MANILA— The Supreme Court (SC) has ruled that employers cannot force employees to retire before the compulsory retirement age of 65 without their clear and voluntary consent, declaring the early retirement of a former Colegio de San Juan de Letran in Laguna (CSJL) executive illegal.

In a decision penned by Associate Justice Ramon Paul L. Hernando, the SC First Division partly granted the petition of Rodolfo C. Ondevilla, finding that the school illegally dismissed him when it considered his appointment expired after he turned 60 in 2019.

Ondevilla joined CSJL as comptroller in 2004 and eventually became assistant vice president for finance. His appointment was renewed several times before a management reorganization in 2018 led to his reassignment as controller.

Although he considered the reassignment a demotion, Ondevilla continued working under the same salary and benefits.

On Aug. 29, 2019, when he turned 60, the school treated his appointment as expired, prompting him to file an illegal dismissal complaint.

The labor arbiter and the National Labor Relations Commission ruled in his favor. The Court of Appeals (CA) likewise found that he had been illegally dismissed but held that he had agreed to retire effective July 31, 2020, citing a letter he sent to the school.

Ondevilla elevated the matter to the SC, maintaining that he never consented to retiring before reaching 65.

The high tribunal sided with Ondevilla, stressing that optional retirement requires a voluntary agreement between the employer and employee, with the latter’s express consent free from pressure or coercion.

Under the Labor Code, the retirement age is governed by an existing agreement or employment contract. In the absence of either, the compulsory retirement age is 65, while employees may opt to retire beginning at 60.

The SC explained that agreeing to optional retirement entails relinquishing the right to security of tenure, making the employee’s voluntary consent essential.

In Ondevilla’s case, the court found no evidence that CSJL had offered or proposed a retirement plan that he could freely accept or reject. The school also showed no indication that it was willing to discuss retirement arrangements with him.

The justices further ruled that Ondevilla’s letter did not constitute clear notice that he was choosing early retirement. Rather, it was a response to the school’s demand that he repay a cash advance.

His objections to early retirement and his decision to file an illegal dismissal complaint also showed that he had no intention of retiring before turning 65, the SC said.

As a result, the court ruled that Ondevilla was entitled to full backwages and separation pay in lieu of reinstatement.

It also awarded him retirement benefits covering his employment from June 16, 2004, until Aug. 29, 2024, when he reached the compulsory retirement age of 65.

The SC directed the arbitration branch to compute the total amount due to Ondevilla.