Internal Guidelines for the Release of Trust Funds

July 5, 2012

NLRC ADMINISTRATIVE ORDER NO. 07-17-12

 

In view of various complaints received and the inconsistent procedure in the release of trust funds, the following internal guidelines are hereby issued to ensure uniformity of procedure in the release of trust/fiduciary funds:

1. Objectives

a. To prescribe a uniform procedure in the processing and requirements for the release of trust funds.

b. To set a clear delineation of responsibilities of each office over the release of trust funds.

c. To simplify the procedure and eliminate "red tape" in the processing of the release of trust funds.

2. General Guidelines

a. All releases from trust funds shall be covered by an approved disbursement voucher in the name of the payee who should be a party in the labor case as per Order of Release issued by the Labor Arbiter or the Commissioner.

b. All checks shall be crossed or marked "for payee's account only" except when the amount to be released in favor of the complainant or aggrieved employee is less than P10,000 as it is impractical on his part to open an account for the said payment. Uncrossing of check is to be done upon the request of the claimant only.

c. No amount shall be paid to persons or entities, including family members, relatives, lawyers, attorney-in-fact, unions and employees associations, if they are not parties to the case, except when it is in the dispositive portion of the final and executory judgment or when there is substitution made in case of the death of any party.

d. Attorney's fees shall be paid to the judgment creditor, not to his counsel, since the same are awards in the concept of damages. If the lawyer files an attorney's lien, the amount covered by the said lien shall be withheld unless the judgment creditor gives his consent in writing or an Order is issued by the appropriate authority directing the release of the said amount to the lawyer.

e. When a TRO or injunction is issued, the party concerned must directly furnish the office of Labor Arbiter or Commissioner and the Financial and Management Division with the copy of the same. Otherwise, the NLRC and its officials cannot be held responsible for releasing the amount to the payee.

3. Specific Guidelines, Procedures and Responsibility

A. Filing of Motion for the Issuance of Order to Release Trust Funds

1.a The release of trust funds must originate upon motion for the issuance of an Order of Release filed by the winning party with the Office of the Labor Arbiter/Commissioner handling the execution.

B. Issuance of the Order to Release Trust Funds

1.b Upon receipt of the motion for the issuance of Order of Release, the concerned Office of Labor Arbiter/Commissioner shall verify from the records of the case the following:

• Receipt by the NLRC Cashier of monetary deposit or proceeds from garnishments or executions.

• Finality of the Decision/Resolution/Order.

• Computation and distribution of the monetary awards in the case of multi-party labor case.

• No previous Order of Release has been issued.

• No payment for monetary claims has been made.

2.b After the complete verification of the above requirements, the Office of Labor Arbiter/Commissioner shall issue an Order of Release which must expressly contain the following information:

• Official Receipt (OR) number, date and amount

• The specific amount to be released

• The complete name/s of the party(ies) to which the monetary judgment awards shall be released

• The computation or distribution of the amount if the recipient involves more than one (1) person.

3.b The original copy of the Order of Release monetary judgment awards shall be forwarded to the Accounting Unit, Financial and Management Division of the Commission and must be supported with the following:

• Certification that the Decision/Resolution/Order has become final and executory and there being no injunction or temporary restraining order (TRO) was issued.

4.b The Office of Labor Arbiter at the arbitration level and the Office of Commissioner at the appellate level must maintain a separate Record Book to register/log all Orders of Release issued, the date of transmittal, and acknowledgment of the receipt of the Order of Release by the Accounting Unit.

C. Processing of Disbursements Voucher and Certification of Availability of Funds

1.c The Accounting Unit shall acknowledge the receipt of the Order of Release with the attached Certification of Finality of the Decision, Resolution or Order by stamping on the face of the documents "Received," indicating therein the date, time, printed name and signature of the person who actually received the documents and in the Record Book maintained by the Office of Labor Arbiter or Commissioner.

 The Accounting Unit must maintain its separate Record Book and shall record or register the receipt of the Order of Release and the Certification of Finality of the Decision, Resolution or Order indicating therein the date, time of the receipt of the document, the name and signature of person who actually received the document and shall assign queue number.

2.c Upon receipt of said Order of Release and the Certificate of Finality of the Decision, Resolution or Order, availability of funds shall be verified from the subsidiary record of trust fund deposit for a specific particular case.

3.c If the trust fund deposit has a sufficient amount to cover the Order of Release, the Disbursement Voucher shall simultaneously be processed to be signed by the Accountant to certify that the fund is available and supporting documents are complete.

 In case of non-availability of funds or discrepancies, the Accounting Unit shall advise and return the Order of Release immediately to the Office of the concerned Labor Arbiter or Commissioner which issued the same.

4.c The routing of the Disbursement Voucher (DV) to the approving officer shall be registered in the Record Book maintained for the receipt and processing of the Order of Release.

D. Issuance and Releasing of Checks

1.d Upon receipt of the approved DV, the Cashier, after validating the amount appearing in the said DV with the attached Order of Release, shall issue a check and prepare a corresponding advice to the bank for the payment/release of trust funds.

2.d The Cashier shall sign the check and the corresponding advice to the bank, record the issuance of the check in the Check Register, and shall immediately forward the same to the approving officer who will countersign the check.

