Republic of the Philippines

SUPREME COURT
Manila
EN BANC
G.R. No. L-58870 December 18, 1987
CEBU INSTITUTE OF TECHNOLOGY (CIT), petitioner,
vs.
HON. BLAS OPLE, in his capacity as Minister, Ministry of Labor and Employment, JULIUS
ABELLA, ARSENIO ABELLANA, RODRIGO ALIWALAS, ZOSIMO ALMOCERA, GERONIDES
ANCOG, GREGORIO ASIA, ROGER BAJARIAS, BERNARDO BALATAYO, JR., BASILIO
CABALLES, DEMOCRITO TEVES, VOLTAIRE DELA CERNA, ROBERTO COBARRUBIAS,
VILMA GOMEZ CHUA, RUBEN GALLITO, EDGARDO CONCEPCION, VICTOR COQUILLA,
JOSE DAKOYKOY, PATERNO WONG, EVELYN LACAYA, RODRIGO GONZALES, JEOGINA
GOZO, MIGUEL CABALLES, CONSUELO JAVELOSA, QUILIANO LASCO, FRANKLIN LAUTA,
JUSTINIANA LARGO, RONALD LICUPA, ALAN MILANO, MARIA MONSANTO, REYNALDO
NOYNAY, RAMON PARADELA, NATALIO PLAZA, LUZPURA QUIROGA, NOE RODIS,
COSMENIA SAAVEDRA, LEONARDO SAGARIO, LETICIA SERRA, SIEGFREDO TABANAG,
LUCINO TAMAOSO, DANILO TERANTE, HELEN CALVO TORRES, ERNESTO VILLANUEVA,
DOLORES VILLONDO, EDWARD YAP, ROWENA VIVARES, DOLORES SANANAM, RODRIGO
BACALSO, YOLANDA TABLANTE, ROMERO BALATUCAN, CARMELITA LADOT, PANFILO
CANETE, EMMANUEL CHAVEZ, JR., SERGIO GALIDO, ANGEL COLLERA, ZOSIMO
CUNANAN, RENE BURT LLANTO, GIL BATAYOLA, VICENTE DELANTE, CANDELARIO DE
DIOS, JOSE MA. ESTELLA, NECITA TRINIDAD, ROTELLO ILUMBA, TEODORICO JAYME,
RAYMUNDO ABSIN, RUDY MANEJA, REYNA RAMOS, ANASTACIA BLANCO, FE DELMUNDO,
ELNORA MONTERA, MORRISON MONTESCLAROS, ELEAZAR PANIAMOGAN, BERNARDO
PILAPIL, RODOLFO POL, DEMOSTHENES REDOBLE, PACHECO ROMERO, DELLO
SABANAL, SARAH SALINAS, RENATO SOLATORIO, EDUARDO TABLANTE, EMMANUEL TAN,
FELICISIMO TESALUNA, JOSE VERALLO, JR., MAGDALENO VERGARA, ESMERALDA
ABARQUEZ, MAC ARTHUR DACUYCUY ACOMPANADA, TRINIDAD ADLAWAN, FE ELIZORDO
ALCANTARA, REOSEBELLA AMPER, ZENAIDA BACALSO, ELIZA BADANA, GEORGIA BAS,
ERLINDA BURIAS, ELDEFONSO BURIAS, CORAZON CASENAS, REGINO CASTANEDA,
GEORGE CATADA, CARMENCITA G. CHAVEZ, LORETIA CUNANAN, FLORES DELFIN,
TERESITA ESPINO, ELVIE GALANZA, AMADEA GALELA, TERESITA. JUNTILLA, LEONARDA
KAPUNGAN, ADORACION LANAWAN, LINDA LAYAO, GERARDO LAYSON, VIRGILIO
LIBETARIO, RAYMOND PAUL LOGARTA, NORMA LUCERO, ANATOLIA MENDEZ, ELIODORO
MENDEZ, JUDALINE MONTE, ELMA OCAMPO, ESTEFA OLIVARES, GEORGE ORAIS,
CRISPINA PALANG, GRETA PEGARIDO, MELBA QUIACHON, REMEDIOS QUIROS, VIRGINIA
RANCES, EDNA DELOS REYES, VICENTE TAN, EMERGENCIA ROSELL, JULIETA TATING,
MERCIA TECARRO, FELISA VERGARA, WEMINA VILLACIN, MACRINA YBARSABAL,
MILAGROS CATALAN, JULIETA AQUINDE, SONIA ARTIAGA, MA. TERESITA OBANDO,
ASUNCION ABAYAN, ESTHER CARREON, ECHEVARRE, BUENAFE SAMSON, CONCEPCION
GONZALES, VITALIANA VENERACION, LEONCIA ABELLAR, REYNITA
VILLACARLOS. respondents.

No. L-68345 December 18, 1987

DIVINE WORD COLLEGE OF LEGAZPI, petitioner,
vs.
The Honorable Deputy Minister of Labor and Employment, VICENTE LEOGARDO, JR., the
HONORABLE REGIONAL DIRECTOR (Regional Office No. 5) of the Ministry of Labor &
Employment GERARDO S. CASTILLO, CECILIA MANUEL and other alleged
complainants, respondents.
Nos. L-69224-5 December 18, 1987
FAR EASTERN UNIVERSITY EMPLOYEES LABOR UNION, petitioner,
vs.
FAR EASTERN UNIVERSITY and the NATIONAL LABOR RELATIONS
COMMISSION, respondents.
No. 70832 December 18, 1987
GREGORIO T. FABROS, ROGELIO B. DE GUZMAN, CRESENCIANO ESPINO, JOSE RAMOS
SUNGA, BAYLON BANEZ FERNANDO ELESTERIO, ISMAEL TABO, AMABLE TUIBEO CELSO
TUBAY, RAFAEL HERNANDEZ, GERONIMO JASARENO, MEL BALTAZAR, MA. LOURDES
PASCUAL, T. DEL ROSARIO ACADEMY TEACHERS and EMPLOYEES ASSOCIATION, DENNIS
MONTE, BECKY TORRES, LOIDA VELASCO, ROMLY NERY, DAISY N. AMPIG, PATRICIO
DOLORES, ROGELIO RAMIREZ, and NILDA L. SEVILLA, petitioners,
vs.
The HON. JAIME C. LAYA, in his capacity as Minister of Education, Culture and
Sports, respondents.
No. L-76524 December 18, 1987
JASMIN BISCOCHO, ROWENA MARIANO, AGNES GALLEGO, MA. ANA ORDENES, ISABEL
DE LEON, LUZVIMINDA FIDEL, MARIQUIT REYES, SOTERA ORTIZ, ANGELINA ROXAS,
BITUIN DE PANO, ELIZABETH ORDEN, APOLLO ORDEN, GUILLERMA CERCANO, IMELDA
CARINGAL, EFREN BATIFORA, ROSIE VALDEZ, DELIA QUILATEZ, FELIX RODRIGUEZ,
OSCAR RODRIGUEZ, JOVITA CEREZO, JOSEFINA BONDOC, BELEN POSADAS, DOLORES
PALMA, ANTONINA CRUS, CONRADO BANAYAT, TERESITA LORBES, and CORAZON
MIRANDA, petitioners,
vs.
THE HONORABLE AUGUSTO SANCHEZ, in his capacity as Minister of Labor and
Employment, ESPIRITU SANTO PAROCHIAL SCHOOL AND ESPIRITU SANTO PAROCHIAL
SCHOOL FACULTY ASSOCIATION,respondents.
No. 76596 December 18, 1987
RICARDO C. VALMONTE and CORAZON BADIOLA, petitioners,
vs.

THE HONORABLE AUGUSTO SANCHEZ, in his capacity as Minister of Labor and

Employment, ESPIRITU SANTO PAROCHIAL SCHOOL FACULTY ASSOCIATION, and
ESPIRITU SANTO PAROCHIAL SCHOOL,respondents.

CORTES, J.:
Six cases involving various private schools, their teachers and non-teaching school personnel, and
even parents with children studying in said schools, as well as the then Minister of Labor and
Employment, his Deputy, the National Labor Relations Commission, and the then Minister of
Education, Culture and Sports, have beenconsolidated in this single Decision in order to dispose of
uniformly the common legal issue raised therein, namely,the allocation of the incremental proceeds
of authorized tuition fee increases of private schools provided for in section 3 (a) of Presidential
Decree No. 451, and thereafter, under the Education Act of 1982 (Batas Pambansa Blg. 232).
Specifically, the common problem presented by these cases requires an interpretation of section
3(a) of Pres. Decree No. 451 which states:
SEC. 3. Limitations. The increase in tuition or other school fees or other charges
as well as the new fees or charges authorized under the next preceding section shall
be subject to the following conditions;
(a) That no increase in tuition or other school fees or charges shall be approved
unless sixty (60%) per centum of the proceeds is allocated for increase in salaries or
wages of the members of the faculty and all other employees of the school
concerned, and the balance for institutional development, student assistance and
extension services, and return to investments: Provided That in no case shall the
return to investments exceed twelve (12%) per centum of the incremental proceeds;
xxx xxx xxx
In addition, there is also a need for a pronouncement on the effect of the subsequent enactment of
B.P. Blg. 232 which provides for the allocation of tuition fee increases in section 42 thereof.
In a nutshell, the present controversy was precipitated by the claims of some school personnel for
allowances and other benefits and the refusal of the private schools concerned to pay said
allowances and benefits on the ground that said items should be deemed included in the salary
increases they had paid out of the 60% portion of the proceeds from tuition fee increases provided
for in section 3 (a) of Pres. Decree No. 451. The interpretation and construction of laws being a
matter of judicial power and duty [Marbury v. Madison, 1 Cranch 137 (1803); Endencia v. David, 93
Phil. 696 (1953)], this Court has been called upon to resolve the controversy.
In the process of reading and at times, having to decipher, the numerous pleadings filed in the six
cases, the Court found that the main issue has been approached by the parties from almost
diametrical points, thereby bringing into focus three sub-issues: first, whether or not allowances and

other fringe benefits of faculty members and other school employees may be charged against the
60% portion of the tuition fee increases provided for in section 3(a) of Pres. Dec. No. 451: second,
whether or not the same items may be charged against said portion under the provisions of B.P. Blg.
232: and, third, whether or not schools and their employees may enter into a collective bargaining
agreement allocating more than 60% of said incremental proceeds for salary increases and other
benefits of said employees. After these sub-issues have been resolved, the Court will tackle the
other incidents attending the individual cases, seriatim.
The factual antecedents that brought these cases before this Tribunal are as follows:
I.. FACTUAL BACKGROUND OF EACH CASE
A.
CEBU INSTITUTE OF TECHNOLOGY CASE
This case originated from a Complaint filed with the Regional Office No. VII of the Ministry of Labor
on February 11, 1981 against petitioner Cebu Institute of Technology (CIT) by private respondents,
Panfilo Canete, et al., teachers of CIT, for non-payment of: a) cost of living allowances (COLA) under
Pres. Dec. Nos. 525, 1123, 1614, 1678 and 1713, b) thirteenth (13th) month pay differentials and c)
service incentive leave. By virtue of an Order issued by the then Deputy Minister of Labor Carmelo
C. Noriel, a labor-management committee composed of one representative each from the Ministry of
Labor and Employment (MOLE), the Minister of Education, Culture and Sports (MECS), and two
representatives each from CIT and from the teachers was created. Said committee was to ascertain
compliance with the legal requirements for the payment of COLA, thirteenth (13th) month pay and
service incentive leave [Rollo, p. 84].
The position taken by CIT during the conference held by the labor management committee was that
it had paid the allowances mandated by various decrees but the same had been integrated in the
teacher's hourly rate. It alleged that the payment of COLA by way of salary increases is in line with
Pres. Dec. No. 451. It also claimed in its position paper that it had paid thirteenth month pay to its
employees and that it was exempt from the payment of service incentive leave to its teachers who
were employed on contract basis [Rollo, pp. 85-86].
After the report and recommendation of the committee, herein public respondent, then Minister of
Labor and Employment issued the assailed Order dated September 29, 1981 and held that the basic
hourly rate designated in the Teachers' Program is regarded as the basic hourly rate of
teachers exclusive of the COLA, and that COLA should not be taken from the 60% incremental
proceeds of the approved increase in tuition fee. The dispositive portion of the Order reads:
PREMISES CONSIDERED, CIT is hereby ordered to pay its teaching staff the
following:
1) COLA under P.D.'s 525 and 1123 from February 1978 up to 1981;
2) COLA under P.D.'s l6l4,1634,1678 and l7l3;and

3) Service incentive leave from l978 upto l981.

