10 Perez vs. Comparts Industries
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mei atienza10 Perez vs. Comparts Industries
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mei atienzaMAUREEN P. PEREZ , petitioner, vs. COMPARTS INDUSTRIES, INC., respondent.
[G.R. No. 197557. October 5, 2016.]
FACTS: Perez (petitioner) started her employment with CII (respondent) on 16 July 1988 and became a
regular employee thereof on 01 September 1988. After years of working and after several promotions,
she was eventually appointed as Marketing Manager. She held this position from 1998 up to 10 January
2009, the date when she resigned from her work.
CII has a retirement program for its managerial employees or officers covered by "Comparts
Industries, Inc. Employees Retirement Plan" (Retirement Plan) that took effect on 01 June 1999 and was
amended on 25 January 2001. Included therein are provisions relating to optional or early retirement
and optional retirement benefits. Prior to her resignation, Perez manifested to CII sometime in
November 2007 her intention to avail of the optional retirement program since she was already
qualified to retire under it. Her application was denied. In January 2008, while vacationing in the United
States of America (USA), she again filed an application for optional retirement to take advantage of a job
offered to her in the said country. Still, her application was denied. CII justified its denial of Perez's
application saying that, under the Retirement Plan, it has the option to grant or deny her application for
optional retirement and considering that it is experiencing financial crisis, it has no choice but to
disallow her intention. Perez maintains that she is entitled to separation pay: (1) primarily through the
optional retirement program under the Retirement Plan having rendered more than twenty (20) years of
service to CII, (2) through a similar optional retirement program under the CBA which has been likewise
extended to other managerial/middle management employees in several instances, or (3) a
retrenchment program undertaken by CII because of the global financial crisis.
ISSUE: Whether or not petitioner is entitled to optional retirement program.
HELD: No. First and foremost, the Court emphasized that termination of employment by the employee,
as in this instance, does not entitle the employee to separation pay. Separation pay is that amount
which an employee receives at the time of his severance from employment, designed to provide the
employee with the wherewithal during the period that he is looking for another employment and is
recoverable only in instances enumerated under Articles 283 and 284 of the Labor Code or in illegal
dismissal cases when reinstatement is not feasible.
Second, in the matter of Perez's entitlement to optional retirement benefits, the Court agrees
with the NLRC and the appellate court that as a managerial employee, she is covered by the Retirement
Plan for CII Officers which took effect in 1999 and was amended in 2001. A Retirement Plan in a
company partakes the nature of a contract, with the employer and the employee as the contracting
parties. It creates a contractual obligation in which the promise to pay retirement benefits is made in,
consideration of the continued faithful service of, the employee for the requisite period. Being a
contract, the employer and employee may establish such stipulations, clauses, terms and conditions as
they may deem convenient. Observably, as stipulated in the Retirement Plan, it is not enough that an
employee of CII who wants to optionally retire meets the conditions for optional retirement. CII has to
give its consent for the optional retirement to operate.
In this case, Perez's application for optional retirement was denied several times as CII still
needs her services. Perez's unilateral act of retiring without the consent of CII does not bind the latter
with the provisions of the Retirement Plan. Therefore, CII is not liable to give Perez the optional
retirement benefits provided therein. Clearly, the age of retirement is primarily determined by the
existing agreement or employment contract. In the absence of such agreement, the retirement age shall
be fixed by law. Under the law, the mandated compulsory retirement age is set at 65 years, while the
minimum age for optional retirement is set at 60 years.