PEDRO P. CLEMENTE, PETITIONER, VS. THE COMMISSION ON AUDIT, REPRESENTED BY FRANCISCO S. TANTUICO JR., ACTING CHAIRMAN, RESPONDENT.

Clemente versus Commission on Audit

The Case

This is a petition brought by Pedro Clemente, a certified public accountant and long-time official of the Commission on Audit, against the Commission on Audit itself, represented by its acting chairman. Clemente asks the Supreme Court to order payment of back salaries for the period he was separated from the government service by the President of the Philippines and later reinstated. The case matters because it draws the line between an ordinary administrative dismissal that is later reconsidered, which carries back pay, and a separation carried out under the so-called September 1975 purge, which does not. It is a study in how the Court characterizes a removal, and in what a reinstated employee must show before back wages may be ordered.

Procedural History

The matter began administratively. After his reinstatement, Clemente filed with the Commission on Audit a claim for back salaries for the period he was out of the service, and he also sought clarification from the Office of the President on the effect of his reinstatement. The Presidential Executive Assistant rendered a decision holding that the reinstatement of a government employee whose dismissal has been reconsidered carries back salaries only where the dismissal arose from an ordinary administrative case, and that separation under the September 1975 purge is of a different category, the policy being to deny back wages to purged but subsequently reinstated employees, who are considered under suspension during the period they were out. Acting on that decision, the Commission on Audit, through its first indorsement, denied Clemente's claim, holding that he was considered under suspension from September 19, 1975 to April 17, 1977 and could only charge that period to his leave of absence, if any, and collect the money value of his leave credits. Clemente then came to the Supreme Court by petition, and the Court resolved the question of whether he is entitled to back salaries for that period.

Facts

Pedro Clemente was a certified public accountant who had been with the Commission on Audit since November 11, 1935, where he held various positions, and who was duly appointed Deputy Auditor of the Central Bank. On the occasion of the third anniversary of the proclamation of martial law, the President announced the beginning of a sweeping, complete and exhaustive reorganization of the government. In the overhaul of government machinery, hundreds of employees of the Commission on Audit, from the highest to the lowest rank, were purged. Clemente's separation, together with that of several hundred other government employees, was pursuant to Letter of Instruction No. 309, series of 1975, and was made effective September 19, 1975. The names of all those affected, including his, were later published in the metropolitan dailies.

Clemente appealed to the President. By memorandum of Presidential Executive Assistant Jacobo Clave dated March 28, 1977, he was informed of the President's approval of his reinstatement as Deputy Auditor of the Central Bank. Implementing the presidential order, the Commission directed him to report to his former office, and he reported on April 18, 1977.

On November 29, 1977, Clemente filed with the Commission on Audit his claim for back salaries for the period he was out of the service, and he sought clarification from the Office of the President on the effect of his reinstatement. The Presidential Executive Assistant ruled on August 30, 1977 that the policy in purge cases is to deny back wages and other benefits to employees purged but subsequently reinstated, they being considered under suspension during the period they were out, though they may charge that period to their leave of absence and collect such other benefits to which an employee on leave is ordinarily entitled. Relying strictly on that decision, the Commission on Audit denied his claim. The records also showed that Clemente had had an administrative case which, although dismissed, resulted in his being sternly admonished to exercise more caution and prudence in his official actuations.

Issues

• Whether or not Clemente is entitled to the payment of back salaries from September 19, 1975 to April 17, 1977, the period he was separated from the government service by the President and later reinstated.
• Whether or not his separation may be treated as a preventive suspension under the Civil Service Law, such that his reinstatement would carry back pay.
• Whether or not his reinstatement amounted to an exoneration from administrative charges.

Applicable Provisions

Section 35, Article VII of Republic Act No. 2260, the Civil Service Law, provides:

Section 35. Lifting of Preventive Suspension Pending Administrative Investigation. When the administrative case against the officer or employee under preventive suspension is not finally decided by the Commissioner of Civil Service within the period of sixty days after the date of suspension of the respondent, the respondent shall be reinstated in the service. If the respondent officer or employee is exonerated, he shall be restored to his position with full pay for the period of suspension.

