G.R. NO. 176985 - Ricardo E. Vergara, Jr. v. Coca-Cola Bottlers Philippines, Inc.

FACTS:
Ricardo Vergara Jr. retired from Coca Bottlers Phils Inc. in 2002, after 34 years of service, as district sales supervisor (DSS).
At that time, the companys retirement plan stated that the annual performance incentive pay of sales supervisors shall be considered
in the computation of retirement benefits using the following formula:
Basic monthly salary + monthly ave perf incentive (which is the total performance incentives earned during the year
immediately preceding + 12 months) x number of years in service.

Unsatisfied with the retirement pay he got, Vergara filed a complaint against Coca-Cola with NLRC for payment of the sum of P474k
representing unpaid Sales Management Incentives (SMI), and recovery of P496k that company deducted from his pay to cover for the
unpaid accounts of two dealers within his sales territory.
Labor Arbiter (LA): decided in favor of Vergara directing Coca Cola to reimburse the amount illegally deducted from Vergaras
retirement package and to integrate therein his SMI privilege.
NLRC: modified and deleted the payment of SMI.
Parties entered into a compromise agreement with Coca-Cola reimbursing Vergara P496,016.67 from the illegal deduction
CA: dismissed Vergaras petition regarding the SMI.
Vergara filed Pet with SC.

ISSUE: WON the SMI should be included in the computation of Vergaras retirement benefits on ground of consistent company practice. --NO

RULING: NO.
Generally, employees have a vested right over existing benefits voluntarily granted to them by their employer. Thus, any benefit and supplement
being enjoyed by the employees cannot be reduced, diminished, discontinued by employer. The principle of non-diminution of benefits is
founded on Constitution to protect the rights of workers, to promote their welfare, and to afford them full protection. In turn, said mandate is the
basis of Art 4 of the Labor Code which states that "all doubts in the implementation and interpretation of this Code, including its implementing
rules and regulations, shall be rendered in favor of labor.

Benefits are diminished if the following requisites are present: a) the grant or benefit is founded on a policy or has ripened into a practice over a
long period of time; b) the practice is consistent and deliberate; c) the practice is not due to error in the construction or application of a doubtful
or difficult question of law; and d) the diminution or discontinuance is done unilaterally by the employer.

For a practice to be characterized as regular, it is essential that the employee is able to prove by substantial evidence that the giving of the
benefit is done over a long period of time, and that it has been made consistently and deliberately.

In this case, the Court found no substantial evidence to prove that the grant of SMI to all retired DSSs regardless of whether or not they qualify
to the same had ripened into company practice. Despite more than sufficient opportunity given him while his case was pending before the NLRC,
the CA, and even to SC, P failed to adduce proof to establish his allegation that SMI has been consistently, deliberately and voluntarily granted to
all retired DSSs without any qualification or conditions whatsoever.

To support his claim, Vergara submitted the sworn statements of two retired sales supervisors who said the SMI was included in their retirement
package even if they did not meet the sales and collection qualifiers. Against these testimonies, the company presented the counter-affidavits of
witnesses who stated that the inclusion of the SMI in one of the retirees pay was made to achieve industrial peace in the plant when it was going
through some labor problems, and that the other retiree has, in reality, met his sales and collection quota as to qualify him for the SMI.

DISPOSITION:
WHEREFORE, the petition is DENIED. The January 9, 2007 Decision and March 6, 2007 Resolution of the Court of Appeals in CA-G.R. SP
No. 94622, which affirmed the January 31, 2006 Decision and March 8, 2006 Resolution of the NLRC deleting the LA's inclusion of sales
management incentives in the computation of petitioner's retirement benefits, is hereby AFFIRMED.