G.R. No. 190809 February 13, 2017
DE LA SALLE ARANETA UNIVERSITY, Petitioner vs. JUANITO C. BERNARDO, Respondent

FACTS

Respondent Juanito C. Bernardo worked for petitioner De La Salle Araneta University (DLS-AU) as a part-time professional lecturer from 1974, with a break for a foreign assignment, until October 2003. His employment was governed by semestral contracts renewed at the start of each term. In November 2003, DLS-AU informed the 75-year-old Bernardo via telephone that his contract would not be renewed due to the implementation of a retirement age limit for faculty. Bernardo then claimed retirement benefits under Republic Act No. 7641 (The Retirement Pay Law).
DLS-AU denied the claim, asserting that Bernardo, as a part-time faculty member engaged under fixed-term contracts, did not acquire permanent status and was thus excluded from the university’s retirement plan under its policy and Collective Bargaining Agreement, which covered only full-time permanent faculty. The university argued that his service was effectively terminated at age 65, the compulsory retirement age, and any extension was a mere privilege. The Labor Arbiter dismissed Bernardo’s complaint, but the National Labor Relations Commission (NLRC) reversed the decision, a ruling affirmed by the Court of Appeals.

ISSUE

Whether a part-time employee, hired under successive fixed-term contracts, is entitled to retirement benefits under Article 287 of the Labor Code, as amended by Republic Act No. 7641 .

RULING

Yes. The Supreme Court denied the petition and affirmed the grant of retirement benefits to Bernardo. The legal logic hinges on the application of the substantive law on retirement, not on the nature of the employment contract. Article 287 of the Labor Code, as amended, mandates that an employee who is at least sixty years old, with at least five years of service, is entitled to retirement pay equivalent to at least one-half month salary for every year of service upon retirement. This is a minimum standard applicable where there is no applicable retirement plan or collective bargaining agreement providing for better benefits.
The Court ruled that Bernardo’s status as a part-time employee hired under fixed-term contracts does not disqualify him from this statutory benefit. The law does not distinguish between part-time and full-time employees; its coverage is broad. His repeated re-hiring over approximately 27 years constituted the required “service.” The university’s own retirement plan and CBA, which excluded part-timers, could not supersede the mandatory minimum provision of the Labor Code. Since the university’s plan did not provide any benefit for Bernardo, the statutory minimum under Article 287 applied directly. His claim was also timely, as the cause of action accrued only upon his actual retirement in 2003, not when he turned 65.