused sick and vacation leaves, pro-rata 13th month pay, and separation pay equivalent to one month’s basic salary for each year of service or any retirement benefits, whichever is greater.

All petitioners were paid their calculated separation pay according to their respective lengths of service. Conrado M. A

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Facts:

Termination and Payment of Separation Pay

• The petitioners, Conrado M. Aquino, Napoleon B. Aromin, Roberto A. Gaspan, and Nicardo P. Blanquisco, were employed by the respondent, Otis Elevator Company, a private company.
• Their services were terminated on the ground of retrenchment as part of the company’s reorganization strategy aimed to streamline operations, consolidate functions, reduce manpower, and cut non-essential spending.
• The company issued separate letters informing the petitioners of their termination and detailing the benefits they were to receive in lieu of notice:
• Payment equivalent to one month’s salary plus regular allowances from the effective date of termination.
• Coverage of normal benefits for the period up to termination.
• Payment for earned and/or unused sick leave and vacation leave, including pro-rata 13th month pay.
• Separation pay computed as one month’s basic salary (or retirement benefits if higher) for every year of service.
• The separation pay was computed in accordance with Section 4, Article VII of the Collective Bargaining Agreement (CBA) between the employer and its employees, with figures provided for each petitioner based on their respective basic monthly salaries and years of service.

Retirement Benefits Claim

• Despite the receipt of separation pay, the petitioners demanded retirement benefits under the company’s Retirement Plan, contending that these benefits were contractual rather than solely statutory.
• Their claim for retirement benefits was based on:
• Section 1, Article XIV of the CBA in relation to Section 5.2, Article V of the Retirement Plan.
• Precedent cases involving co-employees (Cleodeveo Soriano, Jr. and Patriciano Destajo, Jr.) who had received both benefits under similar circumstances.
• The company, in its defense, argued that the provisions of the CBA clearly made the payment of separation pay subject to and not in addition to the retirement benefits, hence rendering the two benefits mutually exclusive.

Legal and Contractual Framework

• The separation pay is mandated by Articles 283 and 284 of the Labor Code as a statutory right aimed at providing financial support while the employee seeks new employment.
• Retirement benefits, which are not mandated by law, are typically provided as a result of a contractual agreement or voluntary act by the employer to reward long years of faithful service.
• The dispute centered on whether the receipt of separation pay precluded an employee from also claiming the retirement benefits as provided under the company’s Retirement Plan and the CBA.

Issue:

Whether an employee who has already received separation pay, as mandated by law and the CBA, is still entitled to claim additional retirement benefits provided for in the company’s Retirement Plan.

• The core issue is the alleged mutually exclusive nature of separation pay and retirement benefits as implied by the language of the CBA.
• Whether the practice of providing one benefit automatically disqualifies the employee from receiving the other, particularly when no explicit prohibition is included in the CBA or Retirement Plan.
• If the separate treatment in prior cases (e.g., the case of co-employees) can be applied as precedent to the present claim.

Ruling:

• (Subscriber-Only)

Ratio:

• (Subscriber-Only)

Doctrine:

• (Subscriber-Only)