Turning 60 does not automatically mean a worker has to retire. The Supreme Court has clarified that employees cannot be forced into early retirement without their clear and voluntary consent, reaffirming their right to security of tenure. Under the Labor Code, compulsory retirement is generally at 65 unless a valid employment agreement establishes an earlier retirement age.
In a statement released on Oct. 27, the Supreme Court’s Office of the Spokesperson highlighted a First Division decision finding Colegio de San Juan de Letran Calamba liable for illegally dismissing an employee whose appointment was considered expired when he turned 60.
The case involved Rodolfo C. Ondevilla, who joined the school as comptroller in June 2004 and later became assistant vice president for finance. His appointment was renewed several times before a management reorganization in 2018 led to his reassignment as controller.
Ondevilla objected to the reassignment, claiming it amounted to a demotion, although he continued receiving the same salary and benefits. On Aug. 29, 2019, the day he turned 60, the school considered his appointment 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 also found that he had been illegally dismissed but concluded that he had agreed to retire on July 31, 2020, based on a letter he sent to the school.
Ondevilla challenged that finding before the Supreme Court, maintaining that he never voluntarily agreed to retire before turning 65.
In its June 29, 2026 decision, written by Associate Justice Ramon Paul L. Hernando, the Supreme Court sided with Ondevilla. It found that his letter was a response to the school’s demand for repayment of a cash advance rather than an express agreement to retire early.
The Court also noted that the school had never offered a retirement arrangement that Ondevilla could freely accept or reject. His objections and decision to file an illegal dismissal complaint further demonstrated that he had no intention of voluntarily retiring.
Under Article 302 of the Labor Code, an existing agreement or employment contract may establish an employee’s retirement age. Without such an arrangement, the law generally allows optional retirement beginning at 60, provided the employee has served at least five years, while compulsory retirement is set at 65.
The Supreme Court emphasized that optional early retirement requires a voluntary agreement between the employer and employee. A worker must freely and expressly consent, without pressure or coercion, because accepting early retirement involves giving up the constitutional right to security of tenure.
The Court stressed that early retirement requires more than an employee’s passive acceptance. Employers must establish that the worker freely and expressly agreed to retire, while valid employment agreements may provide for an earlier retirement age.
Because Ondevilla had not voluntarily agreed to retire, the Supreme Court upheld the finding that his separation from employment constituted illegal dismissal. The Court awarded him full backwages, separation pay in lieu of reinstatement, and retirement benefits.
