AN ACT PRESCRIBING A REVISED COMPENSATION AND POSITION CLASSIFICATION SYSTEM IN THE GOVERNMENT AND FOR OTHER PURPOSES

Case Overview and Summary

Title: Compensation and Position Classification Act of 1989

Statement of Policy (Section 2):
- Provide equal pay for substantially equal work and base pay differences on duties, responsibilities, and qualifications.
- Establish a unified Compensation and Position Classification System for all government entities.

General Provisions (Section 3):
- Pay just and equitable wages with reasonable ratio between higher and lower ranks.
- Compensation comparable to private sector for similar work.
- Maintain reasonable total compensation in proportion to national budget.
- Periodically review compensation rates.

Coverage (Section 4):
- Applies to all positions, appointive or elective, full or part-time, in the government, government-owned or controlled corporations, and financial institutions.
- Defines "government" and "government-owned or controlled corporations and financial institutions".

Position Classification System (Section 5):
- Categorizes positions into professional supervisory, professional non-supervisory, sub-professional supervisory, and sub-professional non-supervisory.
- Defines each category and assigns corresponding salary grades.

Index of Occupational Services, Position Titles and Salary Grades (Section 6):
- All positions shall be allocated to proper titles and salary grades per the Index prepared by DBM.

Salary Schedule (Section 7):
- Prescribes a salary schedule with 33 salary grades and corresponding monthly rates.
- DBM to update the schedule for across-the-board adjustments.
- Daily wage rate determined by dividing monthly rate by 22 working days.

Salaries of Constitutional Officials and Equivalents (Section 8):
- Specifies salary grades for President, Vice President, Senate President, Speaker, Chief Justice, Senators, Representatives, Associate Justices, and Constitutional Commission officials.
- Authorizes DBM to determine equivalent ranks and assign same salary grades based on guidelines.
- Defers implementation for certain officials until specified dates.

Salary Grade Assignments for Other Positions (Section 9):
- DBM to prepare Index of Occupational Services guided by Benchmark Position Schedule and factors like education, experience, work complexity, supervision, decision-making, etc.
- Provides Benchmark Position Schedule with position titles and corresponding salary grades.
- Limits compensation of heads and board of directors of government corporations to Salary Grade 30, with exceptions.

Local Government Units (Section 10):
- Pay rates in LGUs determined based on class and financial capability, not exceeding prescribed percentages of national rates.

Military and Police Personnel (Section 11):
- Base pay per salary schedule in R.A. No. 6638 and R.A. No. 6648.
- Longevity pay per R.A. No. 6638, R.A. No. 1134 as amended, and R.A. No. 6648.
- Existing allowances like cost of living, quarters, subsistence, clothing, hazard pay, etc. continue.

Consolidation of Allowances and Compensation (Section 12):
- Most allowances deemed included in standardized salary rates, except representation, transportation, clothing, subsistence for marine/hospital personnel, hazard pay, foreign service allowances, and others determined by DBM.
- Existing additional compensation as of July 1, 1989 continues.
- Additional compensation from LGU funds absorbed into basic salary paid by National Government.

Pay Adjustments (Section 13):
- No pay reduction if moved to lower class, unless disciplinary action or voluntary demotion.
- Effective January 1, 1990, step increments based on merit and/or length of service per DBM and CSC rules.

Administration of Compensation and Position Classification System (Section 14):
- DBM to administer and revise the System as necessary.

Repeal of Special Salary Laws and Regulations (Section 16):
- Repeals laws, decrees, orders, charters, and issuances inconsistent with the System or authorizing separate compensation schemes.

Salaries of Incumbents (Section 17):
- Incumbents receiving higher compensation than standardized rate continue receiving excess as "transition allowance".
- Transition allowance treated as basic salary for retirement pay, bonuses, etc.
- Computation of first salary adjustment based on 90% of present compensation or standardized rate, whichever is higher.

Additional Compensation of COA Personnel and Other Agencies (Section 18):
- COA officials and employees prohibited from receiving compensation from other government entities to preserve independence and integrity.
- Government entities prohibited from billing others for services to pay additional compensation.

Funding Sources (Section 19):
- For national government entities: appropriations, savings from departments/agencies, and annual General Appropriations Act.
- For LGUs: respective funds, partial implementation allowed with Joint Commission approval, and NALGU savings.
- For government corporations: respective corporate funds.

Other Provisions:
- Separability clause (Section 20).
- Applicability of P.D. No. 985 as amended by P.D. No. 1597 (Section 21).
- Repealing clause (Section 22).
- Effectivity on July 1, 1989, with DBM to allocate positions and issue guidelines within 60 days (Section 23).