EN BANC
G.R. No. 187257, February 07, 2017
REPUBLIC OF THE PHILIPPINES, REPRESENTED BY THE OFFICE OF THE SOLICITOR GENERAL (OSG) AS THE PEOPLE'S TRIBUNE, AND THE NATIONAL POWER BOARD, Petitioners, v. HON. LUISITO G. CORTEZ, PRESIDING JUDGE, REGIONAL TRIAL COURT, BRANCH 84, QUEZON CITY, ABNER P. ELERIA, MELITO B. LUPANGCO, NAPOCOR EMPLOYEES CONSOLIDATED UNION (NECU), AND NAPOCOR EMPLOYEES AND WORKERS UNION (NEWU), Respondents.
G.R. No. 187776
ROLANDO G. ANDAYA, IN HIS CAPACITY AS SECRETARY OF THE DEPARTMENT OF BUDGET AND MANAGEMENT AND MEMBER OF THE BOARD OF DIRECTORS OF THE NATIONAL POWER CORPORATION, Petitioners, v. HON. LUISITO G. CORTEZ, PRESIDING JUDGE, REGIONAL TRIAL COURT, BRANCH 84, QUEZON CITY, ABNER P. ELERIA, MELITO B. LUPANGCO, NAPOCOR EMPLOYEES CONSOLIDATED UNION AND NAPOCOR EMPLOYEES AND WORKERS UNION, Respondents.
D E C I S I O N
LEONEN, J.:
The implementation of Republic Act No. 6758 resulted in the integration of all allowances previously received, including Cost of Living Allowance and Amelioration Allowance, into the basic standardized salary. When a government entity ceases to be covered by Republic Act No. 6758, the new position classification and compensation plan must also include all allowances previously received in the basic salary, in line with the principle of non-diminution of pay.
This is a consolidated case resulting from a Petition for Mandamus filed by the president of the National Power Corporation Employees Consolidated Union (NECU) and the president of the National Power Corporation Employees and Workers Union (NEWU) before the Regional Trial Court, Branch 84, Quezon City.1 The Petition sought to direct the National Power Corporation (NAPOCOR), its President and its Board of Directors to release and pay the Cost of Living Allowance (COLA) and Amelioration Allowance (AA) to all NAPOCOR employees beginning July 1, 1989 to March 16, 1999.2 The Petition for Mandamus was granted by the trial court and the NAPOCOR was ordered to pay a total of P6,496,055,339.98 as back payment for COLA and AA with an additional P704,777,508.60 as legal interest.3
NAPOCOR was created under Commonwealth Act No. 1204 as a government-owned and controlled corporation. Under the law, its National Power Board was authorized to fix the compensation of its officers and employees.5
In 1976, a salary standardization and compensation plan for public employees, including that of government-owned and controlled corporations, was enacted through Presidential Decree No. 985.6 The Decree likewise provided that notwithstanding the standardization and compensation plan, additional incentives may be established by government-owned and controlled corporations from their corporate funds.7 Pursuant to the Decree, then President Ferdinand E. Marcos issued Letter of Implementation No. 97,8 granting additional financial incentives to employees of government-owned and controlled corporation performing critical functions, among which was NAPOCOR.9 The additional incentives included COLA and AA.10
On August 21, 1989, Congress enacted Republic Act No. 6758, or the Compensation and Position Classification Act of 1989, to standardize compensation and benefits of public employees, effective July 1, 1989.11 The law applied to all positions, whether appointive or elective, including those in government-owned and controlled corporations.12 The law also provided that all allowances and other additional compensation not otherwise stated "shall be deemed included"13 in the prescribed standardized salary rates. Section 12 reads:
Section 12. Consolidation of Allowances and Compensation. - All allowances, except for representation and transportation allowances; clothing and laundry allowances; subsistence allowance of marine officers and crew on board government vessels and hospital personnel; hazard pay; allowances of foreign service personnel stationed abroad; and such other additional compensation not otherwise specified herein as may be determined by the DBM, shall be deemed included in the standardized salary rates herein prescribed. Such other additional compensation, whether in cash or in kind, being received by incumbents only as of July 1, 1989 not integrated into the standardized salary rates shall continue to be authorized.On October 2, 1989, the Department of Budget and Management issued Corporate Compensation Circular No. 10 (DBM-CCC No. 10),14 which provided for the integration of COLA, AA, and other allowances into the standardized salaries of public employees effective November 1, 1989.15
Existing additional compensation of any national government official or employee paid from local funds of a local government unit shall be absorbed into the basic salary of said official or employee and shall be paid by the National Government.
To stress, the failure to publish DBM-CCC No. 10 meant that the COLA and the amelioration allowance were not effectively integrated into the standardized salaries of the PPA employees as of July 1, 1989. The integration became effective only on March 16, 1999. Thus, in between those two dates, they were still entitled to receive the two allowances.24On December 28, 2007, Abner P. Eleria, president of NECU, and Melito B. Lupanggo, president of NEWU, filed a Petition for Mandamus with the Regional Trial Court of Quezon City, Branch 84, praying that NAPOCOR be ordered to release the COLA and AA due them.25 NECU and NEWU filed their Motion for Leave of Court to file a Petition-in-Intervention, which was granted by the trial court on March 14, 2008.26 The trial court consolidated the petitions and treated them as a class suit.27
The Office of the Solicitor General filed an Omnibus Motion seeking to withdraw its appearance as counsel for NAPOCOR and asking for leave to intervene as the People's Tribune. The Motion stated that the position taken by NAPOCOR ran counter to the Office of the Solicitor General's stand that the COLA and AA were already integrated into the standardized salaries.37
- Letter of [NPC President] Del Callar dated October 9, 2007 categorizing the workers/employees of the NAPOCOR into three groups, viz:
a.1 NPC employees who were incumbent as of June 30, 1989 are no longer entitled to their COLA and AA from July 1, 1989 to December 31, 1993 since said allowances have been factually integrated into their salaries but entitled to COLA and AA from January 1, 1994 to March 15, 1999;
a.2 NPC employees hired between July 1, 1989 and December 31, 1993 are entitled to COLA and AA since said benefits were not factually integrated into their salaries from their date of employment up to March 15, 1999; and
a.3 NPC employees as of January 1, 1994 to March 15, 1999 are entitled to COLA and AA from their date of employment up to March 15, 1999.- Certification issued by Mr. Alexander P. Japon, NPC's Senior Finance Department Manager dated April 22, 2008 admitting its obligation to pay COLAs and AAs due the NPC workers/employees as well as certifying the availability of funds in the amount of P8.5 Billion for the purpose and pursuant to DBM CCC No. 12; and
- Letter of [NPC President] Del Callar dated April 23, 2008 to the NAPOCOR Board certifying the NPC stand to pay the COLA and AA to the workers/employees.36 (Citations omitted)
WHEREFORE, in the light of the foregoing considerations, judgment is hereby rendered in favor of the petitioners and intervenors NECU & NEWU and against the respondents National Power Corporation, its President and Board of Directors ordering them as follows:The Office of the Solicitor General filed a Notice of Appeal of this Decision.48 Secretary Andaya, Jr. also filed a Motion for Reconsideration, arguing, among others, that the employees were duly notified that their COLA and AA were already integrated into their standardized salaries and that a Certification could be used as basis since this was merely advisory for the Board of Directors.49 NECU and NEWU, on the other hand, filed an Urgent Motion for Execution even within the period for appeal alleging that the needed amount had already been certified available and that the release of the allowances did not require the approval of the Department of Budget and Management.501. To RELEASE and to PAY the amount of SIX BILLION FOUR HUNDRED NINETY SIX MILLION FIFTY-FIVE THOUSAND THREE HUNDRED THIRTY NINE PESOS AND NINETY-EIGHT CENTAVOS [Php 6,496,055,339.98], Philippine Currency representing the COLAs and AAs and TO PAY the amount of SEVEN HUNDRED FOUR MILLION SEVEN HUNDRED SEVENTY-SEVEN THOUSAND FIVE HUNDRED EIGHT HUNDRED (sic) PESOS AND SIXTY CENTAVOS [Php 704,777,508.60], Philippine Currency, representing interest computed from December 28, 2007, within 30 days from finality of this Decision to petitioners, intervenors and other non-union employees similarly situated.
The said monetary judgment shall earn another interest of 12% per annum from date of finality of the decision until its full satisfaction.
