MEMORANDUM CIRCULAR NO.

020-2016

For Undersecreta ries

Assistant Secretaries
Heads of Sectoral Offices and Attached Agencies
and Corporations
Head Executive Assistant
Service Directors
RMC Chairmen
Division Chiefs
This Department

For your information and dissemination, transmitted herewith are:

NATURE DATE SUBJECT

DBM-Budget Circular I April 28, 2016 "RULES AND

No. 2016 - 3 REGULATIONS ON THE
GRANT OF THE MID-
YEAR BONUS FOR FY
2016. "

DBM-Budget Circular April 15, 2016 "UPDATED RULES AND

No. 2016 - 4 REGULATIONS ON THE
GRANT OF THE YEAR-
END BONUS AND CASH
GIFT FOR FY 20161
AND YEARS I
THEREAFTER." .

ROWENA i ~UE
Director III ~UIO(
Administrative Service

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 REPUBLIC OF THE PHILIPPINES
DEPARTMENT OF BUDGET AND MANAGHv1ENT

No. 2016 - 3
April 28, 2016

TO AI! Heads of Departments, Agencies, State Universities and

Colleges (SUes) and other Offices of the National Government,
Including Commissions/Offices under the Ccnstitutlcnal Fiscal
Autonomy Group (CFAG), Government-Owned or -Oontrotled
Corporations (GOCCs); Heads of local Government Units
(lGUs); and AI! Others Concerned

SUBJECT Rules and Regulations on the Grant of the Mid-Year Bonus for
FY 2016
----_._---
1.0 Purpose

This Circular is issued to prescribe the rules and regulations on the grant of the
Mld- Year Bonus to government personnel for FY 2016 pursuant to Executive
Order (EO) No. 201, s. 2016, entitled "Modifying the Salary Schedule for Civilian
Government Personnel and Authorizing the Grant of Additional Benefits for
Both Civilian and MiHtarl and Uniformed Personnel," as approved by the
President on February i 9, 2016.

2.0 Coverage

This Circular shall apply to the following positions and personnel:

2.1 AI! positions for civilian personnel, whether regular, casual, or

contractual in nature, appointive or elective, full-time or part-time, now
Ay,,,,t'r ., or hereafter created in the Executive, Legislative and Judicial
Branches, the Constitutional Commissions and other Constitutional
Offices;SUCs, and GOCes covered by the Compensation and Position
Classification System (CPCS) under Republic Act (RA) No. 6758, as
amended by Senate and House of Representatives Joint Resolutions
No. 1, series of 1994 and No. 4, series of 2009; and in LGUs; and,

Mmtary personnel of the Armed Forces of the Philippines under the

Department of National Defense and uniformed personnel of the
Philippine National Police, Philippine Public Safety College, Bureau of
 Fire Protection, and Bureau of Jail Management and Penology of the
Department the Interior and Local Government; Philippine Coast
Guard of the Department of Transportation and Communications; and
National Mapping and Resource Information Authority of the Department
of Environment and Natural Resources.

3.0 Exclusions

The following are excluded from the coverage this Circular:

3.1 Government personnel from agencies, including GOCCs, that are

exempted from RA No. 6758, as amended, as expressly provided in their
respective enabling law or charter, and are actually implementing their
respective epcs approved by the President of the Philippines;

3.2 Government personnel from GOCCs covered by the CPCS established

by the Governance Commission for GOCes and approved by the
President of the Philippines pursuant to RA No. 10149; and,

3.3 Those hired without employee-employer relationships and funded from

non-Personnel Services appropriations/budgets, as follows:

3.3.1 Consultants and experts hired for a limited period to perform

specific activities or services with expected outputs;

3.3.2 Laborers hired through job contracts (pakyaw) and those paid on
piecework basis;

3.3.3 Student workers and apprentices; and

3.3.4 individuals and groups of people whose services are engaged

through job orders, contracts of service, or others similarly
situated.

4.0 Definition Terms

For purposes of this Circular, the succeeding terms used herein shall have the
following meanings:

4.1 Monthly basic pay shall refer to the monthly salary for regular and
contractual civilian personnel; the total daily wages for the twenty-two
(22) working days a month for casual personnel (equal to the monthly
salary of a regular personnel); the monthly base pay for the military and
uniformed personnel; and the monthly honoraria for barangayofficials
and employees.

