University of Pangasinan v. Confesor
REITERATIONFacts
The Antecedents: The University of Pangasinan Faculty Union (Union) presented demands to the University of Pangasinan (UPang) on August 7, 1986, threatening a strike. Conciliation failed, and the Union went on strike on September 15, 1986. UPang questioned the strike's legality and sought a return-to-work order, which was issued on September 18, 1986. Procedural History: The Regional Office recommended dismissing claims for salary differentials for SYs 1974-1981 due to prescription and affirmed claims for SYs 1982-1988, totaling P36,444,018.29, to be chargeable against the 60% incremental proceeds of tuition fee increases. The Secretary of Labor, on October 5, 1989, adopted these recommendations but ordered a recomputation of salary differentials for SYs 1982-1988 and COLAs for semestral breaks from SY 1982-1983 to 1984-1985. Subsequent recomputations by the Regional Director resulted in amounts of P4,705,819.34 and P6,840,700.15. The Secretary of Labor, on October 10, 1991, ordered UPang to pay P6,840,700.15. Petitioner's motions for reconsideration were denied. The Petition: UPang assailed the Secretary of Labor's Order and resolutions for grave abuse of discretion, arguing that the 60% incremental proceeds should not be solely for salary increases and that claims from SY 1974-1975 to 1980-1981 were prescribed.
Issue(s)
Whether the Secretary of Labor committed grave abuse of discretion in affirming the recomputation of monetary claims, specifically regarding the use of incremental proceeds of tuition fee increases. Whether the 60% incremental proceeds of tuition fee increases can be used for allowances and fringe benefits. Whether the claims for salary differentials for SYs 1974-1975 to 1980-1981 have prescribed.
Ruling
The petition is GRANTED. The decision of the Secretary of Labor is MODIFIED by excluding claims covering SYs 1974 to 1981 on the ground of prescription. Benefits and allowances due shall be charged to the sixty percent incremental proceeds of tuition fee increases. The case is remanded for recomputation.
Ratio Decidendi
On the issue of grave abuse of discretion and the use of incremental proceeds: The Court found merit in the petition. While Presidential Decree No. 451 initially mandated that at least sixty percent of tuition fee increases be applied toward equitable increases in emoluments and other benefits for faculty and staff, the Supreme Court, in University of the East v. U.E. Faculty Association, clarified that this 60% was to be devoted entirely to wage or salary increases, not allowances and benefits. However, with the enactment of Batas Pambansa Blg. 232 (Education Act of 1982), Section 42 thereof broadened the rule-making authority of the Ministry of Education. Subsequent implementing rules and regulations, such as MEC's Order No. 23, s. 1983, and others, consistently permitted the charging of allowances and fringe benefits against the 60% incremental proceeds. The Court held that the Secretary of Labor committed grave abuse of discretion in failing to consider this subsequent rule change, which allowed for the inclusion of allowances and benefits in the computation. Therefore, UPang's proposition that the 60% proceeds could be used for benefits and allowances found adequate legal basis. On the issue of whether the 60% incremental proceeds can be used for allowances and fringe benefits: As stated above, the Court held that the Secretary of Labor committed grave abuse of discretion in failing to consider the subsequent rule change, which allowed for the inclusion of allowances and benefits in the computation. Therefore, UPang's proposition that the 60% proceeds could be used for benefits and allowances found adequate legal basis. On the issue of prescription of money claims: The Court ruled in favor of the petitioner regarding the prescription of claims. Article 291 of the Labor Code, as amended, provides that all money claims arising from employer-employee relations must be filed within three years from the time the cause of action accrued, otherwise they shall be forever barred. The claims for salary differentials for SYs 1974-1975 to 1980-1981 were made in September 1986, which was beyond the three-year prescriptive period. The Court reiterated the ruling in Cebu Institute of Technology v. Ople, stating that the three-year period for filing money claims under the Labor Code equally applies to claims for incremental proceeds from tuition fee increases under PD 451. Consequently, the Secretary of Labor acted with grave abuse of discretion in adopting the Regional Director's computation that included the period from SYs 1974-1975 to 1980-1981.
Main Doctrine
The allocation of the 60% incremental proceeds from tuition fee increases is governed by Batas Pambansa Blg. 232 and its implementing rules, which permit charging allowances and fringe benefits against said proceeds, a departure from the stricter interpretation under Presidential Decree No. 451. Claims for salary differentials prescribed if not filed within three years from accrual.