You are on page 1of 8

Republic of the Philippines

SUPREME COURT
Manila
EN BANC
G.R. No. L-60403 August 3, 1983
ALLIANCE OF GOERNMENT !OR"ERS #AG!$% PN&-FEMA &AN" EMPLO'EES
ASSOCIATION #AG!$% "AISA(AN AT "APATIRAN NG MGA MANGAGA!A AT
"A!ANI NG M!SS #AG!$% &ALARA EMPLO'EES ASSOCIATION #AG!$% GSIS
!OR"ERS ASSOCIATION #AG!$% SSS EMPLO'EES ASSOCIATION #AG!$% PTA
EMPLO'EES ASSOCIATION #AG!$% NATIONAL ALLIANCE OF TEAC(ERS AN)
OFFICE !OR"ERS #AG!$% , petitioners,
vs.
T(E (ONORA&LE MINISTER OF LA&OR *+, EMPLO'MENT, P(ILIPPINE
NATIONAL &AN" #PN&$% METROPOLITAN !ATER!OR"S *+, SE!ERAGE
S'STEM #M!SS$% GOERNMENT SERICE INSURANCE S'STEM #GSIS$% SOCIAL
SECURIT' S'STEM #SSS$% P(ILIPPINE IRGINIA TO&ACCO A)MINISTRATION
#PTA$ P(ILIPPINE NORMAL COLLEGE #PNC$% POL'TEC(NIC UNIERSIT' OF
T(E P(ILIPPINES #PUP$, respondents.
The Solicitor General for MOLE, PNB, SSS, PNC and PUP.
Oliver Gesmundo for etitioners.
!esus C. Gentiles for etitioner SSSE"#"G$.

GUTIERRE-, .R., J.:
Are the branches, agencies, subdivisions, and instrumentalities of the Government,
including government oned or controlled corporations included among the !
"emplo#ers"" under Presidential $ecree No. %&' hich are re(uired to pa# an their
emplo#ees receiving a basic salar# of not more than P',))).)) a month, a thirteenth
*'+th, month pa# not later than $ecember -! of ever# #ear.
Petitioner Alliance of Government /or0ers *AG/, is a registered labor federation hile
the other petitioners are its affiliate unions ith members from among the emplo#ees of
the folloing offices, schools, or government oned or controlled corporations1
'. Philippine National Ban0 *PNB, Escolta 2treet, Manila
-. Metropolitan /ateror0s and 2eerage 2#stem *M/22,
3atipunan Road, Balara, 4ue5on Cit#
+. Government 2ervice 6nsurance 2#stem *G262, Arroceros 2treet,
Manila
!. 2ocial 2ecurit# 2#stem *222, East Avenue, 4ue5on Cit#
&. Philippine 7irginia 8obacco Administration *P78A, Consolacion
Building, Cubao, 4ue5on Cit#
9. Philippine Normal College *PNC, A#ala Boulevard, Manila
:. Pol#technic ;niversit# of the Philippines *P;P, <ippodromo 2treet,
2ta. Mesa, Manila
=n >ebruar# -%, '?%+, the Philippine Government Emplo#ees Association *PGEA, filed
a motion to come in as an additional petitioner.
Presidential $ecree No. %&' provides in its entiret#1
/<EREA2, it is necessar# to further protect the level of real f ages
from the ravage of orld@ide inflationA
/<EREA2, there has been no increase case in the legal minimum
age rates since '?:)A
/<EREA2, the Christmas season is an opportune time for societ# to
sho its concern for the plight of the or0ing masses so the# ma#
properl# celebrate Christmas and Ne Bear.
N=/, 8<ERE>=RE, 6, >ER$6NAN$ E. MARC=2, b# virtue of the
poers vested in me b# the Constitution do hereb# decree as follos1
2EC86=N '. All emplo#ers are hereb# re(uired to pa# all their
emplo#ees receiving a basic salar# of not more than Pl,))) a month,
regardless of the nature of their emplo#ment, a '+th@month pa# not
later than $ecember -! of ever# #ear.
