PH Supreme Court: Employers cannot force workers to retire before 65 years old

The Supreme Court of the Philippines has affirmed that employers cannot mandate early retirement for workers prior to the compulsory age of 65 without obtaining their explicit and voluntary consent.

The ruling stems from a Decision authored by Associate Justice Ramon Paul L. Hernando, in which the High Tribunal's First Division partially granted the petition filed by Rodolfo C. Ondevilla and held Colegio de San Juan de Letran in Laguna (CSJL) liable for illegal dismissal.

Ondevilla began his service at CSJL in 2004 as Comptroller, later rising to Assistant Vice President for Finance through successive appointment renewals.

Following a management reorganization in 2018, he was reassigned to the post of Controller, according to a press release of the Office of the Spokesperson of the SC.

Despite filing an objection to what he characterized as a demotion, Ondevilla continued performing his duties with his compensation and benefits unchanged.

The dispute escalated on August 29, 2019, when Ondevilla reached age 60 and CSJL declared his appointment expired. Ondevilla subsequently initiated an illegal dismissal complaint.

While the Labor Arbiter and the National Labor Relations Commission both rendered decisions supporting Ondevilla, the Court of Appeals (CA) later held that a letter sent by Ondevilla indicated his agreement to retire effective July 31, 2020.

Ondevilla elevated the matter to the Supreme Court, maintaining that he never consented to an early departure before the statutory age of 65.

Siding with the petitioner, the Supreme Court stressed that under the Labor Code, retirement terms are primarily governed by employment contracts or collective bargaining agreements. In their absence, statutory standards establish 60 as the minimum threshold for optional retirement and 65 as the mandatory age.

The Court emphasized that any early or optional retirement scheme requires an express, mutual agreement free from pressure or coercion, as accepting optional retirement involves waiving the constitutional right to security of tenure.

In Ondevilla's case, no evidence showed that CSJL had offered a formal retirement plan for his consideration, nor had the institution demonstrated a willingness to negotiate retirement terms.

Furthermore, the Magistrates clarified that Ondevilla’s correspondence was merely a response regarding an outstanding cash advance, not an unequivocal election to take early retirement.

His prompt filing of an illegal dismissal action and continuous objections underscored his intent to remain employed until the compulsory age of 65.

Consequently, the High Tribunal classified the forced early retirement as an illegal dismissal.

Ondevilla was awarded full backwages and separation pay in lieu of reinstatement, alongside retirement benefits calculated from the start of his tenure on June 16, 2004, up to his 65th birthday on August 29, 2024.

The case has been remanded to the labor arbitration branch for the final computation of the monetary award.

-Paraluman News