4.2 The total or aggregate service required from government personnel for
purposes of the grant of the Mid-Year Bonus shall include all actual
services rendered while occupying a requtar, contractual, or casual

2
"

position in the national and/or local government, including leaves of

absence with pay.

5.0 Guidelines on the Grant of the Mid-Year Bonus

5.1 The Mid-Year Bonus equivalent to one (1) month basic pay as of
May 15 shaH be given to entitled personnel not earlier than May 15 of
the current year, subject to the following conditions:

5.1.1 Personnel has rendered at least a total or an aggregate of four (4)

months of service from July 1 of the immediately preceding year
to May 15 of the current year;

5.1.2 Personnel remains to be in the government service as of May 15

of the current year; and

5.1.3 Personnel has received at least a satisfactory performance rating

in the immediately preceding rating period.

5.2 Those who have rendered a total or an aggregate of less than four (4)
months of service from July 1 of the preceding year to May 15 of the
current year, and those who are no longer in the service as of the latter
date, shall not be entitled to the Mid-Year Bonus.

5.3 The Mid-Year Bonus of personnel hired on part-time service in one or

more agencies shall be in direct proportion to the number of hours/days
of part-time services rendered.

5.4 The Mid-Year Bonus of those on detail to another government agency

shall be paid by the parent agency, while those on secondment shall be
paid by the recipient agency.

5.5 The Mid-Year Bonus of personnel who transferred from one agency to
another shall be paid by the new agency.

5.6 A compulsory retiree, whose services have been extended, may be

granted Mid-Year Bonus, subject to the pertinent provisions of this
Circular.

5.7 Those who are formally charged administrative and/or criminal cases
which are still pending for resolution, shall be entitled to Mid-Year Bonus
until found guilty by final and executory judgment, provided that:

5.7.1 Those found guilty shall not be entitled to Mid-Year Bonus in the
year of finality of the decision. The personnel shall refund the
Mid-Year Bonus received for that year.

5.7.2 If the penalty imposed is only a reprimand, the personnel

concerned shall be entitled to the Mid-Year Bonus.

3
6.0 MidYear Bonus for Personnel of Covered GOCCs

The grant of the Mid-Year Bonus to personnel of covered GOCCs shall be

determined by their respective governing boards, subject to the foliowing
considerations:

6. i The provisions on the entitlement/non-entitlement of personnel to the

Mid-Year Bonus under ltern 5.0 hereof shall be strictly observed.

6.2 If funds are insufficient the Mid-Year bonus may be granted at lower
rates but at a uniform percentage of the monthly basic pay as of May 15
of the current year.

1.0 MidYear Bonus for Personnel of lGUs

The grant of the Mid-Year Bonus to personnel of lGUs shall be determined by

their respective sanggunian, subject to the following considerations:

7.1 The provisions on the entitlement/non-entitlement of personnel to the

Mid-Year Bonus under Item 5.0 hereof shall be strictly observed.

7.2 The Personnel Services limitation in LGU budgets under Sections 325(a)
and 331(b) of RA No. 7160 or the Local Government Code of 1991, shall
be complied with.

7.3 It funds are insufficient, the Mid-Year bonus may be granted at lower
rates but at a uniform percentage of the basic pay as of May 15
of the current year.

8.0 FundSources

8.1 The amounts required for the grant of FY 2016 Mid-Year Bonus to
personnel of National Government Agencies (NGAs) shall be charged
against the Miscellaneous Personnel Benefits Fund (MPSF) authorized
under RA No. 10717 or the FY 2016 General Appropriations Act.

8.2 The amounts required for the payment of Mid-Year Bonus to casual and
contractual personnel in NGAs whose salaries and wages are drawn
from the lump-sum appropriations for non-itemized positions shall be
sourced from the said agency lump-sum appropriations.

8.3 For covered GOCCs, the amounts required to implement the Mid-Year
Bonus shall be charged against their approved corporate operating
budgets (COBs), provided that the national government shall not release
funds for compensation adjustment or any related expenditures,
provided further that the GOCes shall not resort to borrowings for the
purpose, and provided furthermore, that the performance targets in their
Department of Budget and Management {DBM)-approved COBs are met
and their programs/projects for the year are not adversely affected.

4
 8.4 For LGUs, the amounts required to implement the Mid-Year Bonus shall
be charged against their respective local government funds, subject to
the Personnel Services limitation in LGU budgets pursuant to Sections
325 (a) and 331 (b) of RA No. 7160.

