Republic of the Philippines

SUPREME COURT
Manila
EN BANC
G.R. No. 78909 June 30, 1989
MATERNITY CHILDREN'S HOSPITAL, represented by ANTERA L. DORADO,
President, petitioner,
vs.
THE HONORABLE SECRETARY OF LABOR AND THE REGIONAL DlRECTOR
OF LABOR, REGION X,respondents.
MEDIALDEA, J.:
This is a petition for certiorari seeking the annulment of the Decision of the
respondent Secretary of Labor dated September 24, 1986, affirming with
modification the Order of respondent Regional Director of Labor, Region X, dated
August 4, 1986, awarding salary differentials and emergency cost of living
allowances (ECOLAS) to employees of petitioner, and the Order denying
petitioner's motion for reconsideration dated May 13, 1987, on the ground of grave
abuse of discretion.
Petitioner is a semi-government hospital, managed by the Board of Directors of
the Cagayan de Oro Women's Club and Puericulture Center, headed by Mrs.
Antera Dorado, as holdover President. The hospital derives its finances from the
club itself as well as from paying patients, averaging 130 per month. It is also
partly subsidized by the Philippine Charity Sweepstakes Office and the Cagayan
De Oro City government.
Petitioner has forty-one (41) employees. Aside from salary and living allowances,
the employees are given food, but the amount spent therefor is deducted from
their respective salaries (pp. 77-78, Rollo).
On May 23, 1986, ten (10) employees of the petitioner employed in different
capacities/positions filed a complaint with the Office of the Regional Director of
Labor and Employment, Region X, for underpayment of their salaries and
ECOLAS, which was docketed as ROX Case No. CW-71-86.
On June 16, 1986, the Regional Director directed two of his Labor Standard and
Welfare Officers to inspect the records of the petitioner to ascertain the truth of the
allegations in the complaints (p. 98, Rollo). Payrolls covering the periods of May,
1974, January, 1985, November, 1985 and May, 1986, were duly submitted for
inspection.
On July 17, 1986, the Labor Standard and Welfare Officers submitted their report
confirming that there was underpayment of wages and ECOLAs of all the
employees by the petitioner, the dispositive portion of which reads:

IN VIEW OF THE FOREGOING, deficiency on wage and ecola

as verified and confirmed per review of the respondent payrolls
and interviews with the complainant workers and all other
information gathered by the team, it is respectfully recommended
to the Honorable Regional Director, this office, that Antera
Dorado, President be ORDERED to pay the amount of SIX
HUNDRED FIFTY FOUR THOUSAND SEVEN HUNDRED
FIFTY SIX & 01/100 (P654,756.01), representing underpayment
of wages and ecola to the THIRTY SIX (36) employees of the
said hospital as appearing in the attached Annex "F" worksheets
and/or whatever action equitable under the premises. (p.
99, Rollo)
Based on this inspection report and recommendation, the Regional Director
issued an Order dated August 4, 1986, directing the payment of P723,888.58,
representing underpayment of wages and ECOLAs to all the petitioner's
employees, the dispositive portion of which reads:
WHEREFORE, premises considered, respondent Maternity and
Children Hospital is hereby ordered to pay the above-listed
complainants the total amount indicated opposite each name,
thru this Office within ten (10) days from receipt thereof.
Thenceforth, the respondent hospital is also ordered to pay its
employees/workers the prevailing statutory minimum wage and
allowance.
SO ORDERED. (p. 34, Rollo)
Petitioner appealed from this Order to the Minister of Labor and Employment,
Hon. Augusto S. Sanchez, who rendered a Decision on September 24, 1986,
modifying the said Order in that deficiency wages and ECOLAs should be
computed only from May 23, 1983 to May 23, 1986, the dispositive portion of
which reads:
WHEREFORE, the August 29, 1986 order is hereby MODIFIED
in that the deficiency wages and ECOLAs should only be
computed from May 23, 1983 to May 23, 1986. The case is
remanded to the Regional Director, Region X, for recomputation
specifying the amounts due each the complainants under each of
the applicable Presidential Decrees. (p. 40, Rollo)
On October 24, 1986, the petitioner filed a motion for reconsideration which was
denied by the Secretary of Labor in his Order dated May 13, 1987, for lack of merit
(p. 43 Rollo).
The instant petition questions the all-embracing applicability of the award involving
salary differentials and ECOLAS, in that it covers not only the hospital employees

