2.

Arsenio Zurbano vs NLRC and SMC

Topic: Labor Law – Generally

Facts:
 Zurbano worked for the Legazpi office of San Miguel Corp. (SMC) from 1958-1969 as a casual truck
helper to regular truck helper.
 He was hospitalized several times because of work-related accidents and illnesses. This culminated
when he was hit by a falling coconut while performing his work. Zurbano did not go on sick leave as
he had to be treated for his facial injuries which he go during work.
 Labor Arbiter (LA) Fructuoso Aurellano found that Zurbano was summoned by SMC Management for
a meeting at around 10pm. He was forced to retire by said company as he was sickly and his sick
leaves are almost depleted. SMC allegedly tried to compensate him following his dismissal and if he
did not agree, he would get not get his compensation. SMC also promised that his children would be
given employed by SMC.
 Zurbano, due to fear of the power and influence of the SMC Management, he gave in to the demands
to their demands and signed his retirement letter prepared by the management. He received
PhP76,501.88 and signed two quitclaims in favor of SMC.
 Zurbano filed against SMC for illegal dismissal, unfair labor practice and damages with NLRC. He
claims that h was intimidated to sign said retirement letter and SMC did not comply with their promise
to employ his children after his “retirement”.
 SMC denied such allegations. They claim that Zurbano was precluded to question the validity of his
retirement benefits and quit claims. They claim that their harmonious relationship between SMC and
Zurbano prompted him to seek early retirement.
 Aurellano ruled in favor of Zurbano. It found that Zurbano was force to sign said retirement letter.
SMC appealed to the NLRC which reversed the LA’s decision.
 It found that although he was “pressured” to sign said retirement letter, such pressure could not vitiate
his consent. As a regular employee, he knew he could not be dismissed easily. He accepted their
offer and executed quitclaims. He did not immediately question his retirement. No fraud was
committed when SMC did not fulfill its promise and does not constitute as basis to nullify his
retirement.
 However, Commissioner Rogelio Rayala, in his dissent, opined that the mere presence exerted on
Zurbano points to involuntariness of his consent. SMC’s promise to employ his children is proof that
he acted involuntary since there was a need to entice him to retire. Certiorari was filed before the SC.
The OSG prayed that Zurbano’s petition be given due course.

Issue:
 Whether Zurbano was illegally dismissed from work; and
 Whether Zurbano is precluded to file a complaint because of his alleged signing of his retirement
letter and quitclaim.

Ruling:
 SC ruled in favor of Zurbano.
 NLRC acted in grave abuse of discretion. The facts appreciated by NLRC were grossly erroneous.
Their conclusions is not just. Zurbano deserves more sympathy in law as he has less in life (Only
finished 1st Grade; sole bread winner of his wife and 12 children; lost his counsel due to cancer,
unemployed)
 NLRC found that he was indeed pressured yet ruled that his consent to retire was not vitiated. He
was threatened to be terminated if he did not retire by the SMC Management. Zurbano’s poor stature
and education led to his inability to appreciate the concept of security of tenure.
 NLRC erred when it concluded that Zurbano’s decision to retire was induced by the retirement
package and possibility of employment of his children. The threat was present. It is illogical to say that
he would go for short term benefits of his “retirement” then the long term benefits of his continued
employment.
 SC found it whimsical to construe against Zurbano his receipt of his retirement benefits, signing of his
quitclaims and his delay in filing the action. Acceptance of benefits does not mean as he stopped to
question the legality of his dismissal. As ruled in Carino vs ACCFA, employer and employee are of
not in the same footing as the employer can force his/her employee to act against his/her will with
threats such as dismissal.
 Zurbano filed the case within the 3 yr period under the Labor Code hence did not waive his right to
challenge his dismissal.
 As to his signing of the quitclaims, it was observed that he actually signed “Receipt and Release” in
order to get his retirement benefits. If petitioner's receipt of the benefits does not constitute estoppel
on his part, then the signing of the two "quitclaims" which was a necessary requisite to the receipt of
such benefits must likewise not be held against him.
 As to the promise of SMC, it was employed to deceive Zurbano to retire hence was made in bad faith.