9.0 Release of Funds

The DBM shall release to the agencies/operating units concerned the Special
Allotment Release Order for the Mid-Year Bonus requirement, based on data
on the number of filled positions as of April 30, 2016 from the Government
Manpower Information System, chargeable against the MPBF.

The DBM shall issue the corresponding Notice ot Cash Allocation to cover the
Mid- Year Bonus of agency personnel to be given not earlier than May 15 of the
current year, subject to the provisions of National Budget Circular No. 561 dated
January 4,2016 on the release of funds.

10.0 Applicability to Certain Officials

Consistent with the policy under Section 6 of Article VII and Section 10 of Article
VI of the Constitution, the current President of the Philippines, Vice-President
of the Philippines, and the Members of Congress are not entitled to the FY 2016
Mid- Year Bonus. Pursuant to Section 14 of EO No. 201, s. 2016, the current
regular members of the Cabinet are also not entitled to the FY 2016 Mid-Year
Bonus.

11.0 Responsibility of Agencies

Agencies shall be responsible for tile proper implementation of the provisions

of this Circular. The responsible officers shall be held liable for any payment
not in accordance with the provisions of this Circular, without prejudice to the
refund by the employees concerned of any excess or unauthorized payments.

12.0 Resolution of Cases

Cases not covered by the provisions of this Circular shall be referred to the
DBM for resolution.

13.0 Effectivity

This Circular shall take effect immediately.

7- ;;:;;;e::~""''''''---
FLORENCIO B. ABAD
Secretary ,.;~ ...
Z<-;V

5
 REPUBLIC OF THE PHILIPPINES
DEPARTj\'fENT OF BUDGET AND ivIANAGEJ\1ENT
MAU\CANANG, ivl.ANIL./\

No. 2016 - 4
BUDG~:TC:IR(:UU~R I April 28, 2016

TO All Heads of Departments, Agencies, State Universities

and Colleges {SUes} and other Offices of the National
Government, Including Commissions/Offices under the
Constitutional Fiscal Autonomy Group (CFAG),
Government-Owned or -Controlled Corporations (GOCCs);
Heads of local Government Units (LGUs); am! All Others
Concerned

SUBJECT Updated Rules and Regulaticms on the Grant of the Year-

End Bonus and Cash t~ift for FY 2016 and Veal's
Thereafter

1.0 Background

1.1 Executive Order (EO) No. 201, s. 2016, entitled "Modifying the Sa/ary
Schedule for Civilian Government Personnel and Authorizing the
Grant of Additional Benefits tor Both Civilian and Military and
Uniformed Personnel," provided for the adoption of a compensation
adjustment strategy that "vii! ensure that the government
compensation structure is comparable with the prevailing rates in the
private sector, thereby attracting and retaining competent and
committed civil servants.

1.2 The compensation adjustment strategy includes the tollowinq:

1.2.1 Increase in the basic salary of civilian personnel;

1.2.2 Grant of new and increased rates of certain allowances for the
rnilitary and uniformed personnel;

Grant of a Mid-Year Bonus equivalent to one-month basic

salary not earlier than May 15 of every year, as an additional
benefit; and

1.2.4 Enhancement of the eXisting Performance-Based Bonus.

1.3 EO No. 201 likewise provides that the existing Year-End Bonus and
Cash Gift shall be given in November of every year.

1
.'

2.0 Purpose

This Circular is being issued to consolidate and update the policy and
procedural guidelines on the grant 0'1 the Year-End Bonus and Cash Gift to
government personnel for FY 2016 and the years thereafter pursuant to
Republic Act (RA) No, 66861, as amended by RA No. 84412, Congress Joint
Resolution No, 4, S, 20093, and EO No, 201, s. 2016.

3.0 Coverage

This Circular apply to the following nf',,~;tii'VH" and personnel:

3.1 Ail positions for civilian personnel whether regular, contractual, or

casual in nature, appointive or elective, tun-nme or part-time, now
existing or hereafter created in the Executive, Legislative and Judicia!
Branches, the Constitutional and other Constitutional
Offices, SUCs, and GOCCs covered by the Compensation and
Position Classification System (CPCS) under RA No. 6758, as
amended by Senate and House of Representatives Joint Resolutions
No. 1, series of 1994 and No. 4, series of 2009; and in LGUs; and

3.2 Military personnel of the Armed Forces of the Philippines under the
Department of National Dstense and uniformed personnel of the
Philippine National Police, Philippine Public Safety College, Bureau of
Fire Protection, and Bureau of Jail Management and Penology of the
Department of the Interior and Local Government; Phillppine Coast
Guard of the Department of Transportation and Communications: and
National Mapping and Resource Information Authority of the
Department of Environment and Natura! Resources.

