The Supreme Court, in this case, affirmed the Commission on Audit’s (COA) decision to disallow per diems received by a government official who was representing the Secretary of Labor in the Philippine Economic Zone Authority (PEZA) Board meetings. This ruling underscores the constitutional prohibition against double compensation for government officials, ensuring that public servants are not compensated twice for the same service. The decision reinforces the principle that representatives of Cabinet members are subject to the same restrictions as their principals, preventing them from receiving additional compensation for their ex-officio roles.

When a Seat at the Table Doesn’t Entitle You to Extra Pay: The Bitonio Case

The case of Benedicto Ernesto R. Bitonio, Jr. v. Commission on Audit revolves around whether a government official, designated as a representative of a Cabinet Secretary, is entitled to receive per diems for attending board meetings in an ex-officio capacity. Benedicto Ernesto R. Bitonio, Jr., then Director IV of the Bureau of Labor Relations in the Department of Labor and Employment (DOLE), was designated as the DOLE representative to the Board of Directors of the Philippine Economic Zone Authority (PEZA). As a representative, Bitonio received per diems for attending PEZA board meetings from 1995 to 1997. However, the COA disallowed these payments, citing the constitutional prohibition against double compensation as interpreted in Civil Liberties Union v. Executive Secretary.

The COA’s disallowance was based on the principle that Cabinet members and their representatives are prohibited from receiving additional compensation for holding multiple government positions, except when expressly allowed by the Constitution. Bitonio contested the disallowance, arguing that Republic Act (R.A.) No. 7916, the Special Economic Zone Act of 1995, specifically provided for the payment of per diems to board members and that this law was enacted after the Civil Liberties Union case. He also argued that as Director IV, he was not covered by the prohibition applicable to Cabinet Secretaries and their deputies. The Supreme Court, however, sided with the COA, emphasizing that Bitonio’s presence in the PEZA Board was solely by virtue of his capacity as a representative of the Secretary of Labor. Therefore, he was subject to the same restrictions as his principal.

The core of the legal issue stems from Section 13, Article VII of the 1987 Constitution, which states:

Sec. 13. The President, Vice-President, the Members of the Cabinet, and their deputies or assistants shall not, unless otherwise provided in this Constitution, hold any other office or employment during their tenure. They shall not, during their tenure, directly or indirectly, practice any other profession, participate in any business or be financially interested in any other contract with, or in any franchise, or special privilege granted by the Government or any subdivision, agency or instrumentality thereof, including any government-owned or controlled corporations or their subsidiaries. They shall strictly avoid conflict of interest in the conduct of their office.

This provision aims to prevent conflicts of interest and ensure the full dedication of high-ranking officials to their primary roles. The Supreme Court, in Civil Liberties Union v. Executive Secretary, interpreted this provision to mean that Cabinet Secretaries, Undersecretaries, and Assistant Secretaries are generally prohibited from holding other government positions and receiving additional compensation, unless explicitly allowed by the Constitution.

Building on this principle, the COA issued Memorandum No. 97-038, directing the disallowance of any additional compensation to Cabinet Secretaries, their deputies, and assistants, or their representatives, in violation of the rule on multiple positions. The petitioner argued that since R.A. No. 7916 authorized the payment of per diems, it should be presumed valid unless declared unconstitutional. He further contended that the law was enacted after the Civil Liberties Union case, implying that the legislature was aware of the constitutional limitations. However, the Court rejected this argument, stating that any legislative enactment must conform to the Constitution, which is the supreme law of the land. The Court also stated that even though the legislature has competence to enact laws, this competence must be exercised within the framework of the Constitution from which the Legislature draws its power.

The Supreme Court further supported its decision by referencing the case of Dela Cruz v. Commission on Audit, where it upheld the COA’s disallowance of honoraria and per diems to officers who sat as members of the National Housing Authority (NHA) Board of Directors in an ex-officio capacity. The Court reasoned that since the Executive Department Secretaries, as ex-officio members of the NHA Board, were prohibited from receiving extra compensation, their alternates could not be entitled to such compensation either. The court emphasized that giving the alternates the right to receive compensation would create a situation where they had a better right than their principals.

In the Bitonio case, the Supreme Court emphasized that the petitioner’s presence in the PEZA Board was solely due to his designation as the representative of the Secretary of Labor. The Court stated that the representative cannot have a better right than his principal. Consequently, the same prohibitions and restrictions that applied to the Secretary of Labor also applied to Bitonio as the representative. Therefore, his position as Director IV of the DOLE was irrelevant since he attended the board meetings on behalf of the Secretary of Labor.

It is important to note that R.A. No. 7916 was later amended by R.A. No. 8748. The amendment specified that undersecretaries of various departments should sit as board members of PEZA, removing the option for Cabinet Secretaries to designate representatives. The amendment also deleted the provision regarding the payment of per diems to board members, recognizing that such a stipulation conflicted with the constitutional prohibition against double compensation. This legislative action further supports the Supreme Court’s decision in the Bitonio case.

FAQs

What was the key issue in this case?	The key issue was whether a government official, representing a Cabinet Secretary, could receive per diems for attending board meetings, given the constitutional prohibition against double compensation.
What is a per diem?	A per diem is a daily allowance given to individuals to cover expenses incurred while performing official duties away from their regular workplace. It is intended to cover costs like meals, lodging, and transportation.
What did the Commission on Audit (COA) disallow?	The COA disallowed the payment of per diems to Benedicto Ernesto R. Bitonio, Jr. for his attendance in the PEZA Board of Directors’ meetings as the representative of the Secretary of Labor.
What was the basis for the COA’s decision?	The COA based its decision on the case of Civil Liberties Union v. Executive Secretary, which prohibits Cabinet Secretaries, Undersecretaries, and their assistants from receiving additional compensation for holding multiple government positions.
What was Bitonio’s main argument?	Bitonio argued that R.A. No. 7916 specifically provided for the payment of per diems and that he, as Director IV, was not covered by the prohibition applicable to Cabinet Secretaries.
How did the Supreme Court rule on Bitonio’s argument?	The Supreme Court rejected Bitonio’s argument, stating that his presence in the PEZA Board was solely as a representative of the Secretary of Labor and, therefore, he was subject to the same restrictions.
What is the significance of Section 13, Article VII of the Constitution?	Section 13, Article VII of the Constitution prohibits high-ranking government officials from holding multiple positions and receiving additional compensation, aiming to prevent conflicts of interest.
How did the amendment of R.A. No. 7916 affect the case?	The amendment of R.A. No. 7916, through R.A. No. 8748, reinforced the prohibition against double compensation by specifying that undersecretaries should sit on the PEZA Board and removing the per diem provision.
What was the ruling of Dela Cruz v. Commission on Audit?	The Supreme Court ruled that the secretaries and their alternates cannot have extra compensation as a per diem or an honorarium or an allowance because it is prohibited by the Constitution.

The Supreme Court’s decision in the Bitonio case reinforces the constitutional prohibition against double compensation for government officials. It clarifies that representatives of Cabinet members are subject to the same restrictions as their principals, ensuring that public servants are not compensated twice for the same service. This ruling promotes transparency and accountability in government and underscores the importance of adhering to constitutional principles.

For inquiries regarding the application of this ruling to specific circumstances, please contact ASG Law through contact or via email at frontdesk@asglawpartners.com.

Disclaimer: This analysis is provided for informational purposes only and does not constitute legal advice. For specific legal guidance tailored to your situation, please consult with a qualified attorney.
Source: Benedicto Ernesto R. Bitonio, Jr. v. Commission on Audit, G.R. No. 147392, March 12, 2004