CIT is further directed to integrate into the basic salaries of its teachers and (sic)
COLA under P.D.'s 525 and 1123 starting on January 1981, pursuant to P.D. 1751.
For purposes of integration, the hourly rate shown in its Teachers' Program for school
year 198182 shall be considered as the basic hourly rate.
SO ORDERED.
Petitioner assails the aforesaid Order in this Special Civil Action of certiorari with Preliminary
Injunction and/or Restraining Order. The Court issued a Temporary Restraining Order on December
7, 1981 against the enforcement of the questioned Order of the Minister of Labor and Employment.
B.
DIVINE WORD COLLEGE OF LEGAZPI CASE
Upon a complaint filed by ten faculty members for alleged non-compliance by herein petitioner
Divine Word College of Legazpi with, among others, Pres. Dec. No. 451, i.e., allowances were
charged to the 60% incremental proceeds of tuition fee increase, the Labor Regulation Section of
Regional Office No. V (Legazpi City) of the Ministry of Labor and Employment conducted an
inspection of the employment records of said school. On the basis of the report on the special
inspection that the school did not comply with Pres. Dec. No. 451, herein respondent Regional
Director issued an Order dated May 30, 1983, requiring compliance by the Divine Word College. The
latter filed a Memorandum of Appeal from said Order which the Regional Director treated as a
Motion for Reconsideration. Upon failure of the school to comply with the aforesaid Order, another
Order (August 2, 1983) was issued by herein respondent Regional Director requiring herein
petitioner to pay the faculty members- complainants (herein private respondents) the amounts
indicated therein or the total sum of Six Hundred Seventeen Thousand Nine Hundred Sixty Seven
Pesos and Seventy Seven Centavos (P 617,967.77). Petitioner's Motion for Reconsideration of the
Order was denied.
On appeal, the respondent Deputy Minister of Labor and Employment affirmed the Order of the
Regional Director,viz:
xxx xxx xxx
Coming now to the substantial merit of the case, we share the view that the
emergency allowances due the complainants under the several presidential decrees
(PD's 525, 1123, etc.) cannot be charged by the respondent against the 60% of the
incremental proceeds from increase in tuition fees authorized under PD 451, not only
because as per decision of the Supreme Court (UE vs. UE Faculty Association, et.
al., G.R. No. 57387, September 30, 1982) said allowances whether mandated by law
or secured by collective bargaining should be taken only from the return to
investment referred to in the decree if the school has no other resources to grant the
allowances but not from the 60% incremental proceeds, but also because to hold

otherwise would, to our mind, inevitably result in the loss of one benefit due the
complainants-that is the salary or wage increase granted them by PD 451.
In other words, we believe that by paying the complainants' allowances out of the
60% incremental proceeds intended for their salary increase they are practically
being deprived of one benefit-their share in the 60% incremental proceeds in terms
of salary or wage increase.
WHEREFORE, for the reasons abovestated, the Order appealed from is hereby
AFFIRMED, and the appeal DISMISSED, for lack of merit.
SO ORDERED.
(Annex "K " to Petition; Rollo, p. 108, 110).
This special civil action of certiorari and Prohibition with Preliminary Injunction questions the
interpretation of, and application by the respondent Deputy Minister, of the provisions of Pres. Dec.
No. 45 1, as set forth in the assailed Order.
On March 25, 1985, after considering the allegations, issues and arguments adduced in the Petition
as well as the Comment thereon of the public respondent and dispensing with the private
respondents' Comment, the Court resolved to dismiss the Petition for lack of merit (Rollo, p. 198).
On April 26, 1985, petitioner filed a Motion for Reconsideration with Motion to Consider the Case En
Banc. On June 26, 1985 the First Division of the Court referred the case to the Court En Banc for
consolidation with G.R. No. 70832, entitled "Gregorio T. Fabros, et al vs. Hon. Jaime C. Laya, etc.
" since it involves the same issue on the application of 60% incremental proceeds of authorized
tuition fee increases [Rollo, p. 235]. The Court EN BANC resolved to accept the case. (Resolution of
July 16, 1985). These cases were further consolidated with other cases involving the same issues.
C.
FAR EASTERN UNIVERSITY CASE
On December 17, 1978, petitioner Union filed with the Ministry of Labor and Employment a
complaint against respondent University for non-payment of legal holiday pay and under-payment of
the thirteenth (13th) month pay. On July 7, 1979, while the case was pending, the Union President,
in his personal capacity, filed another complaint for violation of Pres. Dec. No. 451 against the same
respondent.
The two cases were forthwith consolidated and jointly heard and tried. On March 10, 1980, Labor
Arbiter Ruben A. Aquino promulgated a decision the dispositive portion of which is quoted
hereunder:
RESPONSIVE TO THE FOREGOING, respondent is hereby directed, within ten (10)
days from receipt hereof, to:

1. To (sic) pay the paid legal holidays that it withdrew since January 14, 1976 up to
the present; and
2. Pay the 13th month pay differential of complainant's for the covered period
December 16, 1975 to December 17, 1978, date of filing of complaint for nonpayment of legal holiday pay and under payment of the 13th month pay, and
thereafter. Barred forever are money claims beyond three (3) years from the time the
course (sic) of action occurred. Respondent's formula on transportation allowance
which was deducted from the 13th month pay is thus subject to this prescriptive
period, for purposes of computation of differentials for the 13th month pay.
The claim under PD 451 is hereby dismissed for lack of merit.
SO ORDERED.
(Annex " E " to Petition; Rollo, p. 55, 65-66).
Both parties appealed the decision of the Labor Arbiter. On September 18, 1984, the respondent
Commission disposed of the appeal in the following manner:
RESPONSIVE TO THE FOREGOING, the Decision of Labor Arbiter Ruben A. Aquino
in the instant case dated March 10, 1980 is hereby Modified in the sense that
complainant's claims for legal holiday pay and 13th month pay are likewise
dismissed for lack of merit and the dismissal of the claim under P.D. 451 is hereby
Affirmed en (sic) toto.
(Annex "A" to Petition: Rollo, p. 24, 35).
Petitioner's Motion for Reconsideration dated September 29, 1984 was denied for lack of merit on
November 8, 1984. Before this Court is the petition on certiorari filed by the Union assailing the
abovementioned decision of the Commissioner.
D.
FABROS CASE
This petition is in the nature of a class suit brought by petitioners in behalf of the faculty members
and other employees of more than 4000 private schools nationwide. Petitioners seek to enjoin the
implementation of paragraphs 7 to 7.5 of MECS Order No. 5, series of 1985 on the ground that the
said order is null and void for being contrary to Pres. Dec. No. 451 and the rulings of the Supreme
Court in the cases of University of the East v. UE Faculty Association [G.R. No. L-57387, September
20, 1982, 117 SCRA 5541, University of Pangasinan Faculty Union v. University of Pangasinan and
NLRC [G.R. No. 63122, February 20, 1984, 127 SCRA 691 ], St. Louis University Faculty Club v.
NLRC and St. Louis University [G.R. No. 65585, September 28, 1984, 132 SCRA 380].

On September 11, 1982, Batas Pambansa Blg. 232 (Education Act of 1982) was signed into law. On
the matter of tuition and other school fees of private schools, section 42 of said law provides as
follows:
Sec. 42. Tuition and other School Fees. Each private School shall determine its
rate of tuition and other school fees or charges. The rates and charges adopted by
schools pursuant to this provision shall be collectible, and their application or use
authorized subject to rules and regulations promulgated by the Ministry of Education,
Culture and Sports. (Emphasis supplied).
Invoking section 42 of B.P. Blg. 232, among others, as its legal basis, the then Minister of Education
Jaime C. Laya promulgated on April 1, 1985 the disputed MECS Order No. 25, s. 1985
entitled Rules and Regulations To Implement the Provisions of B.P. Blg. 232. The Education Act of
1982, Relative to Student Fees for School Year 1985-1986. The relevant portions of said Order are
quoted hereunder:
7. Application or Use of Tuition and
Other School Fees or Charges.
7.1. The proceeds from tuition fees and other school charges as well as other income
of each school shall be treated as an institutional fund which shall be administered
and managed for the support of school purposes strictly: Provided, That for the
purpose of generating additional financial resources or income for the operational
support and maintenance of each school two or more schools may pool their
institutional funds, in whole or in part, subject to the prior approval of their respective
governing boards.
7.2. Tuition fees shag be used to cover the general expenses of operating the school
in order to allow it to meet the minimum standards required by the Ministry or any
other higher standard, to which the school aspires. They may be used to meet the
costs of operation for maintaining or improving the quality of
instruction/training/research through improved facilities and through the payment of
adequate and competitive compensation for its faculty and support personnel,
including compliance with mandated increases in personnel compensation and/or
allowance.
7.3. Tuition fees shag be used to cover minimum and necessary costs including the
following: (a) compensation of school personnel such as teaching or academic staff,
school administrators, academic non-teaching personnel, and non-academic
personnel, (b) maintenance and operating expenses, including power and utilities,
rentals, depreciation, office supplies; and (c) interest expenses and installment
payments on school debts.
7.4. Not less than sixty (60) percent of the incremental tuition proceeds shall be used
for salaries or wages, allowances and fringe benefits of faculty and support staff,

including cost of living allowance, imputed costs of contributed services, thirteenth

(13th) month pay, retirement fund contributions, social security, medicare, unpaid
school personnel claims and payments as may be prescribed by mandated wage
orders. collective bargaining agreements and voluntary employer practices, Provided
That increases in fees specifically authorized for the purposes listed in paragraph
4.3.3 hereof shall be used entirely for those purposes. (Italics supplied).
7.5. Other student fees and charges as may be approved, including registration,
library, laboratory, athletic, application, testing fees and charges shall be used
exclusively for the indicated purposes, including (a) the acquisition and maintenance
of equipment, furniture and fixtures, and buildings, (b) the payment of debt
amortization and interest charges on debt incurred for school laboratory, athletic, or
other purposes, and (c) personal services and maintenance and operating expenses
incurred to operate the facilities or services for which fees and charges are collected.
The Petition prayed for the issuance of a temporary restraining order which was granted by this
Court after hearing. The dispositive portion of the resolution dated May 28, 1985 reads as follows:
After due consideration of the allegations of the petition dated May 22, 1985 and the
arguments of the parties, the Court Resolved to ISSUE, effective immediately and
continuing until further orders from this Court, a TEMPORARY RESTRAINING
ORDER enjoining the respondent from enforcing or implementing paragraphs 7.4 to
7.5 of MECS Order No. 25, s. 1985, which provide for the use and application of sixty
per centum (60%) of the increases in tuition and other school fees or charges
authorized by public respondent for the school year 1985-1986 in a manner
inconsistent with section 3(a), P.D. No. 451, (which allocates such 60% of the
increases exclusively "for increases in salaries or wages of the members of the
faculty and other employees of the school concerned.") and directing accordingly that
such 60% of the authorized increases shall be held in escrow by the respective
colleges and universities, i.e., shall be kept intact and not disbursed for any purpose
pending the Court's resolution of the issue of the validity of the aforementioned
MECS Order in question.
(Rollo, p. 21).
In the same resolution, the Philippine Association of Colleges and Universities (PACU) was
impleaded as respondent.
Subsequent to the issuance of this resolution, four (4) schools, represented in this petition, moved
for the lifting of the temporary restraining order as to them. In separate resolutions, this Court
granted their prayers.
Ateneo de Manila University, De La Sale University (Taft Avenue) and De La Salle University-South,
through their respective counsels, manifested that for the school year 1985-1986, tuition fee
increase was approved by the MECS and that on the basis of Pres. Dec. No. 451, 60% of the tuition
fee increases shall answer for salary increase. However, a budgeted salary increase, exclusive of

living allowances and other benefits, was approved for the same school year which when computed
amounts to more than the 60%.
This Court granted the motions in separate resolutions lifting the temporary restraining order with
respect to these schools in order that they may proceed with the implementation of the general
salary increase for their employees.
In the case of St. Louis University, its Faculty Club, Administrative Personnel Association and the
University itself joined in a petition seeking for leave that 49% of the increase in tuition and other
fees for school year 1985-1986 be released. Petitioners manifested that the remaining balance shall
continue to be held in escrow by the University.
In a resolution dated January 28, 1986, the Court resolved as follows:
Accordingly, the Temporary Restraining Order issued by this Court on May 28, 1985
is hereby ordered LIFTED with respect to Saint Louis University of Baguio City in
order that it may proceed immediately with the implementation of salary increases for
its employees.
D.
BISCOCHO CASE
The Espiritu Santo Parochial School and the Espiritu Santo Parochial School Faculty Association
were parties to a labor dispute which arose from a deadlock in collective bargaining. The parties
entered into conciliation proceedings. The union went on strike after efforts at the conciliation failed.
Subsequently, a return to work agreement was forged between the parties and both agreed to
submit their labor dispute to the jurisdiction of the Minister of Labor.
In the exercise of his power to assume jurisdiction, the Ministry of Labor and Employment issued an
Order dated April 14, 1986 which provides for the following:
IN CONSIDERATION OF ALL THE FOREGOING, the Ministry hereby declares the
strike staged by the Union to be legal and orders the following:
a) the School to submit the pertinent record of employment of Romualdo Noriego to
the Research and Information Division of the NLRC for computation of his
underpayment of wages and for the parties to abide by the said computation;
b) the School to submit all pertinent record of collections of tuition fee increases for
school year (sic) 1982-1983, 1983-1984 and 1984-1985 to the Research and
Information Division of the NLRC for proper computation and for equal distribution of
the amount to all employees and teachers during the abovementioned school year
(sic) as their salary adjustment under P.D. 461;

