SC disallows release of COLA, amelioration back pay for NAPOCOR employees

SC disallows release of COLA, amelioration back pay for NAPOCOR employees

MANILA — The Supreme Court (SC) on Tuesday junked the petition of employees of the National Power Corporation (NAPOCOR) seeking the back payment of additional Cost of Living Allowance (COLA) and Amelioration Allowance (AA) worth PHP8 billion to the agency’s personnel from July 1, 1989 to March 16, 1999.

In a 44-page decision dated Feb. 7, 2017 and penned by Associate Justice Marivic M.V.F. Leonen, the SC sitting in full court reversed the decision of the Quezon City Regional Trial Court Branch 84 compelling NAPOCOR to release COLA and AA of NAPOCOR employees and granted the petition for Certiorari and Prohibition filed by the Office of the Solicitor General (OSG) on the matter.

“Wherefore, the petitions for certiorari and prohibition…are granted. The decision dated November 28, 2008, joint order dated March 20, 2009, and writ of execution dated March 23, 2009 of the [RTC] of Quezon City, Branch 84…vacated and set aside. The Temporary Restraining Order [TRO] dated April 15, 2009 is made permanent. So ordered,” read the decision.

Acting on the petition filed by the OSG, the SC stressed that COLA and AA of the employees were integrated with the salaries of the employees, after the promulgation of Republic Act 6758.

“Republic Act No. 6758 remained effective during the period of ineffectivity of DBM-CCC No. 10. 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 R.A. 6758,” the SC said.

“To grant any back payment of COLA and AA despite their factual integration into the standardized salary would cause salary distortions in the Civil Service. It would also provide unequal protection to those employees whose COLA and AA were proven to have been factually discontinued from the period of R.A. 6758’s effectivity,” the SC said.

The case stemmed from the Petition for Mandamus filed by Abner P. Eleria, president of NAPOCOR Employees Consolidated Union (NECU), and Melito B. Lupanggo, president of NAPOCOR Employees and Workers Union (NEWU) before Quezon City Regional Trial Court (RTC) Branch 84.

Eleria and Lupanggo sought the court to compel NAPOCOR to release the COLA and AA worth P6,496,055,339,98 on Dec. 28, 2007, and legal interest worth P704,777,508.60 as legal interest.

It sought to direct the NAPOCOR, its President and its Board of Directors to release and pay the COLA and AA to all NAPOCOR employees.

On Aug. 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.

The law applied to all positions, whether appointive or elective, including those in government-owned and controlled corporations.

It also provided that all allowances and other additional compensation not otherwise stated “shall be deemed included” in the prescribed standardized salary rates.

On Nov. 28, 2008, the RTC rendered its decision in favor of NECU and NEWU.

According to the trial court, the determination of whether the COLA and AA had been factually integrated was already resolved when the

NAPOCOR Committee certified that the COLA and AA of the employees from July 1, 1989 to Dec. 31, 1993 were not factually integrated into their standardized salaries.

The trial court also cited “De Jesus, Philippine Ports Authority (PPA) Employees Hired After July 1, 1989, and Metropolitan Waterworks and Sewerage.”

On April 14, 2009, the Office of the Solicitor General (OSG) filed a very urgent plea for a TRO to enjoin the implementation of the trial court’s November 28, 2008 decision.

Thus, in a resolution dated April 15, 2009, the SC issued a TRO against the writ of execution until the case was brought again before the high court.

The SC recalled: “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.”

The said law covers all public positions, including appointive and elective positions and those in government-owned and controlled corporations. The law also provided that all allowances and other compensation not otherwise stated ‘shall be deemed included’ in the prescribed standardized salary rates.” Christopher Lloyd Caliwan/PNA