Stimulus

As usual, the government’s plan to set up a stimulus package for pump priming our economy and cushioning the impact of the global financial meltdown has become controversial. Critics once more express fears that it may just be another political gimmick in preparation for the coming 2010 elections. And since the funds for the package involves billions of pesos, their source and their possible dissipation in the hands of the package handlers have also become a growing concern. This concern is heightened even more by the proposal to use the private funds of the private employees in the SSS for the stimulus package.

If the government is really sincere on this plan, there is one move it can immediately undertake akin to the US grant of long withheld benefits to Fil-American veterans of World War II. This is a move already sanctioned by the Supreme Court (SC) in several cases. But it remains unheeded because of the continuing misinterpretation or stubborn insistence on a wrong interpretation of said SC decisions that spawned other numerous litigations now still pending. It will not only cushion the adverse impact of the ongoing global financial crises but also rectify an injustice committed against hundreds of thousands and maybe millions of employees of the national and local governments and their branches and instrumentalities some of whom have already retired or died.

To be sure the move will just correct the error committed by the government itself particularly the Department of Budget and Management (DBM) when it implemented the Salary Standardization Law (R.A. 6758) by issuing circulars that were not published. As the SC said, these (circulars) “which completely disallows payment of allowances and other additional compensation to government officials and employees” are something more than “mere interpretative or internal regulation” as they “tend to deprive government workers of their allowances and additional compensation sorely needed to keep body and soul together”. So “at the very least the government officials and employees concerned should be apprised and alerted by their publication in the Official Gazette (OG) or in a newspaper of general circulation in the Philippines—to the end that they may be given ample opportunity to voice out whatever opposition they may have and to ventilate their stance on the subject matter (De Jesus vs. COA, G.R. 109023, August 12, 1998).

The circulars in question are DBM-Corporate Compensation Circular (DBM-CCC) No. 10 dated October 2, 1989 covering employees of Government Owned and Controlled Corporations (GOCCs) and Government Financial Institutions (GFIs), and DBM National Compensation Circular (DBM-NCC) No. 59 dated September 30, 1989 that applies to employees of Local Government Units (LGUs), National Government Agencies (NGAs), Congress, Judiciary and State Colleges and Universities. DBM-CCC 10 and DBM-NCC 59 declared that Cost of Living Allowances (COLA), Amelioration Allowances (AA), Equity Allowance (EA) and other additional compensation to government officials and employees are already included in their salaries that have been standardized pursuant to R.A. 6758. Hence effective November 1, 1989 payment of said allowances had been stopped.

But on August 12, 1998, the SC nullified DBM CCC 10 for lack of publication. It was published only on March 19, 1999. In a subsequent case (PPA vs. COA, G.R. 160396, September 6, 2005) the SC stressed with clarity and certainty that between the date of its issuance on October 2, 1989 and its publication on March 19, 1999, when DBM-CCC 10 was in “legal limbo”, the COLA, AA, EA and other additional compensation of government officials and employees were not effectively integrated into the standardized salaries. Hence the discontinuance of the payment of said allowances starting November, 1, 1989 had no legal basis. This means that government officials and employees were still entitled to and should have been paid their COLA, AA, EA and other additional compensation from the time their payment was stopped on November 1, 1989 up to the time DBM-CCC 10 was published on March 19, 1999.   

When several GOCCs and GFIs, still refused to pay the allowances, the SC again categorically and decisively re-affirmed the De Jesus ruling and forcefully declared in the case of MWSS vs. Bautista, G.R. 171351, March 14, 2008, that “Being ineffective DBM-CCC 10 cannot affect government employees’ entitlement to fringe benefits, allowances and COLA from 1989 to 1999 even without prior determination from DBM on whether or not the COLA was deemed integrated into their salaries… Thus in between these two dates, they were still entitled to receive the allowances. All—not only incumbents as of July 1, 1989 should receive back pay corresponding to said benefits from the time they were discontinued in November 1989 up to the new effective date of DBM-CCC 10—March 16, 1999”.

DBM-NCC 59 on the other hand which applies to officials and employees of LGUs, NGAs, and other branches and instrumentalities of government has features, characters and contents similar to DBM-CCC 10. It also refers to the discontinuance of payments of fringe benefits and allowances being enjoyed by said officials and employees. It was issued two days earlier than DBM-CCC 10 on September 30, 1989 and was not likewise published in the OG or any newspaper of general circulation. It was published only on May 3, 2004. The SC rulings in De Jesus in 1998 down to Bautista in 2008 can therefore be invoked under the doctrine of “Law of the Case” because it involves similar questions of facts and of law. Hence payment of COLA and other allowances to these employees and officials from the time they were erroneously discontinued in November 1989 up to the date of publication of DBM-NCC 59 on May 3, 2004, is proper, legal, fair and just.

To be sure, several GOCCs, GFIs, LGUs, NGAs and other government branches and instrumentalities have already paid these back allowances. But there are many others who remain adamant and continue to deprive their employees of the benefits long due to them. Malacañang and the DBM should step in and issue a circular ordering their payment once and for all; and so with the LGUs. This is the best assistance they can extend to government employees during these hard times. It will also serve as part of economic stimulus which the government has been planning to provide our countrymen in the face of the ongoing global crises.

Note: Books containing compilation of my articles on Labor Law and Criminal Law (Vols. I and II) are now available. Call tel. 7249445. – Jose C. Sison, Philippine Star

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E-mail at: jcson@pldtdsl.net