c) the parties to wait for the final resolution of the illegal dismissal (case) docketed as
NLRC NCR Case No. 5-1450-85 and to abide by the said resolution;
d) to furnish the MECS a copy of this order for them to issue the guidelines in the
implementation of PRODED Program;
e) the parties to execute a collective bargaining agreement with an economic
package equivalent to 90% of the proceeds from tuition fee increases for school year
1985-1986 and another 90% for school year 1986-1987 and 85% for school year
1987-1988. The amount aforementioned shall be divided equally to all members of
the bargaining unit as their respective salary adjustments. Such other benefits being
enjoyed by the members of the bargaining unit prior to the negotiation of the CBA
shall remain the same and shall not be reduced.
f) the School to deduct the amount equivalent to ten (10%) per cent of the
backwages payable to all members of the bargaining unit as negotiation fee and to
deliver the same to the Union Treasurer for proper disposition (Emphasis supplied).
SO ORDERED.
(Rollo, pp. 16-17)
Pursuant to the said order, private respondent Union agreed to incorporate in their proposed
collective bargaining agreement (CBA) with the School the following:
2) The Union and School Administration will incorporate the following in their CBA 1) The computation of the tuition fee increase shall be gross to gross
from which the corresponding percentage of 90% will be taken. The
resulting amount will be divided among 141.5 employees for 1985-86
and 132.5 employees for 1986-87.
1/2 of the resulting increase will be added to basic and divided by
13.3 to arrive at monthly increase in basic. The other 1/2 will be
divided by 12.3 to arrive at monthly increase in living allowance.
xxx xxx xxx
4) xxx
Upon request/demand of the Union, School win deduct from backwages of
managerial employees and others outside the bargaining unit what Union win charge
its own members in the form of attorney's fees, special assessment and union
dues/agency fee.

5) The signing of the CBA and payment of backwages and others shall be on
November 26, 1986 at the Espiritu Santo Parochial School Library.
(Rollo, pp. 3-4).
The herein petitioners, Jasmin Biscocho and 26 others, all employees and faculty members of the
respondent School, filed the present petition for prohibition to restrain the implementation of the April
14, 1986 Order of respondent Labor Minister as well as the agreements arrived at pursuant thereto.
They contend that said Order and agreements affect their rights to the 60% incremental proceeds
under Pres. Dec. No. 451 which provide for the exclusive application of the 60% incremental
proceeds to basic salary.
Acting on the petitioners' prayer, this Court immediately issued a temporary restraining order on
November 25, 1986 ". . . enjoining the respondents from enforcing, implementing and proceeding
with the questioned order of April 14, 1986 and collective bargaining agreement executed between
respondents Union and the School Administration in pursuance thereof." [Rollo, p. 20].
F.
VALMONTE CASE
This Petition was filed by parents with children studying at respondent school, Espiritu Santo
Parochial School to nullify the Order dated April 14, 1986 issued by public respondent, then Minister
of Labor and Employment, specifically paragraphs (e) and (f) thereof, quoted in the Biscocho case.
The award contained in the said Order is the result of the assumption of jurisdiction by the public
respondent over a labor dispute involving the private respondents school and faculty association.
The latter had earlier filed a notice of strike because of a bargaining deadlock on the demands of its
members for additional economic benefits. After numerous conciliation conferences held while the
union was on strike, the parties voluntarily agreed that the public respondent shall assume
jurisdiction over all the disputes between them. As to the subject matter of the instant case, the
public respondent found that the latest proposals of the respondent school was to give 85% of the
proceeds from tuition fee increases for the school years to be divided among the teachers and
employees as salary adjustments. What the respondent faculty association offered to accept was a
package of 95% for school year 1985-1986, 90% for school year 1986- 1987. The respondent school
offered to strike the middle of the two positions, hence the Order complained of by the petitioners
[See Annex "A", Petition; Rollo, pp. 9, 14-15; Comment of the Respondent Faculty Association:
Rollo, p. 26].
II. RESOLUTION OF THE COMMON LEGAL ISSUE
This long-drawn controversy has sadly placed on the balance diverse interests, opposed yet
intertwined, and all deserving, and demanding, the protection of the State. On one arm of the
balance hang the economic survival of private schools and the private school system, undeniably
performing a complementary role in the State's efforts to maintain an adequate educational system
in the country. Perched precariously on the other arm of the same balance is the much-needed

financial uplift of schoolteachers, extolled for all times as the molders of the minds of youth, hence of
every nation's future. Ranged with them with needs and claims as insistent are other school
personnel. And then, anxiously waiting at the sidelines, is the interest of the public at large, and of
the State, in the continued availability to all who desire it, high-standard education consistent with
national goals, at a reasonable and affordable price.
Amidst these opposing forces the task at hand becomes saddled with the resultant implications that
the interpretation of the law would bear upon such varied interests. But this Court can not go beyond
what the legislature has laid down. Its duty is to say what the law is as enacted by the lawmaking
body. That is not the same as saying what the law should be or what is the correct rule in a given set
of circumstances. It is not the province of the judiciary to look into the wisdom of the law nor to
question the policies adopted by the legislative branch. Nor is it the business of this Tribunal to
remedy every unjust situation that may arise from the application of a particular law. It is for the
legislature to enact remedial legislation if that be necessary in the premises. But as always, with apt
judicial caution and cold neutrality, the Court must carry out the delicate function of interpreting the
law, guided by the Constitution and existing legislation and mindful of settled jurisprudence. The
Court's function is therefore limited, and accordingly, must confine itself to the judicial task of saying
what the law is, as enacted by the lawmaking body.
FIRST SUB-ISSUE
A. Whether or not allowances and other fringe benefits of employees may be
charged against the 60% portion of the incremental proceeds provided for in sec.
3(a) of Pres. Dec. No. 451.
1. Arguments raised in the Cebu Institute of Technology case
In maintaining its position that the salary increases it had paid to its employees should be considered
to have included the COLA, Cebu Institute of Technology (CIT) makes reference to Pres. Dec. No.
451 and its Implementing Rules. The line of reasoning of the petitioner appears to be based on the
major premise that under said decree and rules, 60% of the incremental proceeds from tuition fee
increases may be applied to salaries, allowances and other benefits of teachers and other school
personnel. In support of this major premise, petitioner cites various implementing rules and
regulations of the then Minister of Education, Culture and Sports, to the effect that 60% of the
incremental proceeds may be applied to salaries, allowances and other benefits for members of the
faculty and other school personnel [Petition citing Implementing Rules and Regulations of Pres. Dec.
No. 451 of various dates; Rollo, pp. 318-320]. Petitioner concludes that the salary increases it had
granted the CIT teachers out of the 60% portion of the incremental proceeds of its tuition fee
increases from 1974-1980 pursuant to Pres. Dec. No. 451 and the MECS implementing rules and
regulations must be deemed to have included the COLA payable to said employees for those years
[Rollo, pp. 911].
With leave of Court, the Philippine Association of Colleges and Universities, filed its Memorandum as
Intervenor in support of the proposition that schools may pay the COLA to faculty members and
other employees out of the 60% of the increase in tuition fees. In addition to the arguments already
set forth in the memorandum of the petitioner CIT, intervenor PACU attacks the Decision of this

Court in University of the East v. University of the East Faculty Association et. all G.R. No. 57387 as
"not doctrinal" and inapplicable to the CIT case. The Court held in the UE case, which was
promulgated on September 30, 1982, during the pendency of these cases, that:
... allowances and benefits should be chargeable to the return to investment referred
to in Sec. 3(a), if the schools should happen to have no other resources than
incremental proceeds of authorized tuition fee increases ... (See Dispositive Portion
of the Decision)
Intervenor PACU alleges that the aforecited U.E. decision does not categorically rule that COLA and
other fringe benefits should not be charged against the 60% incremental proceeds of the authorized
tuition fee increase.
The Solicitor General, on the other hand, argues in support of the Order of the public respondent
that Pres. Dec. No. 451 allocates the 60% proceeds of tuition fee increases exclusively for salary
increases of teachers and non- teaching supportive personnel of the school concerned, and that the
Decree does not provide that said salary increases would take the place of the COLA [Rollo, p. 244245]. He cites as authority for this stance, two (2) memoranda of the then President dated June 6,
1978 and March 30, 1979 both of which provide that the 60% incremental proceeds of tuition fee
increases "shall be allocated for the increase in the salaries of teachers and supportive personnel. "
Anent the U.E. case, the Solicitor General states that the Supreme Court in deciding said case took
note of the stand of the Office of the President that the 60% incremental proceeds shall be solely
applied to salaries of faculty members and employees.
On August 7, 1986, considering the supervening events, including the change of administration, that
have transpired during the pendency of these cases, the Court required the Solicitor General to state
whether or not he maintains the action and position taken by his predecessor-in-office. In his
Compliance with said Resolution, the Solicitor General Manifested the position that:
a. If the tuition fee increase was collected during the effectivity oil Presidential
Decree No. 451, 60% thereof shall answer exclusively for salary increase of school
personnel. Other employment benefits shall be covered by the 12% allocated for
return of investment, this is in accordance with the ruling of this Honorable Court
in University of the East vs. U.E. Faculty Association, et. al (117 SCRA 554), ... and
reiterated in University of Pangasinan Faculty Union v. University of Pangasinan, et.
al. (127 SCRA 691) and St. Louis Faculty Club u. NLRC (132 SCRA 380).
b. If the salary increase was collected during the effectivity of Batas Pambansa Blg.
(sic) 232, 60% thereof shall answer not only for salary increase of school personnel
but also for other employment benefits.
(Rollo, at pp. 513-514)
2. Arguments raised in the Divine Word College Case

Petitioner Divine Word College of Legazpi (DWC) advances the theory that the COLA, 13th month
pay and other personnel benefits decreed by law, must be deemed chargeable against the 60%
portion allocated for increase of salaries or wages of faculty and all other school employees. In
support of this stance, petitioner points out that said personnel benefits are not included in the
enumeration of the items for which the balance (less 60%) or 40% portion of the incremental
proceeds may be alloted under section 3(a) of Pres. Dec. No. 451 [Rollo, pp. 29-30. Petitioner
likewise cites the interpretation of the respondent Minister of Education, Culture and Sports
embodied in the Implementing Rules and Regulations of P.D. 451, DEC Issuance, May 13, 1987;
Rollo, p. 30], that the 60% incremental proceeds of authorized tuition fee increases may be applied
to increases in emoluments and/or benefits for members of faculty, including staff and administrative
employees of the school as the valid interpretation of the law, as against that made by the
respondent Deputy Minister of Labor in the assailed Order. If the latter interpretation is upheld,
petitioner would go as far as questioning the constitutionality of Pres. Dec. No. 451 upon the ground
that the same discriminates against the petitioner and other private schools as a class of employers.
According to the petitioner, the discrimination takes the form of requiring said class of employers to
give 60% of their profits to their employees in addition to the COLA mandated by law, while other
employers have to contend only with salary increases and COLA [Petition; Rollo, p. 46].
With regard to the Decision of this Court in the U.E. case, petitioner claims exemption therefrom
upon the ground that the Court's interpretation of a law cannot be applied retroactively to parties who
have relied upon the previous administrative interpretation which has not been declared invalid or
unconstitutional [Petition; Rollo, pp. 50-51 1. Petitioner further argues on this point that if the court
had intended to invalidate the MECS interpretation of the Decree, it should have positively stated so
in the Decision [Petition; Rollo, p. 50].
The Comment of the public respondents cite as settled jurisprudence applicable to the case at bar,
the ruling of this Court in the U.E. case, supra, which was reiterated in the subsequent cases
of University of Pangasinan Faculty Union v. University of Pangasinan et all and St. Louis Faculty
Club v. NLRC, et al.
Public respondents Deputy Minister of Labor and Employment and Regional Director of the MOLE
(Region V) likewise attack the validity of the Revised Implementing Rules and Regulations of Pres.
Dec. No. 451 cited by the petitioner insofar as said rules direct the allotment of the 60% of
incremental proceeds from tuition fee hikes for retirement plan, faculty development and allowances.
They argue that said rules and regulations were invalid for having been promulgated in excess of the
rule-making authority of the then Minister of Education under Pres. Dec. No. 451 which mandates
that the 60% of incremental proceeds from tuition fee hikes should be allotted solely for salary
increases [Comment; Rollo, pp. 184-185]. Finally, with respect to the issue on the allege
unconstitutionality of Pres. Dec. No. 451, the public respondents posit that a legislation (such as
Pres. Dec. No. 451) which affects a particular class does not infringe the constitutional guarantee of
equal protection of the law as long as it applies uniformly and without discrimination to everyone of
that class [Comment; Rollo, p. 14].
3. Arguments raised in the Far Eastern University case

