PM 03-2012

Requesting Entity: Department Of Labor And Employment

Issues Concern: DOLE Department Order (DO) No. 18-A



Whether the requirement that administrative fee in service agreements should not be less than ten percent (10%) of the total contract cost, provided under Section 9(b)(ii) of DOLE DO 18-A, is deemed invalid for being contrary to RA 9184 and its IRR.

[I]t is a settled rule that administrative agencies possess quasi-legislative or rule-making powers to make rules and regulations which results in delegated legislation that is within the confines of the granting statute and the doctrine of non-delegability and separability of powers. However, administrative agencies may not make rules and regulations which are inconsistent with the provisions of the Constitution or a statute, particularly the statute it is administering or which created it, or which are in derogation of, or defeat, the purpose of a statute, and in case of conflict between a statute and an administrative order, the former must prevail.

[C]onsidering the obvious conflict between Section 31 of RA 9184 and Section 9(b)(ii) of DOLE DO 18-A, we express the view that the latter should be considered INVALID, and thus, cannot be a source of any right duty, obligation or power.