Including COLA in State Workers' Salary Legal - SC

Manila Bulletin, March 23, 2010 | Go to article overview

Including COLA in State Workers' Salary Legal - SC


The Supreme Court has unanimously affirmed the legality of two circulars of the Department of Budget Management (DBM) that integrated the cost of living allowances (COLA) into the basic salary of government workers.The circulars – the National Compensation Circular (NCC) 59 and Corporate Compensation Circular (CCC) 10 – were issued in 1989 in line with the implementation of Republic Act 6758 or the Salary Standardization Law.In a 23-page decision penned by Associate Justice Roberto A. Abad, the High Court said it found the inclusion of COLA in the standardized salary rates of civil servants proper.The court said RA 6758 did not bar the DBM from identifying for the purpose of implementation what fell into the class of “all allowances.” RA 6758 was enacted to rationalize the compensation of government employees.Its Section 12 directed the consolidation of allowances and additional compensation already being enjoyed by employees into their standardized salary rates.The law, however, exempted certain additional compensations like 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 other additional compensation that may be determined by the DBM.The court said the law clearly authorized the DBM to promulgate rules and regulations identifying those excluded benefits.“This leads to the inevitable conclusion that until and unless the DBM issues such rules and regulations, the enumerated exclusions… remain exclusive. Thus so, not being an enumerated exclusion, COLA is deemed already incorporated in the standardized salary rates of government employees under the general rule of integration,” the court said.Besides COLA, the DBM also included into the standardized salary rates of state workers the inflation connected allowance (ICA); subsistence allowance; emergency allowance; additional compensations of public health nurses, rural health physicians and nurses in Malacañang clinic; nurses allowance in the Air Transportation Office, assignment allowance of school superintendents, and allowance of postal service office employees.The court said it cannot exclude COLA from the list of allowances included into the standardized rates for state workers since it 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. …

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Including COLA in State Workers' Salary Legal - SC
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