4.0 Exclusions

The following are excluded from the coverage of this Circular:

4.1 Government personnel from agencies, including GOeCs, that are

exempted from RA No. 6758, as amended, as expressly provided in
their respective enabling law or charter, and are actually implementing
their respective CPCS approved by the President of the Philippines;

4.2 Government personnel from GOCes covered by the CPCS

established the Governance Commission for GOeCs and
approved the President of the Philippines to RA No,
101 and

4.3 Those hired without employer-emptcyee relationships and funded

from non-Personnel Services appropriations/budgets, Said individuals
may include, but not limited the following:

, An Act Authorizing Annual Christmas Bonus to all National and Local Govemment Officials and Employees Starting
CY 1988
2 An Act increasing the CaSh Gift to Five Thousand PB~,OSI'-",VUU.IAI!, ArnBnding for tile Purpose Certain Sections of
Act Six Thousand Six Hundred Purposes
Resoiution Authorizing the Prssident of the Phili"n!n'AS and Position Classification
System of Civilian Personnel and the Base Pay unnarmed Personnel in thB Government, and
for Other Purposes

2
 4.3.1 Consultants and experts hired for a limited period to perform
specific activities or services with expected outputs;

4.3.2 Laborers hired through job contracts (pakyaw) and those paid
on piecework basis;

4.3.3 Student !aborers and apprentices; and

4.3.4 Individuals and groups of people whose services are engaged

through job orders, contract of services, or others similarly
situated.

5.0 Definition of Terms

For purposes of this Circular, the succeeding terms used herein shall have
the following meanings:

5.1 Monthly basic pay shaf refer to the monthly salary tor civilian
personnel, including contractual personnel; the total daily wages for
the twenty-two (22) working days a month for casual personnel (equal
to the monthly salary of a regular personnel); the monthly base pay for
the military and uniformed personnel; and the monthly honoraria for
barangayofficials and employees.

5.2 The total or aggregate service required from government personnel

for the purpose of the grant of Year-End Bonus and Cash Gift shall
include all actual services rendered while occupying a regular,
contractual, or casual position in the national and/or local government,
including leaves of absence with pay.

6.0 Guidelines on the Grant of Year-End Bonus and Cash Gift

6.1 The Year-End Bonus equivalent to one (1) month basic pay as of
October 31 and Cash Gift of 195,000 shall be given to entitled
government personnel not earlier than November 15 of the current
year, subject to the following conditions:

6.1.1 Personnel has rendered at least a total or an aggregate of four

(4) months of service from January 1 to October 31 of the
current year; and

6.1.2 Personnel remains to be in the government service as of

October 31 of the same year.

6.2 Those who have rendered at least a total or an aggregate of four (4)
months of service from January 1 of the current year but who have
retired or separated from government service before October 31 of
the same year shall be granted within the month of retirement or
separation, a prorated share of the: a) Year-End Bonus based on the
monthly basic pay immediately preceding the date of retirement or
separation; and b) Cash Gift of f2'5,OOO, as follows:

3
 r----- . ...... ;----------_.._--,
Percentage of the

J
!

I, Length of Service Year-End Bonus and !

ca;~:ift
rs;:~:~:
:~::::::~:~
1---6~onths
:::~._:_~-_;_.- 7 months
bu~._!~~_s._than
_+- 6_0_g_b

_70_0_70 ----;

7 months but less than 8 months 80%

8 months but less than 9 months 90%

'---------------_._._-----+-_.
9 months but less than 10 months 95%

6.3 Those who have rendered a total or an aggregate of less than four (4)
months of service from January 1 to October 31 of the current year
and are still in government service as of October 31 of the same year,
shall be entitled solely to a pro-rated Cash Gift pursuant to Section 2
of RA No. 8441 , as follows:

Percentage Corresponding
Length of Service
of fll'5.000 Amount
_M __ ____ ~_

3 months but less than 4 months 40% P2,000

---_.
2 months but less than 3 months 30% 1,500

1 month but less than 2 months 20% 1,000

Less than one month 10% 500

6.4 The Year-End Bonus and Cash Gift of personnel hired on part-time
service in one or more agencies shall be in direct proportion to the
number of hours/days of part-time services rendered.

