In an 11-page decision penned by Justice Renato Corona, the SC reversed the decision of the Court of Appeals affirming the order of the National Labor Relations Commission dismissing, for lack of merit, the complaint for illegal dismissal of petitioner Alpha Jaculbe.
Instead of reinstatement, the SC awarded Jaculbe separation pay and back wages to be computed from the time of her illegal dismissal up to the statutory retirement age of 65.
Court records show that Silliman University dismissed Jaculbe on the basis of its employee retirement plan which provided that its personnel could be automatically retired "after 35 years of uninterrupted service to the university."
However, the SC found that Jaculbe’s participation in the retirement plan was not at all voluntary.
The SC noted Rule III of the plan which states that all full-time employees of the university will automatically become members of the plan and that a member who continues to serve the university cannot withdraw from the plan.
The SC ruled that the compulsory nature of the plan debunked the claim that Jaculbe’s voluntary contributions were proof of her willing participation in the plan.
The SC also stressed that the retirement plan only came into being in 1970, or 12 years after Jaculbe began working for Silliman University.
The retirement plan, according to the SC, was not part of Jaculbe’s terms of employment when she started working for the university.
In addition, the SC said Jaculbe was still a good eight years away from the compulsory retirement age and that she was still fully capable of discharging her duties as a nurse when she was illegally dismissed.
The SC pointed out that an employer is only free to impose a retirement age less than 65 when it has the employees’ consent.
However, the SC held that the reinstatement of Jaculbe is "out of the question" since she is now 71 years old. For this reason, it granted her separation pay instead of reinstatement.