This Supreme Court decision clarifies that government employees under preventive suspension are still entitled to step increments and benefits, upholding the presumption of innocence. The ruling states that preventive suspension, unlike a penalty, should not automatically disqualify employees from receiving benefits. The court emphasized that while preventive suspension may temporarily interrupt continuous service, it only delays the grant of step increments by the duration of the suspension, aligning it with the treatment of approved leaves without pay. This ensures that employees are not unduly penalized before a final judgment is reached in their administrative cases. This case underscores the importance of balancing administrative efficiency with the protection of employee rights within the Philippine legal system.

GSIS Resolutions and Employee Rights: Can Benefits Be Denied During Suspension?

The case revolves around Albert M. Velasco and Mario I. Molina, employees of the Government Service Insurance System (GSIS), who were administratively charged and preventively suspended for allegedly participating in a demonstration against GSIS management. Consequently, they were denied step increments and Christmas raffle benefits, which prompted them to file a petition for prohibition against the GSIS Board of Trustees and its President and General Manager. The central legal question is whether the GSIS Board Resolutions that disqualify employees with pending administrative cases from receiving certain benefits violate their right to be presumed innocent and their right to due process.

The Regional Trial Court (RTC) initially ruled in favor of Velasco and Molina, declaring the GSIS Board Resolutions null and void. The RTC emphasized that denying employee benefits solely based on pending administrative cases infringes upon their rights. The court also noted that the resolutions were not registered with the University of the Philippines (UP) Law Center, rendering them ineffective. In response, the GSIS elevated the case to the Supreme Court, challenging the RTC’s jurisdiction and the validity of its decision.

The petitioners argued that the Civil Service Commission (CSC), not the RTC, should have jurisdiction over the case, asserting that it involves claims of employee benefits. They also contended that a petition for prohibition against the GSIS Board, exercising its functions in Pasay City, falls outside the territorial jurisdiction of the RTC Manila. The Supreme Court addressed the jurisdictional issues by referencing Rule 65 of the Rules of Court, which outlines the scope and venue for petitions for prohibition. It affirmed that the RTC, not the CSC, correctly exercised jurisdiction because the case was a petition to prohibit the enforcement of certain resolutions, falling squarely within the RTC’s competence.

Moreover, the Supreme Court addressed the argument regarding territorial jurisdiction. According to Section 18 of Batas Pambansa Blg. 129 (BP 129), the Supreme Court defines the territorial jurisdiction of each Regional Trial Court branch. Administrative Order No. 3 specifies that branches in Manila have jurisdiction over the City of Manila only. However, the court clarified that because respondent Velasco resided in Manila, the venue was proper under Section 2, Rule 4 of the Rules of Court, which allows personal actions to be filed where the plaintiff resides. Additionally, Section 21(1) of BP 129 grants Regional Trial Courts the authority to issue writs enforceable throughout their respective regions, further solidifying the RTC’s jurisdiction.

Turning to the issue of whether the GSIS Board Resolutions needed to be filed with the UP Law Center, the Supreme Court distinguished between rules of general applicability and those that are merely internal in nature. It cited the UP Law Center’s guidelines, stating that only rules of general or permanent character must be filed. The Court found that Resolution Nos. 372, 197, and 306 pertained to internal rules regulating GSIS personnel, thus exempting them from the filing requirement. Therefore, the lower court erred in declaring that the GSIS board resolution should have been filed with the UP Law Center.

The Supreme Court then addressed the validity of the GSIS Board Resolutions that disqualified employees with pending administrative cases from receiving step increments and other benefits. The Court emphasized that entitlement to step increments depends on continuous satisfactory service. Citing Joint Circular No. 1, series of 1990, the Court noted that a step increment is granted for every three years of continuous satisfactory service in a given position. The critical point of contention was the effect of preventive suspension on this continuous service requirement.

The Court referenced CSC rules on the effects of suspension and leave without pay to provide context. A penalty of suspension interrupts the continuity of service, delaying the grant of step increment by the duration of the suspension. Similarly, authorized leave without pay exceeding 15 days within a three-year period also delays the step increment by the number of days of absence. Preventive suspension, however, is not a penalty. It is a measure to facilitate investigation. Thus, the court reasoned that employees under preventive suspension should be treated similarly to those on leave without pay, ensuring fairness and consistency.

Moreover, the Supreme Court underscored the importance of the presumption of innocence. According to the court, an employee with a pending administrative case is considered innocent until proven guilty. Consequently, the Court ruled that the respondents, having served their 90-day preventive suspension, should have been reinstated and entitled to step increments after a delay equivalent to the suspension period. By extension, social legislation, such as the circular on step increments, must be liberally construed to benefit government employees, enhancing their efficiency and well-being.

FAQs

What was the key issue in this case?	The key issue was whether the GSIS Board Resolutions that disqualify employees with pending administrative cases from receiving step increments and benefits violate their right to be presumed innocent.
What is a step increment?	A step increment is an increase in salary granted to government employees for every three years of continuous satisfactory service in a particular position.
What is preventive suspension?	Preventive suspension is a temporary suspension of an employee pending an investigation for alleged misconduct, intended to prevent the employee from influencing the investigation.
Is preventive suspension considered a penalty?	No, preventive suspension is not a penalty but a preventive measure to allow for a fair investigation.
How does preventive suspension affect an employee’s entitlement to step increments?	The Supreme Court ruled that preventive suspension only delays the grant of step increments by the duration of the suspension period.
Did the GSIS Board Resolutions need to be filed with the UP Law Center?	The Supreme Court ruled that the GSIS Board Resolutions did not need to be filed with the UP Law Center because they were internal rules regulating GSIS personnel, not rules of general applicability.
What happens if an administrative case is not resolved within the preventive suspension period?	If an administrative case is not resolved within 90 days, the employee under preventive suspension must be automatically reinstated.
What is the presumption of innocence in this context?	The presumption of innocence means that an employee with a pending administrative case is considered innocent until proven guilty, and should not be unduly penalized before a final judgment.

In conclusion, the Supreme Court’s decision emphasizes the importance of upholding employee rights and the presumption of innocence in administrative proceedings. The ruling ensures that preventive suspension is not used as a tool to unfairly deprive employees of their rightful benefits. The court affirmed with modification, declaring the assailed provisions on step increment in GSIS Board Resolution Nos. 197 and 372 void, while clarifying that GSIS Board Resolution Nos. 197, 306 and 372 need not be filed with the University of the Philippines Law Center.

For inquiries regarding the application of this ruling to specific circumstances, please contact ASG Law through contact or via email at frontdesk@asglawpartners.com.

Disclaimer: This analysis is provided for informational purposes only and does not constitute legal advice. For specific legal guidance tailored to your situation, please consult with a qualified attorney.
Source: G.R. No. 170463, February 02, 2011