Retirement is the result of a bilateral act of both the employer and the employee based on their voluntary agreement that upon reaching a certain age, the employee agrees to sever his employment.
Hence, the Supreme Court held in the following case:
Barroga vs. Quezon Colleges of the North
G.R. No. 235572, December 5, 2018
Retirement; Distinction between retirement and dismissal; Voluntary retirement; Involuntary retirement;
Petitioner Edwin Barroga alleged that he was a full-time science and chemistry teacher at QCN’s High School Department continuously from June 1985 to March 2014.
However, at the beginning of school year 2014-2015, Respondents Quezon Colleges of the North and/or Ma. Cristina A. Alonzo and Irma Segunda A. Beltran (QCN, et al.) told him that he could not be given any teaching load allegedly because there were not enough enrollees. Barroga found the timing thereof suspicious as he was already due for optional retirement for continuously serving QCN, et al. for almost thirty (30) years.
Initially, Barroga filed a case via Single-Entry Approach (SENA) before the Department of Labor and Employment Regional Office in Aparri, Cagayan (SENA Case), where he and QCN, agreed on a settlement whereby the latter undertook to pay him his money claims. However, QCN failed to honor the settlement agreement, prompting Barroga to file a complaint for inter alia illegal dismissal against QCN, et al.
QCN, et al. failed to submit their position paper. Thus, the LA proceeded with the decision.
The LA ruled in Barroga’s favor. Seven days later, QCN, et al. belatedly filed their position paper.
QCN, et al. argued that Barroga resigned on September 1, 2006 as shown by his resignation letter of even date (2006 Resignation Letter). Further, per the letter dated September 9, 2015 of the Private Education Retirement Annuity Association (PERAA), Barroga was already paid his retirement benefits in the total amount of P71,546.44 (PERAA Letter).
However, in view of the LA’s ruling, QCN, et al. appealed to the NLRC, principally reiterating their contentions in their position paper.
The NLRC affirmed the LA ruling.
It held that QCN, et al. failed to prove their averment that Barroga had already retired prior to the filing of the illegal dismissal case, observing that there was no proof or record showing that QCN, et al. accepted Barroga’s 2006 Resignation Letter, and that Barroga had undergone clearance proceedings after his purported resignation in 2006, or that he was no longer part of the school’s payroll from such time.
Relatedly, the NLRC also pointed out that while QCN, et al. claimed that Barroga resigned way back in 2006, they nevertheless presented another letter dated June 9, 2014 allegedly prepared by Barroga signifying his intention to retire (2014 Retirement Letter).
The NLRC opined that if Barroga really resigned in 2006, then there would be no reason for him to write QCN, et al. a retirement letter eight (8) years after his alleged resignation. Further, the NLRC pointed out that the PERAA Letter did not prove that Barroga had been paid his retirement benefits, as the plain wording of the letter shows that what was paid to him was merely the repurchase benefit of his shares in the PERAA.
In sum, the NLRC concluded that since Barroga was already entitled to optional retirement, QCN, et al.’ act of not assigning him any teaching load is a malicious scheme to dismiss him from service and to avoid payment of his retirement benefits.
QCN, et al. ·filed a motion for reconsideration, contending therein for the first time that Barroga was not illegally dismissed as he retired on June 9, 2014 as evidenced by the 2014 Retirement Letter. In a Resolution, the NLRC denied QCN, et al.’ motion, holding, among others, that QCN, et al. can no longer change the theory of their defense after the case was already decided by a tribunal.
Aggrieved, QCN, et al. filed a petition for certiorari before the CA.
The CA modified the NLRC ruling holding that Barroga was not illegally dismissed, but is nevertheless entitled to retirement pay, proportionate 13th month pay for 2014, and service incentive leave pay from 1985 until retirement, plus legal interest of six percent (6%) per annum from finality of the CA Decision until fully paid.
The CA held that Barroga failed to prove his allegation that QCN, et al. dismissed him from employment when he was not given any teaching load for school year 2014-2015. The CA opined that he was not given any teaching load for the said school year because he had tendered his retirement, as evidenced by the 2014 Retirement Letter, the existence of which was not disputed by Barroga, as well as the SENA Form reflecting that Barroga was only claiming for non-payment of retirement benefits.
Nonetheless, the CA ordered QCN, et al. to pay Barroga his other monetary claims, including retirement pay, absent any proof that the former already paid the same.
Dissatisfied, Barroga moved for partial reconsideration which was, however, denied. Hence, he filed a petition before the SC.
Whether or not failure to grant teaching load on account of letter of retirement amounts to illegal dismissal
The SC did not find merit in the petition.
Read more digested cases of Supreme Court Decisions on Labor Cases from years 2015 (part), 2016, 2017, and 2018 (part)
According to the SC, while retirement from service is similar to termination of employment insofar as they are common modes of ending employment, they are mutually exclusive, with varying juridical bases and resulting benefits. Retirement from service is contractual, while termination of employment is statutory.
Verily, the main feature of retirement is that it is the result of a bilateral act of both the employer and the employee based on their voluntary agreement that upon reaching a certain age, the employee agrees to sever his employment. Since the core premise of retirement is that it is a voluntary agreement, it necessarily follows that if the intent to retire is not clearly established or if the retirement is involuntary, it is to be treated as a discharge.
The line between “voluntary” and “involuntary” retirement is thin but it is one which case law had already drawn. On the one hand, voluntary retirement cuts the employment ties leaving no residual employer liability; on the other, involuntary retirement amounts to a discharge, rendering the employer liable for termination without cause. The employee’s intent is decisive. In determining such intent, the relevant parameters to consider are the fairness of the process governing the retirement decision, the payment of stipulated benefits, and the absence of badges of intimidation or coercion.
In this case, Barroga’s claim that QCN, et al. forced him to retire is anchored on the supposed fact that at the start of school year 2014-2015, he was suddenly not given any teaching load by the QCN, et al. on the ground that there were not enough enrollees in the school. However, aside from such bare claims, Barroga has not shown any evidence that would corroborate the same. It is settled that bare allegations of discharge, when uncorroborated by the evidence on record, cannot be given credence.
Moreover, Barroga’s aforesaid claim is belied by the fact that about a week after the beginning of school year 2014-2015, he submitted to QCN, et al. the 2014 Retirement Letter wherein he expressed his intent to optionally retire at the age of 61. Notably, records are bereft of any showing that Barroga ever challenged the authenticity and due execution of such letter.
Further, if Barroga really believed that QCN, et al. indeed illegally dismissed him from service, then he would have already made such claim at the earliest instance, i.e., on July 28, 2014 when he filed a SENA Case against the latter. However, an examination his SENA Form readily shows that Barroga’s claim against QCN, et al. was just for “non-payment of retirement benefits,” which they ultimately agreed to settle.
Clearly, this agreement to settle cements Barroga’s intent and decision to opt for voluntary retirement which, as mentioned, is separate and distinct from the concept of dismissal as a mode of terminating employment. Unfortunately, and as found by the tribunals a quo and the CA, QCN, et al. failed to comply with its undertaking under the Settlement of Agreement as Barroga’s retirement benefits remain unpaid.
Thus, the SC held that Barroga retired from service, but nonetheless, pursued the filing of the instant illegal dismissal case in order to recover the proper benefits due to him. In fact, it is telling that he never asked to be reinstated as he only sought the payment of his retirement benefits.
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In view of the foregoing, the SC ordered QCN, et al. to pay Barroga not only his retirement benefits, but also his other monetary claims (i.e., proportionate 13th month pay for 2014 and service incentive leave pay from 1985 until his retirement) which the tribunals a quo and the CA also found to be unpaid.