G.R. No. L-46397 - People vs. Dela Cruz

The case involves a petition for review on certiorari filed by petitioner Eleazar S. Padillo (now substituted by his legal heirs) assailing the decision and resolution of the Cagayan de Oro City Court of Appeals (CA).
The CA had reversed the National Labor Relations Commission’s (NLRC’s) decisions regarding Padillo’s claim for retirement benefits and separation pay.

Padillo was employed by Rural Bank of Nabunturan, Inc. as a Senior Assistant Bookkeeper since October 1, 1977.
In 2003, facing liquidity problems, the Bank procured a retirement/insurance plan (Philam Life Plan) in favor of Padillo among its employees with a benefit amount of P100,000.00 maturing on July 11, 2009.
In 2007, Padillo suffered a mild stroke due to hypertension, resulting in a diagnosis of Hypertension S/P CVA with short term memory loss, which was classified as a total disability.
On September 10, 2007, Padillo wrote a letter requesting early retirement due to his deteriorating health.
Subsequently, on October 3, 2007, he was separated from employment, with the separation certified on December 4, 2007.

Padillo filed a complaint on September 23, 2008 with the NLRC to recover unpaid retirement benefits.
He argued that the Bank had a policy of granting early retirement packages, citing a co-employee, Nenita Lusan, who received retirement benefits at the age of fifty-three.
Respondents (the Bank and its president, Mark S. Oropeza) contended that Padillo’s claim had no basis as he did not meet the age requirement under the applicable law.

The Labor Arbiter (LA) ruled on March 13, 2009, dismissing Padillo’s complaint for retirement benefits but ordering the Bank to pay him P100,000.00 as financial assistance under the Philam Life Plan.
The NLRC, on December 29, 2009, reversed the LA ruling and ordered the payment of P164,903.70, which included separation pay on the ground of disease, referencing Article 297 of the Labor Code.
The NLRC’s decision was later denied in a reconsideration motion on March 31, 2010.

The CA, in its June 28, 2011 decision, set aside the NLRC rulings and reinstated the LA decision with modification.
It determined that Padillo was ineligible for retirement benefits under Article 300 of the Labor Code because he resigned at age fifty-five, below the prescribed retirement age of sixty.
The CA also held that separation pay on the ground of disease should not be granted since Padillo voluntarily retired, though it awarded him P50,000.00 as financial assistance in view of his 29 years of service and his non-derogatory employment record.
Respondents, alleging errors in the CA’s findings, then elevated the matter to the Supreme Court.

Whether Article 297—which contemplates termination pay on the ground of disease—applies when an employee voluntarily resigns due to poor health.

Whether Padillo, having resigned at age fifty-five, meets the compulsory retirement age requirement of sixty years under Article 300 of the Labor Code.
Whether the absence of a company-wide retirement plan or consistent company practice on early retirement affects his entitlement to retirement benefits.

The appropriateness of applying the case of Abaquin Security and Detective Agency, Inc. v. Atienza in this case given the differences in factual context.
Whether the comparison drawn with the treatment of another employee (Nenita Lusan) can establish an evolved company practice granting retirement benefits.

Whether the CA err in awarding only P50,000.00 as financial assistance despite Padillo’s long service and the equities involved.
Whether the respondents’ actions and alleged bad faith, if any, have a bearing on the quantum of financial assistance to be granted.

Whether the respondents’ refusal to accede to Padillo’s claim amounts to abuse of right, meriting damages or additional relief.