2. To PAY Attorney's fees in the amount of P100,000.00 in favor of the Petitioners and P200,000.00 in favor of the Intervenors NECU & NEWU;
3. To DEDUCT the amount of ONE HU[N]DRED FORTY-FIVE MILLION FOUR HUNDRED SIXTY-FOUR THOUSAND EIGHT HUNDRED SEVENTY-TWO PESOS AND FIFTY- FIVE CENTAVOS [Php 145,464,872.55] representing the deficiency payment of docket and other legal fees to be taken from the said lists of NAPOCOR officials, workers, and employees including non-union beneficiaries similarly situated, and to REMIT AND PAY the same to the Office of the Clerk of Court of the Regional Trial Court of Quezon City, within 15 days from finality of this Decision, and finally, to FURNISH this court proof of compliance hereof. The said Amount shall be without prejudice and subject to the final computation and assessment of the Office of the Clerk of Court. The said docket and legal fees shall be a lien on this judgment and shall be first satisfied pursuant to the provisions of Rule 141 and Rule 39 of the Rules of Court.
4. DECLARING the Consultancy Agreement to be valid and binding between the counsels and the Petitioners and the Intervenors NECU & NEWU, and its members.
4.1 To DEDUCT the FIVE percent (5%) of the amount payable to each of the NAPOCOR employees including non-union beneficiaries similarly situated for the said attorney's fees PRO RATA, AND to PAY the amount deducted to Atty. Napoleon Uy Galit and Atty. Jonathan S. Presquito, after deducting the appropriate taxes.
SO ORDERED.47 (Emphasis and underscoring in the original, citation omitted)
WHEREFORE, in the light of the foregoing considerations, the Court resolves as follows, viz:On March 23, 2009, the trial court issued a Certificate of Finality of Judgment57 and a Writ of Execution.581. GRANTS the Motion for Execution filed by NPC workers, petitioners and intervenors NECU & NEWU.SO ORDERED.56
Accordingly, the Branch Clerk of Court is directed to forthwith issue the Certificate of Finality of Judgment and the Writ of Execution to enforce the Court's Decision dated November 28, 2008.
Let the corresponding Writ of Execution be issued and served simultaneous with the service of this Order to the parties to be implemented by the deputy sheriff of this Court.
The initial computation of filing fees amounting to ONE HUNDRED FORTY-FIVE MILLION FOUR HUNDRED SIXTY FOUR THOUSAND EIGHT HUNDRED SEVENTY-TWO PESOS AND FIFTY-FIVE CENTAVOS, [Php 145,464, 872.55], Philippine Currency, SHALL be first executed and paid to the Clerk of Court of RTC Quezon City, pursuant to the provisions of Rule 141 of the Revised Rules of Court, to be eventually remitted to the account of the Supreme Court.
2. GRANTS the motion of petitioners and intervenors to Deposit the Amount Equivalent to Judgment Award and Interest.
Accordingly, ORDERS the NPC Management through its President, NPC BOARD, and Treasurer to DEPOSIT the amount of SIX BILLION FOUR HUNDRED NINETY SIX MILLION FIFTY-FIVE THOUSAND THREE HUNDRED THIRTY NINE PESOS AND NINETY EIGHT CENTAVOS [Php 6,496,055,339.98], Philippine Currency representing the COLAs and AAs, and the amount of SEVEN HUNDRED FOUR MILLION SEVEN HUNDRED SEVENTY SEVEN THOUSAND FIVE HUNDRED EIGHT PESOS AND SIXTY CENTAVOS (Php 704,777,508.60), Philippine Currency, representing interest computed from December 28, 2007, with Land Bank of the Philippines, with high yielding bearing interest, within 30 days from receipt hereof.
Thereafter, to SUBMIT their COMPLIANCE hereto within 15 days from date of deposit of said amounts for the information of the Court.
The said amount shall be under Custodia Legis of the Court pending its distribution to the listed and qualified beneficiaries or pending appeal with the Higher Court.
3. DENIES and DISMISSES the Notice of Appeal filed by the Office of the Solicitor General for utter lack of merit.
4. DENIES the Motion for Reconsideration filed by the Public Respondent Hon. Rolando G. Andaya, Jr. with finality.
True, the Solicitor General is mandated to represent the Government, its agencies and instrumentalities and its officials and agents in any litigation, proceeding, investigation or matter requiring the services of a lawyer. However, the Solicitor General may, as it has in instances take a position adverse and contrary to that of the Government on the reasoning that it is incumbent upon him to present to the court what he considers would legally uphold the best interest of the government although it may run counter to a client's position.121The rationale for the Solicitor General's role is further explained in Gonzales v. Hon. Chavez:122
Indeed, in the final analysis, it is the Filipino people as a collectivity that constitutes the Republic of the Philippines. Thus, the distinguished client of the OSG is the people themselves of which the individual lawyers in said office are a part.In this instance, the Office of the Solicitor General initially represented NAPOCOR and its Board of Directors in the proceedings before the Regional Trial Court. It later on filed an Omnibus Motion To Withdraw Appearance as Counsel for Respondents and For Leave to Intervene as People's Tribune,124 which was granted by the trial court in its June 20, 2008 Order.125 In denying the Office of the Solicitor General's Notice of Appeal, the trial court stated:
....
Moreover, endowed with a broad perspective that spans the legal interests of virtually the entire government officialdom, the OSG may be expected to transcend the parochial concerns of a particular client agency and instead, promote and protect the public weal. Given such objectivity, it can discern, metaphorically speaking, the panoply that is the forest and not just the individual trees. Not merely will it strive for a legal victory circumscribed by the narrow interests of the client office or official, but as well, the vast concerns of the sovereign which it is committed to serve.123
The Court is of the humble opinion and so holds that OSG has ceased to be the counsel of NPC and the subsequent filing of the notice of appeal is not appropriately filed or such notice will accrue to the benefit of NPC.126In granting the Office of the Solicitor General's Omnibus Motion, the trial court allowed a party, separate from NAPOCOR - the People's Tribune — to enter its appearance in the case. As with any other party, it was allowed to file a Notice of Appeal separately from NAPOCOR. Its Notice of Appeal was not for the benefit of NAPOCOR; rather, it was for the protection of the interests of the State. Its Notice of Appeal would have been timely filed.
Section 12. Consolidation of Allowances and Compensation. - All allowances, except for representation and transportation allowances; clothing and laundry allowances; subsistence allowance of marine officers and crew on board government vessels and hospital personnel; hazard pay; allowances of foreign service personnel stationed abroad; and such other additional compensation not otherwise specified herein as may be determined by the DBM, shall be deemed included in the standardized salary rates herein prescribed. Such other additional compensation, whether in cash or in kind, being received by incumbents only as of July 1, 1989 not integrated into the standardized salary rates shall continue to be authorized.As a general rule, "all allowances are deemed included in the standardized salary [rates]."145 The following allowances, however, are deemed not to have been integrated:
Existing additional compensation of any national government official or employee paid from local funds of a local government unit shall be absorbed into the basic salary of said official or employee and shall be paid by the National Government.
