G.R. No. 252716 , March 03, 2021
Patricia Zamora Riingen, Petitioner, vs. Western Union Financial Services (Hong Kong) Limited, Philippines Representative Office, Respondent.

FACTS

Petitioner Patricia Zamora Riingen, former Senior Regional Vice-President of respondent Western Union, retired on August 31, 2016. She inquired about availing the early retirement package under the company’s Employees’ Retirement Plan. Through emails dated August 5 and 11, 2016, Western Union’s Manager for Human Relations and Senior Manager for Compensation and Benefits confirmed to Riingen that her lump-sum retirement benefit was “not taxable.” Relying on this representation, Riingen formalized her retirement. However, on August 24, 2016, Western Union informed her that the benefit was taxable because the Retirement Plan did not meet BIR requirements for tax exemption and was not registered with the BIR. Western Union withheld PHP 4,243,191.80 as tax from her benefit. Riingen filed a monetary claim for the withheld amount, plus damages, arguing Western Union misled its employees. The Labor Arbiter ruled in her favor, awarding the withheld tax, damages, and attorney’s fees. The NLRC affirmed the award of the withheld tax, legal interest, and attorney’s fees but deleted the moral and exemplary damages, applying the doctrine of promissory estoppel. The Court of Appeals reversed the NLRC, holding the claim had no basis as the Retirement Plan stated benefits were “net of all legally required… withholdings,” and the erroneous emails did not constitute a promise.

ISSUE

Whether Western Union should refund to Riingen the amount of taxes withheld from her retirement pay.

RULING

Yes. The Supreme Court granted the petition and reinstated the NLRC Decision. The Court found that the NLRC did not commit grave abuse of discretion. The elements of promissory estoppel were present: (1) Western Union, through its officers, made a promise (that the benefit was tax-free) reasonably expected to induce action; (2) Riingen relied on this promise by formalizing her retirement; and (3) she suffered detriment as she was deprived of the opportunity to explore other, potentially more beneficial options had she been timely informed of the taxability. The Court held that the CA erred in reversing the NLRC’s factual findings, which were supported by substantial evidence. Western Union’s management prerogative not to register the Plan did not negate its liability arising from the representations made by its authorized officers upon which Riingen justifiably relied.