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G.R. No. 152396 - EX-BATAAN VETERANS SECURITY AGENCY, INC. v. THE SECRETARY OF LABOR BIENVENIDO E. LAGUESMA, ET A

SECONDDIVISION
[G.R.NO.152396:November20,2007]
EXBATAANVETERANSSECURITYAGENCY,INC.,Petitioner,v.THESECRETARYOFLABORBIENVENIDOE.
LAGUESMA,REGIONALDIRECTORBRENDAA.VILLAFUERTE,ALEXANDERPOCDING,FIDELBALANGAY,
BUAGENCLYDE,DENNISEPI,DAVIDMENDOZA,JR.,GABRIELTAMULONG,ANTONPEDRO,FRANCISCO
PINEDA,GASTONDUYAO,HULLARUB,NOLIDIONEDA,ATONGCENON,JR.,TOMMYBAUCAS,WILLIAM
PAPSONGAY,RICKYDORIA,GEOFREYMINO,ORLANDORILLASE,SIMPLICIOTELLO,M.G.NOCES,R.D.
ALEJO,andP.C.DINTAN,Respondents.
DECISION
CARPIO,J.:
TheCase
This is a Petition for Review 1with prayer for the issuance of a temporary restraining order or writ of preliminary
injunctionofthe29May2001Decision2andthe26February2002Resolution3oftheCourtofAppealsinCAG.R.SP
No.57653.The29May2001DecisionoftheCourtofAppealsaffirmedthe4October1999OrderoftheSecretaryof
LaborinOSLS044097280.The26February2002Resolutiondeniedthemotionforreconsideration.
TheFacts
ExBataan Veterans Security Agency, Inc. (EBVSAI) is in the business of providing security services while private
respondents are EBVSAI's employees assigned to the National Power Corporation at Ambuklao Hydro Electric Plant,
Bokod,Benguet(AmbuklaoPlant).
On20February1996,privaterespondentsledbyAlexanderPong(Pong)institutedacomplaint4forunderpaymentof
wagesagainstEBVSAIbeforetheRegionalOfficeoftheDepartmentofLaborandEmployment(DOLE).
On 7 March 1996, the Regional Office conducted a complaint inspection at the Ambuklao Plant where the following
violationswerenoted:(1)nonpresentationofrecords(2)nonpaymentofholidaypay(3)nonpaymentofrestday
premium (4) underpayment of night shift differential pay (5) nonpayment of service incentive leave (6)
underpaymentof13thmonthpay(7)noregistration(8)noannualmedicalreport(9)noannualworkaccidental
report (10) no safety committee and (11) no trained first aider.5On the same date, the Regional Office issued a
noticeofhearing6requiringEBVSAIandprivaterespondentstoattendthehearingon22March1996.Otherhearings
weresetfor8May1996,27May1996and10June1996.
On19August1996,theDirectoroftheRegionalOffice(RegionalDirector)issuedanOrder,thedispositiveportionof
whichreads:
WHEREFORE, premises considered, respondent EXBATAAN VETERANS SECURITY AGENCY is
hereby ORDERED to pay the computed deficiencies owing to the affected employees in the total
amountofSEVENHUNDREDSIXTYTHREETHOUSANDNINEHUNDREDNINETYSEVENPESOS
and85/PESOSwithinten(10)calendardaysuponreceipthereof.Otherwise,aWritofExecutionshall
beissuedtoenforcecomplianceofthisOrder.

NAME

DEFICIENCY

1.ALEXANDERPOCDING

P36,380.85

2.FIDELBALANGAY

36,380.85

3.BUAGENCLYDE

36,380.85

4.DENNISEPI

36,380.85

5.DAVIDMENDOZA,JR.

36,380.85

6.GABRIELTAMULONG

36,380.85

7.ANTONPEDRO

36,380.85

8.FRANCISCOPINEDA

36,380.85

9.GASTONDUYAO

36,380.85

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G.R. No. 152396 - EX-BATAAN VETERANS SECURITY AGENCY, INC. v. THE SECRETARY OF LABOR BIENVENIDO E. LAGUESMA, ET A

10.HULLARUB

36,380.85

11.NOLID[EO]NIDA

36,380.85

12.ATONGCENON,JR.

