COMPENSATION OF CONTRACTUAL PERSONNEL AND INDIVIDUAL PROFESSIONAL CONSULTANTS

1. Under Joint CSC-DBM Circular No. 99-7 dated December 29, 1999
contractual personnel refer to those who are hired in accordance with a
specified contract for a specified period and with a definite expected
output and are employed to undertake a particular work or project, and
whose hiring creates an employee-employer relationship between them and
the hiring agency.

2. Starting January 1, 2000 contractual personnel shall be paid
compensation of an equivalent position as determined by the Department
of Budget and Management, but not to exceed the salary of the position.
Under existing laws, rules and regulations they shall also be entitled
to allowances and other benefits authorized for regular employees which
are chargeable against Personal Services.

3. On the other hand, under Section 81 of the General Provisions of
RA 8760 or the FY 2000 General Appropriations Act, individual
professional consultants refer to those experts in a field of special
knowledge or training who is contracted through service contracts to
render particular outputs or services primarily advisory in nature
requiring highly specialized or technical expertise which cannot be
provided by the regular staff of the agency. Such hiring creates no
employer-employee relationship between the individual professional
consultants and the agency.

4. Pending the issuance of the guidelines governing the compensation
of professional consultancy services, these individual professional
consultants shall be paid remuneration of not more than 120% of the
minimum basic salary of his equivalent position in the agency based on
the allocation list duly approved by the Department of Budget and
Management pursuant to National Budget Circular No. 433 dated March 1,
1994.

5. The remuneration of these individual professional consultants
shall be inclusive of all benefits accruing for the services rendered.
Thus, they are not entitled to any other benefits otherwise accruing to
regular personnel of the government.

6. Under existing laws, rules and regulations the remuneration of
individual professional consultants shall be chargeable against
Maintenance and Other Operating Expenses.

7. While the services of both the contractual personnel and the
individual professional consultants are hired in accordance with a
specific contract for a specific period and with a definite expected
output, they differ from one another in terms of the nature of services
rendered, the kind of working relationship with the agency and the
funding source of their compensation.

8. In view thereof, contractual personnel including those in Foreign
Assisted Projects hired in accordance with Item 1 shall be compensated
based on Item 2 hereof while individual professional consultants hired
in accordance with Item 3 shall be compensated based on Item 4 hereof.

9. Hiring of non-experts, such as drivers and clerks under Section
81 of the GAA cannot be made individually, but under a service contract
that may be entered into by an agency through public bidding or
negotiated contracts, subject to pertinent accounting rules and
regulations.

10. Please be guided accordingly.

Adopted: 01 June 2000

(SGD.) BENJAMIN E. DIOKNO
Secretary