It is the petitioner's contention that in respect of Pres. Dec. No. 451, the decision of the NLRC is a
defiance of the rulings of this Court in the cases of University of the East v. U.E. Faculty, Association
et al. and of University of Pangasinan Faculty Union v. University of Pangasinan and NLRC (supra).
The Union submits that monetary benefits, other than increases in basic salary, are not chargeable
to the 60% incremental proceeds.
The respondent University in its Comment dated June 13, 1982 refers to Article 97(f) of the Labor
Code which provides a definition of the term "wages" to support its position that "salaries or wages"
as used in Pres. Dec. No. 451 should be interpreted to include other benefits in terms of money.
As mentioned in the Cebu Institute of Technology case, the Solicitor General filed its Compliance
with this Court's resolution dated August 7, 1986 requiring him to manifest whether public
respondents maintain the position they have taken in these consolidated cases. The resolution of
September 25, 1986 required petitioners to Comment on said Compliance.
The Comment dated December 6, 1986 was received by this Court after petitioner Union was
required to show cause why no disciplinary action should be taken against them for failure to comply
earlier. The Union agreed with the position taken by the Solicitor General that under Pres. Dec. No.
451, 60% of the tuition fee increases, shall answer exclusively for salary increase. However, it
expressed disagreement with the opinion that during the effectivity of B.P. Blg. 232, the 60%
ncremental proceeds shall answer not only for salary increases but also for other employment
benefits. The Union argues that whereas "Pres. Dec. No. 451 is a law on a particular subject, viz.,
increase of tuition fee by educational institutions and how such increase shall be allocated B.P. Blg.
232 is not a law on a particular subject of increase of tuition fee . . . ; at most it is a general
legislation on tuition fee as it touches on such subject in general, " [Comment on Compliance; Rollo,
p. 376], Suppletory to its argument that B.P. Blg. 232 did not impliedly repeal Pres. Dec. No. 451, the
Union also invokes the principle that a special or particular law cannot be repealed by a general law.
RESOLUTION OF THE FIRST SUB-ISSUE
This Court has consistently held, beginning with the University of the East case, that if the schools
have no resources other than those derived from tuition fee increases, allowances and benefits
should be charged against the proceeds of tuition fee increases which the law allows for return on
investments under section 3(a) of Pres. Dec. No. 451, therefore, not against the 60% portion
allocated for increases in salaries and wages (See 117 SCRA at 571). This ruling was reiterated in
the University of Pangasinan case and in the Saint Louis University case.
There is no cogent reason to reverse the Court's ruling in the aforecited cases. Section 3(a) of Pres.
Dec. No. 451 imposes among the conditions for the approval of tuition fee increases, the allocation
of 60% per cent of the incremental proceeds thereof for increases in salaries or wages of school
personnel and not for any other item such as allowances or other fringe benefits. As aptly put by the
Court in University of Pangasinan Faculty Union v. University of Pangasinan, supra:
... The sixty (60%) percent incremental proceeds from the tuition increase are to be
devoted entirely to wage or salary increases which means increases in basic salary.
The law cannot be construed to include allowances which are benefits over and

above the basic salaries of the employees. To charge such benefits to the 60%
incremental proceeds would be to reduce the increase in basic salary provided by
law, an increase intended also to help the teachers and other workers tide
themselves and their families over these difficult economic times. [Italics supplied]
(127 SCRA 691, 702).
This interpretation of the law is consistent with the legislative intent expressed in the Decree itself,
i.e., to alleviate the sad plight of private schools and that of their personnel wrought by slump in
enrollment and increasing operational costs on the part of the schools, and the increasing costs of
living on the part of the personnel (Preamble, Pres. Dec. No. 451). While coming to the aid of the
private school system by simplifying the procedure for increasing tuition fees, the Decree imposes as
a condition for the approval of any such increase in fees, the allocation of 60% of the incremental
proceeds thereof, to increases in salaries or wages of school personnel. This condition makes for
a quid pro quo of the approval of any tuition fee hike by a school, thereby assuring the school
personnel concerned, of a share in its proceeds. The condition having been imposed to attain one of
the main objectives of the Decree, which is to help the school personnel cope with the increasing
costs of living, the same cannot be interpreted in a sense that would diminish the benefit granted
said personnel.
In the light of existing laws which exclude allowances from the basic salary or wage in the
computation of the amount of retirement and other benefits payable to an employee, this Court will
not adopt a different meaning of the terms "salaries or wages" to mean the opposite, i.e. to include
allowances in the concept of salaries or wages.
As to the alleged implementing rules and regulations promulgated by the then MECS to the effect
that allowances and other benefits may be charged against the 60% portion of the proceeds of
tuition fee increases provided for in Section 3(a) of Pres. Dec. No. 45 1, suffice it to say that these
were issued ultra vires, and therefore not binding upon this Court.
The rule-making authority granted by Pres. Dec. No. 451 is confined to the implementation of the
Decree and to the imposition of limitations upon the approval of tuition fee increases, to wit:
SEC. 4. Rules and Regulations. The Secretary of Education and Culture is hereby
authorized, empowered and directed to issue the requisite rules and regulations for
the effective implementation of this Decree. He may, in addition to the requirements
and limitations provided for under Sections 2 and 3 hereof, impose other
requirements and limitations as he may deem proper and reasonable.
The power does not allow the inclusion of other items in addition to those for which 60% of the
proceeds of tuition fee increases are allocated under Section 3(a) of the Decree.
Rules and regulations promulgated in accordance with the power conferred by law would have the
force and effect of law [Victorias Milling Company, Inc. v. Social Security Commission, 114 Phil. 555
(1962)] if the same are germane to the subjects of the legislation and if they conform with the
standards prescribed by the same law [People v. Maceren, G.R. No. L-32166, October 18, 1977, 79
SCRA 450]. Since the implementing rules and regulations cited by the private schools adds

allowances and other benefits to the items included in the allocation of 60% of the proceeds of
tuition fee increases expressly provided for by law, the same were issued in excess of the rulemaking authority of said agency, and therefore without binding effect upon the courts. At best the
same may be treated as administrative interpretations of the law and as such, they may be set aside
by this Court in the final determination of what the law means.
SECOND SUB-ISSUE
B. Whether or not allowances and other fringe benefits may be charged against the 60% portion of
the incremental proceeds of tuition fee increases upon the effectivity of the Education Act of 1982
(B.P. Blg. 232).
1. Arguments raised in the Fabros case
In assailing MECS Order No. 25, s. 1985, petitioners argue that the matter of allocating the proceeds
from tuition fee increases is still governed by Pres. Dec. No. 451. It is their opinion that section 42 of
B.P. Blg. 232 did not repeal Pres. Dec. No. 451 for the following reasons: first, there is no conflict
between section 42 of B.P. Blg. 232 and section 3(a) of Pres. Dec. No. 451 or any semblance of
inconsistency to deduce a case of a repeal by implication: second, Pres. Dec. No. 451 is a specific
law upon a particular subject-the purposes and distribution of the incremental proceeds of tuition fee
increases, while B.P. Blg. 232 is a general law on the educational system; as such, a specific law is
not repealed by a subsequent general law in the absence of a clear intention; and third, Pres. Dec.
No. 451 is still the only law on the subject of tuition fee increases there being no prescription or
provision in section 42 of B.P. Blg. 232 or elsewhere in the law. They furthermore aver that the
disputed MECS Order which imposed additional burdens against the 60% incremental proceeds of
tuition fee increases are not provided in either Pres. Dec. No. 451 or B.P. Blg. 232. The logical result
as intimated by petitioners is that the inclusion of paragraph 7.4 and related paragraphs 7 to 7.3 and
7.5 in the questioned MECS order contravenes the statutory authority granted to the public
respondent, and the same are therefore, void.
Respondent PACU takes the contrary view contending that MECS Order No. 25, s. 1985, complies
with the mandate of section 42 of B.P. Blg. 232 which law had already repealed Pres. Dec. No. 451.
PACU notes that theUniversity of the East case invoked by petitioners is not applicable because the
issue in that case does not involve the effect of B.P. Blg. 232 on Pres. Dec. No. 451.
The Solicitor General, representing the public respondent, after giving a summary of the matters
raised by petitioner and respondent PACU, points out that the decisive issue in this case is whether
B.P. Big. 232 has repealed Pres. Dec. No. 451 because on the answer to this question depends the
validity of MECS Order No. 25, s. 1985. Public respondent holds the view consistent with that of
PACU on the matter of B.P. Blg. 232 having repealed Pres. Dec. No. 451. To support this contention,
the Solicitor General compared the respective provisions of the two laws to show the inconsistency
and incompatibility which would result in a repeal by implication.
RESOLUTION OF THE SECOND SUB-ISSUE
On the matter of tuition fee increases section 42 of B.P. Blg. 232 provides:

SEC. 42. Tuition and Other School Fees. Each private school shall determine its
rate of tuition and other school fees or charges. The rates and charges adopted by
schools pursuant to this provision shall be collectible and their application or use
authorized, subject to rules and regulations promulgated by the Ministry of
Education, Culture and Sports. (Emphasis supplied).
The enactment of B.P. Blg. 232 and the subsequent issuance of MECS Order No. 25, s. 1985
revived the old controversy on the application and use of the incremental proceeds from tuition fee
increases. As can be gleaned from the pleadings and arguments of the parties in these cases, one
side, composed of the teachers and other employees of the private schools, insist on the
applicability of section 3(a) of Pres. Dec. No. 451 as interpreted arid applied in the University of the
East, University of Pangasinan and St Louis University cases, while the private schools uphold the
view that the matter of allocating the incremental proceeds from tuition fee increases is governed by
section 42 of B.P. Blg. 232 as implemented by the MECS Rules and Regulations. As stated, the
latter's argument is premised on the allegation that B.P. Blg. 232 impliedly repealed Pres. Dec. No.
451.
On the second sub-issue, therefore, this Court upholds the view taken by the Solicitor General in
the Fabros case, that the decisive issue is whether B.P. Blg. 232 has repealed Pres. Dec. No. 451.
In recognition of the vital role of private schools in the country's educational system, the government
has provided measures to regulate their activities. As early as March 10, 1917, the power to inspect
private schools, to regulate their activities, to give them official permits to operate under certain
conditions and to revoke such permits for cause was granted to the then Secretary of Public
Instruction by Act No. 2706 as amended by Act No. 3075 and Commonwealth Act No. 180. Republic
Act No. 6139, enacted on August 31, 1970, provided for the regulation of tuition and other fees
charged by private schools in order to discourage the collection of exorbitant and unreasonable fees.
In an effort to simplify the "cumbersome and time consuming" procedure prescribed under Rep. Act
No. 6139 and "to alleviate the sad plight of private schools," Pres. Dec. No. 451 was enacted on May
11, 1974. While this later statute was being implemented, the legislative body envisioned a
comprehensive legislation which would introduce changes and chart directions in the educational
system, hence, the enactment of B.P. Blg. 232. What then was the effect of B.P. Blg. 232 on Pres.
Dec. No. 451?
The Court after comparing section 42 of B.P. Blg. 232 and Pres. Dec. No. 451, particularly section
3(a) thereof, finds evident irreconcilable differences.
Under Pres. Dec. No. 451, the authority to regulate the imposition of tuition and other school fees or
charges by private schools is lodged with the Secretary of Education and Culture (Sec. 1), where
section 42 of B.P. Blg. 232 liberalized the procedure by empowering each private school to
determine its rate of tuition and other school fees or charges.
Pres. Dec. No. 451 provides that 60% of the incremental proceeds of tuition fee increases shall be
applied or used to augment the salaries and wages of members of the faculty and other employees
of the school, while B.P. Blg. 232 provides that the increment shall be applied or used in accordance
with the regulations promulgated by the MECS.