36,380.85

13.TOMMYBAUCAS

36,380.85

14.WILIAMPAPSONGAY

36,380.85

15.RICKYDORIA

36,380.85

16.GEOFREYMINO

36,380.85

17.ORLANDOR[IL]LASE

36,380.85

18.SIMPLICOTELLO

36,380.85

19.NOCES,M.G.

36,380.85

20.ALEJO,R.D.

36,380.85

21.D[I]NTAN,P.C.

36,380.85
TOTAL

P763,997.85

xxx
SOORDERED.7
EBVSAIfiledamotionforreconsideration8andallegedthattheRegionalDirectordoesnothavejurisdictionoverthe
subject matter of the case because the money claim of each private respondent exceededP5,000. EBVSAI pointed
outthattheRegionalDirectorshouldhaveendorsedthecasetotheLaborArbiter.
Inasupplementalmotionforreconsideration,9EBVSAIquestionedtheRegionalDirector'sbasisforthecomputation
ofthedeficienciesduetoeachprivaterespondent.
In an Order10 dated 16 January 1997, the Regional Director denied EBVSAI's motion for reconsideration and
supplemental motion for reconsideration. The Regional Director stated that, pursuant to Republic Act No. 7730 (RA
7730),11the limitations under Articles 12912and217(6)13of the Labor Code no longer apply to the Secretary of
Labor's visitorial and enforcement powers under Article 128(b).14 The Secretary of Labor or his duly authorized
representativesarenowempoweredtohearanddecide,inasummaryproceeding,anymatterinvolvingtherecovery
of any amount of wages and other monetary claims arising out of employeremployee relations at the time of the
inspection.
EBVSAIappealedtotheSecretaryofLabor.
TheRulingoftheSecretaryofLabor
In an Order15dated 4 October 1999, the Secretary of Labor affirmed with modification the Regional Director's 19
August 1996 Order. The Secretary of Labor ordered that theP1,000 received by private respondents Romeo Alejo,
AtongCenon,Jr.,GeofreyMino,DennisEpi,andRickyDoriabedeductedfromtheirrespectiveclaims.TheSecretary
ofLaborruledthat,pursuanttoRA7730,theCourt'sdecisionintheServando16caseisnolongercontrollinginsofar
astherestrictiveeffectofArticle129onthevisitorialandenforcementpoweroftheSecretaryofLaborisconcerned.
The Secretary of Labor also stated that there was no denial of due process because EBVSAI was accorded several
opportunitiestopresentitssidebutEBVSAIfailedtopresentanyevidencetocontrovertthefindingsoftheRegional
Director.Moreover,theSecretaryofLabordoubtedtheveracityandauthenticityofEBVSAI'sdocumentaryevidence.
TheSecretaryofLabornotedthatthesedocumentswerenotpresentedattheinitialstageofthehearingandthatthe
payrolldocumentsdidnotindicatetheperiodscoveredbyEBVSAI'sallegedpayments.
EVBSAIfiledamotionforreconsiderationwhichwasdeniedbytheSecretaryofLaborinhis3January2000Order.17
EBVSAIfiledapetitionforcertioraribeforetheCourtofAppeals.
TheRulingoftheCourtofAppeals
In its 29 May 2001 Decision, the Court of Appeals dismissed the petition and affirmed the Secretary of Labor's
decision. The Court of Appeals adopted the Secretary of Labor's ruling that RA 7730 repealed the jurisdictional
limitation imposed by Article 129 on Article 128 of the Labor Code. The Court of Appeals also agreed with the
SecretaryofLabor'sfindingthatEBVSAIwasaccordeddueprocess.
TheCourtofAppealsalsodeniedEBVSAI'smotionforreconsiderationinits26February2002Resolution.
Hence,thispetition.
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G.R. No. 152396 - EX-BATAAN VETERANS SECURITY AGENCY, INC. v. THE SECRETARY OF LABOR BIENVENIDO E. LAGUESMA, ET A