3.d Releasing of the Check

 The Cashier shall release the check only to the payee named therein upon presentation of two (2) valid government issued identification cards for proper identification.

 In the event of inability of the payee to personally claim the check due to justifiable circumstance(s), an authorized representative, by virtue of a Special Power of Attorney approved by the Labor Arbiter/Commissioner handling the case, may claim the check in behalf of the payee after presentation of the following documents:

• Three (3) copies of Special Power of Attorney

• Three (3) copies of two (2) valid government issued identification cards of the payee

• Three (3) copies of two (2) valid government issued identification cards of representative

 In case the payee is a corporation, the check can only be released after presentation of the following documents:

• Three (3) copies of Secretary's Certificate authorizing to claim the check

• Three (3) copies of the two (2) valid government issued identification cards of the party signing Secretary's Certificate

• Three (3) copies of the two (2) valid government issued identification cards of authorized representative claiming the check.

E. Reporting

1.e The Cashier shall submit Report of Checks Issued and report of unclaimed checks on daily basis to the Accounting Unit;

2.e The Cashier shall inform the Office of the Labor Arbiter or Commissioner concerned of the release of check to the payee in compliance with the Order of Release by furnishing him/her with the photocopy of the approved disbursement voucher and the check issued for the payment. Upon receipt of the said documents, the Labor Arbiter or Commissioner concerned shall cause the stamping or annotation on the face of the case folder, the check number, amount and the date of release of the check.

3.e The report of checks issued shall within ten (10) days be verified, recorded through Journal Entry Voucher (JEV), Checks Disbursement Journal for Trust Funds, Subsidiary Ledgers validation and to be forwarded to the Commission on Audit for post audit purposes.

F. Administrative Sanction for Non-Compliance

Any employee or official who will deliberately violate or fails to comply with these guidelines in the releasing of trust funds will be dealt administratively.

G. Effectivity

These guidelines shall take effect immediately.

(SGD.) GERARDO C. NOGRALESChairman

ATTACHMENT

 

Process Flow in the Release of Fiduciary Funds

 

Step	Procedure	Office/	Time
					Person	Frame
					Responsible
1	Filing of Motion for Issuance of Order of Release	Complainant/s
					or Respondent
2	Issuance of the Order of Release	Labor Arbiter/
					Commissioner
3	Transmittal of the Order of Release to the Accounting Unit
4	Verification of availability of trust funds deposit	MFD/
					Accounting	One (1) Day
5	Preparation of Disbursement Voucher (DV)	Unit	except for
	based on the Order of Release and trust funds		2006 cases
	deposits				and below
						which the
6	Routing of DV for approval to the authorized signatories		Accounting
						Unit allots
7	Transmittal of the approved DV to the Cashier		ample time
						for
	In case of Non-availability of funds, Order of Release		verification of
	will be returned to the issuing Labor		availability of
	Arbiter/Commissioner		funds from
						the records
8	Preparation of Check and Advice to the Bank	Cash Unit:	Within the
					LBP — Central	day from
					Office	receipt of
					UCPB — NCR	approved DV
9	Releasing of Check	Cash Unit:	Upon claim
					LBP — Central	and
					Office	presentation
					UCPB — NCR	of the
						requirements
	NOTE: When TRO or Injunction is issued
	within the period of processing, the party/ies
	concerned must directly furnish the Office of
	Labor Arbiter or Commissioner who issued
	the Order of Release, the FMD-Accounting
	Unit and the Cash Unit with the copy of the
	same. Otherwise, the NLRC cannot be held
	responsible for releasing the trust funds to
	the payee stated in the Order of Release.
	Requirements in Claiming the Checks
	A.	For Judgment Monetary Awards
		a.	If the claimant is the payee, he must
			present two (2) valid government
			issued identification cards
		b.	If the claimant is an authorized representative, he
			must present/submit the following documents:
			i.	three (3) copies of Special Power of Attorney
			ii.	three (3) copies of two (2) valid government
				issued identification cards of payee
			iii.	three (3) copies of two (2) valid government
				issued identification cards of representative
	B.	For Release of Cash Bond
		a.	If the payee is the Company and/or
			private respondent
			i.	Special Power of Attorney (SPA)
				executed by the private respondent
			ii.	Three (3) copies of two (2) valid
				government issued identification
				card of executing party
			iii.	three (3) copies of two (2) valid
				government issued identification
				card of attorney-in-fact
		b.	If the payee is a corporation
			i.	three (3) copies of Secretary's
				Certificate
			ii.	three (3) copies of two (2) valid
				government issued identification
				cards of signing party
			iii.	three (3) copies of two (2) valid
				government issued identification
				cards of authorized representative
	NOTE: The Cashier shall check if the authority to
	sign the voucher and to receive the check from
	the NLRC should be specified in the
	SPA/Secretary's Certificate.
	If the SPA is executed abroad, the said
	SPA together with the photocopy of 2 valid
	ID cards should be authenticated by the
	Philippine Embassy based thereat.
	In case of doubt as to the identity of the
	claimant based on the credentials or
	documents presented, he shall accomplish
	a Clearance for Release of Check to be
	approved by the handling Labor Arbiter.