MODIFYING THE SALARY SCHEDULE FOR CIVILIAN GOVERNMENT PERSONNEL AND AUTHORIZING THE GRANT OF ADDITIONAL BENEFITS FOR BOTH CIVILIAN AND MILITARY AND UNIFORMED PERSONNEL
WHEREAS, Congress, under Item 1 of its Joint Resolution No. 4, (s. 2009), inscribes, as among the governing principles of the Compensation and Position Classification System (CPCS), the payment of just and equitable compensation to all government personnel in accordance with the principle of equal pay for work of equal value and one that is generally comparable with those in the private sector doing comparable work in order to attract, retain and motivate a corps of competent civil servants;
WHEREAS, to ensure this, the same Joint Resolution sets a periodic review of the government’s CPCS taking into account the changes in skills and competency requirement in the bureaucracy, the relative demand for certain expertise, the possible erosion in the purchasing power due to inflation, and other factors;
WHEREAS, Section 13 of Presidential Decree No. 985 and Item 17 (iv) of the above Joint Resolution authorize the President, upon recommendation of the Department of Budget and Management, to periodically revise or update the CPCS as well as the policies on and levels of allowances, benefits and incentives applicable to all government personnel; and
WHEREAS, Congress has appropriated an amount of P57.91 Billion in Republic Act (RA) No. 10717 or the Fiscal Year 2016 General Appropriations Act (GAA), to cover the requirement to implement the compensation adjustment of civilian personnel and military and uniformed personnel in the National Government.
NOW THEREFORE, I, BENIGNO S. AQUINO, III, President of the Philippines, by virtue of the powers vested in me by law, do hereby order:
Section 1. Compensation Adjustment Strategy. To ensure that the compensation structure of government personnel is comparable with the prevailing rates in the private sector thereby attracting and retaining competent and committed civil servants, the existing CPCS is hereby revised or updated to conform with the following:
a) Raise the minimum salary for Salary Grade 1 from the current rate of Nine Thousand Pesos (P9,000) to Eleven Thousand Sixty Eight Pesos (P11,068) to make it even more competitive with the market rates;
b) Bring the compensation of government personnel closer to their private counterparts to at least 70% of the median of the market for all salary grades;
c) Eliminate overlaps in between salary grade allocations of government personnel to recognize differences in duties and responsibilities of the positions;
d) Maximize the net take home pay of government personnel through the inclusion of additional benefits; and
e) Strengthen the performance-based incentive system in recognition of government personnel who play a greater role and carry a heavier responsibility in attaining performance targets and delivering results.
For the military and uniformed personnel (MUP), the compensation adjustment strategy shall be aligned with the objective of mitigating the fiscal crisis building up in their pension system and pursuing the pension reform.
Section 2. Coverage. The modified Salary Schedule authorized herein shall apply to all civilian personnel in the Executive, Legislative and Judicial Branches, Constitutional Commissions and other Constitutional Offices, Government-Owned or Controlled Corporations (GOCCs) not covered by RA No. 10149, and local government units (LGUs); regardless of appointment status, whether regular, contractual or casual; appointive or elective; and on full-time or part-time basis.
The new Provisional Allowance Schedule and the Officers’ Allowance shall apply only to the military personnel of the Department of National Defense (DND) and the uniformed personnel of the Department of the Interior and Local Government (DILG), the Philippine Coast Guard (PCG) and the National Mapping and Resource Information Authority (NAMRIA).
The Mid-Year Bonus, Enhanced Performance-Based Bonus (PBB), and Productivity Enhancement Incentive provided herein shall apply to both civilian personnel, and MUP, except for the increase in Hazard Pay which applies only to the MUP.
However, individuals whose services are engaged through job orders, contracts of service, consultancy contracts, and service contracts with no employer-employee relationship are excluded from the salary increase and benefits authorized herein.
Section 3. Modified Salary Schedule, including Step Increments. The modified Salary Schedule for Civilian Personnel, to be implemented in four (4) tranches, shall be as follows:
First Tranche
Section 4. Mid-Year Bonus. Beginning FY 2016, a Mid-Year Bonus equivalent to one (1) month basic salary as of May 15, shall be granted to those who have rendered at least four (4) months of satisfactory service and are still in the service as of same date, to be given not earlier than May 15 of every year. This shall be in addition to the Standard Allowances and Benefits under the Total Compensation Framework embodied in the Congress Joint Resolution No. 4 (s. 2009). The existing Year-End Bonus equivalent to one (1) month basic salary and Cash Gift at prescribed rates shall be given in November of every year.
Section 5. Enhanced Performance-Based Bonus. The existing PBB granted to qualified government personnel, including those in LGUs, shall be enhanced to strengthen its results orientation, to be given in an amount equivalent to one (1) month basic salary up to two (2) months basic salary, to be implemented in two (2) phases starting in FY 2017. The PBB shall be subject to the achievement by departments or agencies, including LGUs and individual employees of their performance targets or commitments and compliance with good governance and other conditions.
The grant of the enhanced PBB shall be based on a progressive rate system. As the position and responsibility in improving agency performance becomes higher, so is the amount of PBB.