...representation and transportation allowances; clothing and laundry allowances; subsistence allowance of marine officers and crew on board government vessels and hospital personnel; hazard pay; allowances of foreign service personnel stationed abroad; and such other additional compensation not otherwise specified herein as may be determined by the DBM...146The phrase "such other additional compensation not otherwise specified herein as may be determined by the DBM" specifies that the Department of Budget and Management has the delegated authority to determine other allowances that are not deemed integrated into the standardized salaries.147 The Department of Budget and Management subsequently issued DBM-CCC No. 10, enumerating all allowances deemed included in the basic salary and discontinuing all allowances and fringe benefits granted on top of the basic salary.148 Item 4.1 states:
Item No. 5.6 of the Circular states:4.1The present salary of an incumbent for purposes of this Circular shall refer to the sum total of actual basic salary including allowances enumerated hereunder, being received as of June 30, 1989 and authorized pursuant to P.D. No. 985 and other legislative or administrative issuances:4.1.1Cost-of-Living Allowance/Bank Equity Pay (COLA/BEP) equivalent to forty percent (40%) of basic salary or P300.00 per month, whichever is higher;4.1.2Amelioration Allowance equivalent to ten percent (10%) of basic salary of P150.00 per month, whichever is higher;4.1.3COLA guaranteed to GOCCs/GFIs covered by the Compensation and Position Classification Plan for the regular agencies/offices of the National Government and to GOCCs/GFIs following the Compensation and Position Classification Plan under LOImp. No. 104/CCC No. 1 and LOImp.No. 97/CCC No. 2 in the amount of P550.00 per month for those whose monthly basic salary is P1,500 and below, and P500 for those whose monthly basic salary is P1,501 and above, granted on top of the COLA/BEP mentioned in Item No. 4.1.1 above[.]149
Payment of other allowances/fringe benefits and all other forms of compensation granted on top of basic salary, whether in cash or in kind, . . . shall be discontinued effective November 1, 1989. Payment made for such allowances/fringe benefits after said date shall be considered as illegal disbursement of public funds.150In De Jesus, the Commission on Audit disallowed the payment of honoraria to employees of the Local Water Utilities Administration on the ground that this was a fringe benefit granted on top of the basic salary.151 This Court, however, set aside the disallowance and rendered DBM-CCC No. 10 ineffective for non-publication in the Official Gazette or in a newspaper of general circulation:
[I]t is decisively clear that DBM-CCC No. 10, which completely disallows payment of allowances and other additional compensation to government officials and employees, starting November 1, 1989, is not a mere interpretative or internal regulation. It is something more than that. And why not, when it tends to deprive government workers of their allowances and additional compensation sorely needed to keep body and soul together. At the very least, before the said circular under attack may be permitted to substantially reduce their income, the government officials and employees concerned should be apprised and alerted by the publication of subject circular in the Official Gazette or in a newspaper of general circulation in the Philippines — to the end that they be given amplest opportunity to voice out whatever opposition they may have, and to ventilate their stance on the matter. This approach is more in keeping with democratic precepts and rudiments of fairness and transparency.In Philippine Ports Authority (PPA) Employees Hired After July 1, 1989, the Philippine Ports Authority had been paying its officials and employees COLA and AA prior to the issuance of DBM-CCC No. 10.153 Upon the issuance of the Circular, it discontinued the payment of these allowances as these were already deemed integrated into the standardized salaries.154De Jesus, however, rendered the Circular ineffective for non-publication. Thus, a question arose as to whether the employees were entitled to the back pay of their COLA and AA.
In light of the foregoing disquisition on the ineffectiveness of DBM-CCC No. 10 due to its non-publication in the Official Gazette or in a newspaper of general circulation in the country, as required by law, resolution of the other issue at bar is unnecessary.152
The parties fail to cite any law barring the continuation of the grant of the COLA and the amelioration allowance during the period when DBM-CCC No. 10 was in legal limbo.Thus, Philippine Ports Authority (PPA) Employees Hired After July 1, 1989 clarified that those who were already receiving COLA and AA as of July 1, 1989, but whose receipt was discontinued due to the issuance of DBM-CCC No. 10, were entitled to receive such allowances during the period of the Circular's ineffectivity, or from July 1, 1989 to March 16, 1999. The same factual premise was present in Metropolitan Waterworks and Sewerage System, wherein this Court reiterated that those already receiving COLA as of July 1, 1989 were entitled to its payment from 1989 to 1999.156
The present case should be distinguished from PNB v. Palma, in which the respondents sought by mandamus to compel the petitioner therein to grant them certain fringe benefits and allowances that continued to be given to Philippine National Bank (PNB) employees hired prior to July 1, 1989. This Court held that PNB could not be compelled to do so, because the respondents had been hired after that date. Under Section 12 of RA 6758, only "incumbent" government employees (as of July 1, 1989) already receiving those benefits may continue to receive them, apart from their standardized pay.
In the present case, the PPA already granted herein petitioners the COLA and the amelioration allowances, even if they were hired after July 1, 1989. The only issue is whether they should have continued to receive the benefits during the period of the "ineffectivity" of DBC-CCC No. 10; that is, from July 1, 1989 to March 16, 1999, the period during which those allowances were not deemed integrated into their standard salary rates. Furthermore, in the PNB Decision, the employees claimed a right to receive the allowances from July 1, 1989 to January 1, 1997. PNB was able to grant the benefits post facto, because on that date (January 1, 1997) it had already been privatized and was thus no longer subject to the restrictions imposed by RA 6758 (the Salary Standardization Law).
Tellingly, the subject matter of the PNB case involved benefits that had not been deemed integrated into, but in fact exempted from, the standardized salary rates. In the present case, the subject matter refers to those deemed included, but were placed "in limbo" as a result of this Court's ruling in De Jesus v. COA.
To stress, the failure to publish DBM-CCC No. 10 meant that the COLA and the amelioration allowance were not effectively integrated into the standardized salaries of the PPA employees as of July 1, 1989. The integration became effective only on March 16, 1999. Thus, in between those two dates, they were still entitled to receive the two allowances.155
The State aims in Rep. Act No. 6758 to provide equal pay for substantially equal work and to base differences in pay upon substantive differences in duties and responsibilities, and qualification requirements of the positions. Prior to the effectivity of that law, NPC employees were receiving, aside from cost of living allowance, myriad of allowances like social amelioration allowance, emergency allowance, longevity pay and employee welfare allowance.158 (Citation omitted)NAPOCOR Employees Consolidated Union (NECU) also clarifies that Philippine Ports Authority (PPA) Employees Hired After July 1, 1989 was inapplicable since it only applied to back pay of COLA and AA that was previously withheld and not to those who continued to receive these benefits even after the issuance of DBM-CCC No. 10:
The Court has, to be sure, taken stock of its recent ruling in Philippine Ports Authority (PPA) Employees Hired After July 1, 1989 vs. Commission on Audit. Sadly, however, our pronouncement therein is not on all fours applicable owing to differing factual milieu. There, the Commission on Audit allowed the payment of back cost of living allowance (COLA) and amelioration allowance previously withheld from PPA employees pursuant to the heretofore ineffective DBM-CCC No. 10, but limited the back payment only to incumbents as of July 1, 1989 who were already then receiving both allowances. COA considered the COLA and amelioration allowance of PPA employees as "not integrated" within the purview of the second sentence of Section 12 of Rep. Act No. 6758, which, according to COA confines the payment of "not integrated" benefits only to July 1, 1989 incumbents already enjoying said allowances.Republic Act No. 6758 remained effective during the period of ineffectivity of DBM-CCC No. 10.160 Thus, the COLA and AA of NAPOCOR officers and employees were integrated into the standardized salaries effective July 1, 1989 pursuant to Section 12 of Republic Act No. 6758, which provides:
In setting aside COA's ruling, we held in PPA Employees that there was no basis to use the elements of incumbency and prior receipt as standards to discriminate against the petitioners therein. For, DBM -CCC No. 10, upon which the incumbency and prior receipt requirements are contextually predicated, was in legal limbo from July 1, 1989 (effective date of the unpublished DBM-CCC No. 10) to March 16, 1999 (date of effectivity of the heretofore unpublished DBM circular). And being in legal limbo, the benefits otherwise covered by the circular, if properly published, were likewise in legal limbo as they cannot be classified either as effectively integrated or not integrated benefits.
There lies the difference.
Here, the employee welfare allowance was, as above demonstrated, integrated by NPC into the employees' standardized salary rates effective July 1, 1989 pursuant to Rep. Act No. 6758. Unlike in PPA Employees, the element of discrimination between incumbents as of July 1, 1989 and those joining the force thereafter is not obtaining in this case. And while after July 1, 1989, PPA employees can rightfully complain about the discontinuance of payment of COLA and amelioration allowance effected due to the incumbency and prior receipt requirements set forth in DBM-CCC No[.] 10, NPC cannot do likewise with respect to their welfare allowance since NPC has, for all intents and purposes, never really discontinued the payment thereof.159 (Citation omitted)
Section 12. Consolidation of Allowances and Compensation. - All allowances, except for representation and transportation allowances; clothing and laundry allowances; subsistence allowance of marine officers and crew on board government vessels and hospital personnel; hazard pay; allowances of foreign service personnel stationed abroad; and such other additional compensation not otherwise specified herein as may be determined by the DBM, shall be deemed included in the standardized salary rates herein prescribed. Such other additional compensation, whether in cash or in kind, being received by incumbents only as of July 1, 1989 not integrated into the standardized salary rates shall continue to be authorized.Unlike in Philippine Ports Authority (PPA) Employees Hired After July 1, 1989, there would be no basis to distinguish between those hired before July 1, 1989 and those hired after July 1, 1989. Both sets of NAPOCOR employees were continuously receiving their COLA and AA since these allowances were already factually integrated into the standardized salaries pursuant to Section 12 of Republic Act No. 6758.
Existing additional compensation of any national government official or employee paid from local funds of a local government unit shall be absorbed into the basic salary of said official or employee and shall be paid by the National Government.