1
2EC86=N -. Emplo#ers alread# pa#ing their emplo#ees a '+th@month
pa# or its e(uivalent are not covered b# this $ecree.
2EC86=N +. 8his $ecree shall ta0e effect immediatel#. $one in the
Cit# of Manila, this '9th da# of $ecember '?:&.
According to the petitioners, P.$. No. %&' re(uires all emlo%ers to pa# the '+th@month
pa# to their emplo#ees ith one sole eCception found in 2ection - hich states that
"*E,mplo#ers alread# pa#ing their emplo#ees a '+th month pa# or its e(uivalent are not
covered b# this $ecree. " 8he petitioners contend that 2ection + of the Rules and
Regulations 6mplementing Presidential $ecree No. %&' included other t#pes of
emplo#ers not eCempted b# the decree. 8he# state that nohere in the decree is the
secretar#, no Minister of Dabor and Emplo#ment, authori5ed to eCempt other t#pes of
emplo#ers from the re(uirement.
2ection + of the Rules and Regulations 6mplementing Presidential $ecree No. %&'
provides1
2ection +. Emplo#ers covered E 8he $ecree shall appl# to all
emplo#ers eCcept to1
a, $istressed emplo#ers, such as *', those hich are currentl#
incurring substantial losses or ''-, in the case of non@profit
institutions and organi5ations, here their income, hether from
donations, contributions, grants and other earnings from an# source,
has consistentl# declined b# more than fort# *!)F, per cent of their
normal income for the last to *-, ,#ears, subGect to the provision of
2ection : of this issuance.
b, 8he Government and an# of its political subdivisions, including
government@oned and controlled corporations, eCcept,t those
corporation, operating essentiall# as private, ,subsidiaries of the
governmentA
c, Emplo#ers alread# pa#ing their emplo#ees '+th@month pa# or more
in a calendar #ear or its e(uivalent at the of this issuanceA
d, Emplo#ers of household helpers and persons in the personal
service of another in relation to such or0ers1 and
e, Emplo#ers of those ho are paid on purel# commission, boundar#,
or tas0 basis and those ho are paid a fiCed for performing a specific
or0, irrespective of the time consumed in the performance thereof,
eCcept here the or0ers are paid an piece@ rate basis in hich case
the emplo#er shall be covered b# this issuance 1insofar ab such
or0ers are concerned ...
8he petitioners assail this rule as ultra vires and void. Citin& Philiine "arel
$or'ers(Union v. N)*C et al., *')9 2CRA !!!,A Teo+on v. Mem,ers of the Board of(
"dministators *++ 2CRA &%&,A Santos u. -on. Esten.o et al., *')? Phil. !'?,A -ilado u.
Collector of )nternal *evenue *')) Phil. -%%,, and Olsen / Co. )nc. v. "ldanese and
Trinidad *!+ Phil. -&?,, the petitioners argue that regulations adopted under legislative
authorit# must be in harmon# ith the provisions of the la and for the sole purpose of
carr#ing into effect its general provisions. 8he# state that a legislative act cannot be
amended b# a rule and an administrative officer cannot change the la. 2ection + is
challenged as a substantial modification b# rule of a Presidential $ecree and an
unlaful eCercise of legislative poer.
=ur initial reaction as to den# due course to the petition in a minute resolution,
hoever, considering the important issues propounded and the fact, that constitutional
principles are involved, e have no decided to give due course to the petition, to
consider the various comments as ansers and to resolve the (uestions raised through
a full length decision in the eCercise of this CourtHs s#mbolic function as an aspect of the
poer of Gudicial revie.
At the outset, the petitioners are faced ith a procedural barrier. 8he petition is one for
declarator# relief, an action not embraced ithin the original Gurisdiction of the 2upreme
Court. **emoti&ue v. Osmena,, !r., -' 2CRA %+:A *ural Ban' of Olon&ao v.
