G.R. No. 210328 - Government Service Insurance System vs. Pauig

This petition for review was filed by the Government Service Insurance System (GSIS) challenging the RTC Court of Cabagan, Isabela’s Decision dated July 15, 2013 and subsequent Order dated December 4, 2013 in Civil Case No. 22-1035.
The dispute concerns the computation of creditable service for the retirement benefits claim of Apolinario C. Pauig.

Pauig commenced government service on February 12, 1964 as an Emergency Laborer on a casual status.
He later worked as a temporary employee from July 5, 1972 until July 18, 1977.
On July 19, 1977, Pauig was appointed a permanent employee, and on August 1, 1977 he formally became a GSIS member.
He retired on November 3, 2004 upon reaching the mandatory retirement age of sixty-five (65) years.

Upon filing his retirement papers, Pauig’s claim was processed based on a Record of Creditable Service amounting to only twenty-seven (27) years.
Pauig contended that his first fourteen (14) years of service (from his start as an Emergency Laborer until his temporary employment) had been erroneously omitted in the computation.
GSIS argued that the excluded period was not covered by premium payments because he was not yet a GSIS member during those years, and the Premium-Based Policy (effective August 1, 2003) mandates that only periods where premiums were properly remitted are creditable.

Pauig initiated his case in the RTC of Cabagan, Isabela and secured a decision on July 15, 2013 in his favor.
The RTC decision declared the GSIS Premium-Based Policy as lawful and directed the GSIS to credit his casual/temporary service upon subsequent payment of the requisite premium contributions with interest.
GSIS subsequently filed a motion for reconsideration, which was denied, leading to the petition for review.

The computation of retirement benefits is fundamentally tied to the payment and remittance of premium contributions to GSIS.
Relevant laws and policies include:

Policy and Procedural Guidelines No. 171-03 (both the versions dated February 2, 2003 and April 2, 2013) which emphasize that only services with timely remitted contributions are creditable.
Section 4 of Commonwealth Act (C.A.) No. 186 and its subsequent amendments (Republic Act Nos. 4968 and 660), which outline the compulsory membership parameters and different categories of government employees.
Presidential Decree (P.D.) No. 1146 that delineates the coverage of government employees under GSIS.

The distinctions among casual, temporary, and permanent employment statuses were critical in determining creditable service, as only permanent employees with compulsory GSIS membership and corresponding deductions qualify for credit under the retirement insurance plan.

Whether or not the Government Service Insurance System (GSIS) should include Pauig’s first fourteen (14) years of service in computing his retirement benefits.

Whether the Premium-Based Policy, which mandates the inclusion of periods only when premium payments were made and remitted, can be liberally construed to credit service rendered before GSIS membership.
The role of statutory provisions and the clear demarcation between casual/temporary and permanent employment in crediting service for retirement benefits.
The impact of established jurisprudence (e.g., GSIS v. CSC) on interpreting creditability of service periods when deductions were not made.