For employees hired after July 1, 1989 or the effectivity of RA 6758, a finding that the subject allowance was factually integrated into the basic salaries of incumbents as of July 1, 1989 shall mean that said allowances were likewise paid and factually integrated into the basic salaries of those hired after July 1, 1989.Pursuant to this Circular, NAPOCOR submitted to the Department of Budget and Management a Certification165 dated May 28, 2007166 stating:
Any finding that the concerned allowance was not factually integrated into the basic salary, and hence, has not been paid, shall be supported by sworn certifications from the President of the concerned GOCC/GFI, its Vice President for Human Resource and Finance, and other relevant officers directly in charge thereof, or officials with equivalent ranks and responsibilities, attesting to the fact that the subject allowance was not factually integrated in the basic salary after accomplishment of the above matrix, and as supported by the foregoing documents.164
This is to certify that the Cost of Living Allowance (COLA) and Amelioration Allowance (AA) to be paid to the four thousand nine hundred thirteen (4,913) NPC employees hired during the period 01 July 1989 to 31 December 1993 per the attached matrix were not factually integrated in their respective basic salaries for the subject period.The Department of Budget and Management, through Secretary Andaya, Jr., wrote a letter168 dated September 18, 2007 concerning the submission of these documents, stating:
This is to further certify that the COLA and AA to be paid to the nine thousand seven hundred seventy-seven (9,777) NPC employees concerned during the period 01 January 1994 to 16 March 1999 have not been factually integrated into the basic salaries of the subject employees.
Attached herewith is the accomplished matrix prescribed under DBM CCC # 12, which forms an integral part of this certification.167
Based on CCC No. 12, determination of whether such allowances authorized by the Supreme Court to be granted have factually been integrated or not and paid to the NPC employees concerned now rests with the NPC management. The documents enumerated under paragraph 2.1 to 2.4 of said Circular shall serve as basis for determining whether their officials and employees are still entitled to payment of such allowances. It may be noted that CCC No. 12 does not require GOCCs/GFIs to submit the said documents to the Department of Budget and Management. Likewise, payment of such allowances does not require prior approval of the DBM Secretary.In a letter170 dated October 9, 2007, President Cyril C. del Callar (President del Callar) conceded Secretary Andaya, Jr.'s first point but took exception to the second and third point:
The findings of the NPC as to who are entitled to payment of back COLA and AA can only be possible after a diligent and exhaustive review and evaluation of all pertinent documents enumerated in CCC No. 12. May we call your attention, however, to the following[:]a)NPC employees who were incumbents of positions as of June 30, 1989 are no longer entitled to COLA and AA for the period July 1, 1989 to December 31, 1993 since said allowances have been factually integrated into the standardized salaries as clearly reflected in a Notice of Position Allocation and Salary Adjustment (NPASA) of an employee submitted by NPC in connection with the En banc decision of the Supreme Court in the case NAPOCOR EMPLOYEES CONSOLIDATED UNION[,] et al. vs. THE NATIONAL POWER CORPORATION, et al. under G.R. No. 157492 dated March 10, 2006. As reflected in the said NPASA, not only the Welfare Allowance was integrated, but likewise the COLA and Amelioration Allowance being claimed by the NPC employees.b)For employees hired between July 1, 1989 and December 31, 1993, it is inconceivable that NPC was not aware of the Implementation of RA No. 6758. The SSL had already been in effect on July 1, 1989 and as such, the hiring rate under the SSL should have been allowed to NPC employees hired effective the said period. NPC could not have continuously and separately granted any COLA and AA to those hired effective July 1, 1989 and thereafter.c)It may also be worth mentioning that in CY 1994, NPC adopted a new Salary Pay [sic] pursuant to RA No. 7643, the Energy Power Crisis Act, as implemented by Memorandum Order (MO) 198. Under the said Salary Plan, the COLA and AA are no longer subsisting and these have already been integrated into the standardized salary of employees effective July 1, 1989.169
[W]e would like to make some clarifications on the following concerns made on our request:Unfortunately, the attached Notices of Position Allocation and Salary Adjustment and pay slips only served to prove that from July 1, 1989 to December 31, 1993, the COLA and AA were already deemed integrated into the basic salary. According to the various Notices of Position Allocation and Salary Adjustment172 submitted to this Court, the receipt of COLA and AA was not discontinued due to the implementation of Republic Act No. 6758. One employee, Ernesto Camagong (Mr. Camagong), was a Plant Equipment Operator, classified as Salary Grade 10:a)NPC employees who were incumbents of positions as of June 30, 1989 are no longer entitled to COLA and AA for the period July 1, 1989 to December 31, 1993 since said allowances have been factually integrated into the standardized rates as reflected in a NPASA of an employee submitted by NPC in connection with the En banc decision of the Supreme Court ............ by NPC employees..Your position on item a) above is the same with our position as stated in our letter of 10 May 2007. NPC employees who were incumbents of positions as of 30 June 1989 may not be entitled to COLA and AA because during the period 01 July 1989 to 31 December 1993, these employees either actually received such benefits or the said benefits were already factually integrated into their respective standardized salaries.Attached are copies of pay slips of employees who were incumbents as of 30 June 1989 to illustrate that their COLA and AA were integrated into their standardized salaries during the covered period.b)For employees hired between July 1, 1989 and December 31, 1993, it is inconceivable that NPC was not aware of the implementation of RA No. 6758. The SSL had already been in effect on July 1, 1989 and as such, the hiring rate under the SSL should have been allowed to NPC employees hired effective the said period. NPC could not have continuously and separately granted any COLA and AA to those hired effective July 1, 1989 and thereafter.NPC is very much aware of the implementation of RA 6758 and that the SSL took effect on 01 July 1989. However, we would like to remind you that CCC No. 10 was declared ineffective by the Supreme Court due to its non-publication in the Official Gazette in the case of De Jesus, et al. vs. COA (294 SCRA 152). In the case of Philippine Ports Authority Employees vs. COA (GR No. 160396, September 6, 2005), the High Court ruled that the failure to publish DBM-CCC No. 10 meant that the COLA and AA were not effectively integrated into the standardized salaries. It was further ruled that "All - not only incumbents as of July 1, 1989 - should be allowed to receive back pay corresponding to the said benefits, from July 1, 1989 to the new effectivity of DBM-CCC No. 10 - - March 16, 1999.Attached for your reference are copies of pay slips of NPC employees hired after the effectivity of the SSL to serve as proof that the subject benefits were not factually integrated into the respective basic salaries of employees hired after June 30, 1989. Being non-incumbents as of 30 June 1989, nothing was integrated into their salaries effective July 1, 1989 or respective dates they were actually employed thereafter. The COLA and AA were not part of the total compensation package they were receiving during the period 01 July 1989 to 31 December 1993.c)It may also be worth mentioning that in CY 1994, NPC adopted a new Salary Pay [sic] pursuant to RA No. 6743 [sic], the Energy Power Crisis Act, as implemented by Memorandum Order (MO) 198. Under the said Salary Plan, the COLA and AA are no longer subsisting and these have already been integrated into the standardized salary of employees effective July 1, 1989.The new NPC Pay Plan which took effect in 1994 was authorized under Memorandum Order (MO) 198. The salary and benefits level accorded to NPC personnel was aligned with the private sector and was based on the result of the study conducted by SGV. The grant of several existing government-mandated allowances was allowed. However, the COLA and AA were not included in the Schedule of Monthly Allowances due to the belief that DBM-CCC No. 10 was still in effect.171 (Emphasis in the original)
Prior to Republic Act No. 6758, or on June 30, 1989, Mr. Camagong was receiving a total salary of P8,506.30. Upon the effectivity of the law, or on July 1, 1989, all allowances, except those specifically excluded, were deemed integrated into his basic salary. To stress, all allowances previously granted were already deemed integrated into the standardized salary rates by July 1, 1989.