who signed the complaints, but also those (a) who are not signatories to the
complaint, and (b) those who were no longer in the service of the hospital at the
time the complaints were filed.
Petitioner likewise maintains that the Order of the respondent Regional Director of
Labor, as affirmed with modifications by respondent Secretary of Labor, does not
clearly and distinctly state the facts and the law on which the award was based. In
its "Rejoinder to Comment", petitioner further questions the authority of the
Regional Director to award salary differentials and ECOLAs to private
respondents, (relying on the case of Encarnacion vs. Baltazar, G.R. No. L-16883,
March 27, 1961, 1 SCRA 860, as authority for raising the additional issue of lack
of jurisdiction at any stage of the proceedings, p. 52, Rollo), alleging that the
original and exclusive jurisdiction over money claims is properly lodged in the
Labor Arbiter, based on Article 217, paragraph 3 of the Labor Code.
The primary issue here is whether or not the Regional Director had jurisdiction
over the case and if so, the extent of coverage of any award that should be
forthcoming, arising from his visitorial and enforcement powers under Article 128
of the Labor Code. The matter of whether or not the decision states clearly and
distinctly statement of facts as well as the law upon which it is based, becomes
relevant after the issue on jurisdiction has been resolved.
This is a labor standards case, and is governed by Art. 128-b of the Labor Code,
as amended by E.O. No. 111. Labor standards refer to the minimum requirements
prescribed by existing laws, rules, and regulations relating to wages, hours of
work, cost of living allowance and other monetary and welfare benefits, including
occupational, safety, and health standards (Section 7, Rule I, Rules on the
Disposition of Labor Standards Cases in the Regional Office, dated September
16, 1987). 1 Under the present rules, a Regional Director exercises both visitorial
and enforcement power over labor standards cases, and is therefore empowered
to adjudicate money claims, provided there stillexists an employer-employee
relationship, and the findings of the regional office is not contested by the
employer concerned.

must order the necessary rectifications. However, this does not

include adjudication of money claims, clearly within the ambit of
the labor arbiter's authority under Article 217 of the Code.
The Ong case relied on the ruling laid down in Zambales Base Metals Inc. vs. The
Minister of Labor, et al., (G.R. Nos. 73184-88, November 26, 1986, 146 SCRA 50)
that the "Regional Director was not empowered to share in the original and
exclusive jurisdiction conferred on Labor Arbiters by Article 217."
We believe, however, that even in the absence of E. O. No. 111, Regional
Directors already had enforcement powers over money claims, effective under
P.D. No. 850, issued on December 16, 1975, which transferred labor standards
cases from the arbitration system to the enforcement system.
To clarify matters, it is necessary to enumerate a series of rules and provisions of
law on the disposition of labor standards cases.
Prior to the promulgation of PD 850, labor standards cases were an exclusive
function of labor arbiters, under Article 216 of the then Labor Code (PD No. 442,
as amended by PD 570-a), which read in part:
Art. 216. Jurisdiction of the Commission. The Commission
shall have exclusive appellate jurisdiction over all cases decided
by the Labor Arbiters and compulsory arbitrators.
The Labor Arbiters shall have exclusive jurisdiction to hear and
decide the following cases involving all workers whether
agricultural or non-agricultural.
xxx xxx xxx
(c) All money claims of workers, involving nonpayment or underpayment of wages, overtime
compensation, separation pay, maternity leave
and other money claims arising from employeeemployer relations, except claims for workmen's
compensation, social security and medicare
benefits;

Prior to the promulgation of E.O. No. 111 on December 24, 1986, the Regional
Director's authority over money claims was unclear. The complaint in the present
case was filed on May 23, 1986 when E.O. No. 111 was not yet in effect, and the
prevailing view was that stated in the case of Antonio Ong, Sr. vs. Henry M. Parel,
et al., G.R. No. 76710, dated December 21, 1987, thus:
. . . the Regional Director, in the exercise of his visitorial and
enforcement powers under Article 128 of the Labor Code, has no
authority to award money claims, properly falling within the
jurisdiction of the labor arbiter. . . .
. . . If the inspection results in a finding that the employer has
violated certain labor standard laws, then the regional director

(d) Violations of labor standard laws;

xxx xxx xxx
(Emphasis supplied)

Art. 216. Jurisdiction of Labor Arbiters and the

Commission. (a) The Labor Arbiters shall
have exclusive jurisdiction to hear and
decide the following cases involving all workers,
whether agricultural or non-agricultural:

The Regional Director exercised visitorial rights only under then Article 127 of the
Code as follows:
ART. 127. Visitorial Powers. The Secretary of Labor or his
duly authorized representatives, including, but not restricted, to
the labor inspectorate, shall have access to employers' records
and premises at any time of the day or night whenever work is
being undertaken therein, and the right to copy therefrom, to
question any employee and investigate any fact, condition or
matter which may be necessary to determine violations or in aid
in the enforcement of this Title and of any Wage Order or
regulation issued pursuant to this Code.

xxx xxx xxx

(3) All money claims of
workers involving nonpayment or underpayment of
wages, overtime or premium
compensation, maternity or
service incentive leave,
separation pay and other
money claims arising from
employer-employee relations,
except claims for employee's
compensation, social security
and medicare benefits and as
otherwise provided in Article
127 of this Code.

