Salary Standardization Bill raises to 45% all salary grades of gov’t workers

Outgoing Speaker Feliciano Belmonte, Jr. has proposed a new Salary Standardization Law that will result in a weighted average increase of 45 percent in the compensation of all salary grades, and raise compensation of government personnel to at least 70 percent of the private sector rate.

Belmonte, through House Bill 11 or the proposed "Salary Standardization Act of 2016" or "SSL 2016," said the measure will be effected through a combination of a salary increase, a 14th month pay and an enhanced performance-based bonus to be implemented over a four-year period, from January 1, 2016 to January 1, 2019.

"The bill seeks to raise the pay of the government personnel to be competitive with the market rates, strengthen the link between pay and performance through an enhanced performance-based bonus system, temper the cost of benefit while maximizing the benefits of employees, and allow higher take-home pay particularly for government personnel belonging to the lower salary grades," said Belmonte.

In 2009, Belmonte said Congress enacted Joint Resolution No 4 revising the Compensation and Classification System for civilian personnel and base pay of military and uniformed personnel.

Joint Resolution No. 4 mandated the review of the compensation and position classification system after three years from the last year of the adjustment, to determine the competitiveness of government pay in relation to the private sector and the compensation strategy to bring government pay the compensation strategy closer to market rates, according to Belmonte.

Justifying further his proposal, Belmonte said government personnel are given substantial duties and responsibilities, which significantly impact the nation.

"Legislative action is urgently needed to allow the Government of the Republic of the Philippines to attract and retain the services of capable personnel in order to best serve the needs of the Filipino people." said Belmonte.

The proposed Compensation and Position Classification System (CPCS) shall apply to all civilian government personnel in the Executive, Legislative and Judicial Branches, Constitutional Commissions and other Constitutional Offices, government-owned or -controlled corporations (GOCCs) not covered by Republic Act No. 10149, and local government units (LGUs). This shall cover government personnel whether regular, contractual or casual, appointive or elective; and on full-time or part-time basis.

Excluded from coverage of the CPCS are military and uniformed personnel which shall be covered by the provisions of Section 11 hereof; GOCCs under Republic Act No. 10149 which shall be covered by a CPCS established by the Governance Commission for GOCCs (GCG); and individuals whose services are engaged through job orders, contracts of service, consultancy contracts, and service contracts with no employer-employee relationship.

House Bill 11 provides for an equitable compensation in accordance with the principle of equal pay for work of equal value. In pursuing this policy, the State shall ensure that differences in pay shall be based upon substantive differences in duties, responsibilities, accountabilities and qualification requirements of the positions.

Moreover, compensation for all civilian government personnel shall be standardized and rationalized across all government agencies to create an enabling environment that will promote social justice, integrity, efficiency, productivity, accountability and excellence in the civil service.

The total compensation to be given to all civilian government personnel for services rendered shall be limited to basic salaries, including step increments; standard allowances and benefits; specific-purpose allowances and benefits; and incentives and performance-based pay.

It excludes all indirect compensation under existing laws such as, but not limited to life and retirement insurance benefits; employee compensation insurance; health insurance; Pag-Ibig Fund benefits; and Provident Fund benefits.

For this purpose, the Act shall raise the minimum salary for Salary Grade 1 from the current rate of P9,000 to P11,068 to make it even more competitive with the market rates; and bring the compensation of government personnel closer to their private counterparts to at least 70 percent of the market rate for all salary grades.

It shall also ensure that authorized salaries for each of the salary grade allocation of government personnel shall not overlap to recognize differences in duties and responsibilities for the position; and provide for a compensation adjustment partly as basic salary and partly as mid-year 14th month pay to maximize the employees' net take-home pay.

Finally, it shall strengthen the link between government pay and performance by enhancing the performance-based bonus to recognize the government personnel who play a greater role and carry a heavier responsibility in improving performance.

The SSL 2016 shall be implemented in four tranches. On January 1, 2016, the compensation adjustment will be in the form of the first tranche salary increase and a mid-year bonus.

By January 1, 2017, the compensation adjustment will consist of the second tranche salary increase, the mid-year bonus and a 50 percent implementation of the enhanced performance-based bonus.

By January 1, 2018, the compensation adjustment will include the third tranche salary increase, mid-year bonus and the enhanced performance-based bonus.

Finally on January 1, 2019, the full implementation of the SSL 2016 will be composed of the final tranche salary increase, the mid-year bonus and the enhanced performance-based bonus.

Source: The Philippine Information Agency