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    Central Bank Employees Association vs. BSP: G.R. NO. 148208: December 15, 2004

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    The Supreme Court ruled the proviso exempting only BSP employees at salary grade 19 and above from the Salary Standardization Law to be unconstitutional, violating the equal protection clause. While the initial classification may have had a rational basis, subsequent amendments exempting all employees of other Government Financial Institutions created inconsistent and unequal treatment between the BSP and other GFIs. As there were no substantial differences between the entities to justify the differential treatment, the distinction imposed by law was deemed arbitrary.

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    Central Bank Employees Association vs. BSP: G.R. NO. 148208: December 15, 2004

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    90 views3 pages
    The Supreme Court ruled the proviso exempting only BSP employees at salary grade 19 and above from the Salary Standardization Law to be unconstitutional, violating the equal protection clause. While the initial classification may have had a rational basis, subsequent amendments exempting all employees of other Government Financial Institutions created inconsistent and unequal treatment between the BSP and other GFIs. As there were no substantial differences between the entities to justify the differential treatment, the distinction imposed by law was deemed arbitrary.

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    3 Central-Bank-vs-BSP

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    The Supreme Court ruled the proviso exempting only BSP employees at salary grade 19 and above from the Salary Standardization Law to be unconstitutional, violating the equal protection clause. While the initial classification may have had a rational basis, subsequent amendments exempting all employees of other Government Financial Institutions created inconsistent and unequal treatment between the BSP and other GFIs. As there were no substantial differences between the entities to justify the differential treatment, the distinction imposed by law was deemed arbitrary.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    90 views3 pages

    Central Bank Employees Association vs. BSP: G.R. NO. 148208: December 15, 2004

    Uploaded by

    A M I R A
    The Supreme Court ruled the proviso exempting only BSP employees at salary grade 19 and above from the Salary Standardization Law to be unconstitutional, violating the equal protection clause. While the initial classification may have had a rational basis, subsequent amendments exempting all employees of other Government Financial Institutions created inconsistent and unequal treatment between the BSP and other GFIs. As there were no substantial differences between the entities to justify the differential treatment, the distinction imposed by law was deemed arbitrary.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    of 3

    Central Bank Employees Association vs.

    BSP
    G.R. NO. 148208 : December 15, 2004

    Facts:
     The new Central Bank Act took effect and gave way for the creation of Bangko Sentral
    ng Pilipinas.
     Other Governmental Financial Institutions (GFIs) also amended their charters.
     After almost 8 years following the amendment of the GFIs’ charters, BSP’s employees,
    through petitioner, filed a petition for prohibition against the BSP and the Executive
    Secretary to restrain the respondents from further implementing the last proviso in Sec.
    15, Art. II of the New Central Bank Act (i.e., the exemption from the Salary
    Standardization Law (SSL) of all employees with salary grade of 19 and the non-
    exemption of those having a salary grade under 19). They alleged its constitutionality for
    being an invalid “class legislation”.
    Petitioner’s Contentions:
     The said proviso violates equal protection clause because only the officers of the BSP
    (those holding the salary grade of 19 and up) are exempted from the SSL.
     Those belonging from 19 and up and those 19 below do not really differ from one other
    in terms of the nature of work and expertise.
     Other GFIs, which are the same as the BSP, exempt all their rank-and-file personnel
    from SSL without any distinction.
    BSP’s contention:
     The proviso is not unconstitutional as it can stand the constitutional test, provided it is
    construed in harmony with other provisions of the same law, such as the mandate of the
    Monetary Board to “establish professionalism and excellence at all levels in accordance
    with sound principles of management.”
    Solicitor General, on behalf of respondent Executive Secretary:
     The proviso is not unconstitutional as the classification is based on actual and real
    differentiation, even as it adheres to the enunciated policy of the new SB Act to establish
    professionalism and excellence within the BSP subject to prevailing laws and policies of
    the national government.

    Issue: 

    WON the proviso is unconstitutional for being violative of equal protection clause.

    Held:

     YES, the proviso is unconstitutional for being violative of the equal protection
    clause.
     Equal protection clause does not prevent the Legislature from establishing classes of
    individuals or objects upon which different rules shall operate – so long as the
    classification is not unreasonable. Equality of operation of statutes does not mean
    indiscriminate operation on persons themselves, but on persons according to the
    circumstances surrounding them. It guarantees equality, not identity of rights.
     In the case at bar, it is clear in the legislative deliberations that the exemption of officers
    (SG 20 and above) from the SSL was intended to address the BSP’s lack of
    competitiveness in terms of attracting competent officers and executives. It was not
    intended to discriminate against the rank-and-file and the resulting discrimination or
    distinction has a rational basis and is not palpably, purely, and entirely arbitrary in the
    legislative sense. However, in the subsequent passages of the amendment on the
    charters of other GFI, the surrounding circumstances of the case changed.
     The subsequent amendments of the other GFIs’ charter (i.e., express authorization
    to determine and institute its own compensation and wage structure, and explicit
    exemption – without distinction as to salary grade or position – all employees of the GFI
    from the SSL) resulted to the oppressive results of Congress’ inconsistent and
    unequal policy towards the BSP rank-and-file and those of the seven other GFI. In
    the case at bar, it is precisely the fact that as regards the exemption from the SSL,
    there are no characteristics peculiar only to the seven GFIs or their rank-and-file
    so as to justify the exemption which BSP rank-and-file employees were
    denied (not to mention the anomaly of the SEC getting one). The distinction made by
    the law is not only superficial, but also arbitrary. It is not based on substantial
    distinctions that make real differences between the BSP rank-and-file and the seven
    other GFIs.
     The subsequent grant to the rank-and-file of the seven other GFIs and continued denial
    to the BSP rank-and-file employees of the exemption from SSL breached the latter’s
    right to equal protection.
     The equal protection clause does not demand absolute equality but it requires that all
    persons shall be treated alike, under like circumstances and conditions both as to
    privileges conferred and liabilities enforced.

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