With the promulgation of PD 850, Regional Directors were given enforcement

powers, in addition to visitorial powers. Article 127, as amended, provided in part:
SEC. 10. Article 127 of the Code is hereby amended to read as
follows:
Art. 127. Visitorial and enforcement powers.
xxx xxx xxx
xxx xxx xxx
(b) The Secretary of Labor or
his duly authorized
representatives shall have the
power to order and administer,
after due notice and
hearing,compliance with the
labor standards provisions of
this Code based on the
findings of labor regulation
officers or industrial safety
engineers made in the course
of inspection, and to issue
writs of execution to the
appropriate authority for the
enforcement of their order.
xxx xxx xxx
Labor Arbiters, on the other hand, lost jurisdiction over labor standards cases.
Article 216, as then amended by PD 850, provided in part:
SEC. 22. Article 216 of the Code is hereby amended to read as
follows:

(Emphasis supplied)
Under the then Labor Code therefore (PD 442 as amended by PD 570-a, as
further amended by PD 850), there were three adjudicatory units: The Regional
Director, the Bureau of Labor Relations and the Labor Arbiter. It became
necessary to clarify and consolidate all governing provisions on jurisdiction into
one document. 2 On April 23, 1976, MOLE Policy Instructions No. 6 was issued,
and provides in part (on labor standards cases) as follows:
POLICY INSTRUCTIONS NO. 6
TO: All Concerned
SUBJECT: DISTRIBUTION OF JURISDICTION OVER LABOR
CASES
xxx xxx xxx
1. The following cases are under the exclusive
original jurisdiction of the Regional Director.

a) Labor standards cases

arising from violations of labor
standard lawsdiscovered in the
course of inspection or
complaints where employeremployee relations still exist;
xxx xxx xxx
2. The following cases are under the exclusive
original jurisdiction of the Conciliation Section of
the Regional Office:
a) Labor standards cases
where employer-employee
relations no longer exist;
xxx xxx xxx
6. The following cases are certifiable to the
Labor Arbiters:
a) Cases not settled by the
Conciliation Section of the
Regional Office, namely:
1) labor standard cases where
employer-employee
relations no longer exist;
xxx xxx xxx
(Emphasis supplied)
MOLE Policy Instructions No. 7 (undated) was likewise subsequently issued,
enunciating the rationale for, and the scope of, the enforcement power of the
Regional Director, the first and second paragraphs of which provide as follows:
POLICY INSTRUCTIONS NO. 7
TO: All Regional Directors
SUBJECT: LABOR STANDARDS CASES

Under PD 850, labor standards cases have been taken from the
arbitration system and placed under the enforcement system,
except where a) questions of law are involved as determined by
the Regional Director, b) the amount involved exceeds
P100,000.00 or over 40% of the equity of the employer,
whichever is lower, c) the case requires evidentiary matters not
disclosed or verified in the normal course of inspection, or
d) there is no more employer-employee relationship.
The purpose is clear: to assure the worker the rights and benefits
due to him under labor standards laws without having to go
through arbitration. The worker need not litigate to get what
legally belongs to him. The whole enforcement machinery of the
Department of Labor exists to insure its expeditious delivery to
him free of charge. (Emphasis supplied)
Under the foregoing, a complaining employee who was denied his rights and
benefits due him under labor standards law need not litigate. The Regional
Director, by virtue of his enforcement power, assured "expeditious delivery to him
of his rights and benefits free of charge", provided of course, he was still in the
employ of the firm.
After PD 850, Article 216 underwent a series of amendments (aside from being renumbered as Article 217) and with it a corresponding change in the jurisdiction of,
and supervision over, the Labor Arbiters:
1. PD 1367 (5-1-78) gave Labor Arbiters
exclusive jurisdiction over unresolved issues in
collective bargaining, etc., and those cases
arising from employer-employee relationsduly
indorsed by the Regional Directors. (It also
removed his jurisdiction over moral or other
damages) In other words, the Labor Arbiter
entertained cases certified to him. (Article 228,
1978 Labor Code.)
2. PD 1391 (5-29-78) all regional units of the
National Labor Relations Commission (NLRC)
were integrated into the Regional Offices
Proper of the Ministry of Labor; effectively
transferring direct administrative control and
supervision over the Arbitration Branch to the
Director of the Regional Office of the Ministry of
Labor. "Conciliable cases" which were thus
previously under the jurisdiction of the defunct
Conciliation Section of the Regional Office for
purposes of conciliation or amicable settlement,
became immediately assignable to the

