G.R. No. 179217 ; February 2, 2011
METROPOLITAN WATERWORKS AND SEWERAGE SYSTEM, Petitioner, vs. GABRIEL ADVINCULA, ET AL., Respondents.

FACTS

Petitioner Metropolitan Waterworks and Sewerage System (MWSS) underwent reorganization in 1996 and privatization in 1997. It offered separation benefits through two programs: the Revised Early Retirement Incentive Package (ERIP I) in 1996, governed by MC No. 26-96, and Early Retirement Incentive Package II (ERIP II) in 1997. Under MC No. 26-96, the ERIP gratuity for affected permanent officials and employees with at least one year of service was computed as: 1.5 months’ basic monthly pay per year for the first 20 years, 2.0 months per year for 20 to 30 years, and 2.5 months per year for over 30 years. Respondents, comprising 550 past and present MWSS employees qualified to retire under Republic Act No. 1616 (RA 1616) at the time, filed a petition for mandamus. They claimed they did not receive their full separation benefits, alleging they were owed an additional 0.5 month’s salary per year of service under ERIP I and an additional 1 month’s salary per year under ERIP II. The Regional Trial Court granted the writ of mandamus, ordering MWSS to pay the claimed balances. The Court of Appeals partially granted MWSS’s appeal, modifying the order to command MWSS to pay the balance of 0.5 month’s salary per year only to two groups under ERIP II: (1) employees with less than 15 years of service (if not excluded by MC No. 26-96(c) and not absorbed by concessionaires), and (2) those who served for more than 30 years. MWSS filed this petition, agreeing with the CA’s ruling regarding the first group but contesting the ruling for employees with over 30 years of service.

ISSUE

Whether the Court of Appeals erred in allowing the writ of mandamus against petitioner commanding it to pay the balance of 0.5 month salary for every year of service of unpaid separation benefits to those employees who have served for more than 30 years and retired in 1997 under ERIP II.

RULING

The petition lacks merit. The Supreme Court upheld the Court of Appeals’ ruling. Employees who served for more than 30 years and retired under ERIP II are entitled to the additional 0.5 month salary per year of service. The Court explained that under MC No. 26-96, the separation benefit for employees qualified to retire under existing law (like RA 1616) is the difference between the ERIP gratuity and the retirement benefit under that law. RA 1616 provides a gratuity of 1 month salary per year of service (not exceeding 24 months) for those with at least 20 years of service. For an employee with over 30 years of service, the ERIP gratuity under MC No. 26-96 is 2.5 months per year. Therefore, after deducting the 1 month per year received under RA 1616, the employee is entitled to a balance of 1.5 months per year from MWSS. Since MWSS had only paid 1 month per year under ERIP II, a balance of 0.5 month per year remains unpaid. The Court rejected MWSS’s argument that this balance was conditional upon not being absorbed by a concessionaire or actually resigning, finding no such condition in the memorandum circular for those qualified to retire. The writ of mandamus was proper to compel MWSS to perform its ministerial duty to pay this computed balance.