Commission of Land *e&istration, ')- 2CRA :?!A 0e la Llana v. "l,a, ''- 2CRA -?!,.
8here is no statutor# or Gurisprudential basis for the petitionersH statement that the
2upreme Court has original and eCclusive Gurisdiction over declarator# relief suits here
onl# (uestions of la are involved. Iurisdiction is conferred b# la. 8he petitioners have
not pointed to an# provision of the Constitution or statute hich sustains their seeping
assertion. =n this ground alone, the petition could have been dismissed outright.
>olloing similar action ta0en in Nacionalista Part% v. "n&elo Bautista *%& Phil. ')', and
"1uino v. Commission on Elections *9- 2CRA -:&, e have, hoever, decided to treat
the petition as one for mandamus. 8he petition has far reaching implications and raises
(uestions that should be resolved. <ave the respondents unlafull# eCcluded the
petitioners from the use and enGo#ment of rights to hich the# are entitled under the
la.
An anal#sis of the "hereases" of P.$. No. %&' shos that the President had in mind
onl# or0ers in private emplo#ment hen he issued the decree. 8here as no intention
to cover persons or0ing in the government service. 8he decree states1
2
CCC CCC CCC
/<EREA2, there has been no increase in the legal minimum age
rates since '?:)A
CCC CCC CCC
As pointed out b# the 2olicitor General in his comment for the Minister of Dabor and
Emplo#ment, the 2ocial 2ecurit# 2#stem the Philippine Normal College, and
Pol#technic ;niversit#, the contention that govermment oned and controlled
corporations and state colleges and universities are covered b# the term "all emplo#ers"
is belied b# the nature of the '+@ month pa# and the intent behind the decree.
8he 2olicitor General states1
"Presidential $ecree No. %&' is a labor standard la hich re(uires covered emplo#ers
to pa# their emplo#ees receiving not more than P',))).)) a month an additional
thirteenth@month pa#. 6ts purpose is to increase the real age of the or0er *Marcopper
Mining Corp. v. =ple, ')& 2CRA :&A and National >ederation of 2ugar /or0ers v.
=veGera, G.R. No. &?:!+, Ma# +', '?%-, as eCplained in theHhereasHclause hich
read1
/<EREA2, it is necessar# to further protect the
level of real ages from the ravage of orld@ide
inflationA
/<EREA2, there has been no increase in the legal
minimum age rates since '?:)A ''
/<EREA2, the Christmas season is an opportune
time for societ# to sho its concern for the plight of
the or0ing masses so the# ma# celebrate the
Christmas and Ne Bear.
CCC CCC CCC
/hat the P.$. No. %&' intended to cover, as eCplained in the prefator#
statement of the $ecree, are onl# those in the private sector hose
real ages re(uire protection from orld@ide inflation. 8his is
emphasi5ed b# the "hereas" clause hich states that Hthere has
been no increase in the legal minimum age rates since '?:)H. 8his
could onl# refer to the private sector, and not to those in the
government service because at the time of the enactment of
Presidential $ecree No. %&' in '?:&, onl# the emplo#ees in the
private sector had not been given an# increase in their minimum
age. 8he emplo#ees in the government service had alread# been
granted in '?:! a ten percent across@the@board increase on their
salaries as stated in P.$. No. &-&, 2ection !.