Arbitration Branch for joint conciliation and

compulsory arbitration. In addition, the Labor
Arbiter had jurisdiction even over termination
and labor-standards cases that may be
assigned to them for compulsory arbitration by
the Director of the Regional Office. PD 1391
merged conciliation and compulsory arbitration
functions in the person of the Labor Arbiter. The
procedure governing the disposition of cases at
the Arbitration Branch paralleled those in the
Special Task Force and Field Services Division,
with one major exception: the Labor Arbiter
exercised full and untrammelled authority in the
disposition of the case, particularly in the
substantive aspect, his decisions and orders
subject to review only on appeal to the NLRC. 3

them through the conciliation section of the

Regional Office.
2. Labor Standards Cases.
Cases involving violation of labor standards
laws where employer- employee relationshipstill
exists shall be assigned to the Labor Arbiters
where:
a) intricate questions of law
are involved; or
b) evidentiary matters not
disclosed or verified in the
normal course of inspection by
labor regulations officers are
required for their proper
disposition.

3. MOLE Policy Instructions No. 37 Because

of the seemingly overlapping functions as a
result of PD 1391, MOLE Policy Instructions No.
37 was issued on October 7, 1978, and
provided in part:

3. Disposition of Cases.

POLICY INSTRUCTIONS NO. 37

When a case is assigned to a Labor Arbiter, all

issues raised therein shall be resolved by him
including those which are originally cognizable
by the Regional Director to avoid multiplicity of
proceedings. In other words, the whole case,
and not merely issues involved therein, shall be
assigned to and resolved by him.

TO: All Concerned

SUBJECT: ASSIGNMENT OF CASES TO LABOR ARBITERS
Pursuant to the provisions of Presidential
Decree No. 1391 and to insure speedy
disposition of labor cases, the following
guidelines are hereby established for the
information and guidance of all concerned.
1. Conciliable Cases.
Cases which are conciliable per se i.e., (a) labor
standards cases where employer-employee
relationship no longer exists; (b) cases involving
deadlock in collective bargaining, except those
falling under P.D. 823, as amended; (c) unfair
labor practice cases; and (d) overseas
employment cases, except those involving
overseas seamen, shall be assigned by the
Regional Director to the Labor Arbiter for
conciliation and arbitration without coursing

xxx xxx xxx

(Emphasis supplied)
4. PD 1691(5-1-80) original and exclusive
jurisdiction over unresolved issues in collective
bargaining and money claims,
which includes moral or other damages.
Despite the original and exclusive jurisdiction of labor arbiters
over money claims, however, the Regional Director
nonetheless retained his enforcement power, and remained
empowered to adjudicate uncontested money claims.
5. BP 130 (8-21-8l) strengthened voluntary
arbitration. The decree also returned the Labor

Arbiters as part of the NLRC, operating as

Arbitration Branch thereof.
6. BP 227(6-1- 82) original and exclusive
jurisdiction over questions involving legality of
strikes and lock-outs.
The present petition questions the authority of the Regional Director to issue the
Order, dated August 4, 1986, on the basis of his visitorial and enforcement powers
under Article 128 (formerly Article 127) of the present Labor Code. It is contended
that based on the rulings in the Ong vs. Parel (supra) and the Zambales Base
Metals, Inc. vs. The Minister of Labor (supra) cases, a Regional Director is
precluded from adjudicating money claims on the ground that this is an exclusive
function of the Labor Arbiter under Article 217 of the present Code.
On August 4, 1986, when the order was issued, Article 128(b) 4 read as follows:
(b) The Minister of Labor or his duly authorized
representatives shall have the power to order
and administer, after due notice and hearing,
compliance with the labor standards provisions
of this Code based on the findings of labor
regulation officers or industrial safety engineers
made in the course of inspection, and to issue
writs of execution to the appropriate authority
for the enforcement of their order, except in
cases where the employer contests the
findings of the labor regulations officer and
raises issues which cannot be resolved without
considering evidentiary matters that are not
verifiable in the normal course of inspection.
(Emphasis supplied)
On the other hand, Article 217 of the Labor Code as amended by P.D. 1691,
effective May 1, 1980; Batas Pambansa Blg. 130, effective August 21, 1981; and
Batas Pambansa Blg. 227, effective June 1, 1982, inter alia, provides:
ART. 217. Jurisdiction of Labor Arbiters and the Commission.
(a) The Labor Arbiters shall have the original and
exclusive jurisdiction to hear and decide within thirty (30) working
days after submission of the case by the parties for decision, the
following cases involving all workers, whether agricultural or nonagricultural:
1. Unfair labor practice cases;

