SC: BOC can’t charge airlines for overtime pay

MANILA, Philippines — The Supreme Court (SC) has ruled that the Bureau of Customs (BOC) cannot charge airlines and other private firms for the overtime pay of its airport personnel as it violates Republic Act 10863, or the Customs Modernization and Tariff Act (CMTA).

According to a 14-page decision penned by Associate Justice Ricardo Rosario, promulgated on July 12 but published only on Nov. 24, the overtime pay for BOC airport personnel should be charged to the national government and not to airlines and other private firms.

BOC spokesman and operations chief Arnaldo dela Torre Jr., when asked to react to the SC’s decision, said no airline is paying the overtime pay of BOC airport personnel.

Dela Torre added that he will also ask the BOC Employees Association (BOCEA) and seaport personnel to clarify if there are shipping lines that are still paying for their overtime pay.

“Our Customs employees assigned at the Ninoy Aquino International Airport or NAIA (offices and under Deputy Collector for Passenger Services; Aircraft Operations Division) render services in shifting schedules and claim overtime pay from government funds,” Dela Torre said.

Dela Torre refused to further comment on the SC’s decision as they have yet to receive a copy of the decision.

The SC’s decision stemmed from the petition filed by the BOCEA in 2013 to invalidate several administrative orders issued by former BOC commissioner Rozzano Rufino Biazon and former Department of Finance (DOF) secretary Cesar Purisima.

The BOC is an attached agency of the DOF.

In deciding the case, the SC said that it partially granted BOCEA’s petition.

The SC said that the exemption laid down in the questioned administrative issuances in favor of private entities violates Section 3506 of the Tariff and Customs Code of the Philippines (TCCP), which stated that airlines and other private firms are liable for the overtime pay of the airport personnel.

But the SC noted that upon the effectivity of the CMTA on June 16, 2016 that codified the exemption in the questioned administrative issuances, “the practice of charging private entities for overtime pay is now prohibited.”

The SC also emphasized that all overtime pay for BOC employees acquired from the time the administrative issuances were implemented in 2012 and before June 16, 2016 must be charged against private entities served and not against the government.

“Because of the assailed administrative issuances, the national government was prejudiced to the extent of the overtime work it paid during the said four-year period. On the other hand, since their overtime work during the four-year period was already paid, albeit by the national government, Customs employees were prejudiced only to the extent of the difference – if any – between overtime rates in private enterprises and overtime rates actually paid to them by the (BOC) during that time,” the SC said.

It also clarified that “any resulting monetary prejudice to the government or to petitioners is essentially evidentiary in nature and must be raised in the proper administrative and/or judicial proceeding.”

While it partially granted BOCEA’s petition, the SC emphasized that the administrative order prescribing BOC personnel’s official hours of work at the NAIA and other international airports was valid.