G.R. No. 152928 - Metropolitan Bank and Trust Co. vs. National Labor Relations Commission

Petitioner: Metropolitan Bank and Trust Company (Metrobank).
Respondents: Felipe A. Patag and Bienvenido C. Flora, former managerial officers of Metrobank.

Both respondents retired under the bank’s compulsory retirement plan as provided in the 1995 Officers’ Benefits Memorandum.
At retirement:

Patag, an Assistant Manager, retired on February 1, 1998, with a monthly salary of P32,100.00.
Flora, a Senior Manager, retired on April 1, 1998, with a monthly salary of P48,500.00.

Their retirement benefits were computed at 185% of their gross monthly salary for every year of service, resulting in total payments of:

Early 1998 saw ongoing negotiations for a new Collective Bargaining Agreement (CBA) covering rank and file employees for 1998-2000.
Based on the expectation of improved officers’ benefits tied to the new CBA, the respondents submitted requests:

Patag wrote a letter on February 2, 1998 requesting recalculation of his retirement benefits using the anticipated improved rate.
Flora wrote on March 25, 1998 asking that the computation of his benefits reflect a 200% rate as provided under the just-concluded CBA with the rank and file.

In line with its longstanding practice of matching or exceeding benefits granted to rank and file employees, Metrobank issued on June 10, 1998 an Officers’ Benefits Memorandum granting improved benefits at a rate of 200%, effective January 1, 1998.
This memorandum imposed a new condition: the improved benefits would only be extended to officers who remained in service as of June 15, 1998.
On June 29, 1998, Flora sought reconsideration of the condition by writing to Metrobank; the bank denied the request on July 17, 1998.

On August 31, 1998, Patag and Flora, through counsel, sent a letter demanding the payment of additional retirement benefits amounting to:

Metrobank responded on September 17, 1998 via its First Vice-President, asserting that both respondents were ineligible for the improved benefits since they had already ceased employment and were not officers as of the required June 15, 1998.
The respondents filed their consolidated complaint before the Labor Arbiter on September 25, 1998, challenging the underpayment of retirement benefits and claiming additional benefits under the 1998 memorandum, with additional claims by Patag for profit share and structural adjustment.
The Labor Arbiter dismissed the complaint on June 8, 1999, prompting the respondents to appeal to the National Labor Relations Commission (NLRC).
On March 31, 2000, the NLRC partially granted the appeal and directed Metrobank to pay the demanded additional benefits.
Unsatisfied, Metrobank elevated the matter to the Court of Appeals (CA) via a petition for certiorari (CA-G.R. No. 63144). The CA affirmed the NLRC’s resolution by rendering a decision on December 13, 2001, and denied Metrobank’s subsequent motion for reconsideration on April 9, 2002.
Finally, Metrobank sought review before the Supreme Court under Rule 45 of the 1997 Rules of Civil Procedure.

The records demonstrate that from 1986 up to 1997, Metrobank consistently issued memoranda after each CBA with its rank and file, granting improved or at least equivalent benefits to its officers retroactive to January 1 with no condition regarding the status of employment on a specified future date.
The 1998 memorandum was the first to impose the condition that only officers employed as of June 15, 1998, could avail of the improved benefits.
Respondents argued that this long-standing practice had ripened into a company policy, which could not be unilaterally modified to the detriment of those who retired before the new condition was imposed.
Metrobank, on the other hand, contended that:

The respondents had already received full retirement benefits computed under the old rate.
They were not eligible for the improved benefits since they did not satisfy the condition of being employed on June 15, 1998.
The CA erred in allowing the claim when compared to other similarly situated retirees who did not initiate legal actions.

Is it proper to allow respondents to claim additional retirement benefits computed at 200% under the 1998 Officers’ Benefits Memorandum despite:

Their compulsory retirement under the 1995 memorandum?
The fact that they did not meet the condition of continuing employment as of June 15, 1998?

Does the long-proven practice of granting improved benefits to officers (from 1986 to 1997) constitute an established company policy that automatically accords a vested right to such benefits?

Can Metrobank’s imposition of a new condition in the 1998 memorandum, following the respondents’ expressed requests for increased benefits, be justified legally?

Is the defense of estoppel applicable in barring the respondents from claiming additional benefits given that they had already received payment under the old retirement plan?