TheIssues
Thiscaseraisesthefollowingissues:
1. Whether the Secretary of Labor or his duly authorized representatives acquired jurisdiction over
EBVSAIand
cralawlibrary

2. Whether the Secretary of Labor or his duly authorized representatives have jurisdiction over the
moneyclaimsofprivaterespondentswhichexceedP5,000.
TheRulingoftheCourt
Thepetitionhasnomerit.
OntheRegionalDirector'sJurisdictionoverEBVSAI
EBVSAIclaimsthattheRegionalDirectordidnotacquirejurisdictionoverEBVSAIbecausehefailedtocomplywith
Section11,Rule14ofthe1997RulesofCivilProcedure.18EBVSAIpointsoutthatthenoticeofhearingwasserved
at the Ambuklao Plant, not at EBVSAI's main office in Makati, and that it was addressed to Leonardo Castro, Jr.,
EBVSAI'sVicePresident.
TheRulesontheDispositionofLaborStandardsCasesintheRegionalOffices19(rules)specificallystatethatnotices
and copies of orders shall be served on the parties or their duly authorized representatives at their last known
addressor,iftheyarerepresentedbycounsel,throughthelatter.20Therulesshallbeliberallyconstrued21andonly
intheabsenceofanyapplicableprovisionwilltheRulesofCourtapplyinasuppletorycharacter.22
Inthiscase,EBVSAIdoesnotdenyhavingreceivedthenoticesofhearing.Infact,on29Marchand13June1996,
DaniloBurgosandEdwinaManao,detachmentcommanderandbookkeeperofEBVSAI,respectively,appearedbefore
theRegionalDirector.Theyclaimedthatthe22March1996noticeofhearingwasreceivedlateandmanifestedthat
thenoticesshouldbesenttotheManilaoffice.Thereafter,thenoticesofhearingweresenttotheManilaoffice.They
were also informed of EBVSAI's violations and were asked to present the employment records of the private
respondents for verification. They were, moreover, asked to submit, within 10 days, proof of compliance or their
position paper. The Regional Director validly acquired jurisdiction over EBVSAI. EBVSAI can no longer question the
jurisdiction of the Regional Director after receiving the notices of hearing and after appearing before the Regional
Director.
OntheRegionalDirector'sJurisdictionovertheMoneyClaims
EBVSAImaintainsthatunderArticles129and217(6)oftheLaborCode,theLaborArbiter,nottheRegionalDirector,
has exclusive and original jurisdiction over the case because the individual monetary claim of private respondents
exceedsP5,000. EBVSAI also argues that the case falls under the exception clause in Article 128(b) of the Labor
Code. EBVSAI asserts that the Regional Director should have certified the case to the Arbitration Branch of the
NationalLaborRelationsCommission(NLRC)forafullblownhearingonthemerits.
InAlliedInvestigationBureau,Inc.v.Sec.ofLabor,weruledthat:
WhileitistruethatunderArticles129and217oftheLaborCode,theLaborArbiterhasjurisdictionto
hearanddecidecaseswheretheaggregatemoneyclaimsofeachemployeeexceedsP5,000.00,said
provisionsoflawdonotcontemplatenorcoverthevisitorialandenforcementpowersoftheSecretary
ofLabororhisdulyauthorizedrepresentatives.
Rather,saidpowersaredefinedandsetforthinArticle128oftheLaborCode(asamendedbyR.A.No.
7730)thus:
Art.128Visitorialandenforcementpower.xxx
(b)NotwithstandingtheprovisionsofArticle[s]129and217ofthisCodetothecontrary,
and in cases where the relationship of employeremployee still exists, the Secretary of
Labor and Employment or his duly authorized representatives shall have the power to
issuecomplianceorderstogiveeffectto[thelaborstandardsprovisionsofthisCodeand
other] labor legislation based on the findings of labor employment and enforcement
officersorindustrialsafetyengineersmadeinthecourseofinspection.TheSecretaryor
