Legal basis and institutional setup
- Executive Order No. 180 (June 1, 1987) authorizes all government employees, including those in GOCCs with original charters, to form, join, or assist employees’ organizations of their own choosing for the furtherance and protection of their interests.
- Chapter 6, Title 1, Book V of Executive Order No. 292 (Administrative Code of 1987) (July 25, 1987) further provides the legal framework for the right of government employees to self-organization.
- The Public Sector Labor-Management Council (PSLMC) was created, chaired by the Civil Service Commission Chairman and vice-chaired by the Secretary of Labor and Employment, with Secretaries of Budget and Management, Finance, and Justice as members.
- The PSLMC is tasked to implement pertinent laws and promulgate rules to promote the right of government employees to self-organization, and issued PSLMC Resolution No. 1 (July 20, 1999) providing for the conditional grant of CNA signing bonus.
Policy and purpose
- CNA signing bonus is granted as a reward to rank-and-file employees for successfully forging unity, cooperation, and organization to protect and further their interests.
- The bonus is intended to foster an alliance/partnership with management for a well-organized and well-operated agency.
- The Circular prescribes the rules and regulations on the grant of CNA signing bonus pursuant to PSLMC Resolution No. 1.
Coverage: who may receive
- The Circular applies to all rank-and-file employees of the government regardless of employment status: permanent, temporary, contractual, casual, or emergency; and full-time or part-time.
- Eligible employees must have rendered at least a total six (6) months service, including leaves of absence with pay, in NGAs, GOCCs, GFIs, and LGUs within one year immediately preceding the date of signing/ratification of the CNAs of their respective agencies.
- Eligible employees must still be employed in the same agency as of the signing of its CNA.
Defined terms: key concepts
- Rank-and-File Employees refer to government employees with the rank of division chief and below.
- Collective Negotiation Agreement (CNA) refers to the written agreement entered into by the employee organization with management, stipulating terms and conditions of employment or improvements not fixed by law in accordance with EO 180.
- Employee Organization refers to an association or body of rank-and-file employees organized to further and safeguard rights and interests regarding working conditions, rights, privileges, and other employee concerns.
- Duly Registered Employee Organization refers to an employee organization duly registered with the Department of Labor and Employment and the Civil Service Commission in accordance with EO 180.
- Duly Recognized Employee Organization refers to an employee organization accorded voluntary recognition by the Department of Labor and Employment through its Bureau of Labor Relations, in accordance with EO 180.
Eligibility limits, exemptions, and exclusions
- High level government personnel whose functions are normally considered policy-making or managerial, or whose duties are highly confidential, are excluded from eligibility.
- Employees higher than division chiefs are excluded from eligibility.
- Individuals whose services are hired not as part of the regular workforce and without an employee-employer relationship—such as consultants and experts, contract workers hired on piecework basis (pakiao workers), student laborers and apprentices, and others similarly situated—are excluded.
- In local governments, employees occupying positions with rank of Assistant Department Head and above are excluded.
CNA signing bonus rules and rates
The CNA signing bonus may be granted at a rate not exceeding PHP 5,000 per personnel.
The grant is conditioned on these requirements:
- The government entity has a duly registered and duly recognized employee organization.
- The CNA is duly ratified/approved by both management and the registered and recognized employee organization.
For funding eligibility, the Circular requires different funding approvals by government type:
GOCCs / GFIs / SUCs
- An appropriate Board of Directors resolution for GOCCs/GFIs approving the grant and including a specific funding requirement for the purpose in the corporate operating budget; and an appropriate Board of Trustees resolution for SUCs including a specific funding requirement for the purpose.
- In committing resources:
- The required 50% dividends to be remitted to the National Treasury under Republic Act No. 7656 (November 9, 1993) must not be reduced.
- No additional funding shall come from the national government.
- For Local Water Districts, the funding requirement must be within 75% of revenue from operation net of the required subsidy for loan amortization.
NGAs
- A specific appropriation item in the annual budget of the agency under the General Appropriations Act (GAA), and the agency must include the funding requirement in its budget proposals.
LGUs
- An Appropriation Ordinance by the local sanggunian approving the grant and necessary funds, or inclusion of a specific funding requirement in the annual budget or supplemental budget, subject to the personal services limitation under RA 7160.
The head of the GOCC/GFI/SUC/LGU concerned decides the bonus rate not exceeding PHP 5,000, considering the availability of funds and program priorities.
For NGAs, the bonus rate is based on the amount provided in the agency’s annual budget under the GAA.
The benefit must be granted not earlier than the date of signing of the CNA.
After a new CNA is approved, the signing bonus may be granted again, but only once in three (3) years.
If a CNA is ratified every year, the three-year counting starts from the approval date of the CNA used as the basis of the payment of the last signing bonus.
If an employee already received the CNA bonus in an old agency and is transferred before the signing of the CNA in a new agency, the employee is not entitled to the bonus in the new agency within the three-year period following the old grant.
If the CNA bonus amount received in the old agency is lower than the CNA bonus in the new agency, the employee may receive the difference, provided the employee has rendered at least six (6) months of service in the new agency before the signing of the CNA there.
Each entity or frontline bureau created under a distinct enabling act or law and treated as a separate and distinct institution is treated as a separate and distinct agency for purposes of the Circular.
Government offices/bureaus placed directly under a department/department-level entity and whose creation is not through a charter are treated as part of the concerned department.
CNAs ratified before July 20, 1999—the signing date/approval of PSLMC Resolution No. 1, s. 1999—are not covered by the Circular.
The signing bonus is not part of the terms and conditions of the CNAs.
If funds are insufficient, government entities may grant a lesser amount at a uniform rate for all personnel.
Timing, treatment of repeated CNAs, and agency structure
- The bonus is tied to the signing date of the CNA and is not awarded earlier than that date.
- A bonus can be awarded upon approval of a new CNA, but the entitlement is limited to once in three (3) years.
- For annually ratified CNAs, the three-year period is measured from the approval date of the CNA that was used for the last payment.
- Separate institutions created by chartered or distinct enabling laws are handled as separate agencies for bonus entitlement and coverage purposes.
Funding source rules
- GOCCs/GFIs/SUCs must charge the CNA bonus funding requirement from their respective corporate/agency funds.
- NGAs must charge from the appropriation for the purpose in their annual budgets as authorized under the GAA.
- LGUs must charge from local funds.
Agency head liability and reporting
- The Head of the Agency/Local Chief Executive is personally liable for any payment of the signing bonus not in accordance with the Circular.
- Any excess payment made may be refunded by the employee concerned, without prejudice to the personal liability of the head.
- A report must be submitted to the DBM or to the concerned DBM Regional Offices (for LGUs) by accomplishing the attached form document reflecting implementation.
Savings clause, effectivity, and controlling decisions
- Cases not covered by the provisions of the Circular must be referred to the Secretary of Budget and Management for resolution.