This is the provision Clemente invoked, and the Court holds it inapplicable because his separation was not a preventive suspension and his reinstatement was not an exoneration.

Section 9, Article XVII of the Constitution provides:

Section 9. All officials and employees in the existing Government of the Republic of the Philippines shall continue in office unless otherwise provided by law or decree by the incumbent President of the Philippines.

This provision supplied the authority for Letter of Instruction No. 309 and confirms the legality of Clemente's separation.

Section 3, Article XII(B) of the Constitution provides:

Section 3. No officer or employee in the Civil Service shall be suspended or dismissed except for cause as provided by law.

The Court notes that Section 9, Article XVII qualifies this guarantee during the transition period.

Ruling

On the first issue, the Court held that Clemente is not entitled to back salaries. His separation on September 19, 1975 was, for all intents, a dismissal pursuant to the urgently needed reform movement initiated by the President, which, as a compassionate gesture, was subsequently modified as suspension without pay, a disciplinary penalty short of dismissal. The Court stressed that the purge was carried out pursuant to Letter of Instruction No. 309, issued under the authority of Section 9, Article XVII of the Constitution, which vests in the incumbent President the power to remove officials and employees of the existing government, and that this dissipates all doubts about the legality of the separation. Being a legal act on the part of the President, it cannot ground a claim for back wages.

On the second issue, the Court held that Section 35 of the Civil Service Law does not apply. That provision applies only where the officer or employee is placed under preventive suspension, which is subsequently lifted upon final exoneration. Clemente admitted that as of September 19, 1975, when he was purged, there was no pending administrative charge against him for any act or omission warranting disciplinary action. His separation was not the consequence of an administrative case, just as his reinstatement was not the result of an exoneration from administrative charges.

On the third issue, the Court held that Clemente was not exonerated. To exonerate means to exculpate, to relieve, to clear from accusation or blame, and it may imply complete clearance not only from the immediate charge but from suspicion or attendant denigration. The admonition in the decision dismissing the administrative case no more implies than that he had also been remiss in the discharge of his duties.

The Court added that it is a settled rule that absent a showing that the dismissal was tainted with bad faith and grave abuse of discretion, an employee is not entitled to back wages. The separation of some two thousand undesirables, including Clemente, was impelled by the desire for reforms, and the list of Commission on Audit employees to be purged was submitted by the acting chairman on August 28, 1975, when Clemente still had a pending administrative case. The cases he cited were not in point: one involved administrative suspension, and the others involved illegal dismissal. As to the officials he invoked as precedent, their situations differed, for one was reinstated with retroactive effect to the date of separation, and the other collected only the money value of his leave credits, not salaries. The Court also noted that the President ordered Clemente's reinstatement only, without back salaries.

Doctrine

First, the reinstatement of a government employee whose dismissal has been reconsidered carries with it the payment of back salaries only where the dismissal is the result of an ordinary administrative case. Second, Section 35 of the Civil Service Law, which restores full pay to an exonerated employee, applies only to preventive suspension, not to a separation carried out under a valid reorganization or purge ordered by the President pursuant to Section 9, Article XVII of the Constitution. Third, exoneration means complete clearance from the charge, suspicion, and attendant denigration; a dismissal of the administrative case accompanied by a stern admonition is not an exoneration. Fourth, absent a showing that the dismissal was tainted with bad faith and grave abuse of discretion, a separated employee is not entitled to back wages. Fifth, a reinstatement made effective immediately, and not retroactive to the date of separation, does not entitle the employee to salaries for the intervening period.

Disposition

The petition was dismissed, without costs, and Clemente was denied back salaries, though he may charge the period of his suspension against his leave credits, if any, and commute them to money value.

Remember This

The line to memorize is this: a reinstated employee gets back pay only when the removal was an ordinary administrative dismissal later reconsidered, or a preventive suspension followed by exoneration, and not when the removal was a valid act of the President under the transitory provision of the Constitution. Examiners use this case to test the distinction between preventive suspension and dismissal, the meaning of exoneration, and the requirement of bad faith and grave abuse of discretion before back wages may be awarded.