G.R. No. 219774 - Manila Hotel Corporation vs. De Leon

Respondent, Rosita De Leon, was employed by petitioner Manila Hotel Corporation beginning September 1, 1976, initially as a Restaurant and Bar Cashier.
Over the years, she was promoted successively to Front Office Cashier (October 1977), Front Office Cashier’s Shift Leader (August 1986), Head Cashier (January 1988), Income Auditor (March 1989) and Assistant Credit and Collection Manager (seven years after being Income Auditor).
In March 2000, petitioner assigned her the functions of the General Cashier following the resignation of the incumbent.

On June 7, 2011, respondent received a letter from petitioner dated June 6, 2011, titled “Notice of Compulsory Retirement.”

The Notice indicated that petitioner was exercising its prerogative to retire her at the close of office hours on June 10, 2011.
At that time, respondent was 57 years old with 34 years of service and held the position of Assistant Credit and Collection Manager/Acting General Cashier.

The Notice stated that, upon compulsory retirement, respondent would be entitled to her retirement pay and benefits in accordance with the company’s policies.
Subsequent to receiving the Notice, respondent questioned the basis of her retirement and maintained that she had not agreed to such compulsory measure.

Respondent filed a complaint for illegal dismissal and other related benefits including underpayment of salaries, 13th month pay, service charges, transportation allowance, illegal deductions, among others.
She argued that her forced retirement without due process constituted constructive dismissal and maintained that she did not voluntarily accept the retirement offer.
Conversely, petitioner contended that:

There was no dismissal since respondent had reportedly accepted its compulsory retirement offer by promptly processing her Personnel Clearance and inquiring about her retirement pay.
Her long years of service in excess of the required minimum (20 years under the Collective Bargaining Agreement or CBA) justified the unilateral retirement even though respondent was only 57 years old.

Respondent was a rank-and-file employee whose job responsibilities were routine and did not involve managerial discretion.
Any benefits given under the CBA were part of the management’s prerogative which is not generally subject to interference from labor law.

The LA ruled in favor of respondent, finding that she was a managerial employee based on her job responsibilities, benefits, and privileges.
Consequently, the CBA did not apply to her, and her compulsory retirement was deemed a constructive dismissal.
The LA ordered reinstatement with backwages and awarded attorney’s fees and relief for illegal deductions.

The NLRC reversed and set aside the LA’s decision, dismissing the complaint for illegal constructive dismissal.
It held that petitioner’s unilateral offer of retirement, with immediate processing including the Personnel Clearance, constituted a bilateral agreement under Article 287 of the Labor Code.
Based on this acceptance, respondent was estopped from contesting the compulsory retirement.

The CA granted respondent’s petition for certiorari, annulling the NLRC’s decision and holding that respondent was a managerial employee and not covered by the CBA.
The CA ordered petitioner to pay backwages, retirement benefits, illegal deductions, and attorney’s fees.

Petitioner filed a Motion for Partial Reconsideration seeking to affirm the NLRC ruling, which was subsequently denied.

Whether respondent qualified as a managerial employee despite petitioner’s classification and the purported benefits under the CBA.

The determination centered on the nature of her job functions, responsibilities, and whether the benefits and privileges accorded to her signified a managerial status.

Whether the receipt and processing of the Personnel Clearance by respondent amounted to an unequivocal acceptance of petitioner’s compulsory retirement offer under the CBA.

The controversy arises over whether respondent’s actions were a voluntary acceptance or were merely compelled by the circumstances given the urgent nature of the processing deadlines.

Whether petitioner’s exercise of management prerogative to impose compulsory retirement on respondent, without a bilateral agreement for early retirement, constituted illegal dismissal.

This issue examines if unilateral action by the employer, without express consent of the employee, violates the requirements of a valid retirement contract as set forth by labor law.