Marcos, et. al. vs.

NLRC AND Insular Life Assurance (1995)

FACTS:
Petitioners herein have served respondent Insular for more
than 20 years in multiples of five (20-30 years). They were
terminated due to redundancy and thus were given special
redundancy benefits. But they were denied their service
awards which was set apart from the redundancy fund. They
were made to sign a quit claim, which they complied, but
they still submitted a letter of protest. They inquired from the
DOLE-LS on the validity of the denial of their service awards,
to which DOLE decided in their favour. The service awards
were part of the Employees Manual and were therefore
company policies. The award was earned on the anniversary
date. Even if the employees were separated from service
before the anniversary date, they were still entitled to the
material benefits of the award.

However, respondent still refused to pay this. On its 80
th

anniversary, the company approved an anniversary
equivalent of one-month salary to its employees. The
petitioners alleged that they were entitled to this.

The LA ruled in petitioners favour, but NLRC reversed this,
upholding the validity of the quitclaim they signed voluntarily.

ISSUE:
W/N the quitclaim was invalid and if so, petitioners would be
entitled to their service award.

HELD:
Release and Quitclaim INVALID, petitioners were
ENTITLED to the service awards.

A deed of release or quitclaim cannot bar an employee from
demanding payment to which he is entitled. Quitclaims are
against public policy and are therefore null and void. The
Court does not believe that petitioners signed the Release
and Quitclaim voluntarily, as the subsequent submission of a
letter of protest and the inquiry before the NLRC
contradicted their willingness to execute the quitclaim.

The special redundancy package could not have covered the
service awards, and respondents actions estopped it from
claiming such. Service awards are not bonuses. They are
stated in the Employees Manual, which is contractual in
nature therefor the law between the parties. It is company
policy and has been in practice by the company.