SB | September 2026

October 7, 2026

SALIGAN Batas | Updates | Workers Rights

Meralco v. Argentera: Protecting Workers’ Accrued Rights After Dismissal

Deanne Lawrence Tano1

Labor disputes remain a central concern in the Philippines, with dismissal and claims for monetary benefits among the most frequent issues brought before labor tribunals. Questions surrounding the extent of an employee’s rights after termination continue to surface, particularly where collective bargaining agreements or company practices provide for additional benefits. In this context, the Supreme Court’s 2021 ruling in Manila Electric Company v. Apolinar A. Argentera has given an important reference point for both employers and employees in determining what rights survive a valid dismissal.

The case involved Apolinar Argentera, who had worked for Meralco since 1990 and rose to the position of acting foreman. In 2012, several disconnect switch blades from Meralco’s Forbes Park substation were discovered missing. Security guards and fellow workers implicated Argentera and a co-employee in the unauthorized dismantling and removal of these materials, allegedly to sell them to junkshops. Following an internal investigation, Meralco dismissed Argentera on February 18, 2014 for serious misconduct and violations of its Code of Employee Discipline.2

Argentera filed a complaint for illegal dismissal and monetary claims before the Labor Arbiter. The Arbiter, and later the NLRC, found that his dismissal was valid, citing substantial evidence of his involvement in the loss of company property. However, the tribunals acknowledged his entitlement to the lump sum benefit of P70,000 provided under the collective bargaining agreement (CBA).3 On appeal, the Court of Appeals affirmed the validity of the dismissal but further awarded him benefits and bonuses accrued up to the date of termination, ruling that there was no showing that such benefits were automatically forfeited by dismissal. 4 Both Argentera and Meralco elevated the matter to the Supreme Court.

The Supreme Court, in its February 8, 2021 Decision, dismissed both petitions. It affirmed the validity of the dismissal, holding that multiple testimonies and records established Argentera’s culpability, and that his defenses consisted merely of general denials. At the same time, the Court declared that dismissal for just cause does not automatically result in forfeiture of accrued benefits.5 Citing Book VI, Rule I, Section 7 of the Omnibus Rules Implementing the Labor Code, the Court emphasized that unless company policy, a CBA, or law expressly provides for forfeiture, an employee remains entitled to benefits already earned. 6It held that Argentera was entitled to the CBA lump sum, monetized vacation and sick leave credits, and Christmas, anniversary, and midyear bonuses that accrued until his dismissal, while denying his claims for incentive and signing bonuses. The case was remanded to the Labor Arbiter for computation of benefits with legal interest.7

The ruling is relevant to Filipino workers because it draws a clear line between disciplinary action and deprivation of rights. Employers are free to dismiss employees for just causes such as theft or serious misconduct, but accrued benefits cannot be withheld without a clear legal or contractual basis. For workers, this means that the fruits of their labor, leave credits, bonuses, or lump sums under a collective bargaining agreement, remain protected even if employment ends under adverse circumstances. For employers, it is a reminder to craft precise policies and agreements if they intend forfeiture to apply.

The takeaway from Meralco v. Argentera is straightforward yet critical: valid dismissal terminates the employment relationship but does not erase rights and benefits already earned. In a labor environment where disputes are frequent and stakes are high, this jurisprudence reaffirms that fairness must remain at the center of employment relations. For Filipino workers, it is a guarantee that even when discipline is necessary, justice does not stop at dismissal.

  1. Deanne Lawrence Tano is currently a fourth-year law student of Ateneo de Davao University. She completed her CLEP placement with SALIGAN from August 6, 2025 to April 10, 2026. ↩︎
  2. Manila Electric Company v. Argentera, G.R. Nos. 224729 & 225049, February 8, 2021, 896 Phil. 66, Facts section. ↩︎
  3. Id. at 435–446, Labor Arbiter and NLRC rulings. ↩︎
  4. Id., Court of Appeals Decision dated November 27, 2015. ↩︎
  5. Id., Supreme Court Decision, Ruling. ↩︎
  6. Omnibus Rules Implementing the Labor Code, Book VI, Rule I, Sec. 7. ↩︎
  7. Meralco v. Argentera, supra note 2, at 23–26 (final disposition). ↩︎
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