JOB GRADE: 10WITH A SALARY AS OF 06/30/89 AS FOLLOWS:BASIC SALARY [P]3,912.00COST OF LIVING 1,564.80ALLOWANCE (COLA) ADDITIONAL COLA 200.00SOCIAL AMELIORATION ALLOWANCE 391.20EMERGENCY ALLOWANCE 255.00RED CIRCLE RATE (RCR) 1,592.10LONGEVITY PAY 200.00EMPLOYEE WELFARE ALLOWANCE 391.20 TOTALAS OF 06/30/89 8,506.30 SALARY ADJUSTMENTEFFECTIVE JULY 1, 1989 NONE TRANSITION ALLOWANCEEFFECTIVE JULY 1, 1989 4,120.30 ADJUSTED SALARYEFFECTIVE JULY 1, 1989 4,386.00 TOTAL COMPENSATIONEFFECTIVE JULY 1, 1989 8,506.30173
When Rep. Act No. 6758 became effective on July 1, 1989, the new position title of Camagong was Plant Equipment Operator B with a salary grade of 14 and with a monthly salary of P4,386.00.The integration of COLA into the standardized salary rates is not repugnant to the law. Gutierrez, et al. v. Department of Budget and Management, et al.175 explains:
Admittedly, in the case of Camagong, his monthly gross income of P8,506.30 prior to the effectivity of Rep. Act No. 6758, was thereafter reduced to only P4,386.00. The situation, however, is duly addressed by the law itself. For, while Rep. Act No. 6758 aims at standardizing the salary rates of government employees, yet the legislature has adhered to the policy of non-diminution of pay when it enacted said law. So it is that Section 17 thereof precisely provides for a "transition allowance," as follows:Section 17. Salaries of Incumbents. — Incumbents of positions presently receiving salaries and additional compensation/fringe benefits including those absorbed from local government units and other emoluments, the aggregate of which exceeds the standardized salary rate as herein prescribed, shall continue to receive such excess compensation, which shall be referred to as transition allowance. The transition allowance shall be reduced by the amount of salary adjustment that the incumbent shall receive in the future.Evidently, the transition allowance under the aforequoted provision was purposely meant to bridge the difference in pay between the pre-R.A. 6758 salary of government employees and their standardized pay rates thereafter, and because non-diminution of pay is the governing principle in Rep. Act No. 6758, Camagong, pursuant to Section 17 of that law was given a transition allowance of P4,120.30. This explains why, in the case of Camagong, his gross monthly income remained at P8,506.30, as can be seen in his NPASA, clearly showing that the allowances he used to receive prior to the effectivity of Rep. Act No. 6758, were integrated into his standardized salary rate.174 (Citation omitted)
The transition allowance referred to herein shall be treated as part of the basic salary for purposes of computing retirement pay, year-end bonus and other similar benefits.
As basis for computation of the first across-the-board salary adjustment of incumbents with transition allowance, no incumbent who is receiving compensation exceeding the standardized salary rate at the time of the effectivity of this Act, shall be assigned a salary lower than ninety percent (90%) of his present compensation or the standardized salary rate, whichever is higher. Subsequent increases shall be based on the resultant adjusted salary.
COLA is not in the nature of an allowance intended to reimburse expenses incurred by officials and employees of the government in the performance of their official functions. It is not payment in consideration of the fulfillment of official duty. As defined, cost of living refers to "the level of prices relating to a range of everyday items" or "the cost of purchasing those goods and services which are included in an accepted standard level of consumption." Based on this premise, COLA is a benefit intended to cover increases in the cost of living. Thus, it is and should be integrated into the standardized salary rates.176Thus, it would be incongruous to grant any alleged back pay of COLA and AA from July 1, 1989 to December 31, 1993, when the NAPOCOR officers and employees have already received such allowances for this period. The grant would be tantamount to additional compensation, which is proscribed by Section 8, Article IX (B) of the Constitution:
SECTION 8. No elective or appointive public officer or employee shall receive additional, double, or indirect compensation, unless specifically authorized by law, nor accept without the consent of the Congress, any present, emolument, office, or title of any kind from any foreign government.Mandamus cannot lie to compel the performance of an unconstitutional act.177 The Regional Trial Court clearly acted in grave abuse of discretion in ordering the back payment, to the affected NAPOCOR officers and employees, the COLA and AA for the period of July 1, 1989 to December 31, 1993.
Pensions or gratuities shall not be considered as additional, double, or indirect compensation.
SEC. 2. COMPENSATION PLAN. The NPC Compensation Plan consists of the following:Thus, Philippine Ports Authority (PPA) Employees Hired After July 1, 1989 is inapplicable for the period following the enactment of Republic Act No. 7648. This case interprets provisions of Republic Act No. 6758. The "legal limbo" contemplated in this case does not apply to a period where a new position classification and compensation plan has already been enacted. Thus, entitlement to the back pay of COLA and AA from 1994 to 1999 should not be premised on this case.2.1 Total monthly compensation structure as shown in Annex "A" which shall include:2.1.1 Monthly basic salary schedule as shown in Annex "B"; and
2.1.2 Schedule of monthly allowances as provided in Annex "C" which include existing government mandated allowances such as PERA and Additional Compensation, and Rice Subsidy, and Reimbursable Allowances, i.e., RRA, RTA and RDA, provided however, that the NP Board is hereby authorized to further rationalize and/or revise the rates for such allowances as may be necessary; and2.2 "Pay for Performance". Pay for Performance is a variable component of the total annual cash compensation consisting of bonuses and incentives but excluding the 13th month pay, earned on the basis of corporate and/or group performance or productivity, following a Productivity Enhancement Program (PEP), and step-increases given in recognition of superior individual performance using a performance rating system, duly approved by the NP Board. The corporate or group productivity or incentive bonus shall range from zero (0) to four (4) months basic salary, to be given in lump-sum for each year covered by the PEP. The in-step increases on the other hand, once granted, shall form part of the monthly basic salary.
It may also be worth mentioning that in CY 1994, NPC adopted a new Salary Pay [sic] pursuant to RA No. 6743 [sic], the Energy Power Crisis Act, as implemented by Memorandum Order (MO) 198. Under the said Salary Plan, the COLA and AA are no longer subsisting and these have already been integrated into the standardized salary of employees effective July 1, 1989.179NAPOCOR's Office of the General Counsel disagreed with this assessment, stating that Memorandum Order No. 198, series of 1994 did not include the COLA and AA "presumably due to the belief that DBM-CCC No. 10 was still in effect (the Supreme Court decisions declaring the said Circular as ineffective were not yet promulgated as of that time)."180 This sentiment was echoed in President del Callar's letter181 dated October 9, 2007 to Secretary Andaya, Jr.
SECTION 5. Reorganization of the National Power Corporation. — The President is hereby empowered to reorganize the NAPOCOR, to make it more effective, innovative, and responsive to the power crisis. For this purpose, the President may abolish or create offices; split, group, or merge positions; transfer functions, equipment, properties, records and personnel; institute drastic cost-cutting measures and take such other related actions necessary to carry out the purpose herein declared. Nothing in this Section shall result in the diminution of the present salaries and benefits of the personnel of the NAPOCOR: Provided, That any official or employee of the NAPOCOR who may be phased out by reason of the reorganization authorized herein shall be entitled to such benefits as may be determined by the Board of Directors of the NAPOCOR, with the approval of the President.In issuing Memorandum No. 198, series of 1994, the President determined that the New Compensation Plan for the NAPOCOR personnel shall include the basic salary, PERA and Additional Compensation, Rice Subsidy, and Reimbursable Allowances. The discretion of the President to specify the new salary rates, however, is qualified by the statement: "Nothing in this Section shall result in the diminution of the present salaries and benefits of the personnel of the NAPOCOR." This qualification is repeated in Section 7 of the Memorandum:
The President may upgrade the compensation of the personnel of the NAPOCOR at rates comparable to those prevailing in privately-owned power utilities to take effect upon approval by Congress of the NAPOCOR's budget for 1994. (Emphasis supplied)
SEC. 7. NON-DIMINUTION IN PAY. Nothing in this Order shall result in the reduction of the compensation and benefits entitlements of NPC personnel prior to the effectivity of this Order.The Board of Directors is authorized to rationalize or revise only the rates for PERA and Additional Compensation, Rice Subsidy, and Reimbursable Allowances:
2.1.2 Schedule of monthly allowances as provided in Annex "C" which include existing government mandated allowances such as PERA and Additional Compensation, and Rice Subsidy, and Reimbursable Allowances, i.e., RRA, RTA and RDA, provided however, that the NP Board is hereby authorized to further rationalize and/or revise the rates for such allowances as may be necessary[.]183 (Emphasis supplied)As previously discussed, COLA and AA were already deemed integrated into the basic standardized salary from July 1, 1989 to December 31, 1993. These allowances need not be separately granted. All basic salaries by December 31, 1993 already included the COLA and AA.
