Gov’t workers to get bonuses, cash gifts next week–DBM

GOVERNMENT employees can expect to receive their bonuses and cash gifts starting the middle of this month, according to the Department of Budget and Management (DBM).

In a circular issued on Nov. 9, Budget Secretary Florencio “Butch” Abad said the remaining half of the year-end bonus as well as the cash gift for 2015 “shall be released not earlier than Nov. 15.”

The other half of the year-end bonus was distributed in May, ahead of the start of classes for most students in June. This remaining half was expected to be spent mainly on Christmas-related celebrations.

The year-end bonus is equivalent to one month’s worth of the government worker’s basic salary, while the additional cash gift amounts to P5,000.

Both the bonus and the cash gift are given “to all national government officials and employees, whether under regular, temporary, casual or contractual status, on full-time or part-time basis, who have rendered at least a total of four months of service, including leaves of absence with pay from Jan. 1 to Oct. 31 of each year, and who are still in the service as of Oct. 31 of the same year,” the DBM noted.

The government allotted P20.95 billion for year-end bonuses on top of P4.69 billion in cash gift under the 2015 national budget.

Government-owned and -controlled corporations as well as government financial institutions, meanwhile, source bonuses from their corporate funds.

Local government units also draw bonuses from their own funds.

The over 1.5 million workers in government—from the President down to minimum wage earners— are also expected to enjoy higher pay next year under a proposed bill endorsed by President Aquino to Congress on Monday.

Under the proposed Salary Standardization Law (SSL) of 2015, the pay of government workers will be adjusted over the next four years starting 2016. (See story on Page A1.)

Abad said both the Senate and the House of Representatives have committed to pass by Dec. 19 the salary bill that will cost the government a total of P226 billion.

Once passed into law, the initial tranche of salary adjustment will take effect on Jan. 1, 2016, Abad said. The three succeeding tranches will be implemented every Jan. 1 of the subsequent years.

Under the proposed SSL, the salary of the next Philippine President will more than triple to P388,096 a month by 2019, from the current P120,000 a month.

Workers with Salary Grade 1 however will get a minimal increase, from the present P9,000 a month, to P11,068 a month by 2019.

Abad said the salary adjustments were benchmarked with “market” rates, the pay being received by the workers’ counterparts in the private sector. At present, government employees receive the equivalent of only 55 percent of market rates, he added.

The proposed pay hike across all salary grades averages 45 percent, equivalent to 84 percent of compensation levels in the private sector, the DBM said.

The additional pay will come from basic salary increases, a 14th-month pay to be distributed every midyear, and an enhanced performance-based bonus.

The budget secretary said the proposed adjustments were based on a study conducted by the DBM in cooperation with private sector consultant, Towers Watson.

With the law signed by President Aquino early this year that raised to P82,000 the tax-exemption cap on bonuses, the DBM said the “majority of (government) employees will enjoy a higher take-home pay” once the Salary Standardization Law of 2015 takes effect.

The higher salaries should enable government to keep its workers amid more intense competition from the private sector, Abad said.