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The city budget office seems to agree with the employees’ interpretation of the Salary Standardization Law V, but says there’s no sufficient funds for the back pay
ILOILO CITY, Philippines – Some 2,000 regular employees of the Iloilo City government are seeking back pay covering 21 months, citing a law that took effect four years ago.
Local and national authorities, however, have a different interpretation of Republic Act 11466 or the Salary Standardization Law (SSL) V signed by then-president Rodrigo Duterte in 2019. They say the law is not to be applied retroactively.
The “unfulfilled salary” increases, as the employees characterize their claim, would require the city government to allocate P50 million.
What does the Salary Standardization Law V say?
The SSL V was signed by Duterte in 2019 and took effect in January 2020. It provides the salary increase of employees of the local government units (LGUs) and other civilian government workers.
The increase was to be implemented in four annual tranches, between 2020 and 2023.
The law SSL V does not provide salary increases or adjustments to be made retroactively.
Andrew Murray Durano, an Administrative Assistant I at the Office of the City Veterinarian, has written to Department of Budget and Management (DBM) Secretary Amenah Pangandaman to ask whether the local government unit (LGU) employees would still receive the deficits in their expected salary increases.
In July, Durano also brought the issue to the attention of Iloilo City Mayor Jerry Treñas.
What the mayor says
Treñas said the city government cannot retroactively apply the salary increases due to a provision in the Local Government Code of 1991. Section 325 (g) states that “the creation of new positions and salary increases and adjustments shall in no case be made retroactive.”
He said that, without a legal basis, enforcing retroactive payments could result in audit disallowances from the Commission on Audit.
The mayor also cited the budget secretary’s call to amend the Code to allow retroactive salary increases for LGU workers. That the budget chief had to raise this — during the 11th leg of the Public Financial Management Competency Program for LGUs in Butuan City on August 30 — meant there is no law nor mechanism for retroactive payments yet, he said.
However, if the DBM will favor Durano’s request, Treñas said the city government would comply with paying the supposed gap in salary increase payments for employees.
What the employees say
Durano said Treñas’ statements on the retroactivity of SSL V is “not only inaccurate but potentially misleading.”
He said that SSL V is a law enacted by the Congress and signed by the President, which makes it on equal footing with the Local Government Code and therefore “[holds] a superior position in the hierarchy of laws compared to executive orders.”
“The issue at hand is not one of retroactivity but rather the apparent failure of the lloilo City Government to fulfill its legal obligation to implement RA 11466 and compensate its permanent employees accordingly,” Durano said.
What the city budget office says
Viminale Capulso of the City Budget Office said the city government was only able to fully release the first tranche of the salary increase — the one in 2020 — and even then delayed it to October instead of January that year.
Then the city government was only able to fully implement SSL V in 2023 — the schedule for the fourth tranche — due to insufficient funds.
Capulso noted that the DBM had allowed the city government to delay the implementation of the increase if funds were inadequate.
A January 2020 DBM circular noted that if funds were insufficient for the full implementation of the salary increase schedule, the local council or its legislative body could “formulate a modified salary schedule with lower rates but at a uniform percentage of the rates in the applicable salary schedules” of SSL V.
Capulso said the 21-month deficit in the salary increase that some employees are asking for is “no longer certain” as they cannot include it to the city’s supplemental budget and other budgetary requirements.
She said the current priority of the city government is to implement the SSL from 2024 to 2027. – Rappler.com
Rjay Zuriaga Castor is a 2024 Aries Rufo Journalism Fellow. He is a reporter for The Daily Guardian, an Iloilo-based newspaper.