[O]n the basis of the testimonies of the aforementioned key officers of the NPC who categorically stated that NPC had sold and has been selling all its power plants and transmission lines and the proceeds thereof were given to Power Sector Assets and Liabilities Management ["PSA[L]M"] for payment of its obligations to the exclusion of the present COLAs and AAs; that at present, NPC has P400 Million bank deposits but the payment of COLAs and AAs can be sourced from the revenues of generated funds and guaranteed receivables from 58 power customers; that the effect of selling all the NPC's power plants and transmission lines will result to lesser future income that cannot meet the present judgment award. That if ordered by the Court, the management can set aside funds based on the present generated income revenues where NPC has been receiving P10 Billion per month from the present 58 customers.200 (Citation omitted)The preparation of corporate operating budgets of government-owned and controlled corporations is governed by Executive Order No. 518, series of 1979.201 Through Republic Act No. 7638,202 NAPOCOR was placed under the supervision of the Department of Energy, and their corporate operating budgets were submitted to Congress for approval.203
It should be noted that the corporate officers of NAPOCOR, including Vice President Anguluan, also stand to benefit from the back payment of any additional COLA and AA.COURT:Can you explain to the Court what does the administration or management of National Power Corporation, as certified obligation insofar as this matter is concerned?[NPC VP EDMUNDO ANGULUAN]: No, your Honor, what we do is we advise the finance to include this in our certified obligation at the end of the year. That should be the
case.COURT:Are you telling to the Court that this obligation amounting to P6,496,055,339.98 plus 2 billion estimated amount of back COLA for those persons who claimed their salary thru disbursement voucher were included in the year 2005 of certified obligation?A:Yes, your Honor.COURT:So what happened after the same has been submitted in Congress, was it approved by Congress?A:It is only internal to us, your Honor, the inclusion of the certified obligation submitted to the Finance is internal to the NPC and this has been carried on for two (2) [years]. Because during the first year, we were not successful in getting paid of the cost of living so we included it again in the C.O.COURT:So, when it is included as certified obligation, can you please explain to the Court in a common parlance, what did the corporation do insofar as this obligations are concerned? Am I correct to say or to state that as a certified obligation that seems to be that the NPC or the management recognized this proposition will be due and payable?A:Yes, your Honor.COURT:Does it also mean that as certified obligation they are now earmarking portion of their funds for the payments of this obligation?A:Yes, your Honor.204 (Emphasis supplied, citation omitted)
SECTION 26. General Jurisdiction. - The authority and powers of the Commission shall extend to and comprehend all matters relating to auditing procedures, systems and controls, the keeping of the general accounts of the Government, the preservation of vouchers pertaining thereto for a period of ten years, the examination and inspection of the books, records, and papers relating to those accounts; and the audit and settlement of the accounts of all persons respecting funds or property received or held by them in an accountable capacity, as well as the examination, audit, and settlement of all debts and claims of any sort due from or owing to the Government or any of its subdivisions, agencies and instrumentalities. The said jurisdiction extends to all government-owned or controlled corporations, including their subsidiaries, and other self-governing [sic] boards, commissions, or agencies of the Government, and as herein prescribed, including non-governmental entities subsidized by the government, those funded by donation through the government, those required to pay levies or government share, and those for which the government has put up a counterpart fund or those partly funded by the government. (Emphasis supplied)Money claims and judgments against the government must first be filed with the Commission on Audit. Trial courts have already been strongly cautioned against the issuance of writs of execution in cases involving the disbursement of public funds in Supreme Court Administrative Circular No. 10-2000:206
[SUPREME COURT] ADMINISTRATIVE CIRCULAR NO. 10-2000Thus, in National Electrification Administration v. Morales,207 this Court held that while any entitlement to the back payment of allowances under Republic Act No. 6758 may be adjudicated before the trial court, the parties must file a separate action before the Commission on Audit for the satisfaction of any judgment award.208:All Judges of Lower CourtsSUBJECT:Exercise of Utmost Caution, Prudence and Judiciousness in the Issuance of Writs of Execution to Satisfy Money Judgments Against Government Agencies and Local Government Units
In order to prevent possible circumvention of the rules and procedures of the Commission on Audit, judges are hereby enjoined to observe utmost caution, prudence and judiciousness in the issuance of writs of execution to satisfy money judgments against government agencies and local government units.
Judges should bear in mind that in Commissioner of Public Highways v. San Diego (31 SCRA 617, 625 [1970]), this Court explicitly stated:The universal rule that where the State gives its consent to be sued by private parties either by general or special law, it may limit claimant's action 'only up to the completion of proceedings anterior to the stage of execution' and that the power of the Court ends when the judgment is rendered, since government funds and properties may not be seized under writs of execution or garnishment to satisfy such judgments, is based on obvious considerations of public policy. Disbursements of public funds must be covered by the corresponding appropriation as required by law. The functions and public services rendered by the State cannot be allowed to be paralyzed or disrupted by the diversion of public funds from their legitimate and specific objects, as appropriated by law. Moreover, it is settled jurisprudence that upon determination of State liability, the prosecution, enforcement or satisfaction thereof must still be pursued in accordance with the rules and procedures laid down in P.D. No. 1445[,] otherwise known as the Government Auditing Code of the Philippines (Department of Agriculture [vs.] NLRC, 227 SCRA 693, 701-02 [1993] citing Republic vs. Villasor, 54 SCRA 84 [1973]). All money claims against the Government must first be filed with the Commission on Audit which must act upon it within sixty days. Rejection of the claim will authorize the claimant to elevate the matter to the Supreme Court on certiorari and in effect sue the State thereby (P.D. 1445, Sections 49-50)[.]
Endnotes:
1Rollo (G.R. No. 187257), p. 1531, Regional Trial Court Decision in Civil Case No. Q-07-61728.
2 Id.
3 Id. at 1552.
4 An Act Creating the "National Power Corporation," Prescribing its Powers and Activities, Appropriating the Necessary Funds Therefor, and Reserving the Unappropriated Public Waters for its Use (1936).
5 Com. Act No. 120 (1936), sec. 5 provides:
....
The duties and powers as well as the compensation of the said officers and employees shall be such as may be defined and prescribed or fixed by the National Power Board: Provided, That no additional compensation shall be given to any officer or employee of the Commonwealth or any of its political subdivisions or of any public or semi-public corporation, who may be designated to perform additional duties in the Corporation[.]
6 A Decree Revising the Position Classification and Compensation Systems in the National Government, and Integrating the Same (1976).
7 Pres. Decree No. 985 (1976), sec. 2 provides:
Section 2. Declaration of Policy. It is hereby declared to be the policy of the national government to provide equal pay for substantially equal work and to base differences in pay upon substantive differences in duties and responsibilities, and qualification requirements of the positions. In determining rates of pay, due regard shall be given to, among others, prevailing rates in private industry for comparable work. For this purpose, there is hereby established a system of compensation standardization and position classification in the national government for all departments, bureaus, agencies, and offices including government-owned or controlled corporations and financial institutions: Provided, That notwithstanding a standardized salary system established for all employees, additional financial incentives may be established by government corporation and financial institutions for their employees to be supported fully from their corporate funds and for such technical positions as may be approved by the President in critical government agencies. (Emphasis supplied)
8 Authorizing the Implementation of Standard Compensation and Position Classification Plans for the Infrastructure/Utilities Group of Government Owned or Controlled Corporations (1979).
9See L.O. Impl. No. 97, second whereas clause and no. 1(b).
10Rollo (G.R. No. 187257), p. 1569, Notice of Position Allocation and Salary Adjustment.
11 Rep. Act No. 6758(1989), sec. 23.
12See Rep. Act No. 6758 (1989), sec. 4.
13 Rep. Act No. 6758 (1989), sec. 12.
14Rollo (G.R. No. 187257), pp. 482-492.
15See NAPOCOR Employees Consolidated Union (NECU) v. National Power Corporation (NPC), 519 Phil. 372, 377-378 (2006) [Per J. Garcia, En Banc].
16 Rep. Act No. 7648 (1993), sec. 5.
17 Directing and Authorizing the Upgrading of Compensation of Personnel of the National Power Corporation at Rates Comparable with those Prevailing in Privately-Owned Power Utilities and for Other Purposes (1994).
18 Memo. Order No. 198 (1994), sec. 10.
19 355 Phil. 584 (1998) [Per J. Purisima, En Banc].
20 Id. at 589-591.
21Philippine Ports Authority (PPA) Employees Hired After July 1, 1989 v. Commission on Audit, 506 Phil. 382, 390-391 (2005) [Per Acting C.J. Panganiban, En Banc].
22 506 Phil. 382 (2005) [Per Acting C.J. Panganiban, En Banc].