his duly authorized representatives shall issue writs of execution to the appropriate
authority for the enforcement of their orders, except in cases where the employer
conteststhefindingsofthelaboremploymentandenforcementofficerandraisesissues
supportedbydocumentaryproofswhichwerenotconsideredinthecourseofinspection.
xxx
TheaforequotedprovisionexplicitlyexcludesfromitscoverageArticles129and217oftheLaborCode
bythephrase"(N)otwithstandingtheprovisionsofArticles129and217ofthisCodetothecontraryxx
x" thereby retaining and further strengthening the power of the Secretary of Labor or his duly
authorizedrepresentativestoissuecomplianceorderstogiveeffecttothelaborstandardsprovisionsof
said Code and other labor legislation based on the findings of labor employment and enforcement
officerorindustrialsafetyengineermadeinthecourseofinspection.23(Italicsintheoriginal)
ThiswasfurtheraffirmedinourrulinginCirineoBowlingPlaza,Inc.v.Sensing,24wherewesustainedthejurisdiction
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of the DOLE Regional Director and held that "the visitorial and enforcement powers of the DOLE Regional
Director to order and enforce compliance with labor standard laws can be exercised even where the
individualclaimexceedsP5,000."
However,ifthelaborstandardscaseiscoveredbytheexceptionclauseinArticle128(b)oftheLaborCode,thenthe
RegionalDirectorwillhavetoendorsethecasetotheappropriateArbitrationBranchoftheNLRC.Inordertodivest
the Regional Director or his representatives of jurisdiction, the following elements must be present: (a) that the
employerconteststhefindingsofthelaborregulationsofficerandraisesissuesthereon(b)thatinordertoresolve
such issues, there is a need to examine evidentiary matters and (c) that such matters are not verifiable in the
normalcourseofinspection.25Therulesalsoprovidethattheemployershallraisesuchobjectionsduringthehearing
ofthecaseoratanytimeafterreceiptofthenoticeofinspectionresults.26
Inthiscase,theRegionalDirectorvalidlyassumedjurisdictionoverthemoneyclaimsofprivaterespondentsevenif
theclaimsexceededP5,000 because such jurisdiction was exercised in accordance with Article 128(b) of the Labor
Codeandthecasedoesnotfallundertheexceptionclause.
TheCourtnotesthatEBVSAIdidnotcontestthefindingsofthelaborregulationsofficerduringthehearingorafter
receipt of the notice of inspection results. It was only in its supplemental motion for reconsideration before the
Regional Director that EBVSAI questioned the findings of the labor regulations officer and presented documentary
evidencetocontroverttheclaimsofprivaterespondents.Butevenifthiswasthecase,theRegionalDirectorandthe
Secretary of Labor still looked into and considered EBVSAI's documentary evidence and found that such did not
warrant the reversal of the Regional Director's order. The Secretary of Labor also doubted the veracity and
authenticity of EBVSAI's documentary evidence. Moreover, the pieces of evidence presented by EBVSAI were
verifiable in the normal course of inspection because all employment records of the employees should be kept and
maintained in or about the premises of the workplace, which in this case is in Ambuklao Plant, the establishment
whereprivaterespondentswereregularlyassigned.27
WHEREFORE,weDENYthepetition.WeAFFIRMthe29May2001Decisionandthe26February2002Resolutionof
theCourtofAppealsinCAG.R.SPNo.57653.
SOORDERED.
Quisumbing,CarpioMorales,Tinga,Velasco,Jr.,JJ.,concur.
Endnotes:
1UnderRule45ofthe1997RulesofCivilProcedure.
2Rollo, pp. 125133. Penned by Associate Justice Alicia L. Santos with Associate Justices Ramon A.

