Korean Air Co. v. Adelina A.S. Yuson

Summary

This case involved Korean Air employee Adelina Yuson's claim for early retirement program benefits after the company offered an ERP during financial difficulties but excluded her. Yuson worked 26 years for Korean Air, rising to passenger sales manager. When Korean Air suffered massive losses, it offered an ERP with enhanced benefits to reduce workforce. Yuson accepted but was excluded because she was retiring in January 2002. She subsequently availed optional retirement under Labor Code Article 287 and received P1.67M through compromise agreement. The Supreme Court held Yuson's ERP claim became moot when she accepted Article 287 benefits, creating a supervening event precluding her ERP claim. The Court ruled no perfected contract existed as the company's offer reserved management discretion and required head office approval. The decision establishes that employees cannot claim benefits under both statutory retirement and employer early retirement programs, and management prerogatives in discretionary programs will be upheld absent bad faith.