23 Id. at 389.
24 Id. at 390.
25Rollo (G.R. No. 187257), p. 1531, Regional Trial Court Decision in Civil Case No. Q-07-61728.
26 Id.
27 Id.
28 Id. at 1532.
29 Id. The Committee was composed of the President, Vice President of Human Resources and Finance, General Counsel, and Senior Department Managers of Human Resources and Internal Audit.
30 Id.
31 Id.
32 Id.
33 Id.
34 Id.
35 Id. at 1533-1534.
36 Id. at 1534.
37 Id. at 1535.
38 Id. at 1537.
39 Id.
40 Id. at 1538.
41 Id.
42 Id.
43 Id. at 1530-1553. The Decision was penned by Presiding Judge Luisito G. Cortez.
44 Id. at 1542.
45 572 Phil. 383 (2008) [Per J. R. T. Reyes, Third Division].
46Rollo (G.R. No. 187257), p. 1544, Regional Trial Court Decision in Civil Case No. Q-07-61728.
47 Id. at 1552-1553.
48 Id. at 1515, Regional Trial Court Joint Order in Civil Case No. Q-07-61728.
49 Id. at 1515 and 1519.
50 Id. at 1515-1517 and 1519.
51 Id. at 1515-1529. The Joint Order was penned by Presiding Judge Luisito G. Cortez.
52 Id. at 1527-1528.
53 Id. at 1522.
54 Id. at 1523-1524.
55 Id. at 1526-1527.
56 Id. at 1527-1528.
57 Id. at 1560-1563.
58 Id. at 1554-1557.
59 Id. at 7-68.
60Rollo (G.R. No. 187776), pp. 3-A, Petition for Certiorari and Prohibition.
61 Id. at 2-42.
62Rollo (G.R. No. 187257), pp. 576-579.
63 Id. at 581-582.
64 Id. at 583-585.
65Rollo (G.R. No 187359), pp. 3-59.
66 Id. at 55.
67 Id. at 48-55.
68Rollo (G.R. No. 187420), pp. 3-34.
69 Id. at 4.
70 Id. at 3.
71Rollo (G.R. No. 187776), pp. 149-150.
72Rollo (G.R. No. 187257), pp. 1115-A-1115-B.
73Rollo (G.R. No. 187359), pp. 645-651.
74 Id. at 649. G.R. No. 156208 is entitled NPC Drivers and Mechanics Association, et al. v. National Power Corporation, et al.
75Rollo (G.R. No. 187257), pp. 1581-1582.
76 Id. at 1582.
77Rollo (G.R. No. 187776), pp. 428-429.
78 Id. at 422-425.
79Rollo (G.R. No. 187257), p. 1314, Office of the Solicitor General's Memorandum.
80 Id.
81 Id. at 1315.
82 Id. at 1317.
83 Id. at 1321-1322.
84 Id. at 1504, Department of Budget and Management's Memorandum.
85 Id. at 1506.
86 Id. at 1502-1503.
87 Id. at 1387, Workers' Consolidated Memorandum.
88 Id. at 1392.
89 Id. at 1390.
90 Id. at 1382-1383.
91 Id. at 1417.
92 Id. at 1393.
93 Rep. Act No. 6758 (1989), sec. 12 provides:
Section 12. Consolidation of Allowances and Compensation. - All allowances, except for representation and transportation allowances; clothing and laundry allowances; subsistence allowance of marine officers and crew on board government vessels and hospital personnel; hazard pay; allowances of foreign service personnel stationed abroad; and such other additional compensation not otherwise specified herein as may be determined by the DBM, shall be deemed included in the standardized salary rates herein prescribed. Such other additional compensation, whether in cash or in kind, being received by incumbents only as of July 1, 1989 not integrated into the standardized salary rates shall continue to be authorized.
Existing additional compensation of any national government official or employee paid from local funds of a local government unit shall be absorbed into the basic salary of said official or employee and shall be paid by the National Government.
94Rollo (G.R. No. 187257), pp. 1293-1294, Office of the Solicitor General's Memorandum.
95 630 Phil. 1, 16-17 (2010) [Per J. Abad, En Banc].
96Rollo (G.R. No. 187257), pp. 1294-1295, Office of the Solicitor General's Memorandum.
97 Id. at 1296.
98 519 Phil. 372, 384-387 (2006) [Per J. Garcia, En Banc].
99Rollo (G.R. No. 187257), pp. 1299--1302, Office of the Solicitor General's Memorandum.
100 Id. at 1306-1311.
101 Id. at 1311-1313.
102 Id. at 1484-1488, Department of Budget and Management's Memorandum.
103 Id. at 1488-1490.
104 Id. at 1491.
105 Id. at 1494-1495.
106 Id. at 1495-1496.
107 Id. at 1496.
108 Id. at 1496-1498.
109 Id. at 1499-1502.
110 Id. at 1499.
111 Id. at 1500.
112 Id. at 1500-1502.
113 Id. at 1378, Workers' Consolidated Memorandum.
114 Id. at 1380-1381.
115 Id. at 1446, Workers' Supplemental/Reply Memorandum.
116 Id. at 1445-1446.
117 Id. at 1458.
118 Id. at 1416-1417, Workers' Consolidated Memorandum.
119 1987 ADM. CODE (1987), book IV, title III, chap. 12, sec. 35.
120 352 Phil. 424 (1998) [Per J. Kapunan, En Banc].
121 Id. at 431-432, citing Pres. Decree No. 478 (1974), sec. 1, 1987 ADM. CODE, book IV, title III, chap. 12, sec. 35, Sec. Orbos of the Department of Transportation and Communications v. Civil Service Commission, 267 Phil. 476, 483-484 (1990) [Per J. Gancayco, En Banc], Martinez v. Court of Appeals, 307 Phil. 592, 601 (1994) [Per C.J. Narvasa, Second Division].
122 282 Phil. 858 (1992) [Per J. Romero, En Banc].
123 Id. at 889-891.
124Rollo (G.R. No. 187257), p. 1535, Regional Trial Court Decision in Civil Case No. Q-07-61728.
125 Id. at 1522, Regional Trial Court Joint Order in Civil Case No Q-07-61728
126 Id.
127See NAPOCOR Employees Consolidated Union (NECU) v. National Power Corporation (NPC), 519 Phil. 372, 375 (2006) [Per J. Garcia, En Banc].
128Rollo (G.R. No. 187257), p. 1536, Regional Trial Court Decision in Civil Case No. Q-07-61728.
129 Id. at 1515, Regional Trial Court Joint Order in Civil Case No. Q-07-61728.
130See RULES OF COURT, Rule 15, sec. 4 provides:
RULE 15. Motions
....
SECTION 4. Hearing of Motion. - Except for motions which the court may act upon without prejudicing the rights of the adverse party, every written motion shall be set for hearing by the applicant.
Every written motion required to be heard and the notice of the hearing thereof shall be served in such a manner as to ensure its receipt by the other party at least three (3) days before the date of hearing, unless the court for good cause sets the hearing on shorter notice.
131Nuñez v. GSIS Family Bank, 511 Phil. 735, 747-748 (2005) [Per J. Carpio Morales, Third Division].
132Laude v. Ginez-Jabalde, G.R. No. 217456, November 24, 2015, 775 SCRA 408, 426 [Per J. Leonen, En Banc].
133Rollo (G.R. No. 187257), p. 1523, Regional Trial Court Joint Order in Civil Case No. Q-07-61728.
134 Rules of Court, Rule 41, sec. 2(a).
135 RULES OF COURT, Rule 41, sec. 2(b) and Rule 42, sec. 1.
136 RULES OF COURT, Rule 41, sec. 2(c) and Rule 45, sec. 1.
137Republic v. Malabanan, et al., 646 Phil. 631, 638 (2010) [Per J. Villarama, Jr., Third Division], citing Leoncio, et al. v. Vera, et al., 569 Phil. 512, 516 (2008) [Per J. Nachura, Third Division], which cited Binay v. Odeña, 551 Phil. 681, 689 (2007) [Per J. Nachura, En Banc] and Velayo-Fong v. Spouses Velayo, 539 Phil. 377, 386-387 (2006) [Per J. Austria-Martinez, First Division]. See also Century Iron Works, Inc., et al. v. Bañas, 711 Phil. 576, 585-586 (2013) [Per J. Brion, Second Division] and Tongonan Holdings and Development Corporation v. Ally. Escaño, Jr., 672 Phil. 747, 756 (2011) [Per J. Mendoza, Third Division].
