Which should prevail in case of conflict between a statute and an administrative regulation?

       TOPIC:

1. Which should prevail in case of conflict between a statute and an administrative regulation?
2. Other benefits (in the statute) vs. Other wage-related benefits (in the admin regulation)

Guagua National Colleges (GNC) vs. Guagua National Colleges (GNC) Faculty Labor Union and Non-Teaching and Maintenance Labor Unions 

FACTS:

Respondents Guagua National Colleges (GNC) Faculty Labor Union and Non-Teaching and Maintenance Labor Unions demanded GNC that the 70% of the tuition fee incremental proceeds (TIP) should be allocated to the payment of salaries or wages of the faculty and all other employees of the school under Section 182 (b) of the 2010 Revised Manual of Regulations for Private Schools in Basic Education (2010 Revised Manual). 

Petitioner GNC argued that the school management has discretion on the allocation of the 70% of the TIP. Petitioner stressed that RA 6728 is controlling in the manner of the distribution. 

Under Section 5(2) of R.A. 6728, 70% of the amount subsidized allotted for tuition fee or of the tuition fee increases shall go to the payment of salaries, wages, allowances allotted for tuition fee or of the tuition fee increases shall go to the payment of salaries, wages, allowances and other benefits of teaching and non-teaching personnel.

However, DECS Order No. 15, s. 1992 provides that the minimum of 70% incremental proceeds shall be added to the salaries/wages/allowances and other wage-related benefits. In effect, the guidelines issued under DECS Order No. 15, series of 1992 on the allocation of the 70% incremental proceeds under RA 6728 restricted the scope of "other benefits" by limiting its applicability to "wage-related benefits," which the law itself does not require. 

The Voluntary Arbitrator ruled in favor of the respondent labor unions. The VA ruled that administrative regulations and policies enacted by administrative bodies to interpret the law that they are entrusted to enforce have the force of law and are entitled to great weight and respect. In this case, the Department of Education Culture and Sports (DECS) is the agency tasked to implement RA 6728. Thus, DECS Order No. 15, series of 1992 (Guidelines on the Allocation of the Minimum 70% and 20% Incremental Proceeds Required under RA No. 6728) and subsequently, the 2010 Revised Manual, should prevail. 

The term "other benefits," as used in Section 5 (2) of RA 6728, should be interpreted as "wage-related benefits" or one that is immediately available or may be availed of by the employee while he is still working with the employer. A retirement plan is not a "wage-related benefit," since a Retirement Plan provides benefits to employees upon retirement; it does not provide immediate benefit or relief that may be availed of while the employee is still working. Subsequently, the CA affirmed the decision of the VA. 

ISSUE:

Whether or not the term "other benefits" under RA 6728 should only refer to "wage-related benefits" under DECS Order No. 15, s. 1992. 

RULING: 

No. 

Jurisprudence provides that a law is controlling and cannot be amended by an administrative rule or regulation. Hence, in case of conflict, the law prevails over the administrative regulations implementing it. 

In this case, RA 6728 does not qualify the term "other benefits," contrary to DECS Order No. 15, s. 1992, which limits the increase to "wage-related benefits" only. Thus, the allocation of a portion of the 70% TIP for the employees' retirement plan, which is clearly intended for the benefit of the employees, falls under the category of "other benefits" as provided under the law. 

Therefore, the increase in the retirement plan is permissible under RA 6728. 

  

STATUTORY CONSTRUCTION DISCUSSION

1. What are the conflicting provisions in this case?

Section 5(2) of RA 6728 provides that 70% of the tuition fee increases shall go to the payment of salaries, wages, allowances, and other benefits of teaching and non-teaching personnel. However, DECS Order No. 15, s. 1992 provides that the 70% incremental proceeds under RA 6728 restricted the scope of "other benefits" by limiting its applicability to "wage-related benefits."

2. What does "other benefits" mean?

The phrase "other benefits" includes the employer's mandatory share in the Social Security System (SSS), Medicare, and Pag-IBIG premiums (CIM vs. CIM Employee's Union). 

3. What is the recent administrative regulation about this law? 

Department of Education Secretary Luistro issued DepEd Order No. 11, s. 2011, which already conforms to the provision of Section 5 (2) of Republic Act No. 6728, among others, to include other benefits in the allocation of the allowed tuition fee increase, apart from the payment of salaries, wages, and allowances of members of the faculty and other school employees. 

4. Which should prevail between a conflict in the statute and the administrative regulation?

Well-settled is the rule that the letter of the law is controlling and cannot be amended by an administrative rule or regulation. Thus, "in case of discrepancy between the basic law and a rule or regulation issued to implement said law, the basic law prevails, because the said rule or regulation cannot go beyond the terms and provisions of the basic law.

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