Moreover, here emplo#ees in the government service ere to
benefit from labor standard las, their coverage is eCplicitl# stated in
the statute or presidential enactment. 8his is evident in *a,
Presidential $ecree No. +?), 2ec. ' hich granted emergenc# cost of
living alloance to emplo#ees in the national governmentA *b,
Republic Act No. 9''', 2ec. ') on medicare benefitsA *c, Presidential
$ecree No @!!-, 8itle 66, Article ?: on the applicable minimum age
ratesA *d, Presidential $ecree No. !!-, 8itle '', Article '9: *g, on
or0menHs compensationA *e, Presidential $ecree No. ''-+ hich
provides for increases in emergenc# alloance to emplo#ees in the
private sector and in salar# to government emplo#ees in 2ection -
thereofA and *f, ECecutive =rder No. :&- granting government
emplo#ees a #ear@end bonus e(uivalent to one ee0Hs pa#. 8hus, had
the intention been to include government emplo#ees under the
coverage of Presidential $ecree No. %&', said $ecree should have
eCpressl# so provided and there should have been accompan#ing
#earl# appropriation measures to implement the same. 8hat no such
eCpress provision as provided and no accompan#ing appropriation
measure to as passed clearl# sho the intent to eCclude
government emplo#ees from the coverage of P. $. No. %& '.
/e agree.
6t is an old rule of statutor# construction that restrictive statutes and acts hich impose
burdens on the public treasur# or hich diminish rights and interests, no matter ho
broad their terms do not embrace the 2overeign, unless the 2overeign is specificall#
mentioned. *2ee $ollar 2avings Ban0 v. ;nited 2tates, '? /all *;.2., --:A ;nited
2tates v. ;nited Mine /or0ers of America, ++) ;.2. -9&,. 8he Republic of the
Philippines, as sovereign, cannot be covered b# a general term li0e "emplo#er" unless
the language used in the la is clear and specific to that effect.
8he issue raised in this petition, hoever, is more basic and fundamental than a mere
ascertainment of intent or a construction of statutor# provisions. 6t is concerned ith a
revisiting of the traditional classification of government emplo#ment into governmental
functions and proprietar# functions and of the man# ramifications that this dichotomous
3
treatment presents in the handling of concerted activities, collective bargaining, and
stri0es b# government emplo#ees to rest concessions in compensation, fringe
benefits, hiring and firing, and other terms and conditions of emplo#ment.
8he or0ers in the respondent institutions have not directl# petitioned the heads of their
respective offices nor their representatives in the Batasang Pambansa. 8he# have
acted through a labor federation and its affiliated unions. 6n other ords, the or0ers
and emplo#ees of these state firms, college, and universit# are ta0ing collective action
through a labor federation hich uses the bargaining poer of organi5ed labor to secure
increased compensation for its members.
;nder the present state of the la and pursuant to the eCpress language of the
Constitution, this resort to concerted activit# ith the ever present threat of a stri0e can
no longer be alloed.
8he general rule in the past and up to the present is that "the terms and conditions of
emplo#ment in the Government, including an# political subdivision or instrumentalit#
thereof are governed b# la" *2ection '', the 6ndustrial Peace Act, R.A. No. %:&, as
amended and Article -::, the Dabor Code, P.$. No. !!-, as amended,. 2ince the terms
and conditions of government emplo#ment are fi+ed ,% la2, government or0ers cannot
use the same eapons emplo#ed b# or0ers in the private sector to secure
concessions from their emplo#ers. 8he principle behind labor unionism in private
industr# is that industrial peace cannot be secured through compulsion b# la.
Relations beteen private emplo#ers and their emplo#ees rest on an essentiall#
voluntar# basis. 2ubGect to the minimum re(uirements of age las and other labor and
elfare legislation, the terms and conditions of emplo#ment in the unioni5ed private
sector are settled through the process of collective bargaining. 6n government
emplo#ment, hoever, it is the legislature and, here properl# given delegated poer,
the administrative heads of government hich fiC the terms and conditions of
emplo#ment. And this is effected through statutes or administrative circulars, rules, and
regulations, not through collective bargaining agreements.
