NAPOCOR gives backpay of retrenched workers after almost 2 decades

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After nearly two decades, the National Power Corporation (NAPOCOR) has begun paying the back wages of former employees laid off in 2003 due to the implementation of Republic Act 9136 or the Electric Power Industry Reform Act of 2001 (EPIRA), following a Supreme Court (SC) decision as affirmed by the Commission on Audit (COA).
The payment of claims will be done on an alphabetical basis according to the batches as validated by COA.
“The claimants or their authorized representatives shall be informed when they are to proceed to the NAPOCOR Cashier’s Office to claim their checks. This is to ensure orderly distribution of payments and that the necessary health protocols are observed to prevent the transmission of COVID-19,” NAPOCOR President and CEO Benavidez said in a statement.
Thousands of NAPOCOR employees were separated from service and were paid with separation benefits equivalent to 1.5 month of pay per year of service following the implementation of EPIRA, which changed the government-owned firm’s corporate purpose. Majority of these employees were rehired by NAPOCOR, National Transmission Corporation (TransCo) and Power Sector Assets and Liabilities Management (PSALM) Corporation. However, around 1,763 employees were not reinstated.
TransCo serves as the owner of the country’s grid, which is being operated by privately-owned National Grid Corporation of the Philippines, while PSALM — TransCo’s mother firm — is in charge of disposing NAPOCOR’s assets. Established by virtue of EPIRA, PSALM and TransCo are also state-run companies.
Among those not re-hired were the members of the Drivers and Mechanics Association who contested and filed a case before the court questioning National Power Board Resolution Nos. 2002-124 and 2002-125, being signed only by three duly constituted Directors of the Board, and the rest by their respective official alternates. The said resolutions were the documents that implemented the retrenchment.
In 2006, the SC declared the resolutions void on the ground that department secretaries who are members of the National Power Board cannot delegate their duties to their official alternates. In November 2017, the high court ordered the payment of back wages of more than 8,000 employees amounting to Php34.7 billion.
NAPOCOR abided with the said decision, but said it needed back then to verify the accuracy of the number of employees affected. Together with PSALM, it sought the assistance of COA to validate not only the number of qualified employees who are entitled for payment, but also the appropriate amount of back wages to be paid since all retrenched employees already received their separation pay
COA, then issued Decision No. 2019-416 on September 23, 2019 giving NAPOCOR the green light to release the claims to certified rightful employees. NAPOCOR also coordinated with the Bureau of Internal Revenue and the Government Service Insurance System to make accurate computations on taxes and contributions.
“Today, the long wait for the claimants has finally ended. The 17-year wait for the claimants saw a long legal and procedural battle with the state-corporation who naturally had to defend and protect itself from the suit. It, unfortunately, created rifts and strained relations between NAPOCOR and its former employees who are still considered a valued part of [the company’s] 84-year existence. We have high hopes that the payment of these claims would start to heal the wounds between the parties and unite the NAPOCOR community, past and present,” Benavidez said.

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