138 RULES OF COURT, Rule 34, sec. 1.
139Rollo (G.R. No. 187257), pp. 1542-1543, Regional Trial Court Decision in Civil Case No. Q-07-61728.
140 Id. at 1535-1536. The OSG filed its Motion To Withdraw as Counsel for Respondents and For Leave to Intervene as the People's Tribune on June 11, 2008. It filed its Comment/Opposition to the Motion for Judgment on the Pleadings on June 12, 2008.
141 Further Rationalizing the System of Compensation and Position Classification in the National Government (1978).
142 Pres. Decree No. 1597 (1978), sec. 5.
143Ambros v. Commission on Audit, 501 Phil. 255, 279 (2005) [Per J. Callejo, Sr., En Banc].
144See Maritime Industry Authority v. Commission on Audit, G.R. No. 185812, January 13, 2015, 745 SCRA 300, 319 [Per J. Leonen, En Banc].
145Maritime Industry Authority v. Commission on Audit, G.R. No. 185812, January 13, 2015, 745 SCRA 300, 321 [Per J. Leonen, En Banc].
146 Rep. Act No. 6758 (1989), sec. 12.
147See Maritime Industry Authority v. Commission on Audit, G.R. No. 185812, January 13, 2015, 745 SCRA 300, 334-335 [Per J. Leonen, En Banc].
148De Jesus v. Commission on Audit, 355 Phil. 584, 587 (1998) [Per J. Purisima, En Banc].
149Rollo (G.R. No. 187257), p. 483, Department of Budget and Management Corporate Compensation Circular No. 10.
150De Jesus v. Commission on Audit, 355 Phil. 584, 587 (1998) [Per J. Purisima, En Banc]
151 Id.
152 Id. at 590-591.
153Philippine Ports Authority (PPA) Employees Hired After July 1, 1989 v. Commission on Audit, 506 Phil. 382, 385 (2005) [Per Acting C.J. Panganiban, En Banc].
154 Id.
155 Id. at 389-390, citing Philippine National Bank v. Palma, 503 Phil. 917 (2005) [Per J. Panganiban, Third Division].
156Metropolitan Waterworks and Sewerage System v. Bautista, et al., 572 Phil. 383, 403-407 (2008) [Per J. R. T. Reyes, Third Division].
157NAPOCOR Employees Consolidated Union (NECU) v. National Power Corporation (NPC), 519 Phil. 372, 382 (2006) [Per J. Garcia, En Banc].
158 Id. at 383.
159 Id. at 388-389.
160See NAPOCOR Employees Consolidated Union (NECU) v. National Power Corporation (NPC), 519 Phil. 372, 382 (2006) [Per J. Garcia, En Banc].
161 The term "wage distortion" is defined in Rep. Act No. 6727 (1989) as "a situation where an increase in prescribed wage rates results in the elimination or severe contraction of intentional quantitative differences in wage or salary rates between and among employee groups in an establishment as to effectively obliterate the distinctions embodied in such wage structure based on skills, length of service, or other logical bases of differentiation."
162See Carpio Morales v. Court of Appeals (Sixth Division), G.R. Nos. 217126-27, November 10, 2015, 774 SCRA 431 [Per J. Perlas-Bernabe, En Banc], on our abandonment of the condonation doctrine.
163Rollo (G.R. No. 187257), pp. 507-508.
164 Id. at 508.
165 Id. at 673.
166 Id. The date refers to the date of notarization.
167 Id.
168 Id. at 680-681.
169 Id.
170 Id. at 678-679.
171 Id.
172 Id. at 1569-1571. NAPOCOR Employees Consolidated Union (NECU) v. National Power Corporation (NPC), 519 Phil. 372, 385 (2006) [Per J. Garcia, En Banc] cited the same NPASA in its Decision.
173 Id. at 1569.
174NAPOCOR Employees Consolidated Union (NECU) v. National Power Corporation (NPC), 519 Phil. 372, 385-386 (2006) [Per J. Garcia, En Banc], citing Philippine Ports Authority v. Commission on Audit, 289 Phil. 266, 274 (1992) [Per J. Gutierrez, Jr., En Banc].
175 630 Phil. 1 (2010) [Per J. Abad, En Banc].
176 Id. at 17, citing Bureau of Fisheries and Aquatic Resources (BFAR) Employees Union, Regional Office No. VII, Cebu City v. Commission on Audit, 584 Phil. 132, 140 (2008) [Per C.J. Puno, En Banc], THE NEW OXFORD AMERICAN DICTIONARY (Oxford University Press, 2005), and WEBSTER'S THIRD NEW INTERNATIONAL DICTIONARY (Merriam-Webster Inc., 1993).
177See RULES OF COURT, Rule 65, sec. 3 and NAPOCOR Employees Consolidated Union (NECU) v. National Power Corporation (NPC), 519 Phil. 372, 389-390 (2006) [Per J. Garcia, En Banc].
178Rollo (G.R. No. 187257), pp. 1572-1573.
179 Id. at 1575, National Power Corporation President Cyril C. del Callar's letter dated October 9, 2007.
180 Id. at 1577-1578, National Power Corporation's Memorandum dated May 2, 2007.
181 Id. at 1574-1575.
182 Id. at 482. Department of Budget and Management Corporate Compensation Circular No. 10, item 1.0 states:
1.0 PURPOSEThis Circular is being issued in compliance with Section 23 of R.A. No. 6758, entitled, "An Act Prescribing A Revised Compensation and Position Classification System In the Government and For Other Purposes," mandating the Department of Budget and Management (DBM) to prepare and issue the necessary guidelines to implement the mandate of said law within sixty (60) days after its approval.
183 Memo. Order No. 198 (1994), sec. 2.1.2.
184Rollo (G.R. No. 187257), pp. 339-348.
185 Id. at 343.
186 Id. at 344.
187 Id. at 351-359.
188 Id. at 353.
189 Id. at 354.
190 CONST., art. IX(B), sec. 8 provides:
ARTICLE IX. Constitutional Commissions
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B. The Civil Service Commission
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SECTION 8. No elective or appointive public officer or employee shall receive additional, double, or indirect compensation, unless specifically authorized by law, nor accept without the consent of the Congress, any present, emolument, office, or title of any kind from any foreign government. Pensions or gratuities shall not be considered as additional, double, or indirect compensation.
191See RULES OF COURT, Rule 39, sec. 1, which provides:
RULE 39. Execution, Satisfaction and Effect of Judgments
SECTION 1. Execution Upon Judgments or Final Orders. — Execution shall issue as a matter of right, or motion, upon a judgment or order that disposes of the action or proceeding upon the expiration of the period to appeal therefrom if no appeal has been duly perfected.
192See RULES OF COURT, Rule 41, sec. 3.
193See RULES OF COURT, Rule 42, sec. 1.
194See RULES OF COURT, Rule 45, sec. 2.
195See RULES OF COURT, Rule 65, sec. 4.
196Rollo (G.R. No. 187257), pp. 1560-1563.
197 Id. at 1554-1556.
198 Id. at 1525, Regional Trial Court Joint Order in Civil Case No. Q-07-61728.
199 Id. at 1526.
200 Id.
201 Establishing a Procedure for the Preparation and Approval of the Operating Budgets of Government Owned or Controlled Corporations (1979).
202 Department of Energy Act of 1992.
203See Rep. Act No. 7638, chap. III, sec. 13 provides:
CHAPTER III. ATTACHED AGENCIES AND CORPORATIONS
Section 13. Attached Agencies and Corporations. - The Philippine National Oil Company (PNOC), the National Power Corporation (NPC), and the National Electrification Administration (NEA) are hereby placed under the supervision of the Department, but shall continue to perform their respective functions insofar as they are not inconsistent with this Act. Their annual budget shall be submitted to Congress for approval. The Secretary shall, in a concurrent capacity, be the ex officio chairman of the respective boards of the PNOC, NPC, and NEA, unless otherwise directed by the President: Provided, That in no case shall the Secretary be the chief executive officer or chief operating officer of the said agencies or their subsidiaries, any law to the contrary notwithstanding. (Emphasis supplied)
204Rollo (G.R. No. 187257), p. 1524, Regional Trial Court Joint Order in Civil Case No. Q-07-61728.
205 Pres. Decree No. 1445 (1978).
206 The Administrative Circular was dated October 25, 2000.
207 555 Phil. 74 (2007) [Per J. Austria-Martinez, Third Division].
208 Id. at 83-86.