G.R. Nos.

117442-43 January 11, 1995

FEM'S ELEGANCE LODGING HOUSE, FENITHA SAAVEDRA and IRIES ANTHONY
SAAVEDRA,
petitioners,
vs.
The Honorable LEON P. MURILLO, Labor Arbiter, Regional Arbitration Branch, Region
X, National Labor Relations Commission, Cagayan de Oro City, et al, respondents.
Facts: Private respondents were former employees of FEM'S ELEGANCE LODGING
HOUSE, a business enterprise engaged with providing lodging accommodations. It is
owned by petitioner Fenitha Saavedra and managed by petitioner Iries Anthony
Saavedra. Private respondents were terminated between March and April, 1994.
After their dismissal private respondents filed two separate cases against
petitioners before the National Labor Relations Commission (NLRC), Regional
Arbitration. They sought for unpaid benefits such as minimum wage, overtime pay,
rest day, holiday pay, full thirteenth-month pay and separation pay. On May 31,
1994, two-points were agreed upon the pre-arbitration conference: (1) both of the
labor cases would be consolidated; and (2) parties would file their respective
position paper within thirty days from the said date or until June 30, 1994, after
which the cases would be deemed submitted for resolution. Petitioners were able to
file their position papers on said period and on July 7, when they inquired from the
NLRC whether private respondents had filed theirs, NLRC confirmed that private
respondents had not yet filed their position papers.
On July 8, petitioners filed a motion to dismiss for failure of private respondents to
file their position paper within the said period. Private respondents were able to file
their position paper on July 15 and on July 18, petitioners filed a Motion to Expunge
private respondents position paper from the records of the case. Prior to the
hearing set by the Labor Arbiter, petitioners also filed a Motion to Resolve, Motion to
Dismiss and Motion to Expunge private respondents position paper from the
records of the case. Labor Arbiter denied the motions filed by the petitioners thus
the present petition. Petitioner claimed that they were denied with due process and
the Labor Arbiter should have cited private respondents in contempt for their failure
to comply with the agreement in the pre-arbitration conference.
Issue: whether the Labor Arbiter committed grave abuse of discretion for not
expunging the private respondents position papers filed out of the time as agreed
on their pre-arbitration conference thus denying petitioners due process?
Held: The petition was dismissed. First, petitioners failed to exhaust their remedies.
They should have appealed with the NLRC as provided in Art. 223 of the Labor Code.
Given that the petition would prosper, it would still be dismissed since the delay of
private respondents in the submission of their position papers is a procedural flaw
and admission is in discretion of the Labor Arbiter. It is a well-settled rule that
technical rules of procedure are not binding in labor cases and procedural lapses
may be disregarded in the interest of their substantial justice. Position papers filed

out of time is not a ground for the dismissal of a complaint in labor cases. This is in
accordance with Art. 4 of the Labor Code which provides that all doubts in the
interpretation shall be resolved in favor of the labor. Substantive rights of litigants
should not be sacrificed by technicality.
Ruling: Petition was dismissed.