R & E TRANSPORT, INC.

, and HONORIO ENRIQUEZ

- versus -
AVELINA P. LATAG, representing her deceased husband,
PEDRO M. LATAG
G.R. No. 155214
(February 13, 2004)

FACTS:
Pedro Latag was a regular employee of La Mallorca Taxi since
March 1, 1961. La Marllorca ceased from business operations and
Latag was transferred to R&E transport., Inc. where he was receiving
an average daily salary of five hundred pesos (P500.00) as a taxi
driver.
Latag got sick in January 1995 and was forced to apply for partial
disability with the SSS, which was granted. When he recovered, he
reported back to work, but was denied to continue working due to
his old age. Latag thus asked Felix Fabros, the administrative officer
for his retirement pay pursuant to Republic act 7641 but he was left
unheeded. Latag consequently filed a case for payment of his
retirement pay before the NLRC. He died later on and was
substituted by his wife, Avelina. She was offered the amount
of P38,500.00, which she accepted. She was also asked to sign an
already prepared quitclaim and release and a joint motion to
dismiss the case.
ISSUE: Whether or not Pedro Latag is entitled to retirement benefit
despite the signed quitclaim and waiver by his wife.

HELD:
YES. The basis of contention is the number of years that he
should be credited with in computing those benefits. As to the
Quitclaim and waiver signed by Avelina Latag, the CA committed
no error when it ruled that the document was invalid and could not
bar her from demanding the benefits legally due her husband. This is
not say that all quitclaims are invalid per se. Courts, however are
wary of schemes that frustrate workers' rights and benefits, and look
with disfavor upon quitclaims and waivers that bargain these away.
Pedro M. Latag was credited with 14 years of service with R&E
transport, Inc. Article 287 of the Labor Code, as amended by
Republic Act No. 7641, which provides:
Retirement. In the absence of retirement plan or agreement
providing for retirement benefits of employees in the establishments,
an employee upon reaching the age of sixty years or more, but not
beyond sixty five years which is hereby declared as the compulsory
age, who has served at least five years in said establishment, may
retire and shall be entitled to retirement pay to at least one half
month salary for every year of service. Unless the parties provide for
broader inclusions, the term one half month salary shall mean 15
days plus one twelfth of the 13 month pay and the cash equivalent
of not more than 5 days of service incentive leaves.
The rules implementing the new Retirement Law similarly
provide the above mentioned formula for computing the one half
month salary. Since Pedro was paid according to the "boundary"
system, he is not entitled to the 13th month and 32 and the service
incentive pay; hence his retirement pay should be computed on the
sole basis of his salary. It is accepted that taxi drivers do not receive
fixed wages, but retain only those sums in excess of the boundary or
fee they pay to the owners of their vehicles. Thus the basis for
computing their benefits should be the average daily income. In This
case the CA found that Pedro was earning an average of 500 pesos
a day. Consequently, he is entitled to retirement pay, which is
hereby computed at P105,000 (P500.00 x 15 days x 14 creditable
years of service) less the P38,850 which has already been received
by respondent, plus six (6) percent interest thereon from December
21, 1998 until its full payment.