A closer look at these differences leads the Court to resolve the question in favor of repeal. As
pointed out by the Solicitor General, three aspects of the disputed provisions of law support the
above conclusion. First, the legislative authority under Pres. Dec. No. 451 retained the power to
apportion the incremental proceeds of the tuition fee increases; such power is delegated to the
Ministry of Education and Culture under B.P. Blg. 232. Second, Pres. Dec. No. 451 limits the
application or use of the increment to salary or wage increase, institutional development, student
assistance and extension services and return on investment, whereas B.P. Blg. 232 gives the MECS
discretion to determine the application or use of the increments. Third, the extent of the application
or use of the increment under Pres. Dec. No. 451 is fixed at the pre-determined percentage
allocations; 60% for wage and salary increases, 12% for return in investment and the balance of
28% to institutional development, student assistance and extension services, while under B.P. Blg.
232, the extent of the allocation or use of the increment is likewise left to the discretion of the MECS.
The legislative intent to depart from the statutory limitations under Pres. Dec. No. 451 is apparent in
the second sentence of section 42 of B.P. Blg. 232. Pres. Dec. No. 451 and section 42 of B.P. Blg.
232 which cover the same subject matter, are so clearly inconsistent and incompatible with each
other that there is no other conclusion but that the latter repeals the former in accordance with
section 72 of B.P. Blg. 232 to wit:
Sec. 72. Repealing clause. All laws or parts thereof inconsistent with any provision
of this Act shall be deemed repealed or modified, as the case may be.
Opinion No. 16 of the Ministry of Justice dated January 29, 1985, quoted below, supports the above
conclusion:
Both P.D. No. 451 and B.P. Blg. 232 deal with the imposition of tuition and other
school fees or charges and their use and application, although the latter is broader in
scope as it covers other aspects of the education system. We note substantial
differences or inconsistencies between the provisions of the two laws. P.D. No. 451
prescribes certain limitations in the increase of tuition and other school fees and their
application, whereas the latter law, B.P. Blg. 232 s silent on the matter. Under P.D.
451, rates of tuition/school fees need prior approval of the Secretary of Education,
Culture (now Minister of Education, Culture and Sports), who also determines the
reasonable rates for new school fees, whereas under B.P. Blg. 232, each private
school determines its rate of tuition and other school fees or charges. P.D. No. 451
authorizes the Secretary of Education and Culture to issue requisite rules and
regulations to implement the said Decree and for that purpose, he is empowered to
impose other requirements and limitations as he may deem proper and reasonable in
addition to the limitations prescribed by the Decree for increases in tuition fees and
school charges, particularly, the limitations imposed in the allocation of increases in
fees and charges, whereas under B.P. Blg. 232, the collection and application or use
of rates and charges adopted by the school are subject to rules and regulations
promulgated by the Ministry of Education, Culture and Sports without any mention of
the statutory limitations on the application or use of the fees or charges. The
authority granted to private schools to determine its rates of tuition and unconditional
authority vested in the Ministry of Education, Culture and Sports to determine by

rules and regulations the collection and application or use of tuition or fees rates and
charges under B.P. Big. 232 constitute substantial and irreconcilable incompatibility
with the provisions of P.D. No. 451, which should be for that reason deemed to have
been abrogated by the subsequent legislation.
Moreover, B.P. Blg. 232 is a comprehensive legislation dealing with the
establishment and maintenance of an integrated system of education and as such,
covers the entire subject matter of the earlier law, P.D. No. 451. The omission of the
limitations or conditions imposed in P.D. No. 451 for increases in tuition fees and
school charges is an indication of a legislative intent to do away with the said
limitations or conditions. (Crawford, supra, p. 674). It has also been said that
an act which purports to set out in full all that it intends to contain,
operates as a repeal of anything omitted which was contained in the
old act and not included in the amendatory act." (People vs. Almuete
69 SCRA 410; People vs. Adillo 68 SCRA 90) (Ministry of Justice, Op.
No. 16, s. 1985).
Having concluded that under B.P. Big. 232 the collection and application or use of tuition and other
school fees are subject only to the limitations under the rules and regulations issued by the Ministry,
the crucial point now shifts to the said implementing rules.
The guidelines and regulations on tuition and other school fees issued after the enactment of B.P.
Blg. 232 consistently permit the charging of allowances and other benefits against the 60%
incremental proceeds. Such was the tenor in the MECS Order No. 23, s. 1983; MECS Order No. 15,
s. 1984; MECS Order No. 25, s. 1985; MECS Order No. 22, s. 1986; and DECS Order No. 37, s.
1987. The pertinent portion of the latest order reads thus:
In any case of increase at least sixty percent (60%) of the incremental proceeds
should be allocated for increases in or provisions for salaries or wages, allowances
and fringe benefits of faculty and other staff, including accruals to cost of living
allowance, 13th month pay, social security, medicare and retirement contribution and
increases as may be provided in mandated wage orders, collective bargaining
agreements or voluntary employer practices.
The validity of these orders, particularly MECS Order No. 25, s. 1985, is attacked on the ground that
the additional burdens charged against ". . . the 60% of the proceeds of the increases in tuition fees
constitute both as [sic] an excess of statutory authority and as (sic) a substantial impairment of the
accrued, existing and protected rights and benefits of the members of faculty and non-academic
personnel of private schools." Memorandum for Petitioners, Rollo, p. 1911. Petitioners alleged that
these additional burdens under the MECS Order are not provided in the law itself, either in section
42 of B.P. Blg. 232 or section 3(a) of Pres. Dec. No. 451, except increases in salaries in the latter
provision.

Section 42 of B.P. Blg. 232 grants to the Minister of Education (now Secretary of Education) rulemaking authority to fill in the details on the application or use of tuition fees and other school
charges. In the same vein is section 70 of the same law which states:
SEC. 70. Rule-making Authority. The Minister of Education, Culture and Sports
charged with the administration and enforcement of this Act, shall promulgate the
necessary implementing rules and regulations.
Contrary to the petitioners' insistence that the questioned rules and regulations contravene the
statutory authority granted to the Minister of Education, this Court finds that there was a valid
exercise of rule-making authority.
The statutory grant of rule-making power to administrative agencies like the Secretary of Education
is a valid exception to the rule on non-delegation of legislative power provided two conditions concur,
namely: 1) the statute is complete in itself, setting forth the policy to be executed by the agency, and
2) said statute fixes a standard to which the latter must conform [Vigan Electric Light Co., Inc. v.
Public Service Commission, G.R. No. L-19850, January 30, 1964, and Pelaez v. Auditor General, G.
R. No. L-23825, December 24, 1965].
The Education Act of 1982 is "an act providing for the establishment and maintenance of an
integrated system for education " with the following basic policy:
It is the policy of the State to establish and maintain a complete, adequate and
integrated system of education relevant to the goals of national development. Toward
this end, the government shall ensure, within the context of a free and democratic
system, maximum contribution of the educational system to the attainment of the
following national development goals:
1. To achieve and maintain an accelerating rate of economic development and social
progress;
2. To assure the maximum participation of all the people in the attainment and
enjoyment of the benefits of such growth; and
3. To achieve and strengthen national unity and consciousness and preserve,
develop and promote desirable cultural, moral and spiritual values in a changing
world.
The State shall promote the right of every individual to relevant quality education,
regardless of sex, age, creed, socioeconomic status, physical and mental conditions,
racial or ethnic origin, political or other affiliation. The State shall therefore promote
and maintain equality of access to education as well as the enjoyment of the benefits
of education by all its citizens.
The State shall promote the right of the nation's cultural communities in the exercise
of their right to develop themselves within the context of their cultures, customs,

traditions, interests and belief, and recognizes education as an instrument for their
maximum participation in national development and in ensuring their involvement in
achieving national unity. (Section 3, Declaration of Basic Policy).
With the foregoing basic policy as well as, specific policies clearly set forth in its various provisions,
the Act is complete in itself and does not leave any part of the policy-making, a strictly legislative
function, to any administrative agency.
Coming now to the presence or absence of standards to guide the Minister of Education in the
exercise of rule-making power, the pronouncement in Edu v. Ericta [G.R. No. L-32096, October 24,
1970, 35 SCRA 481, 497] is relevant:
The standard may be either expressed or implied. If the former, the non-delegation
objection is easily met. The standard though does not have to be spelled out
specifically. It could be implied from the policy and purpose of the act considered as
a whole. In the Reflector Law, clearly the legislative objective is public safety. What is
sought to be attained as in Calalang v. Williams is "safe transit upon the roads."
(Italics supplied).
Thus, in the recent case of Tablarin et al. v. Hon. Gutierrez, et al. (G.R. No. 78164, July 31, 1987],
the Court held that the necessary standards are set forth in Section 1 of the 1959 Medical Act, i.e.,
"the standardization and regulation of medical education" as well as in other provisions of the Act.
Similarly, the standards to be complied with by Minister of Education in this case may be found in the
various policies set forth in the Education Act of 1982.
MECS Order No. 25, s. 1985 touches upon the economic relationship between some members and
elements of the educational community, i.e., the private schools and their faculty and support staff. In
prescribing the minimum percentage of tuition fee increments to be applied to the salaries,
allowances and fringe benefits of the faculty and support staff, the Act affects the economic status
and the living and working conditions of school personnel, as well as the funding of the private
schools.
The policies and objectives on the welfare and interests of the various members of the educational
community are found in section 5 of B.P. Blg. 232. which states:
SEC. 5. Declaration of Policy and Objectives. It is likewise declared government
policy to foster, at all times, a spirit of shared purposes and cooperation among the
members and elements of the educational community, and between the community
and other sectors of society, in the realization that only in such an atmosphere can
the true goals and objectives of education be fulfilled.
Moreover, the State shall:
1. Aid and support the natural right and duty of parents in the rearing of the youth
through the educational system.

2. Promote and safeguard the welfare and interests of the students by defining their
rights and obligations, according them privileges, and encouraging the establishment
of sound relationships between them and the other members of the school
community.
3. Promote the social and economic status of an school personnel, uphold their
rights, define their obligations, and improve their living and working conditions and
career prospects.
4. Extend support to promote the viability of those institutions through which parents,
students and school personnel seek to attain their educational goals.
On the other hand, the policy on the funding of schools in general, are laid down in section 33:
SEC. 33. Declaration of Policy. It is hereby declared to be a policy of the State that
the national government shall contribute to the financial support of educational
programs pursuant to the goals of education as declared in the Constitution. Towards
this end, the government shall:
1. Adopt measures to broaden access to education through financial assistance and
other forms of incentives to schools, teachers, pupils and students; and
2. Encourage and stimulate private support to education through, inter alia, fiscal and
other assistance measures.
Given the abovementioned policies and objectives, there are sufficient standards to guide the
Minister of Education in promulgating rules and regulations to implement the provisions of the
Education Act of 1982, As in the Ericta andTablarin cases, there is sufficient compliance with the
requirements of the non-delegation principle.
THIRD SUB-ISSUE
C. Whether or not schools and their employees may enter into a collective bargaining
agreement allocating more than 60% of said incremental proceeds for salary
increases and other benefits of said employees.
1. Arguments raised in the Biscocho and Valmonte cases
Assailed by the petitioners in the Biscocho and the Valmonte cases is the Order of the respondent
Minister of Labor directing the execution of a CBA between the school and the respondent Espiritu
Santo Parochial School Faculty Association which provides for an economic package equivalent to
90% of the proceeds of tuition fee increases for school year 1985-1986, another 90% for school year
1986-1987 and 85% for school year 1987-1988. Pursuant to said Order, petitioners in
the Biscocho case alleged that the parties had agreed to incorporate in their CBA a provision which
allocates one-half (1/2) of the 90% portion of the proceeds or 45% to increases in the monthly basic
salaries and the other one-half (1/2) or 45% to increases in monthly living allowance.

