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WESLEYAN UNIVERSITY PHILIPPINES v. WESLEYAN UNIVERSITY- PHILIPPINES FACULTY

FACTS:

Petitioner Wesleyan University-Philippines, a non-stock, non-profit educational institution, and respondent Wesleyan University-Philippines Faculty and Staff Association, a registered labor organization, entered into a Collective Bargaining Agreement (CBA) effective from June 1, 2003, to May 31, 2008. On August 16, 2005, petitioner issued a memorandum detailing new guidelines for the implementation of vacation and sick leave credits and vacation leave commutation. These guidelines stipulated that leave credits were to be earned monthly and that vacation leave commutation would be available only after two years of continuous service. Respondent’s President, Cynthia L. De Lara, opposed these unilateral changes, arguing that they violated existing practices and specific sections of the CBA which allowed for 15 days of vacation and sick leave annually, with unused vacation leave being paid out after the second year of service. During a Labor Management Committee meeting on February 8, 2006, petitioner advised respondent to file a grievance complaint regarding the new leave policy and announced the intention to implement a one-retirement policy, which the respondent also found unacceptable. Unable to resolve their differences, the matter was referred to a Voluntary Arbitrator. The Voluntary Arbitrator ruled in favor of the respondent, declaring the one-retirement policy and the August 16, 2005 memorandum contrary to law, and ordered the reinstatement of the previous leave policy and continuation of the dual retirement benefits under both the CBA and the Private Education Retirement Annuity Association (PERAA) Plan.

ISSUES:

a. Whether the Court of Appeals (CA) committed grave and palpable error in sustaining the Voluntary Arbitrator's ruling that the affidavits submitted by Respondent are substantial evidence that Petitioner has long been in the practice of granting its employees two (2) sets of Retirement Benefits.

b. Whether the CA committed grave and palpable error in sustaining the Voluntary Arbitrator's ruling that a university practice of granting its employees two (2) sets of Retirement Benefits had already been established, especially given the alleged illegality and lack of authority of such a grant.

c. Whether the CA committed grave and palpable error in sustaining the Voluntary Arbitrator's ruling that it is incumbent upon Petitioner to show proof that no Board Resolution was issued granting two (2) sets of Retirement Benefits.

d. Whether the CA committed grave and palpable error in revoking the 16 August 2005 Memorandum of Petitioner for being contrary to the extant policy.

RULING:

The Petition is bereft of merit.

  • The evidence submitted by Respondent, including affidavits from retired and incumbent employees, sufficiently demonstrated an established practice of granting two (2) retirement benefits, one under the CBA and another under the PERAA Plan. The Petitioner's lack of contrary evidence and its own contradictory statements about the "one-retirement policy" reinforced the finding that the two-retirement policy had ripened into a consistent and deliberate practice. Thus, revoking this policy would violate the non-diminution of benefits rule.

  • The Memorandum dated August 16, 2005, which altered the implementation of vacation and sick leave credits, was struck down for imposing limitations not agreed upon by the parties nor specified in the CBA, thus making it contrary to the existing terms of the CBA.

PRINCIPLES:

  • Collective Bargaining Agreement (CBA) as a Contract: The CBA has the force of law between the parties and should be complied with in good faith. Unilateral changes to the CBA are not allowed without mutual consent.

  • Non-Diminution of Benefits: Under Article 100 of the Labor Code, employers are prohibited from reducing or eliminating benefits that employees have been habitually receiving. This applies when the benefit becomes a consistent and deliberate practice over time.

  • Interpretation in Favor of Labor: Provisions in a CBA should be interpreted in favor of labor, especially if there is any ambiguity.

  • Validity of Long-standing Practices: Long-standing practices established by substantial evidence and not immediately corrected when done in error are considered valid and binding upon the employer.

  • Substantial Evidence: Affidavits from retirees and current employees can constitute substantial evidence, as long as they are detailed and corroborated, even if self-serving.