Creation of AFP Chief and Senior Master Sergeant Ranks

Policy and purpose

Section 1 declares it to be the policy to develop and professionalize the Armed Forces of the Philippines.
Section 1 requires providing adequate remuneration and benefits to AFP members.
Section 1 provides that career development and promotion shall be established to ensure progression of all AFP personnel.
Section 1 states that career progression shall provide appropriate career motivations for AFP personnel.

Creation and placement of new ranks

Section 2 creates the enlisted grades of Chief Master Sergeant/Master Chief Petty Officer (E-9) and Senior Master Sergeant/Senior Chief Petty Officer (E-8).
Section 2 provides that the created grades form a component part of the noncommissioned officers grades of the AFP.

Distribution of authorized positions

Section 3 requires the total number of Senior Master Sergeants/Senior Chief Petty Officers and Chief Master Sergeants/Master Chief Petty Officers to follow the number of authorized positions in the approved Table of Organization.
Section 3 links the Table of Organization to Republic Act No. 7898, otherwise known as the AFP Modernization Act.

Promotion qualifications

Section 4 requires that qualifications for promotion from Master Sergeant/Chief Petty Officer to Senior Master Sergeant/Senior Chief Petty Officer be based on merit, fitness, and other qualifications determined by the Secretary of National Defense.
Section 4 requires that qualifications for promotion from Senior Master Sergeant/Senior Chief Petty Officer to Chief Master Sergeant/Master Chief Petty Officer be based on merit, fitness, and other qualifications determined by the Secretary of National Defense.

Pay, allowances, and computation rules

Section 5 makes qualified Master Sergeants/Chief Petty Officers eligible for promotion to Senior Master Sergeants/Senior Chief Petty Officers.
Section 5 makes qualified Senior Master Sergeants/Senior Chief Petty Officers eligible for promotion to Chief Master Sergeants/Master Chief Petty Officers.
Section 5 sets the monthly base pay for a Chief Master Sergeant/Master Chief Petty Officer (E-9) as the monthly base pay of a Master Sergeant/Chief Petty Officer plus one-half (1/2) of the difference between the monthly base pay of a Second Lieutenant/Ensign and the monthly base pay of a Master Sergeant/Chief Petty Officer.
Section 5 sets the monthly base pay for a Senior Master Sergeant/Senior Chief Petty Officer as the monthly base pay of a Master Sergeant/Chief Petty Officer plus one-half (1/2) of the difference between the monthly base pay of a Chief Master Sergeant/Master Chief Petty Officer and the monthly base pay of a Master Sergeant/Chief Petty Officer.
Section 5 requires that the computation of their quarters allowance follow the same scheme as their base pay computations.

Retirement, separation, and beneficiary treatment

Section 6 provides that enlisted personnel who attain the ranks of Master Sergeant/Chief Petty Officer, Senior Master Sergeant/Senior Chief Petty Officer, and Chief Master Sergeant/Master Chief Petty Officer are entitled upon retirement to the retirement pay and benefits of a Second Lieutenant/Ensign.
Section 6 provides that a Chief Master Sergeant/Master Chief Petty Officer upon retirement receives a gratuity equivalent to that of a Second Lieutenant/Ensign, plus one-half (1/2) of the difference between the gratuity of a Second Lieutenant/Ensign and a Master Sergeant/Chief Petty Officer, payable in one lump sum.
Section 6 provides that a Senior Master Sergeant/Senior Chief Petty Officer upon retirement receives a gratuity equivalent to that of a Second Lieutenant/Ensign, plus one-half (1/2) of the difference between the gratuity of a Chief Master Sergeant/Master Chief Petty Officer and a Master Sergeant/Chief Petty Officer, payable in one lump sum.
Section 6 allows Chief Master Sergeant/Master Chief Petty Officer and Senior Master Sergeant/Senior Chief Petty Officer to opt for monthly retirement pay in lieu of gratuity, with computation based on the same scheme.
Section 6 provides that upon retirement, they may receive, at their option, in advance their lump sum annual retirement pay for the first three (3) years, and thereafter receive annual retirement pay payable in equal monthly installments as they accrue.
Section 6 provides that if he dies within the three-year period following retirement and is survived by beneficiaries as defined in Presidential Decree No. 1638, the beneficiaries receive derivative benefits starting the first month after the three-year period.
Section 6 prohibits treating the section as authorizing adjustment of pay or payment of any differential in retirement pay to officers and enlisted men already retired prior to the approval of Republic Act No. 8220 due to increases in salary of personnel in active service.
Section 6 allows retirees recalled to active duty to have their retirement pension adjusted based on the rank held and the prevailing pay of military personnel in active service at the time recall terminates.

AFP Command Sergeant Major selection

Section 7 requires that the AFP Command Sergeant Major be selected from among Chief Master Sergeants/Master Chief Petty Officers under rules and regulations prescribed by the Chief of Staff, AFP.
Section 7 provides that unless sooner terminated, the AFP Command Sergeant Major serves for a maximum term of three (3) years.

Tenure-in-grade authority

Section 8 directs the Secretary of National Defense to determine the maximum tenure-in-grade of enlisted personnel in the ranks of Master Sergeant/Chief Petty Officer, Senior Master Sergeant/Senior Chief Petty Officer, and Chief Master Sergeant/Master Chief Petty Officer.

Implementing rules, appropriations, and effect

Section 9 requires the Secretary of National Defense to promulgate necessary rules and regulations and other guidelines for effective implementation within ninety (90) days after approval of the Act.
Section 10 requires that the amount necessary for effective implementation be charged to the appropriations of the Department of National Defense under the current General Appropriations Act.
Section 10 requires that sums necessary for continued implementation be included in the annual General Appropriations Act.

Separability, repeals, and amendments

Section 11 provides a separability rule: any portion or provision declared unconstitutional shall nullify that portion or provision, and the remaining provisions are not affected by that unconstitutionality.
Section 12 repeals or amends all inconsistent laws, decrees, executive orders, rules and regulations, and other issuances or parts thereof with respect to provisions of Republic Act No. 8220.