GR 111744; (September, 1995) (Digest)
G.R. No. 111744 September 8, 1995
LOURDES G. MARCOS, ALEJANDRO T. ANDRADA, BALTAZARA J. LOPEZ AND VILMA L. CRUZ, petitioners, vs. NATIONAL LABOR RELATIONS COMMISSION and INSULAR LIFE ASSURANCE CO., LTD., respondents.
FACTS
Petitioners were regular employees of Insular Life Assurance Co., Ltd., with service records ranging from 20 to 30 years. They were dismissed on November 1, 1990, due to redundancy, and received a redundancy package. Prior to termination, they demanded payment of their service awards, which were granted under the company’s Employee’s Manual for every five years of service, arguing these were distinct from redundancy benefits. They were required to and did sign a “Release and Quitclaim,” but did so under written protest, reiterating their claim to the service awards. Subsequently, Insular Life announced an anniversary bonus for employees as of November 15, 1990, and a performance bonus for permanent employees as of March 30, 1991. Petitioners, having been terminated before these cut-off dates, filed a complaint for payment of their service awards, anniversary bonus, and a prorated performance bonus.
ISSUE
Whether petitioners are entitled to their service awards, anniversary bonus, and a prorated performance bonus despite their redundancy termination and the execution of a quitclaim.
RULING
Yes. The Supreme Court granted the petition, reinstating the Labor Arbiter’s decision. On the service awards, the Court ruled they are a vested benefit under the company’s long-standing practice, as outlined in its Employee’s Manual. Entitlement accrues on the employee’s anniversary date, and separation thereafter, even for redundancy, does not extinguish this accrued right. The quitclaim is void as to these awards because petitioners signed under protest, and the consideration they received was solely for standard separation benefits, not for these distinct, earned awards.
Regarding the bonuses, the Court applied the principle that a bonus promised by an employer for continued service, once the service condition is fulfilled, becomes an enforceable obligation. The anniversary bonus was announced for employees as of November 15, 1990; petitioners, terminated on November 1, were unjustly excluded by a mere 15-day gap for a benefit recognizing long service. The performance bonus, announced after their termination, should likewise be prorated based on their ten months of service in 1990 prior to dismissal. Equity demands they receive a proportionate share, as the bonus was intended to reward work performed during that year, from which the company benefited. The NLRC’s dismissal of the claims was reversed.