The petitioners in the two cases seek the nullification of the MOLE Order for exactly opposite
reasons. In theBiscocho case, the controversy springs from what petitioners perceive to be a
diminution of the benefits to be received by the school employees insofar as the CBA allocates only
45% for salary increases instead of 60%, which petitioners claim to be the portion set aside by Pres.
Dec. No. 451 for that purpose. Parenthetically, the case questions the allocation of the remaining
45% of the 90% economic package under the CBA, to allowances. Stripped down to its essentials,
the question is whether or not the 90% portion of the proceeds of tuition fee increases alloted for the
economic package may be allocated for both salary increases and allowances.
On the other hand, petitioners in the Valmonte case believe that the MOLE cannot order the
execution of a CBA which would allocate more than 60% of the proceeds of tuition fee increases for
salary increases of school employees. Furthermore, petitioners question the authority of the then
Minister of Labor and Employment to issue the aforequoted Order insofar as this allocates the tuition
fee increases of the respondent private school. According to them, only the Minister of Education,
Culture and Sports has the authority to promulgate rules and regulations on the use of tuition fees
and increases thereto, pursuant to the provisions of B.P. Blg. 232. They further argue that the
assailed Order collides with the provisions of Pres. Dec. No. 451 insofar as it allocates 90% of the
tuition fee increases for salary adjustments of the members of the bargaining unit which exceeds the
60% of the said increases allocated by the Decree for the same purpose.
Before delving further into the questions raised, this Court notes that in the Valmonte case,
respondent Minister and respondent Faculty Association raise a procedural objection to the filing of
the Petition: the standing of the petitioners to bring this suit. Both respondents decry the petitioners'
lack of the interest required in Rule 65 of the Rules of Court for the filing of the Petition for certiorari
and Prohibition, since the latter do not appear to be in any way aggrieved by the enforcement of the
Order. Petitioners-parents did not even participate in the proceedings below which led to the
issuance of the assailed Order.
This Court finds merit in the respondents' objection. Under Rule 65 of the Rules of Court (Secs. 1
and 2), only a person aggrieved by the act or proceeding in question may file a petition for certiorari
and/or prohibition. TheValmonte petition fails to indicate how the petitioners would be aggrieved by
the assailed Order. It appears that the petitioners are not parties and never at any time intervened in
the conciliation conferences and arbitration proceedings before the respondent Minister. The parties
therein, who stand to be directly affected by the Order of the respondent Minister, do not contest the
validity of said Order. The petition does not even state that petitioners act as representative of the
parents' association in the School or in behalf of other parents similarly situated.
If indeed, petitioners Valmonte and Badiola are aggrieved by the said Order, they should have
intervened and moved for a reconsideration of respondent Minister's Order before filing the instant
petition. Petitioners failed to show that the case falls under any one of the recognized exceptions to
the rule that a motion for reconsideration should first be availed of before filing a petition for certiorari
and prohibition.
In view of the foregoing, the resolution of the third sub-issue will be based mainly on the arguments
raised in theBiscocho case.

RESOLUTION OF THE THIRD SUB-ISSUE

The Biscocho case involves the issue on the allocation of the incremental proceeds of the tuition fee
increases applied for by the respondent Espiritu Santo Parochial School for school years 1985-1986,
1986-1987, and 1987-1988. With the repeal of Pres. Dec. No. 451 by B.P. Blg. 232, the allocation of
the proceeds of any authorized tuition fee increase must be governed by specific rules and
regulations issued by the Minister (now Secretary) of Education pursuant to his broadened rule
making authority under section 42 of the new law. Thus, insofar as the proceeds of the authorized
tuition fee increases for school year 1985-1986 are concerned, the allocation must conform with the
pertinent section of MECS Order No. 25, s. 1985, to wit:
7. Application or Use of Tuition and Other School Fees or Charges.
xxx xxx xxx
7.4. Not less than sixty (60) percent of the incremental tuition proceeds shall be used
for salaries or wages, allowances and fringe benefits of faculty and support staff,
including cost of living allowance, imputed costs of contributed services, thirteenth
(13th) month pay, retirement fund contributions, social security, medicare, unpaid
school personnel claims, and payments as may be prescribed by mandated wage
orders, collective bargaining agreements and voluntary employer
practices: Provided, That increases in fees specifically authorized for the purposes
fisted in paragraph 4.3.3 hereof shall be used entirely for those purposes.
xxx xxx xxx
With regard to the proceeds of the tuition fee increases for school year 1986-1987, the applicable
rules are those embodied in MECS Order No. 22, s. 1986 which made reference to MECS Order No.
25, s. 1985, the pertinent portion of which is quoted above.
Finally, as to the proceeds of the tuition fee increases for school year 1987- 1988, DECS Order No.
37, s. 1987 must apply:
c. Allocation of lncremental Proceeds
(1) In any case of increase at least sixty percent (60%) of the incremental proceeds
should be allocated for increases in or provisions for salaries or wages, allowances
and fringe benefits of faculty and other staff, including accruals to cost of living
allowance, 13th month pay, social security, medicare and retirement contributions
and increases as may be provided in mandated wage orders, collective bargaining
agreements or voluntary employer practices.
(2) Provided, that in all cases of increase the allocation of the incremental proceeds
shall be without prejudice to the Supreme Court cases on the interpretation and
applicability of existing legislations on tuition and other fees especially on the

allocation and use of any incremental proceeds of tuition and other fees increases.
(Emphasis supplied).
xxx xxx xxx
Based on the aforequoted MECS and DECS rules and regulations which implement BP Blg. 232, the
60% portion of the proceeds of tuition fee increases may now be allotted for both salaries and
allowances and other benefits. The 60% figure is, however, a minimum which means that schools
and their employees may agree on a larger portion, or in this case, as much as 90% for salaries and
allowances and other benefits. This is not in anyway to allow diminution or loss of the portion allotted
for institutional development of the school concerned. Thus, paragraph 7.5 of MECS Order No. 25,
series of 1985 specifically provides that other student fees and charges like registration, library,
laboratory or athletic fees shall be used exclusively for the purposes indicated.
III RESOLUTION OF THE SPECIFIC ISSUES
CEBU INSTITUTE OF TECHNOLOGY CASE
Petitioner assigns three other errors in the petition for certiorari:
1
RESPONDENT MINISTER OF THE MINISTRY OF LABOR AND EMPLOYMENT COMMITTED
GRAVE ABUSE OF DISCRETION AMOUNTING TO A DENIAL OF DUE PROCESS OF LAW IN
DIRECTLY ISSUING THE ORDER DATED SEPTEMBER 29,1981 WITHOUT CONDUCTING A
FORMAL INVESTIGATION AND ARBITRATION PROCEEDINGS.
2
PUBLIC RESPONDENT ERRED IN NOT DECLARING THAT PETITIONER IS EXEMPTED AND/OR
NOT OBLIGED TO PAY SERVICE INCENTIVE LEAVE.
3
PUBLIC RESPONDENT ERRED IN NOT DECLARING THAT PRIVATE RESPONDENTS' CLAIMS
FOR COLA AND SERVICE INCENTIVE LEAVE ARE FULLY BARRED BY LACHES AND/OR
EXTINGUISHED BY PRESCRIPTION.
1. Petitioner assails the Order of the Minister of Labor on the ground that the same was issued
without the benefit of a hearing and was merely based on the report of the labor management
committee which is allegedly without power to pass upon the issues raised. On this premise,
petitioner claims that it was denied its right to due process.
Petitioner's contention is without merit. The Labor Management Committee was empowered to
investigate the complaint against the petitioner for non-payment of the cost of living allowance, 13th
month pay and service incentive leave from 1974-1981 [Annex "F"; Rollo, p. 37]. In the committee,

petitioner was represented by its counsel, registrar and assistant accountant and in the conferences
that were held, the representatives of the petitioner were present. Furthermore, the petitioner's
position paper submitted to the committee reflects that in all the deliberations, it was never denied
the right to present evidence and be heard on all the issues raised, particularly to demonstrate that it
had complied with the various COLA, 13th month pay and service incentive leave decrees. The
evidence presented during the conferences and the position paper of the parties were made the
basis of the committee's report and recommendation which in turn became the basis of the order of
the Minister of Labor directing the petitioner to pay the complainants their COLA and service
incentive leave benefits.
It could not therefore be contended that the petitioner was deprived of his right to be heard when it
appears on the record that it was permitted to ventilate its side of the issues. There was sufficient
compliance with the requirements of due process. In the face of the well- settled principle that
administrative agencies are not strictly bound by the technical rules of procedure, this Court
dismisses the petitioner's claim that formal investigative and arbitration proceedings should be
conducted. "While a day in court is a matter of right in judicial proceedings, in administrative
proceedings it is otherwise since they rest upon different principles." [Cornejo v. Gabriel and
Provincial Board of Rizal, 41 Phil. 188 (1920); Tajonera v. Lamaroza, G.R. Nos. L-48907 and L49035, December 19,1981, 110 SCRA 438].
2. Going now to the matter of service incentive leave benefits, petitioner claims that private
respondents are engaged by the school on a contract basis as shown by the individual teachers
contract which defines the nature, scope and period of their employment; hence, they are not
entitled to the said benefit according to Rule V of the Implementing Rules and Regulations of the
Labor Code to wit:
Sec. 1. Coverage. This rule [on Service Incentive Leave] shall apply to all
employees, except:
xxx xxx xxx
(d) Field personnel and other employees whose performance is unsupervised by the
employer including those who are engaged on task or contract basis, purely
commission basis, or those who are paid in a fixed amount for performing work
irrespective of the time consumed in the performance thereof; (MOLE Rules and
Regulations, Rule V, Book III)
The phrase "those who are engaged on task or contract basis" should however, be related with "field
personnel " applying the rule on ejusdem generis that general and unlimited terms are restrained
and limited by the particular terms that they follow, [Vera v. Cuevas, G.R. No. L-33693, May 31,
1979, 90 SCRA 379]. Clearly, petitioner's teaching personnel cannot be deemed field personnel
which refers "to non-agricultural employees who regularly perform their duties away from the
principal place of business or branch office of the employer and whose actual hours of work in the
field cannot be determined with reasonable certainty. [Par. 3, Article 82, Labor Code of the
Philippines]. Petitioner's claim that private respondents are not entitled to the service incentive leave
benefit cannot therefore be sustained.

3. As a last ditch effort to bar private respondents'claims, petitioner asserts that the same are barred
by laches and/or extinguished by prescription according to Article 291 of the Labor Code which
provides:
Art. 291. Money claims. All money claims arising from employer-employee ,
relations accruing during the effectivity of this Code shall be filed within three (3)
years from the time the cause of action accrued; otherwise, they shall be forever
barred.
All money claims accruing prior to the effectivity of this Code shall be filed with the
appropriate entities established under this Code within one (1) year from the date of
effectivity, and shall be processed or determined in accordance with implementing
rules and regulations of the Code; otherwise, they shall be forever barred.
xxx xxx xxx
Considering that the complaint alleging non-payment of benefits was filed only on February 11,
1981, petitioner argues that prescription has already set in.
From the aforequoted provision, it is not fully accurate to conclude that the entire claims for COLA
and service incentive leave are no longer recoverable. This Court finds no reason to disturb the
following pronouncement of the Minister of Labor:
xxx xxx xxx
Simply stated, claims for COLA under P.D. 525, which took effect on August 1, 1974,
for the months of August, September and October 1974 must be filed within one (1)
year from November 1, 1974, otherwise they shall be considered prescribed; claims
under the same decree that accrued on or after November 1, 1974 should be
initiated within three (3) years from the date of accrual thereof, otherwise the same
shall be deemed extinguished. Although this particular claim was filed on February
11, 1981, petitioners herein are entitled to COLA under P.D. 525 from February 1978
up to the present since the COLA that accrued in February 1978 has not yet
prescribed at the time that the claim was filed in February 1981. In the same vein,
petitioners herein should be granted COLA under P.D. 1123 from February 1978 up
to 1981 inasmuch as said decree became effective only on May 11, 1977. Further,
petitioners are entitled to the full amount of COLA provided under P.D.'s 1614, 1634,
1678 and 1713. It must be pointed out that the earliest of the just cited four (4)
decrees, i.e., P.D. 1614, just took effect on April 1, 1979. Thus, the prescriptive period
under Art. 292 of the Labor Code, as amended, does not as yet apply to money
claims under the just mentioned decrees.
DIVINE WORD COLLEGE CASE
In assailing the disputed Order, petitioner contends that the public respondents acted with grave and
patent abuse of discretion amounting to lack of jurisdiction in that:

1. The Regional Director has no jurisdiction over money claims arising from
employer-employee relationship; and
2. The Regional Director and Deputy Minister of Labor adopted the report of the
Labor Standards Division without affording the petitioner the opportunity to be heard.
1. Petitioner school claims that the case at bar is a money claim and should therefore be within the
original and exclusive jurisdiction of the Labor Arbiter pursuant to article 217 of the Labor Code, as
amended.
It appears from the record, however, that the original complaint filed by ten (10) faculty members of
the Divine Word College was for non-compliance with Pres. Dec. No. 451 and with Labor Code
provisions on service incentive leave, holiday and rest day pay and which complaint specifically
prayed that an inspection of the College be conducted.
Contrary to the petitioner's protestation of lack of jurisdiction, the Secretary of Labor or his duly
authorized representatives (which includes Regional Directors) are accorded the power to
investigate complaints for non- compliance with labor laws, particularly those which deal with labor
standards such as payment of wages and other forms of compensation, working hours, industrial
safety, etc. This is provided for in article 128 of the Labor Code, as amended:
Art. 128. Visitorial and enforcement power.
(a) The Secretary of Labor or his duly authorized representatives including labor
regulation officers, shall have access to employers' records and premises at any time
of the day or night, whenever work is being undertaken therein, and the right to copy
therefrom, to question any employee and investigate any fact, condition or matter
which may be necessary to determine violations or which may aid in the enforcement
of this Code and of any labor law, wage order or rules and regulations issued
pursuant thereto.
(b) The Secretary of Labor or his duly authorized representatives shall have the
power to order and administer, after due notice and hearing, compliance with the
labor standards provisions of this Code based on the findings of labor regulation
officers or industrial safety engineers made in the course of inspection, and to issue
writs of execution to the appropriate authority for the enforcement of their order,
except in cases where the employer contests the findings of the labor regulations
officer and raises issues which cannot be resolved without considering evidentiary
matters that are not verifiable in the normal course of inspection. (Emphasis
supplied).
Furthermore, Policy Instruction No. 6 which deals with the distribution of jurisdiction over labor cases
restates inter alia that "(L)abor standards cases arising from violation of labor standards laws
discovered in the course of inspection or complaints where employer-employee relations still exist"
are under the exclusive original jurisdiction of the Regional Director.

