Elegir v. Philippine Airlines

REYES, J.:

This is a petition for review on certiorari under Rule 45 of the Rules of Court seeking to annul and set aside the Decision1 dated August 6, 2007 of the Court of Appeals (CA) in CA-G.R. SP No. 79111, which reversed and set aside the Decision2 dated March 18, 2002 and Order3 dated June 30, 2003 of the National Labor Relations Commission (NLRC) in NLRC NCR Case No. 00-08-06135-97 and NLRC NCR CA No. 015030-98. Factual Antecedents As culled from the records, the instant case stemmed from the following factual antecedents: Petitioner Bibiano C. Elegir (petitioner) was hired by Philippine Airlines, Inc. (PAL) as a commercial pilot, specifically designated as HS748 Limited First Officer, on March 16, 1971.4 In 1995, PAL embarked on a refleeting program and acquired new and highly sophisticated aircrafts. Subsequently, it sent an invitation to bid to all its flight deck crew, announcing the opening of eight (8) B747-400 Captain positions that were created by the refleeting program.

The petitioner, who was then holding the position of A-300 Captain, submitted his bid and was fortunately awarded the same.5 The petitioner, together with seven (7) other pilots, was sent for training at Boeing in Seattle, Washington, United States of America on May 8, 1995, to acquire the necessary skills and knowledge in handling the new aircraft. He completed his training on September 19, 1995.6 On November 5, 1996, after rendering twenty-five (25) years, eight (8) months and twenty (20) days of continuous service, the petitioner applied for optional retirement authorized under the Collective Bargaining Agreement (CBA) between PAL and the Airline Pilots Association of the Philippines (ALPAP), in which he was a member of good standing. In response, PAL asked him to reconsider his decision, asseverating that the company has yet to recover the full value of the costs of his training.

It warned him that if he leaves PAL before he has rendered service for at least three (3) years, it shall be constrained to deduct the costs of his training from his retirement pay.7 On November 6, 1996, the petitioner went on terminal leave for thirty (30) days and thereafter made effective his retirement from service. Upon securing his clearance, however, he was informed that the costs of his training will be deducted from his retirement pay, which will be computed at the rate of ₱ 5,000.00 per year of service. The petitioner, through his counsel, sent PAL a correspondence, asserting that his retirement benefits should be based on the computation stated in Article 287 of the Labor Code, as amended by Republic Act (R.A.) No. 7641, and that the costs of his training should not be deducted therefrom.

In its Reply dated August 4, 1997, PAL refused to yield to the petitioner's demand and maintained that his retirement pay should be based on PAL-ALPAP Retirement Plan of 1967 (PAL-ALPAP Retirement Plan) and that he should reimburse the company with the proportionate costs of his training. Thus, on August 27, 1997, the petitioner filed a complaint for non-payment of retirement pay, moral damages, exemplary damages and attorney's fees against PAL.8 On February 6, 1998, the Labor Arbiter (LA) rendered a Decision,9 the pertinent portions of which read: From the foregoing, it is manifestly clear that an employee's retirement benefits under any collective bargaining agreement shall not be less than those provided under the New Retirement Pay Law and if such benefits are less, the employee shall pay the difference between the amount due the employee and that provided under the CBA or individual agreement or retirement plan (Par.

3.2, Sec. 3, rules Implementing the New Retirement Pay Law).

Thus, applying the pertinent CBA provision in correlation with the New Retirement Pay Law, complainant should receive the following amount, to wit: 22.5 x 26 yrs. x P138,447.00= P2,700,301.50 If we were to follow the PAL's computation of petitioner's retirement pay, the latter's retirement benefits in the amount of P125,000.00 based on Section 2, Article VII of the Retirement Plan of the CBA at P5,000.00 per every year of service would be much less than his monthly salary of P138,477.00 at the time of his retirement. This was never envisioned by the law.

Instead, it is the clear intention of our law makers to provide a bigger and better retirement pay or benefits under existing laws and/or existing CBA or other agreements. x x x x

WHEREFORE, in view of the foregoing, we find PAL liable to the petitioner for the payment of his retirement benefits as follows: Retirement Benefits (22.5 x 26 years x P138,477.00) ₱ 2,700,301.50 Accrued Trip Leave 760,299.37 Accrued Vacation Leave 386,546.44 1996 Unutilized days off 105,089.46 Nov. '96 Prod. Allow. (net) 1,726.92 Unpaid Salary 12/1/-5/96 22,416.65 1996 w/tax refund 2,464.42 13th month backpay for the year 1988-1991 171,262.50 TOTAL