At the same time, the old 6ndustrial Peace Act eCcepted emplo#ees and or0ers in
proprietar# functions of government from the above compulsion of la. 8hus, in the
past, government emplo#ees performing proprietar# functions could belong to labor
organi5ations imposing the obligation to Goin in stri0es or engage in other concerted
action. *2ection '', R.A. %:&, as amended,. 8he# could and the# did engage in
concerted activities and various stri0es against government oned and controlled
corporations and other government institutions discharging proprietar# functions. Among
the institutions as falling under the eCception in 2ection '' of the 6ndustrial Peace Act
ere respondents Government 2ervice 6nsurance 2#stem *G262EA v. Alvendia, ')%
Phil. &)&, and 2ocial 2ecurit# 2#stem *222EA v. 2oriano, : 2CRA ')'9,. And this
Court has supported labor completel# in the various stri0es and concerted activities in
firms and agencies discharging proprietar# functions because the Constitution and the
las alloed these activities.
8he eCception, hoever belongs to the past.
8he petitioners state in their counter comment filed Iul# -+, '?%- that the '?:+
Constitution is categorical about the grant of the rights to self@ organi5ation and
collective bargaining to all 2or'ers and that no amount of stretched interpretation of
lesser las li0e the Dabor Code and the Civil 2ervice Act can overturn the clear
message of the Constitution ith respect to these rights to self@organi5ation and
collective bargaining.
8hese statements of the petitioners are error insofar as government or0ers are no
concerned.
;nder the present Constitution, govemment@oned or controlled corporations are
specificall# mentioned as embraced b# the civil service. *2ection ', Article J66@B,
Constitution,. 8he inclusion of the clause "including ever# government oned or
controlled corporation" in the '?:+ amendments to the Constitution as a deliberate
amendment for an eCpress purpose. 8here ma# be those ho disagree ith the intent
of the framers of the amendment but because it is fundamental la, e are all bound b#
it. 8he amendment as intended to correct the situation here more favored emplo#ees
of the government could enGo# the benefits of to orlds. 8he# ere protected b# the
las governing government emplo#ment. 8he# could also engage in collective
bargaining and Goin in stri0es to secure higher ages and fringe benefits hich e(uall#
hardor0ing emplo#ees engaged in government functions could onl# env# but not
enGo#.
Presidential $ecree No. %):, the Civil 2ervice $ecree of the Philippines has
implemented the '?:+ Constitutional amendment. 6t is categorical about the inclusion of
personnel of government@oned or controlled corporations in the civil service and their
being subGect to civil service re(uirements1
2EC86=N &9. Government# o2ned or Controlled Cororations
Personnel.EAll permanent personnel of government@ oned or
controlled corporations hose positions are no embraced in the civil
service shall continue in the service until the# have been given a
chance to (ualif# in an appropriate eCamination, but in the meantime,
those ho do not possess the appropriate civil service eligibilit# shall
not be promoted until the# (ualif# in an appropriate civil service
eCamination. 2ervices of temporar# personnel ma be # terminated
an# time.
4
Personnel of government@oned or controlled corporations are no part of the civil
service. 6t ould not be fair to allo them to engage in concerted activities to ring
higher salaries or fringe benefits from Government even as other civil service personnel
such as the hundreds of thousands of public school teachers, soldiers, policemen,
health personnel, and other government or0ers are denied the right to engage in
similar activities.
8o sa# that the ords "all emplo#ers" in P.$. No. %&' includes the Government and all
its agencies, instrumentalities, and government@oned or controlled corporations ould
also result in nightmarish budgetar# problems.
>or instance, the 2upreme Court is tr#ing its best to alleviate the financial difficulties of
courts, Gudges, and court personnel in the entire countr# but it can do so onl# ithin the
limits of budgetar# appropriations. Public school teachers have been resorting to hat
as formerl# unthin0able, to mass leaves and demonstrations, to get not a '+th@month
pa# but promised increases in basic salaries and small alloances for school uniforms.
8he budget of the Ministr# of Education, Culture and 2ports has to be supplemented
ever# no and then for this purpose. 8he point is, salaries and fringe benefits of those
embraced b# the civil service are fiCed b# la. An# increases must come from la, from
appropriations or savings under the la, and not from concerted activit#.
