G.R. No. L-7756 - Philippine Long Distance Telephone Company vs. Crispin Jeturian et al.

PHILIPPINE LONG DISTANCE TELEPH0NE COMPANY, Petitioner, appealed from a decision of the Court of Industrial Relations in Case No. 639-V.
Crispin Jeturian and about sixty other employees, Respondents, filed the petition in 1951 in the Court of Industrial Relations claiming pension benefits and unpaid salaries.

On September 18, 1923, the predecessor company, Philippine Telephone and Telegraph Co., adopted a "Plan for Employees Pensions" later adopted by the Petitioner.
Eligibility: all male employees who reached age fifty and had twenty or more years' service; all female employees who reached age forty-five and had twenty or more years' service; retirement could be at the employee's request or at directors' discretion.
Pension formula: one and one-half percent (1-1/2%) of average annual pay during last five years (or five years' highest wages in directors' discretion) for each year of term of employment; payments from date of retirement until death of the pensioner.
Section 5 provisions: (1) Board action establishing plan not to be construed as giving right to continued employment or to pensions unless right accrued prior to discharge; (2) assignment of pension not permitted; (3) pensions may be suspended or terminated for gross misconduct; (5) absences without pay are breaks in continuity unless directors determine otherwise; (7) temporary lay-off not a break unless absence exceeds four months in any twelve consecutive months, with reemployment rules not exceeding one year.
Section 4 (par. 4) provided pensions ceased upon death and no transmission to heirs; plan made no provision for death benefits.

Company bookkeeping established a "Provident Reserve" balance of P221,074.14 as of October 31, 1941; Court estimated P224,074.14 by December 31, 1941.
On November 6, 1945, the Board of Directors adopted a resolution discontinuing the Employees' Pension plan and all payments thereunder, effective retroactively as of January 1, 1942, citing operations being outside jurisdiction of elected management and lack of revenue during that period.

None of the petitioners had satisfied the age-and-service conditions on January 1, 1942.
The Court of Industrial Relations found that Major Stevenot, then Manager, instructed employees to remain with the Company during the Japanese administration and they worked during occupation pursuant to that instruction.
When the Company resumed control in 1946, the petitioners were not recalled to service.

(Subscriber-Only)

Whether the establishment of the 1923 pension plan constituted a mere gratuitous offer the Company could revoke at will or a binding contract enforceable against the Company.

Whether Respondents, who had not attained the plan's age-and-service conditions by January 1, 1942, could recover benefits or a pro rata indemnity despite nonfulfillment.

Whether the outbreak of the war terminated or dissolved the employer-employee relationship.
Whether wartime losses and asserted inability to pay relieved the Company of its obligation to continue the pension plan o...(Subscriber-Only)