Case Digest (G.R. No. 162716)
Facts:
The case involves a petition for review filed by Secretary Emilia T. Boncodin of the Department of Budget and Management (DBM) against the National Power Corporation Employees Consolidated Union (NECU). The events leading to the case began on October 8, 2001, when the Board of Directors of the National Power Corporation (NAPOCOR) issued Board Resolution No. 2001-113, which amended a previous resolution that granted a step increment to qualified NAPOCOR employees based on their length of service. The original requirement of ten years was reduced to three years. Following this, on November 12, 2001, NAPOCOR's then-President, Jesus Alcordo, issued Circular No. 2001-51 to implement the new guidelines. However, on May 6, 2002, NAPOCOR's Officer-in-Charge, Roland Quilala, issued Circular No. 2002-22, which provided additional guidelines for the implementation of the step increment.
On November 26, 2001, Secretary Boncodin informed Alcordo that the implementation of the st...
Case Digest (G.R. No. 162716)
Facts:
Background of the Case
The case involves the National Power Corporation (NAPOCOR) and its employees' union, the National Power Corporation Employees Consolidated Union (NECU). The dispute arose from NAPOCOR's implementation of salary step increments based on length of service, which was later suspended and revised.NAPOCOR Board Resolutions and Circulars
- On October 8, 2001, NAPOCOR's Board of Directors issued Board Resolution No. 2001-113, amending Board Resolution No. 99-35. The amendment reduced the requirement for step increments from 10 years to 3 years of service in a position.
- On November 12, 2001, NAPOCOR President Jesus Alcordo issued Circular No. 2001-51, providing implementing rules for the step increments.
- On May 6, 2002, NAPOCOR Officer-in-Charge Roland Quilala issued Circular No. 2002-22, adding guidelines for the implementation of the step increments.
DBM's Intervention
- On November 26, 2001, the Department of Budget and Management (DBM), through Secretary Emilia T. Boncodin, informed NAPOCOR that the step increments lacked legal basis and could not be implemented without DBM approval. The DBM estimated the cost of the increments at P84 million.
- On June 5, 2002, Corporate Auditor Norberto Cabibihan issued a Memorandum Circular suspending the payment of step increments, citing the lack of DBM approval.
NAPOCOR's Revised Resolution
- On July 24, 2002, NAPOCOR's Board issued Board Resolution No. 2002-81, revising the step increment policy. The resolution limited the increments to two steps and ordered a rollback of salaries for employees who received more than two steps.
Legal Action by NECU
- On August 27, 2002, NECU filed a Petition for Prohibition with Application for TRO/Preliminary Injunction before the Regional Trial Court (RTC) of Quezon City, challenging the suspension and rollback of the step increments.
- On September 25, 2002, the RTC granted NECU's application for a Writ of Preliminary Injunction, enjoining the implementation of the suspension and rollback.
Appeal to the Court of Appeals
- The DBM and NAPOCOR appealed to the Court of Appeals (CA), which upheld the RTC's decision, finding no grave abuse of discretion in issuing the injunction.
Issue:
Propriety of the Writ of Preliminary Injunction
- Whether the RTC had jurisdiction to issue the injunction despite the doctrine of exhaustion of administrative remedies.
- Whether NECU had a clear legal right to the step increments, justifying the issuance of the injunction.
Legality of the Step Increments
- Whether NAPOCOR had the authority to grant step increments without DBM approval.
- Whether the step increments violated the Salary Standardization Law (RA 6758).
Ruling:
Propriety of the Writ of Preliminary Injunction
- The Supreme Court ruled that the issuance of the Writ of Preliminary Injunction was improper. NECU failed to establish a clear and positive legal right to the step increments. The validity of the step increments was seriously contested, and the RTC erred in granting the injunction without sufficient proof of NECU's entitlement.
Legality of the Step Increments
- The Court did not rule on the merits of the step increments, as this issue was still pending before the trial court. However, it emphasized that the step increments required DBM approval under RA 6758 (Salary Standardization Law). The absence of such approval rendered the increments legally questionable.
Ratio:
Injunction as an Extraordinary Remedy
- An injunction is an extraordinary remedy that requires the applicant to prove a clear and positive legal right. In this case, NECU failed to demonstrate such a right, as the validity of the step increments was disputed and lacked DBM approval.
Doctrine of Exhaustion of Administrative Remedies
- The Court held that the doctrine of exhaustion of administrative remedies was not strictly applicable in this case. The urgency of the situation, particularly the impending rollback of salaries, justified NECU's immediate resort to judicial action.
No Vested Right to Step Increments
- The Court ruled that NECU members did not acquire a vested right to the step increments. The increments were granted without proper legal authority, and their suspension or revision did not constitute a diminution of benefits.
Presumption of Regularity in Official Acts
- The Court emphasized that acts of public officers, such as the DBM's suspension of the step increments, are presumed regular and valid. NECU failed to overcome this presumption, making the issuance of the injunction unjustified.
Judicial Caution in Granting Injunctions
- The Court reiterated that injunctions should be granted with caution, especially when they effectively dispose of the main case without a full trial. The RTC's issuance of the injunction prejudged the merits of the case, which was improper.
Conclusion:
The Supreme Court granted the petition, reversing the CA's decision and setting aside the Writ of Preliminary Injunction. The RTC was directed to proceed with the trial on the merits of the case. The Court emphasized that NECU failed to prove a clear legal right to the step increments, and the injunction was improperly issued.