BarcelonaandRodrigoV.Cosico,concurring.

3Id.at144145.PennedbyAssociateJusticeAliciaL.SantoswithAssociateJusticesRodrigoV.Cosico

andCandidoV.Rivera,concurring.
4Id.at46.
5Id.at47.
6Id.
7Id.at5052.
8Id.at5362.
9Id.at6368.
10Id.at7073.

11Entitled"ANACTFURTHERSTRENGTHENINGTHEVISITORIALANDENFORCEMENTPOWERSOFTHE

SECRETARYOFLABORANDEMPLOYMENT,AMENDINGFORTHEPURPOSEARTICLE128OFP.D.442,
ASAMENDED,OTHERWISEKNOWNASTHELABORCODEOFTHEPHILIPPINES,"dated2June1994.
12Article129oftheLaborCodeprovides:

Article 129. RECOVERY OF WAGES, SIMPLE MONEY CLAIMS AND OTHER BENEFITS.
Uponcomplaintofanyinterestedparty,theregionaldirectoroftheDepartmentofLabor
and Employment or any of the duly authorized hearing officers of the Department is
empowered,throughsummaryproceedingandafterduenotice,tohearanddecideany
matter involving the recovery of wages and other monetary claims and benefits,
including legal interest, owing to an employee or person employed in domestic or
household service or househelper under this Code, arising from employer employee
relations: Provided, That such complaint does not include a claim for
reinstatementProvided,further, That the aggregate money claim of each employee or
househelperdoesnotexceedFiveThousandpesos(P5,000.00).xxx
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13Article217(6)oftheLaborCodeprovides:

Article217.JURISDICTIONOFLABORARBITERSANDTHECOMMISSION.(a)Exceptas
otherwise provided under this Code, the Labor Arbiter shall have original and exclusive
jurisdiction to hear and decide within thirty (30) calendar days after the submission of
the case by the parties for decision without extension, even in the absence of
stenographic notes, the following cases involving all workers, whether agricultural or
nonagricultural:
xxx
6. Except claims for Employees Compensation, Social Security, Medicare and maternity
benefits, all other claims arising from employeremployee relations, including those of
personsindomesticorhouseholdservice,involvinganamountexceedingfivethousand
pesos(P5,000.00)regardlessofwhetheraccompaniedwithaclaimforreinstatement.
14Article128oftheLaborCodeprovides:

Article128.VISITORIALANDENFORCEMENTPOWER.xxx
(b)NotwithstandingtheprovisionsofArticles129and217ofthisCodetothecontrary,
and in cases where the relationship of employeremployee still exists, the Secretary of
Labor and Employment or his duly authorized representatives shall have the power to
issuecomplianceorderstogiveeffecttothelaborstandardsprovisionsofthisCodeand
other labor legislation based on the findings of labor employment and enforcement
officersorindustrialsafetyengineersmadeinthecourseofinspection.TheSecretaryor
his duly authorized representatives shall issue writs of execution to the appropriate
authority for the enforcement of their orders, except in cases where the employer
conteststhefindingsofthelaboremploymentandenforcementofficerandraisesissues
supportedbydocumentaryproofswhichwerenotconsideredinthecourseofinspection.
15Rollo,pp.107111.
16G.R.No.85840,26April1990,184SCRA664.
17Rollo,pp.122123.
18Section11,Rule14ofthe1997RulesofCivilProcedureprovides:

SEC.11. Service upon domestic private juridical entity. When the defendant is a
corporation,partnershiporassociationorganizedunderthelawsofthePhilippineswitha
juridicalpersonality,servicemaybemadeonthepresident,managingpartner,general
manager,corporatesecretary,treasurer,orinhousecounsel.
19Dated16September1987.
20 Department of Labor and Employment, Rules on the Disposition of Labor Standard Cases in the

RegionalOffices,Section4,RuleII(1987).
21Id.,Section5,RuleI.
22Id.,Section6,RuleI.
23377Phil.80,8890(1999).

24G.R.No.146572,14January2005,448SCRA175,186.
25

Batong Buhay Gold Mines, Inc. v. Sec. Dela Serna, 370 Phil. 872 (1999), citing SSK Parts
Corporationv.Camas,G.R.No.85934,30January1990,181SCRA675.
26 Department of Labor and Employment, Rules on the Disposition of Labor Standard Cases in the

RegionalOffices,Section1(b),RuleIII(1987).

27ImplementingRulesofBookIII,RuleX,Section11.

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