BOARD OF TRUSTEES OF THE G.S.I.S. VS. VELASCO earned his right to the step increment before Resolution No.

crement before Resolution No. 372 was

enacted. Respondents also argued that the three resolutions were
Facts: On 23 May 2002, petitioners charged respondents ineffective because they were not registered with the University of
administratively with grave misconduct and placed them under the Philippines (UP) Law Center pursuant to the Revised
preventive suspension for 90 days. Respondents were charged for Administrative Code of 1987.
their alleged participation in the demonstration held by some GSIS
employees denouncing the alleged corruption in the GSIS and The trial court granted respondents’ petition for prohibition.
calling for the ouster of its president and general manager, petitioner
Winston F. Garcia. Issues:
1. Whether internal rules and regulations need not require
Respondent Mario I. Molina requested GSIS SVP for the publication with the Office of the National [Administrative]
implementation of his step increment but the official denied the Register for their effectivity; and
request citing GSIS Board Resolution No. 372 which provides that 2. Whether a regulation, which disqualifies government
the step increment adjustment of an employee who is on preventive employees who have pending administrative cases from the
suspension shall be withheld until such time that a decision on the grant of step increment and Christmas raffle benefits is
case has been rendered. unconstitutional.

Respondents also asked that they be allowed to avail of the Ruling:

employee privileges under GSIS Board Resolution No. 306
approving Christmas raffle benefits for all GSIS officials and 1. Petitioners also argue that Resolution Nos. 372, 197, and 306
employees. Respondents request was again denied because of their need not be filed with the UP Law Center ONAR since they
pending administrative case. are, at most, regulations which are merely internal in nature
regulating only the personnel of the GSIS and not the public.
Petitioner GSIS Board issued Board Resolution No. 197 approving
the policy recommendations on the disqualification from promotion, Not all rules and regulations adopted by every government agency
step increment, PBB, and other benefits and privileges of an are to be filed with the UP Law Center. Only those of general or of
employee with a pending administrative case. permanent character are to be filed. According to the UP Law
Centers guidelines for receiving and publication of rules and
Respondents filed before the trial court a petition for prohibition with regulations, interpretative regulations and those merely internal in
prayer for a writ of preliminary injunction. They claimed that they nature, that is, regulating only the personnel of the Administrative
were denied the benefits which GSIS employees were entitled under agency and not the public, need not be filed with the UP Law Center.
Resolution No. 306. Respondents also sought to restrain and prohibit
petitioners from implementing Resolution Nos. 197 and 372. Resolution No. 372 was about the new GSIS salary structure,
Respondents claimed that the denial of the employee benefits due Resolution No. 306 was about the authority to pay the 2002
them on the ground of their pending administrative cases violates Christmas Package, and Resolution No. 197 was about the GSIS
their right to be presumed innocent and that they are being punished merit selection and promotion plan. Clearly, the assailed resolutions
without hearing. Respondent Molina also added that he had already pertained only to internal rules meant to regulate the personnel of
the GSIS. There was no need for the publication or filing of these Consequently, an employee who was preventively suspended will
resolutions with the UP Law Center. still be entitled to step increment after serving the time of his
preventive suspension even if the pending administrative case
2. First, entitlement to step increment depends on the rules against him has not yet been resolved or dismissed. The grant of
relative to the grant of such benefit. step increment will only be delayed for the same number of days,
which must not exceed 90 days, that an official or employee was
A grant of step increment on the basis of length of service requires serving the preventive suspension.
that an employee must have rendered at least three years of
continuous and satisfactory service in the same position to which he Fourth, the trial court was correct in declaring that respondents had
is an incumbent.31 To determine whether service is continuous, it is the right to be presumed innocent until proven guilty. This means that
necessary to define what actual service is.32Actual service refers to an employee who has a pending administrative case filed against
the period of continuous service since the appointment of the official him is given the benefit of the doubt and is considered innocent until
or employee concerned, including the period or periods covered by the contrary is proven.41
any previously approved leave with pay.
In this case, respondents were placed under preventive suspension
Second, while there are no specific rules on the effects of preventive for 90 days beginning on 23 May 2002. Their preventive suspension
suspension on step increment, we can refer to the CSC rules and ended on 21 August 2002. Therefore, after serving the period of their
rulings on the effects of the penalty of suspension and approved preventive suspension and without the administrative case being
vacation leaves without pay on the grant of step increment for finally resolved, respondents should have been reinstated and, after
guidance. serving the same number of days of their suspension, entitled to the
grant of step increment.
Preventive suspension pending investigation is not a penalty. 38 It is a
measure intended to enable the disciplining authority to investigate On a final note, social legislation like the circular on the grant of step
charges against respondent by preventing the latter from intimidating increment, being remedial in character, should be liberally construed
or in any way influencing witnesses against him.39 If the investigation and administered in favor of the persons to be benefited. The liberal
is not finished and a decision is not rendered within that period, the approach aims to achieve humanitarian purposes of the law in order
suspension will be lifted and the respondent will automatically be that the efficiency, security and well-being of government employees
reinstated. may be enhanced.

Therefore, on the matter of step increment, if an employee who was

suspended as a penalty will be treated like an employee on
approved vacation leave without pay,40 then it is only fair and
reasonable to apply the same rules to an employee who was
preventively suspended, more so considering that preventive
suspension is not a penalty. If an employee is preventively
suspended, the employee is not rendering actual service and this will
also effectively interrupt the continuity of his government service.