6.5 The Year-End Bonus and Cash Gift of personnel on detail with
another government agency shall be paid by the parent agency, while
those on secondment shall be paid by the recipient agency.

6.6 The Year-End Bonus and Cash Gift of personnel transferred from one
agency to another shall be paid by the new agency.

6.7 A compulsory retiree, whose services have been extended, may be

granted Year-End Bonus and Cash Gift, subject to pertinent
provisions of this Circular.

6.8 Those who are formally Charged administrative and/or criminal cases
which are stili pending for resolution, shall be entitled to Year-End
Bonus and Cash Gift until found guilty by final and executory
judgment, provided that:

4
 6.8.1 Those found guilty shall not be entitled to Year-End Bonus and
Cash Gift in the year of finality of the decision. The personnel
shall refund the Year-End Bonus and Cash Gift received for
that year.

6.8.2 If the penalty imposed is only a reprimand, the personnel

concerned shall be entitled to the Year-End Bonus and Cash
Gift.

7.0 Year-End Bonus and Cash Gift of 8arangay Personnel

7.1 As determined by the respective sanggunian, elective or appointive

barangay officials or employees who have rendered at least a total or
an aggregate of four (4) months of service from January 1 of the
current year and who are still in the service as of October 31 of the
same year. may be entitled to the Year-End Bonus equivalent to one
(1) month Honorarium received as of October 31 and Cash Gift of
P5,OOO.

7.2 Those who have rendered a total or an aggregate of four (4) months
of service from January 1 of the current year but who have retired or
separated from government service before October 31 of the same
year may be entitled to a proportionate share of the Year-End Bonus
and Cash Gift, consistent with Item 6.2 of this Circular.

7.3 A pro-rated Cash Gift may also be granted to personnel who have
rendered a total or an aggregate of less than four (4) months of
service from January 1 to October 31 of the current year and are still
in government service as of October 3'j of the same year, pursuant to
Item 6.3 hereof.

7.4 A salaried barangayemployee may be granted Year-End Bonus and

Cash Gift, subject to the conditions provided in this Circular.

8.0 Fund Source

8.1 For national government agencies (NGAs), the Year-End Bonus and
Cash Gift for personnel occupying regular positions shall be charged
against agency appropriations in the annual General Appropriations
Act (GAA). For FY 2016, funds for this purpose were released to the
agencies pursuant to National Budget Circular (NBC) No. 561 dated
January 4, 2016. .

Any deficiency as a result of the salary adjustment under EO No. 201

shall be charged against the Misce!laneous Personnel Benefits Fund
(MPBF).

8.2 The amounts required for the grant of Year-End Bonus and Cash Gift
to casual and contractual personnel in the NGAs shall be charged
against agency lump sum appropriations in the annual GAA.

8.3 For covered GOCCs, said benefits shall be charged against their
respective approved corporate operating budgets.

5
 8.4 For LGUs, said benefits shall be charged against their respective local
government funds, subject to the Personnel Services (PS) limitation in
the LGU budgets pursuant to Sections 325(a) and 331(b) of RA No.
7160 or the Local Government Code of 1991.

8.5 Enforcement of said PS limitation shaj be waived insofar as the

minimum Year-End Bonus of 1'>1,000 for the punong barangay and
~600 for the other mandatory barangayofficials, and their Cash Gifts
are concerned.

9.0 Release of Funds

9.1 For FY 2016, the Department of Budget and Management (DBM)

shall release to the agencies concerned the Special Allotment
Release Order (SARO) to cover the funding deficiency as a result of
the adjustments in salary under EO No. 201, chargeable against the
MPBF.

9.2 The SARO shall be released directly to the operating units of the
agencies concerned based on data from the Government Manpower
Information System as of October 31 of the given year.

9.3 The DBM shall likewise issue additional Notices of Cash Allocation
(NCAs) for any detioiency as a result of the salary adjustment under
EO No. 201 to cover the total requirements for the Year-End Bonus
and Cash Gift of agency personnel, subject to the provisions of NBC
No. 561 on the release of funds.

10.0 Responsibility of Agencies

Agencies shall be responsible for the proper implementation of the provisions

of this Circular. The responsible officers shall be held liable for any payment
not in accordance with the provisions of this Circular, without prejudice to the
refund by the employees concerned of any excess or unauthorized
payments.

11.0 Resolution of Cases

Cases not covered by the provisions of this Circular shall be referred to the
DBM for resolution.

12.0 Effectivity

This Circular shall take effect immediately.