8he Government Corporate Counsel, Iustice Manuel Da5aro, in his consolidated
comment K for respondents G262, M/22, and P78A gives the bac0ground of the
amendment hich includes ever% government@oned or controlled corporation in the
embrace of the civil service1
Records of the '?:' Constitutional Convention sho that in the
deliberations held relative to hat is no 2ection '*', Article J66@B,
sura the issue of the inclusion of government@oned or controlled
corporations figured prominentl#.
8he late delegate Roberto 2. =ca, a recogni5ed labor leader,
vehementl# obGected to the inclusion of government@oned or
controlled corporations in the Civil 2ervice. <e argued that such
inclusion ould put asunder the right of or0ers in government
corporations, recogni5ed in Gurisprudence under the '?+&
Constitution, to form and Goin labor unions for purposes of collective
bargaining ith their emplo#ers in the same manner as in the private
section *see1 records of '?:' Constitutional Convention,.
6n contrast, other labor eCperts and delegates to the '?:'
Constitutional Convention enlightened the members of the Committee
on Dabor on the divergent situation of government or0ers under the
'?+& Constitution, and called for its rectification. 8hus, in a Position
Paper dated November@--, '?:', submitted to the Committee on
Dabor, '?:' Constitutional Convention, then Acting Commissioner of
Civil 2ervice Epi Rev Pangramu#en declared1
6t is the stand, therefore, of this Commission that b#
reason of the nature of the public emplo#er and the
peculiar character of the public service, it must
necessaril# regard the right to stri0e given to unions
in private industr# as not appl#ing to public
emplo#ees and civil service emplo#ees. 6t has been
stated that the Government, in contrast to the
private emplo#er, protects the interests of all people
in the public service, and that accordingl#, such
conflicting interests as are present in private labor
relations could not eCist in the relations beteen
government and those hom the# emplo#.
Moreover, determination of emplo#ment conditions
as ell as supervision of the management of the
public service is in the hands of legislative bodies. 6t
is further emphasi5ed that government agencies in
the performance of their duties have a right to
demand undivided allegiance from their or0ers
and must ala#s maintain a pronounced esprit de
corps or firm discipline among their staff members.
6t ould be highl# incompatible ith these
re(uirements of the public service, if personnel too0
orders from union leaders or put solidarit# ith
members of the or0ing class above solidarit# ith
the Government. 8his ould be inimical to the
public interest.
Moreover, it is asserted that public emplo#ees b#
Goining labor unions ma# be compelled to support
obGectives hich are political in nature and thus
Geopardi5e the fundamental principle that the
governmental machiner# must be impartial and
non@political in the sense of part# politics.H *see1
Records of '?:' Constitutional Convention,.
5
2imilarl#, $elegate Deandro P. Garcia, eCpressing support for the
inclusion of government@oned or controlled corporations in the Civil
2ervice, argued1
6t is meretricious to contend that because
Govermnent oned or controlled corporations #ield
profits, their emplo#ees are entitled to better ages
and fringe benefits than emplo#ees of Government
other than Government@ oned and controlled cor
orations hich are not ma0ing profits. 8here is no
gainsa#ing the fact that the capital the# use is the
peopleHs *see Records of the '?:' Constitutional
Convention,.
2ummari5ing the deliberations of the '?:' Constitutional Convention
on the inclusion of Government oned or controlled corporations,
$ean Ioa(uin G. Bernas, 2I., of the Ateneo de Manila ;niversit#
Professional 2chool of Da, stated that government@oned
corporations came under attac0 as mil0ing cos of a privileged fe
enGo#ing salaries far higher than their counterparts in the various
branches of government, hile the capital of these corporations
belongs to the Government and government mone# is pumped into
them henever on the brin0 of disaster, and the# should therefore
come under the stric0 surveillance of the Civil 2ervice 2#stem.
*Bernas, 8he '?:+ Philippine Constitution, Notes and Cases, '?:!
ed., p. &-!,.
