Court orders Napocor to pay 573 retirees P300 million

MANILA, Philippines – Retirees of the National Power Corp. (Napocor) will receive more than P300 million in claims and damages from the state-owned power firm on orders of a Quezon City court.

Judge Ralph Lee of Quezon City Regional Trial Court Branch 83 ordered the Napocor and the National Power Board to pay 573 retirees P301,536,001 in claims and P1 million in exemplary damages for getting less than their actual benefits during the restructuring of Napocor.

In his decision, Lee said the gratuity from the Government Service Insurance System (GSIS) should not have been deducted from the financial assistance.

“The gratuity benefits received by petitioners from the GSIS are entirely separate and distinct from the separation benefits under the SEDP (Special Early Disengagement Plan),” the judge declared.

“The gratuities from the GSIS constitute the employees’ money. On the other hand, the financial assistance under SEDP is pursuant to the restructuring and privatization program of Napocor in order to serve as an incentive to those who would be affected by the reorganization.

“It appears that respondents deducted an aggregate amount of at least P301,536,001.15, excluding the unknown claims of other petitioners, which can easily be ascertained upon verification with NPC, plus amount of interest. Thus, respondents are hereby ordered to pay said amount.”

Lee said exemplary damages were awarded to the petitioners so others would not emulate the practice of creating two sets of retirees.

“Respondents’ act of making petitioners believe that they will get a generous financial assistance as a consideration for early retirement only to later on renege on that promise and adopting a policy that effectively ‘penalized’ employees for their long and loyal service clearly indicates bad faith,” he said.

Before they availed of the retirement plan, Napocor told them the financial assistance that would be received would be on top of their gratuity from the GSIS and other entitlements due them from the power firm, the retirees added.

The retirees said in deducting the gratuities, Napocor created two sets of retirees – the “favored and the non-favored.”

The non-favored were comprised of retirees with longer service in government, the retirees added.

The retirees said those with less than 15 years of service who were not entitled to gratuity from the GSIS Law got the full financial assistance of one-and-a-half months salary for every year of service.

Those who served for 15 years or more who were entitled to gratuity pay received only 23 to 43 percent of the 1.5-month financial assistance because the gratuity they received was deducted from the financial assistance, the retirees added.