THE Commission on Audit (COA) has sustained its earlier decision blocking P97.65 million in separation pay granted to 79 former rank-and-file employees of the Philippine National Construction Corp. (PNCC).

In a ruling issued this month, the COA en banc said the benefits—equivalent to 250 percent of the employees’ monthly basic salary for every year of service—were “excessive, extravagant, injudicious and unconscionable.”

Auditors pointed out that PNCC, a government-acquired firm under the Department of Trade and Industry, suffered “substantial losses” from 2006 to 2010, making the large payouts unjustified and inconsistent with sound management.

“One cannot squeeze blood out of a dry stone; nor water out of parched land. To require the Management to continue being generous when it is no longer in a position to do so would certainly be unconscionable,” the commission said.

COA also noted that the separation pay exceeded the one-month salary per year of service allowed under Article 283 of the Labor Code.

The commission dismissed PNCC’s claim that it is exempt from audit as a private corporation, citing Supreme Court rulings affirming COA’s authority. It warned that treating PNCC as independent would turn it into a “lost command” within the Executive Branch.

“The PNCC is not just like any other private corporation precisely because it is not a private corporation but indisputably a government-owned corporation,” the ruling stated.

Those held liable for the disallowed amount include the PNCC Board of Directors who approved the benefits, the officers who certified the payments, and the recipients themselves.

COA, however, cleared P1.38 million in separation pay given to 14 employees, saying their benefits were protected by a valid Collective Bargaining Agreement. The remaining 65 employees, auditors said, are entitled only to the minimum benefits required by law.