Even assuming that respondent Regional Director was without jurisdiction to entertain the case at
bar, petitioner is now barred at this stage to claim lack of jurisdiction having actively participated in
the proceedings below. Petitioner never questioned the jurisdiction of the respondent Regional
Director.
2. The petitioner claims that it was never afforded the opportunity to be heard and was therefore
denied due process.
There is no dispute that an inspection of the College was conducted after a complaint by some
faculty members was filed with the Regional Office of the Ministry of Labor and Employment. A report
was submitted on the basis of the findings contained therein. Petitioner was furnished a copy of said
report to which it filed a comment. Finding this to be without merit, the Regional Director issued an
order giving petitioner ten (10) days to manifest its compliance with the findings, otherwise, another
would be issued to enforce payment. Petitioner appealed but instead of resolving the memorandum
of appeal, which the Regional Director treated as a motion for reconsideration, said Director issued
another Order dated August 2, 1983 directing the payment of the employees' share in the sixty
(60%) percent incremental proceeds. Petitioner moved for a reconsideration of the latest order which
the Regional Director, however, denied, thereby elevating the case to the Office of the Minister of
Labor and Employment.
The foregoing facts demonstrate that petitioner had the opportunity to refute the report on the
inspection conducted. It submitted a comment thereto, which was in effect its position paper. The
arguments therein and evidence attached thereto were considered by respondent Regional Director
in the order issued subsequently. They, therefore, had ample opportunity to present their side of the
controversy.
What due process contemplates is not merely the existence of an actual hearing. The "right to be
heard" focuses more on the substance rather than the form. In the case at bar, petitioner was
actually heard through the pleadings that it filed with the Regional Office V. As it itself admitted in its
petition that it was afforded the right to be heard on appeal [See Rollo, p. 581, petitioner cannot
therefore insist that it was denied due process.
FAR EASTERN UNIVERSITY CASE
Two other issues are raised in this petition, to wit:
1
WHETHER OR NOT 'TRANSPORTATION ALLOWANCE' SHOULD BE CONSIDERED AS
'EQUIVALENT TO 13TH-MONTH PAY UNDER PRES. DEC. NO. 851.
2
WHETHER OR NOT LEGAL HOLIDAY PAY BENEFIT COULD BE VALIDLY WITHDRAWN AFTER
BEING PRACTICED CONTINUOUSLY FOR EIGHT (8) MONTHS.

1. The issue on the thirteenth (13th) month pay involves an interpretation of the provisions of Pres.
Dec. No. 851 which requires all employers "to pay all their employees receiving a basic salary of not
more than Pl,000 a month, regardless of the nature of the employment, a 13th- month pay" (Sec. 1).
However, "employer[s] already paying their employees a 13th-month pay or its equivalent are not
covered" (Sec. 2). (Emphasis supplied)
The Rules and Regulations Implementing Pres. Dec. No. 851 provide the following:
SEC. 3. Employees. The Decree shall apply to all employers except to: ...
c) Employers already paying their employees 13th-month or more in a calendar year
or its equivalent at the time of this issuance; ...
xxx xxx xxx
The term "its equivalent" as used in paragraph (c) hereof shall include Christmas
bonus, mid-year bonus, profit-sharing payments and other cash bonuses amounting
to not less than 1/12th of the basic salary but shall not include cash and stock
dividends, cost of living allowances and all other allowances regularly enjoyed by the
employer, as well as non-monetary benefits. Where an employer pays less than 1/1
2th of the employees basic salary, the employer shall pay the difference.
In the case at bar, the 13th month pay is paid in the following manner:
FOR REGULAR EMPLOYEES:
Transportation Allowance (TA)
50% of basic for the first year of service plus additional 5% every year thereafter but
not to exceed 100% of basic salary
Christmas Bonus (CB)
50% of basic salary for the first year of service plus additional 5% every year
thereafter but not to exceed 100% of basic salary.
For employees who have served the University for more than 10 years, the
University pays them emoluments equivalent to the 14 months salaries.
13th Month Pay Formula:
Monthly Rate x No. of
months served for the year
Less TA/CB = 13th Mo. pay

12 months
FOR CASUAL EMPLOYEES:
13th Month Pay Formula:
Add salaries from 16 December of previous year to 15th December of present year [and] divide by
12 months = 13th Mo. Pay (Rollo, pp. 60, 72).
The University's answer to the Union's claim of underpayment of the 13th month pay is that the
"transportation allowance" paid to its employees partakes the nature of a mid-year bonus which
under section 2 of Pres. Dec. No. 851 and section 3(c) of the Implementing Rules and Regulations is
equivalent to the 13th month pay,
The Labor Arbiter ordered FEU to pay the 13th month pay differentials of the complainants
reasoning that:
CLEARLY, transportation allowance cannot be considered as equivalent" of 13th
month pay as it is neither a Christmas bonus, mid-year bonus, profit sharing
payment, or other cash bonuses, pursuant to paragraphs (c) and (e), Section 3 of PD
851. The regularity of its payment further cements this proposition.
PERFORCE, complainants are underpaid of their 13th month pay in an amount
equivalent to 50% of their basic salary for the lst year of service, plus additional 5%
every year thereafter but not to exceed 100% of their basic salary which, per
respondent's formula, corresponds to their transportation allowance. (Rollo, p. 61).
On appeal, the Third Division of the National Labor Relations Commission reversed the Labor
Arbiter's ruling by dismissing the complainant's claim for underpayment of the 13th month pay for
lack of merit. The NLRC ruled that:
From the above findings and conclusion, it is clear that insofar as employees with ten
(10) years of service or more are concerned, they receive the equivalent of one (1)
month pay for Christmas bonus and another one (1) month pay as transportation
allowance or a total of fourteen (14) months salary in a year. Obviously, this group of
employees are fully paid of their 13th month pay and are not therefore subject to the
instant claim. As it is only those with less than ten (10) years of service are included
or encompassed by the Labor Arbiter's resolution on this particular issue. With this
clarification, we shall now proceed to discuss the crux of the controversy, that is, the
determination of whether or not the so designated "transportation allowance" being
paid to the employees should be considered among those deemed equivalent to 13th
month pay. As adverted earlier, the Labor Arbiter opined that it cannot be so
considered as the equivalent of 13th month pay.
xxx xxx xxx

In passing upon the issue, we deemed it best to delve deeper into the nature and
intendment of the transportation allowances as designated by both the complainants
and the respondent. Complainants claim that the transportation allowance they enjoy
has always been called and termed allowance and never as bonus since the time the
same was given to them. They assert that it simply was intended as an allowance
and not a bonus. It would appear however that complainants do not dispute
respondent's stand that transportation allowance is being paid only every March of
each year as distinguished from other allowances that are being paid on a monthly
basis or on a bimonthly basis; that the amount of transportation allowance to be paid
is dependent on the length of service of the employee concerned (i.e. 50% basic in
the first year and additional 5% for each succeeding years, etc.); that the said
method of computing the amount of the transportation allowance to be paid the
complainants is Identical to that used in determining Christmas bonus (respondent's
exhibit 8) that the reason behind said transportation allowance is to financially assist
employees in meeting their tax obligations as the same become due on or about the
month of March of each year.
xxx xxx xxx
We are inclined to believe and so hold that by the manner by which said
transportation allowance is being paid (only once a year) as well as the method in
determining the amount to be paid (similar to Christmas bonus) and considering
further the reason behind said payment (easing the burden of taxpayer-employee),
the said transportation allowance given out by respondent while designating as such,
partakes the nature of a mid-year bonus. It bears to note in passing that in providing
for transportation allowance, respondent was not compelled by law nor by the CBA
(Annex "A" of respondent's Appeal) as nowhere in the CBA nor in the Labor Code
can be found any provision on transportation allowance. It was therefore a benefit
that stemmed out purely from the voluntary act and generosity of the respondent
FEU. Moreover, said transportation allowance is only being paid once a year. On the
other hand, regular allowances not considered as 13th month pay equivalent under
P.D. 851, to our mind, refer to those paid on regular intervals and catering for specific
employees' needs and requirements that recur on a regular basis. Verily, if the
intendment behind the disputed transportation allowance is to answer for the daily
recurring transportation expenses of the employees, the same should have been
paid to employees on regular periodic intervals. All indications, as we see it, point out
to conclusion that the disputed transportation allowance, while dominated as such
apparently for lack of better term, is in fact a form of bonus doled out by the
respondent during the month of March every year.
Hence, we hold that it is one of those that can very well be considered as equivalent
to the 13th month pay (Rollo, pp. 73, 74, 75, 76).
This Court sustains the aforequoted view of public respondent. The benefit herein designated as
"transportation allowance" is a form of bonus equivalent to the 13th month pay. Nevertheless, where
this does not amount to 1/12 of the employees basic salary, the employer shall pay the difference.

The evident intention of the law was to grant an additional income in the form of a 13th month pay to
employees not already receiving the same. This Court ruled in National Federation of Sugar
Workers (NFSW) v. Ovejera [G.R. No. 59743, May 31, 1982, 114 SCRA 354].
Otherwise put, the intention was to grant some relief not to all workers but only
to the unfortunate ones not actually paid a 13th month salary or what amounts to it,
by whatever name called: but it was not envisioned that a double burden would be
imposed on the employer already paying his employees a 13th month pay or its
equivalent whether out of pure generosity or on the basis of a binding agreement
and, in the latter case, regardless of the conditional character of the grant (such as
making the payment dependent on profit), so long as there is actual payment.
Otherwise, what was conceived to be a 13th month salary would in effect become a
14th or possibly 15th month pay.
xxx xxx xxx
Pragmatic considerations also weigh heavily in favor of crediting both voluntary and
contractual bonuses for the purpose of determining liability for the 13th month pay. To
require employers (already giving their employees a 13th month salary or its
equivalent) to give a second 13th month pay would be unfair and productive of
undesirable results. To the employer who had acceded and is already bound to give
bonuses to his employees, the additional burden of a 13th month pay would amount
to a penalty for his munificence or liberality. The probable reaction of one so
circumstanced would be to withdraw the bonuses or resist further voluntary grants for
fear that if and when a law is passed giving the same benefits, his prior concessions
might not be given due credit; and this negative attitude would have an adverse
impact on the employees (pp.369,370).
The case of Dole Philippines, Inc. v. Leogardo [G.R. No. 60018, October 23, 1982, 117 SCRA 938
(1982)], citing the ruling in the above case also pointed out that:
To hold otherwise would be to impose an unreasonable and undue burden upon those employers
who had demonstrated their sensitivity and concern for the welfare of their employees. A contrary
stance would indeed create an absurd situation whereby an employer who started giving his
employees the 13th month pay only because of the unmistakable force of the law would be in a far
better position than another who, by his own magnanimity or by mutual agreement, had long been
extending his employees the benefits contemplated under PD No. 851, by whatever nomenclature
these benefits have come to be known. Indeed, PD No. 851, a legislation benevolent in its purpose,
never intended to bring about such oppressive situation. (p. 944)
2. Presidential Decree No. 570-A was issued on November 1, 1974 amending certain articles of
Presidential Decree No. 442 (Labor Code of the Philippines promulgated on May 1, 1974 which took
effect six months thereafter). Section 28 thereof provides that:
Section 28. A new provision is hereby substituted in lieu of the original provision of
Article 258 of the same Code to read as follows:

Art. 258. Right to holiday pay(a) Every worker shall be paid his regular holidays, except in retail and service
establishments regularly employing less than ten (10) workers;
(b) The term "holiday" as used in this Chapter, shall include: New Year's day, Maundy
Thursday, Good Friday, the ninth of April, the first of May, the twelfth of June, the
fourth of July, the thirtieth of November, the twenty fifth and thirtieth of December and
the day designated by law for holding a general election.
(c) When employer may require work on holidays. The employer may require an
employee to work on any holiday but such employee shall be paid a compensation
equivalent twice his regular rate.
Presidential Decree No. 850 issued on December 16, 1975 also amending certain articles of Pres.
Dec. No. 442 adopted the aforequoted provision. Two months later, on February 16, 1976, the Rules
and Regulations Implementing the Labor Code, as amended, was released the pertinent portion of
which states that:
Section 2. Status of employees paid by the month. Employees who are uniformly
paid by the month, irrespective of the number of working days therein, with a salary
of not less than the statutory or established minimum wage shall be presumed to be
paid for all days in the month whether worked or not.
For this purpose, the monthly minimum wage shall not be less than the statutory
minimum wage multiplied by 365 days divided by twelve.
(e) Section 3. Holiday Pay. Every employer shall pay his employees their regular
daily wage for any unworked regular holiday.
As used in the Rule, the term 'holiday' shall exclusively refer to: New Year's Day,
Maundy Thursday, Good Friday, the ninth of April, the first of May, the twelfth of June,
the fourth of July, the thirtieth of November, the twenty-fifth and thirtieth of December
and the day designated by law for a general election or national referendum or
plebiscite (MOLE Rules and Reg. Book III, Rule IV, sec. 2 (1976).
After one week, on February 23, 1976, the Minister of Labor issued Policy Instruction No. 9, to clarify
further the right to holiday pay, thus:
The Rules Implementing PD 850 have clarified the policy in the implementation of the
ten (10) paid legal holidays. Before PD 850. the number of working days a year in a
firm was considered important in determining entitlement to the benefit. Thus, where
an employee was working for at least 313 days, he was definitely already paid. If he
was working for less than 313, there was no certainty whether the ten (10) paid legal
holidays were already paid to him or not.

