G.R. No. 207735 - Field Investigation Office-Office of the Ombudsman vs. Rondon

The petitioner, Orlando M. Escareal, was hired by the Philippine Refining Company, Inc. (PRC) on 16 September 1977 as a Pollution Control Manager with a starting monthly salary of P4,230.00.
His employment was made permanent effective 16 March 1978, with his contract stipulating that his retirement date would be upon reaching his 60th birthday, though he could retire voluntarily at 50.
The basis for the appointment derived from Letter of Instruction No. 588, which mandated the appointment/designation of Pollution Control Officers, and Memorandum Circular No. 02, both of which underscored the legal need for such positions.
On 1 April 1979, he was designated as Safety Manager pursuant to Article 162 of the Labor Code and was duly accredited by the Bureau of Labor Standards and the Safety Organization of the Philippines.
Subsequently, his designation was formally changed to Pollution Control and Safety Manager, reflecting his dual role.
His salary was progressively upgraded, with the latest increase effective 1 April 1988 when his monthly pay was raised to P23,100.00, evidencing his value to the company.

In the first week of November 1987, George B. Ditching, then PRC’s Personnel Administration Manager, informed the petitioner of the company’s plan to declare his position redundant.
The petitioner was offered alternatives such as redundancy benefits and an early retirement plan, but he insisted on completing his contract, citing that he had approximately three and a half years before reaching the mandatory retirement age of 60.
On 15 June 1988, Jesus P. Javelona, PRC’s Engineering Department Manager and the petitioner’s immediate superior, formally notified him that his position would be declared redundant effective 15 July 1988, with its functions to be absorbed by the Industrial Engineering Manager.
The petitioner protested the redundancy via his letter dated 22 June 1988.
Despite the protest, PRC circulated a clearance on 12 July 1988 indicating an “early retirement” as the ground for termination, which later was adjusted to a termination effected on 16 August 1988.
On the day of termination, a Notice of Termination was sent to the Ministry of Labor and Employment, and Miguelito S. Navarro was designated as the new Pollution Control and Safety Officer, effectively replacing the petitioner.

The petitioner filed a complaint for illegal dismissal with damages before the NLRC (National Labor Relations Commission) in NLRC-NCR Case No. 00-08-03412-88.
After trial, the Labor Arbiter rendered a decision on 19 February 1990 ordering PRC to pay the redundancy benefits in accordance with its policy, albeit with modifications.
The NLRC affirmed the Labor Arbiter’s decision as modified on 14 January 1991, and a subsequent Resolution on 13 May 1991 dismissed part of the petitioner’s motion for reconsideration and further clarified the separation benefits.
Both the petitioner and PRC filed separate motions for reconsideration, with the petitioner challenging the factual and legal basis of his termination and benefit computation.

The petitioner elevated his case to the Court via a petition filed on 29 May 1991, arguing that the NLRC and Labor Arbiter committed grave abuse of discretion by:

Validating the redundancy of a position that was legally mandated.
Erroneously interpreting his employment contract as not constituting a fixed term ending at 60.
Denying separation or additional benefits, limiting his entitlement solely to retirement benefits under the PRC retirement scheme.
Failing to award damages and attorney’s fees despite evidence of malicious, wanton, and bad-faith acts by PRC.

The petitioner’s Memorandum of Errors enumerated several points, including the substitution of a duly experienced employee with a less qualified individual, which he argued was executed in bad faith to avoid paying his full benefits.

The contract of employment and related company correspondences set forth the terms regarding retirement and benefits, thereby forming the basis for the petitioner’s argument that his employment was not for a fixed period.
The legal framework, including Article 283 of the Labor Code on redundancy and Article 279 on wrongful dismissal and backwages, played a central role in the dispute.
The judicial record also contained references to previous cases and legal texts that reinforced the statutory rights of employees regarding redundancy, security of tenure, and due process in termination.

Whether the declaration of redundancy of the petitioner’s position was valid and in accordance with the existing legal framework, considering that the position is mandated by law.
Whether the petitioner’s employment contract, which stated retirement upon reaching 60, implies a fixed-term employment, thus guaranteeing uninterrupted service until that age.
Whether PRC’s actions in substituting the petitioner with a less qualified employee and eliminating his position were executed in bad faith and amounted to an abuse of management prerogative.
Whether the NLRC and the Labor Arbiter erred in limiting the petitioner’s benefits solely to retirement pay under the PRC retirement scheme, thereby neglecting his entitlement to backwages and other monetary equivalents for wrongful dismissal.
Whether the petitioner's assignment of errors—including the alleged grave abuse of discretion, lack or excess of jurisdiction, and the misapplication of relevant Labor Code provisions—provides sufficient basis for setting aside the administrative decisions.