G.R. No. 192836 & G.R. No. 194889. November 29, 2022.
THE PHILIPPINE PORTS AUTHORITY, PETITIONER, VS. PAMBANSANG TINIG AT LAKAS NG PANTALAN (PANTALAN), ET AL., RESPONDENTS. [G.R. No. 194889] SAMAHANG MANGGAGAWA SA PALIPARAN NG PILIPINAS, PETITIONER, VS. MANILA INTERNATIONAL AIRPORT AUTHORITY, ET AL., RESPONDENTS.

FACTS

These consolidated petitions involve claims for Cost of Living Allowance (COLA) and amelioration allowance by employees of the Philippine Ports Authority (PPA) and the Manila International Airport Authority (MIAA). Prior to 1989, both government corporations paid these allowances separately. Payment was discontinued upon the effectivity of Republic Act No. 6758 (the Compensation Standardization Law) and its implementing rules, DBM Corporate Compensation Circular (CCC) No. 10, which deemed such allowances integrated into the standardized basic salary. In De Jesus v. COA, the Supreme Court initially declared CCC No. 10 unenforceable for lack of publication, leading to the payment of back allowances. Upon CCC No. 10’s proper publication in 1999, PPA and MIAA again ceased separate payments.
The employee unions, Pantalan and SMPP, filed separate petitions for mandamus. They argued that the allowances were not “actually integrated” into their basic salaries and sought payment of differentials from July 1999 onward. They contended that integration required a positive act of appropriation and addition to their pay. PPA and MIAA countered that RA 6758 and the published CCC No. 10 provided for automatic integration by operation of law, requiring no further corporate act.

ISSUE

Whether the Cost of Living Allowance and amelioration allowance granted to employees of government-owned or controlled corporations (GOCCs) prior to RA 6758 must be “actually integrated” into their basic salaries through a positive act of the governing board, or whether such integration is automatic by operation of law upon the effectivity of the standardized system.

RULING

The Supreme Court ruled in favor of PPA and MIAA, holding that integration is automatic by operation of law. The Court reversed the decisions of the Court of Appeals which had granted the writs of mandamus. The legal logic is anchored on the clear policy and provisions of RA 6758. The law’s primary objective is to standardize compensation across the public sector, prescribing a unified basic salary that subsumes all existing allowances, with specific statutory exceptions not applicable here. The Court emphasized that the law itself effects the integration; it is not contingent upon a subsequent implementing act by the individual GOCC.
The Court clarified that the “deemed integrated” clause in Section 12 of RA 6758 and the corresponding provisions in the duly published DBM CCC No. 10 are self-executing. The standardized salary prescribed by law is conclusively presumed to already include the previously separate allowances. Therefore, employees are not entitled to receive these allowances on top of their standardized basic salary. Mandamus does not lie to compel a discretionary act or to enforce a supposed right that does not exist under the law. Since the law automatically integrated the allowances into the basic salary, the GOCCs had no ministerial duty to perform a separate act of integration or to pay additional differentials. The claim for separate payment contravenes the very essence of the standardization law.