The ten (10) paid legal holidays law, to start with, is intended to benefit principally
daily employees. In the case of monthly, only those whose monthly salary did not yet
include payment for the ten (10) paid legal holidays are entitled to the benefit.
Under the rules implementing PD 850, this policy has been fully clarified to eliminate
controversies on the entitlement of monthly paid employees. The new determining
rule is this: If the monthly paid employee is receiving not less than P 240, the
maximum monthly minimum wage, and his monthly pay is uniform from January to
December, he is presumed to be already paid the ten (10) paid legal holidays.
However, if deductions are made from his monthly salary on account of holidays in
months where they occur, then he is entitled to the ten (10) legal holidays.
These new interpretations must be uniformly and consistently upheld.
This issuance shall take effect immediately.
In the meantime, respondent University paid its employees holiday pay for the following days:
DATE HOLIDAYS PAID
June 9, 1975 for the previous nine legal holidays
August, 1975 for the previous June 12 and July 4
Jan. 14, 1976 or the previous Nov. 30, Dec. 25
and 30 and Jan. 1
After January 14, 1976, however, the University ceased paying the holiday pay allegedly by reason
of Policy Instruction No. 9. Specifically, the University claimed that the monthly salary of its
employees was, as of 1976, more than P 240.00 without deductions from their monthly salary on
account of holidays in months where they occurred and that therefore, by virtue of Policy Instruction
No. 9, they were no longer entitled to the ten paid legal holidays.
Petitioners, upon the other hand, contend that Policy Instruction No. 9 could not have possibly been
the reason that prompted the University to withdraw such benefits from its faculty and employees
because said implementing rule was issued only on April 23, 1976 or four months later.
The Labor Arbiter ruled in favor of the complainant Union for the reason that ". . . the payment of the
10-paid legal holiday benefits from June 8, 1975 up to January 14, 1976 is considered an employer
practice that can no longer be withdrawn." [Decision; Rollo, p. 59].
As in the case of the 13th month pay, the NLRC reversed the Labor Arbiter's ruling. The NLRC held
that:

Apparently, Arbiter Ruben Aquino concluded that payment by the respondent of the
legal holiday pay preceded the effectivity of the Rules and Regulations Implementing
P.D. 850 and which rules took effect on February 16, 1976. Hence, his conclusion
that the payment of the legal holiday pay stemmed out from company practice and
not from law. Tracing back, however, the payments made by respondent of said
holiday pay will show that, if ever, the same was made pursuant to P.D. 570-A which
took effect on November 1, 1974. Noteworthy is the undisputed fact that respondent
first paid its employees legal holiday pay in June 1975 corresponding to nine (9) legal
holidays. It bears to note that from the time of the effectivity of P.D. 570-A which was
in November of 1974 up to June of 1975, the time respondent first paid legal holiday
pay for nine (9) legal holidays, there, were indeed more or less nine legal holidays
that transpired to wit: November 30, 1974, December 25, 1974, December 30, 1974,
January 1, 1975, February 27, 1975 (Referendum Day), Maundy Thursday of 1975,
Good Friday of 1975, April 9, 1975 and finally, May 1st of 1975. We are therefore
inclined to lend credence to respondent's claim that the payment of legal holiday pay
was in fact made pursuant to law, P.D. 570-A in particular, it is not one that arose out
of company practice or policy.
Finding that said payment was made based on an honest although erroneous
interpretation of law, which interpretation was later on corrected by the issuance (sic)
of Policy Instruction No. 9 and which issuance prompted respondent to withdraw the
holiday pay benefits extended to the employees who were paid on a regular monthly
basis, and finding further that under Policy Instructions No. 9, said subject employees
are deemed paid their holiday pay as they were paid on a monthly basis at a wage
rate presumably above the statutory minimum, we believe and so hold that the
withdrawal of said holiday pay benefit was valid and justifiable under the
circumstances (Rollo, pp. 33-4).
This Court cannot sustain the foregoing decision of public respondent. Said decision relied on
Section 2, Rule IV, Book Ill of the implementing rules and on Policy Instruction No. 9 which were
declared by this Court to be null and void in Insular Bank of Asia and America Employee's Union
(IBAAEU) v. Inciong (G.R. No. 52415, October 23, 1984, 132 SCRA 6631. In disposing of the issue
at hand, this Court reiterates the ruling in that case, to wit:
WE agree with the petitioner's contention that Section 2, Rule IV, Book Ill of the
implementing rules and Policy Instruction No. 9 issued by the then Secretary of
Labor are nun and void since in the guise of clarifying the Labor Code's provision on
holiday pay, they in fact amended them by enlarging the scope of their exclusion.
xxx xxx xxx
It is elementary in the rules of statutory construction that when the language of the
law is clear and unequivocal the law must be taken to mean exactly what it says. In
the case at bar, the provisions of the Labor Code on the entitlement to the benefits of
holiday pay are clear and explicit it provides for both the coverage of and
exclusion from the benefits. In Policy Instruction No. 9, the then Secretary of Labor

went as far as to categorically state that the benefit is principally intended for daily
paid employees, when the law clearly states that every worker shall be paid their
regular holiday pay. This is a flagrant violation of the mandatory directive of Article 4
of the Labor Code, which states that "All doubts in the implementation and
interpretation of the provisions of this Code, including its implementing rules and
regulations, shall be resolved in favor of labor. " Moreover, it shall always be
presumed that the legislature intended to enact a valid and permanent statute which
would have the most beneficial effect that its language permits (Orlosky vs. Haskell,
155 A. 112). (pp. 673-4).
BISCOCHO CASE
At issue also in this petition is whether the 60% incremental proceeds may be subjected to attorney's
fees, negotiation fees, agency fees and the like.
The Court notes the fact that there are two classes of employees among the petitioners: (1) those
who are members of the bargaining unit and (2) those who are not members of the bargaining unit.
The first class may be further subdivided into two: those who are members of the collective
bargaining agent and those who are not.
It is clear that the questioned Order of the respondent Minister applies only to members of the
bargaining unit. The CBA prepared pursuant to said Order, however, covered employees who are
not members of the bargaining unit, although said CBA had not yet been signed at the time this
petition was filed on November 24, 1986. Assuming it was signed thereafter, the inclusion of
employees outside the bargaining unit should be nullified as this does not conform to said order
which directed private respondents to execute a CBA covering only members of the bargaining unit.
Being outside the coverage of respondent Minister's order, and thus, not entitled to the economic
package involved therein, employees who are non- members of the bargaining unit should not be
assessed negotiation fees, attorney's fees, agency fees and the like, for the simple reason that the
resulting collective bargaining agreement does not apply to them. It should be clear, however, that
while non-members of the bargaining unit are not entitled to the economic package provided by said
order, they are, in lieu thereof, still entitled to their share in the 60% incremental proceeds of
increases in tuition or other school fees or charges.
As far as assessment of fees against employees of the collective bargaining unit who are not
members of the collective bargaining agent is concerned, Article 249 of the Labor Code, as
amended by B.P. Blg. 70, provides the rule:
Art. 249. Unfair labor practices of employers.xxx xxx xxx
(e) ... Employees of an appropriate collective bargaining unit who are not members of
the recognized collective bargaining agent may be assessed a reasonable fee
equivalent to the dues and other fees paid by members of the recognized collective

bargaining agent, if such non- union members accept the benefits under the
collective agreement . . .
Employees of the collective bargaining unit who are not members of the collective bargaining agent
have to pay the foregoing fees if they accept the benefits under the collective bargaining agreement
and if such fees are not unreasonable. Petitioners who are members of the bargaining unit failed to
show that the equivalent of ten (10%) percent of their backwages sought to be deducted is
unreasonable.
WHEREFORE, the Court rules:
CEBU INSTITUTE OF TECHNOLOGY CASE
In G.R. No. 58870, the Order of respondent Minister of Labor and Employment dated September 29,
1981 is SUSTAINED insofar as it ordered petitioner Cebu Institute of Technology to pay its teaching
staff the following:
(1) Cost of living allowance under Pres. Dec.Nos.525 and 1123 from February 1978
up to 1981;
(2) Cost of living allowance under Pres. Dec. Nos. 1614, 1634, 1678 and 1713; and
(3) Service incentive leave due them from 1978.
The Temporary Restraining Order issued by this Court on December 7, 1981 is hereby LIFTED and
SET ASIDE. No costs.
DIVINE WORD COLLEGE CASE
The petition in G.R. No. 68345 is DENIED for lack of merit. The questioned Orders of respondent
Deputy Minister of Labor and Employment, dated December 19, 1983 and July 4, 1984
are SUSTAINED insofar as said Orders denied the payment of the emergency cost of living
allowances of private respondents faculty teachers of the Divine Word College of Legazpi out of the
sixty (60%) incremental proceeds of tuition and other school fee increases collected during the
effectivity of Pres. Dec. No. 451. The Rules and Regulations implementing Pres. Dec. No. 451 are
hereby declared invalid for being ultra vires No costs.
FAR EASTERN UNIVERSITY CASE
The Decision of public respondent National Labor Relations Commission dated September 18, 1984
is REVERSEDinsofar as it affirmed in toto the dismissal of petitioner Far Eastern University
Employee Labor Union's claim under Pres. Dec. No. 451 and its claim for payment of holiday pay.
Private respondent Far Eastern University is therefore ordered to pay its employees the following:
(1) Their sixty (60) percent share in the increases in tuition and other school fees or
charges which shall be allocated exclusively for increase in salaries or wages if the

tuition or other school fee increase was collected during the effectivity of Pres. Dec.
No. 451;
(2) Their claim for holiday pay which was withdrawn since January 14, 1976 up to the
present.
The Decision of respondent National Labor Relations Commission, however, is SUSTAINED insofar
as it denied petitioner's claim for thirteenth (1 3th month pay. No costs.
FABROS CASE
In G.R. No. 70832, the Petition for certiorari and Prohibition is DISMISSED. MECS Order No. 25. s.
1985, particularly paragraphs 7.0 to 7.5 thereof, which provide for the use and application of sixty
(60%) percent of the increases in tuition and other school fees or charges, having been issued
pursuant to B.P. Blg. 232 which repealed Pres. Dec. No. 451, is hereby declared VALID. The
Temporary Restraining Order issued by this Court dated May 29, 1985 is LIFTED and SET ASIDE.
No costs.
BISCOCHO CASE
The assailed portions of the Order of the Minister of Labor and Employment dated April 14, 1986 are
AFFIRMED. The collective bargaining agreement prepared pursuant thereto should, however, be
MODIFIED to cover only members of the bargaining unit. Only petitioners who are members of the
collective bargaining unit, if they accept the benefits under the resulting collective bargaining
agreement, shall be charged ten (10%) percent of the payable backwages as negotiation fees. The
Temporary Restraining Order dated November 25, 1986 is LIFTED and SET ASIDE. No costs.
VALMONTE CASE
The petition in G.R. No. 76596 is DISMISSED for lack of merit.
Effective September 1, 1982, the application and use of the proceeds from increases in tuition fees
and other schools fees or charges shall be governed by section 42 of B.P. Blg. 232 as implemented
by the Rules and Regulations issued by the then Ministry, now Department of Education, Culture
and Sports. SO ORDERED.
Teehankee, C.J., Yap, Melencio-Herrera, Gutierrez, Jr., Paras, Feliciano, Gancayco, Bidin and
Sarmiento, JJ., concur.
Fernan, Narvasa, Cruz and Padilla, JJ., took no part.