8he Government Corporate Counsel cites the precedent setting decision in Agricultural@
Credit and Cooperative >inancing Administration *"CC3" v. Confederation of Unions in
Government Cororations and Offtces CUGCO et al., +) 2CRA 9!45 as giving the
rationale for coverage of government@oned or controlled corporations b# the civil
service. /e stated "CC3" v. CUGCO that1
... 8he ACA is a government office or agenc# engaged in
governmental, not proprietar# functions. 8hese functions ma# not be
strictl# hat President /ilson described as "constituent" *as
distinguished from HministrantH,, LBacani vs. National Coconut
Corporation, G.R. No. D@?9&:, Nov. -?,'?&9, &+ =.G. p. -%))M such
as those relating to the maintenance of peace and the prevention of
crime, those regulating propert# and propert# rights, those relating to
the administration of Gustice and the determination of political duties of
citi5ens, and those relating to national defense and foreign relations.
;nder this traditional classification, such constituent functions are
eCercised b# the 2tate as attributes of sovereignt#, and not merel# to
promote the elfare, progress and prosperit# of the people these
latter functions being ministrant, the eCercise of hich is optional on
the part of the government.
8he groing compleCities of modern societ#, hoever, have rendered
this traditional classification of the functions of government (uite
unrealistic, not to sa# obsolete. 8he areas hich used to be left to
private enterprise and initiative and hich the government as called
upon to enter optionall#, and onl# "because it as better e(uipped to
administer for the public elfare than is an# private individual or group
of individuals," *Malcolm, 8he Government of the Philippines, pp. '?@
-)A Bacani vs. National Coconut Corporation, supra, continue to lose
their ell@ defined boundaries and to be absorbed ithin activities that
the government must underta0e in its sovereign capacit# if it is to
meet the increasing social challenges of the times. <ere as almost
ever#here else the tendenc# is undoubtedl# toards a greater
sociali5ation of economic forces, <ere of course this development
as envisioned, indeed adopted as a national polic#, b# the
Constitution itself in its declaration of principle concerning the
promotion of social Gustice.
Chief Iustice >ernando, then an Associate Iustice of this Court, observed in a
concurring opinion that the traditional classification into constituent and ministrant
functions reflects the primac# at that time of the no discredited and repudiated laisse.
faire concept carried over into government. <e stated1
8he influence eCerted b# American constitutional doctrines
unavoidable hen the Philippines as still under American rule
notithstanding, an influence that has not altogether vanished even
after independence, the laisse. faire principle never found fun
acceptance in this Gurisdiction, even during the period of its full
floering in the ;nited 2tates. Moreover, to erase an# doubts, the
Constitutional Convention sa to it that our fundamental la
embodies a polic# of the responsibilit# thrust on government to cope
ith social and economic problems and an earnest and sincere
commitment to the promotion of the general elfare through state
action. 6t ould thus follo that the force of an# legal obGection to
regulator# measures adversel# affecting propert# rights or to statutes
organi5ing public corporations that ma# engage in competition ith
private enterprise has been blunted. ;nless there be a clear shoing
of an# invasion of rights guaranteed b# the Constitution, their validit#
is a foregone conclusion. No fear need be entertained that thereb#
spheres hitherto deemed outside government domain have been
6
encroached upon. /ith our eCplicit disavoal of the Hconstituent@
ministrantH test, the ghost of the laisse5@faire concept no longer stal0s
the Guridical stage."
=ur dismissal of this petitiNn should not, b# an# means, be interpreted to impl# that
or0ers in government@oned and controlled corporations or in state colleges and
universities ma# not enGo# freedom of association. 8he or0ers hom the petitioners
purport to represent have the right, hich ma# not be abridged, to form associations or
societies for purposes not contrar# to la. *Constitution, Article 67, 2ection :,. 8his is a
right hich share ith all public officers and emplo#ees and, in fact, b# ever#bod# living
in this countr#. But the# ma# not Goin associations hich impose the obligation to
engage in concerted activities in order to get salaries, fringe benefits, and other
emoluments higher than or different fr m that provided b# la and regulation. 