The Inter-Agency Task Force on the Harmonization of National Government Performance Monitoring, Information and Reporting Systems created under Administrative Order No. 25 (s. 2011) shall prescribe the conditions on eligibility and procedures for the grant of the enhanced PBB, including the ranking system to recognize differences in levels of performance.
Section 6. Productivity Enhancement Incentive. Beginning FY 2016, the Productivity Enhancement Incentive shall be given not earlier than December 15 of every year to all qualified government employees at Five Thousand Pesos (P5,000) each for the purpose of improving the government employees’ productivity.
Section 8. Hazard Pay. The Hazard Pay of all military and uniformed personnel shall be increased from the current rate of Two Hundred Forty Pesos (P240) per month to the following rates:
a) Starting January 1,2016, Three Hundred Ninety Pesos (P390) per month;
b) By January 1, 2017, Five Hundred Forty Pesos (P540) per month;
c) By January 1, 2018, Six Hundred Ninety Pesos (P690) per month; an
d) By January 1, 2019, Eight Hundred Forty Pesos (P840) per month.
Section 11. Implementation Schedule. The modified Salary Schedule and additional benefits authorized herein shall be implemented in National Government Agencies as follows, subject to appropriations by Congress:
Starting January 1, 2016, the first tranche salary schedule for civilian personnel and the first tranche Provisional Allowance, Officers’ Allowance and Hazard Pay for MUP, together with the Mid-Year Bonus.
By January 1, 2017, the second tranche salary schedule for civilian personnel and the second tranche Provisional Allowance, Officers’ Allowance and Hazard Pay for MUP, the Mid-Year Bonus and half of the enhanced PBB;
By January 1, 2018, the third tranche salary schedule for civilian personnel and the third tranche Provisional Allowance, Officers’ Allowance and Hazard Pay for MUP, the Mid-Year Bonus and full amount of the enhanced PBB; and
By January 1, 2019, the fourth tranche salary schedule for civilian personnel and the fourth tranche Provisional Allowance, Officers’ Allowance and Hazard Pay for MUP, the Mid-Year Bonus and full amount of the enhanced PBB.
For covered GOCCs and LGUs, the implementation of the compensation adjustments shall be in at least four (4) years depending on their respective financial capability, with each tranche starting not earlier than the dates stated above. GOCCs and LGUs which do not have adequate or sufficient funds shall partially implement the modified Salary Schedule and authorized benefits. In case of partial implementation, the same shall be at uniform percentage across all positions for every GOCC/LGU.
Section 12. Retroactive Application. The first tranche implementation of the modified Salary Schedule for civilian personnel, the grant of the Provisional Allowance, Officers’ Allowance and increased Hazard Pay for the MUP, shall be effective January 1, 2016.
For covered GOCCs and LGUs, the retroactive application of the first tranche shall be subject to their financial capabilities and compliance with other requirements under existing laws.
Section 13. Exempt Entities. The following exempt entities shall not be covered by the modified Salary Schedule and additional benefits authorized herein:
(i) government agencies, including GOCCs that are exempted from the coverage of RA No. 6758, as amended, as provided in their respective enabling law or charter; and
(ii) GOCCs governed by the CPCS established by the Governance Commission for GOCCs (GCG) and approved by the President of the Philippines, under RA No. 10149.
They shall be governed by their respective CPCS which shall be made effective upon the recommendation of the DBM or the Governance Commission for GOCCs, as the case may be, and approval by the President of the Philippines.
Section 14. Applicability to Certain Officials. Consistent with the policy under Section 6 of Article VII and Section 10 of Article VI of the Constitution, the salaries authorized herein for the President, Vice President and Members of Congress shall take effect only after the expiration of the respective terms of the incumbents.
The implementation of this Executive Order with respect to the regular members of the Cabinet shall be effective starting July 1, 2016.
Section 15. Funding Source. The funding sources for the amounts necessary to implement this Executive Order shall be as follows:
a) For national government agencies funded in the GAA, the amount needed for the compensation adjustment in FY 2016 shall be charged against the appropriations provided in the FY 2016 GAA.
The funding requirements for the compensation adjustment in FYs 2017, 2018 and 2019 will be included in the proposed annual National Expenditure Program submitted to Congress for its approval. The DBM, following the compensation adjustment strategy embodied in Section 1 hereof, and consistent with its authority under Section 7 of RA No. 6758, as amended, shall then be authorized to implement or adjust the compensation corresponding to the appropriations provided in the GAA.
b) For GOCCs, the amounts shall come from their respective corporate funds in the corporate operating budgets approved by DBM.
c) For LGUs, the amounts shall be charged against their respective funds in accordance with the pertinent provisions of this Order and RA No. 7160.
Section 16. Implementing guidelines. The DBM shall issue the guidelines necessary to implement the provisions of this Order.
Section 17. Separability. Should any provision of this Order be declared invalid or unconstitutional, the other provisions unaffected thereby shall remain valid and subsisting.
Section 18. Repeal. All other rules, regulations and issuances, or parts thereof which are inconsistent with this Order are hereby repealed or modified accordingly..
Section 19. Effectivity. This Order shall take effect immediately upon its publication in a newspaper of general circulation.
DONE, in the city of Manila, this 19th day of February, in the year of our Lord, Two Thousand and Sixteen.
(Sgd.) BENIGNO S. AQUINO III
