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SABAS B. VILLENA v. NLRC

FACTS:

Sabas B. Villena worked with Batangas, Laguna and Tayabas Bus Company (BLTBCo.) for 32 years until he became the traffic operations manager in 1987. On April 30, 1987, he received a letter from the company stating that he was compulsorily retired effective immediately due to the company's continuous losses. The letter did not mention the amount of retirement benefits he would receive. Villena, after not hearing from the company for a month, sought legal counsel and assistance. His lawyer wrote a letter to the company demanding clarification of the terms of Villena's retirement and raised issues of the company's failure to provide notice of termination, the improper application of the CBA compulsory retirement provision to a managerial employee, and the company's failure to mention the amount of separation benefits and the time frame for payment. The company ignored the letter, prompting Villena to file a complaint for illegal dismissal in the NLRC. During the conciliation proceedings, the company admitted its failure to serve the required notice of termination and offered to pay Villena a certain amount as retirement pay.

ISSUES:

  1. Whether or not Villena's retirement was validly implemented by the company.

  2. Whether or not Villena is entitled to retirement benefits under the CBA.

RULING:

  1. The Supreme Court held that Villena's retirement was not validly implemented by the company. The company failed to provide Villena with the required one-month notice prior to termination. This failure constitutes a violation of Villena's rights as an employee.

  2. The Supreme Court ruled that Villena is entitled to retirement benefits under the CBA. The CBA provides for one month basic salary for every year of service in the company. Villena served the company for thirty-two years and therefore, he is entitled to retirement benefits computed based on his salary.

PRINCIPLES:

  • An employee's retirement must be validly implemented by the company, which includes providing the required notice prior to termination.

  • The entitlement to retirement benefits is determined by the provisions of the collective bargaining agreement (CBA) between the company and the employee.