8he ver# Dabor Code, P.$. No. !!- as amended,, hich governs the registration and
provides for the rights of legitimate labor organi5ations states1
AR8. -::. Government emlo%ees.E 8he terms and conditions of
emplo#ment of all government emplo#ees, including emplo#ees of
government@oned and controlled corporations, shall be governed b#
the Civil 2ervice Da, rules and regulations. 8heir salaries shall be
standardi5ed b# the National Assembl# as provided for in the ne
constitution. <oever, there shall be no reduction of eCisting ages,
benefits, and other terms and conditions of emplo#ment being
enGo#ed b# them at the time of the adoption of this code.
2ection 9, Article J66@B of the Constitution gives added reasons h# the government
emplo#ees represented b# the petitioners cannot eCpect treatment in matters of salaries
different from that eCtended to all others government personnel. 8he provision states1
2EC. 9. 8he National Assembl# shall provide for the standardi5ation
of compensation of government officials and emplo#ees, including
those in government@oned or controlled corporations, ta0ing into
account the nature of the responsibilities pertaining to, and the
(ualifications re(uired for the positions concerned.
6t is the legislature or, in proper cases, the administrative heads of government and not
the collective bargaining process nor the concessions rung b# labor unions from
management that determine ho much the or0ers in government@oned or controlled
corporations ma# receive in terms of salaries, '+th month pa#, and other conditions or
terms of emplo#ment. 8here are government institutions hich can afford to pa# to
ee0s, three ee0s, or even '+th@month salaries to their personnel from their budgetar#
appropriations. <oever, these pa#ments must be pursuant to la or regulation.
Presidential $ecree No. ?%& as amended provides1
CCC CCC CCC
2EC. -. 0eclaration of Polic%.E 6t is hereb# declared to be the polic#,
of the national government to provide e(ual pa# for substantiall#,
e(ual or0 and to base differences in pa# upon substantive
differences in duties and responsibilities, and (ualification
re(uirements of the positions. 6n determining rates of pa#, due regard
shall be given to, among others, prevailing rates in private industr# for
comparable or0. >or this purpose, there is hereb# established a
s#stem of compensation standardi5ation and position classification in
the national government for all departments, bureaus, agencies, and
officers including government@oned or controlled corporations and
financial institutions1 Provided, 8hat notithstanding a standardi5ed
salar# s#stem established for all emplo#ees, additional financial
incentives ma# be established b# government corporations and
financial institutions for their emplo#ees to be supported full# from
their corporate funds and for such technical positions as ma# be
approved b# the President in critical government agencies.
8he 2olicitor@General correctl# points out that to interpret P.$. No. %&' as including
government emplo#ees ould upset the compensation levels of government emplo#ees
in violation of those fiCed according to P.$. No. ?%&.
<ere as in other countries, government salaries and ages have ala#s been loer
than salaries, ages, and bonuses in the private sector. <oever, civil servants have no
cause for despair. 2ervice in the government ma# at times be a sacrifice but it is also a
elcome privilege. Apart from the emotional and ps#chic satisfactions, there are various
material advantages. 8he securit# of tenure guaranteed to those in the civil service b#
the Constitution and statutes, the 0noledge that one is or0ing for the most stable of
emplo#ers and not for private persons, the merit s#stem in appointments and
promotions, the scheme of vacation, sic0, and maternit# leave privileges, and the
prestige and dignit# associated ith public office are onl# a fe of the Go#s of
government emplo#ment.
2ection + of the Rules and Regulations 6mplementing Presidential $ecree No. %&' is,
therefore, a correct interpretation of the decree. 6t has been implemented and enforced
from $ecember --, '?:& to the present, 8he petitioners have shon no valid reason
h# it should be nullified because of their petition filed siC and a half #ears after the
issuance and implementation of the rule.
7
/<ERE>=RE, the petition is hereb# $62M622E$ for lac0 of merit.
2= =R$ERE$.
8