Press Release
November 4, 2010


Rank-and-file employees will be protected in terms of compensation once a measure seeking to rationalize the operations of government-owned or controlled corporations (GOCCs) is passed into law, Senator Franklin Drilon has assured.

Drilon, author of Senate Bill 2566 or the proposed GOCC Governance Act of 2010, said that employees occupying lower ranks will be given higher percentage of salary increases than those in the higher ranks.

"We need to give due consideration to the rank-and-file and put the ratio of their compensation at par with the higher ranks, notwithstanding their respective charters," said Drilon, who chairs the Senate Finance Committee.

Currently, 27 GOCCs have been granted by Congress the authority to set their pay schemes.

The measure, the result of a series of hearings on the reported unwarranted salaries and perks received by governing boards and employees of state firms, mandates a new compensation system for directors, trustees and employees of GOCCs.

Under the measure, reasonable, justifiable and appropriate remunerations schemes will be adopted for the officers and employees of state firms to prevent the granting of unconscionable and excessive remuneration packages.

The proposed Governance Council for GOCCs, which will be created as an advisory, monitoring, recommendatory and policy-enforcing body attached to the Office of the President, will conduct compensation studies and recommend to the President a new salary scheme for GOCCs.

A review of the GOCC compensation rates will be conducted periodically by the monitoring council, taking into consideration the overall performance of the state-run firm and its contribution to the national economy, among other factors.

No exemptions will be made for state firms from the coverage of the new compensation scheme, and in no case shall there be any decrease in the salaries of incumbent employees of state-run enterprises who are covered by Republic Act 6758, as amended, upon the implementation of the Compensation and Position Classification System for state firms.

The monitoring body may also recommend, subject to the President's approval, additional allowances for certain position titles, giving due consideration to the necessity for such allowances and the good performance of the state enterprise.

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