2. Those that workers may file involving wages,

hours of work and other terms and conditions of
employment;
3. All money claims of workers, including those
based on non-payment or underpayment of
wages, overtime compensation, separation pay
and other benefits provided by law or
appropriate agreement, except claims for
employees' compensation, social security,
medicare and maternity benefits;
4. Cases involving household services; and
5. Cases arising from any violation of Article
265 of this Code, including questions involving
the legality of strikes and lock-outs. (Emphasis
supplied)
The Ong and Zambales cases involved workers who were still connected with the
company. However, in the Ong case, the employer disputed the adequacy of the
evidentiary foundation (employees' affidavits) of the findings of the labor standards
inspectors while in the Zambales case, the money claims which arose from
alleged violations of labor standards provisions were not discovered in the course
of normal inspection. Thus, the provisions of MOLE Policy Instructions Nos. 6,
(Distribution of Jurisdiction Over Labor Cases) and 37 (Assignment of Cases to
Labor Arbiters) giving Regional Directors adjudicatory powers over uncontested
money claims discovered in the course of normal inspection, provided an
employer-employee relationship still exists, are inapplicable.
In the present case, petitioner admitted the charge of underpayment of wages to
workers still in its employ; in fact, it pleaded for time to raise funds to satisfy its
obligation. There was thus no contest against the findings of the labor inspectors.
Barely less than a month after the promulgation on November 26, 1986 of the
Zambales Base Metals case, Executive Order No. 111 was issued on December
24, 1986, 5 amending Article 128(b) of the Labor Code, to read as follows:
(b) THE PROVISIONS OF ARTICLE 217 OF
THIS CODE TO THE CONTRARY
NOTWITHSTANDING AND IN CASES WHERE
THE RELATIONSHIP OF EMPLOYEREMPLOYEE STILL EXISTS, the Minister of
Labor and Employment or his duly authorized
representatives shall have the power to order
and administer, after due notice and hearing,
compliance with the labor standards provisions

of this Code AND OTHER LABOR

LEGISLATION based on the findings of labor
regulation officers or industrial safety engineers
made in the course of inspection, and to issue
writs of execution to the appropriate authority
for the enforcement of their orders, except in
cases where the employer contests the findings
of the labor regulation officer and raises issues
which cannot be resolved without considering
evidentiary matters that are not verifiable in the
normal course of inspection. (Emphasis
supplied)
As seen from the foregoing, EO 111 authorizes a Regional Director to order
compliance by an employer with labor standards provisions of the Labor Code and
other legislation. It is Our considered opinion however, that the inclusion of the
phrase, " The provisions of Article 217 of this Code to the contrary notwithstanding
and in cases where the relationship of employer-employee still exists" ... in Article
128(b), as amended, above-cited, merelyconfirms/reiterates the enforcement
adjudication authority of the Regional Director over uncontested money claims in
cases where an employer-employee relationship still exists. 6
Viewed in the light of PD 850 and read in coordination with MOLE Policy
Instructions Nos. 6, 7 and 37, it is clear that it has always been the intention of our
labor authorities to provide our workers immediate access (when still feasible, as
where an employer-employee relationship still exists) to their rights and benefits,
without being inconvenienced by arbitration/litigation processes that prove to be
not only nerve-wracking, but financially burdensome in the long run.
Note further the second paragraph of Policy Instructions No. 7 indicating that the
transfer of labor standards cases from the arbitration system to the enforcement
system is
. . to assure the workers the rights and benefits due to him under
labor standard laws, without having to go through arbitration. . .
so that
. . the workers would not litigate to get what legally belongs to
him. .. ensuring delivery . . free of charge.
Social justice legislation, to be truly meaningful and rewarding to our workers,
must not be hampered in its application by long-winded arbitration and litigation.
Rights must be asserted and benefits received with the least inconvenience. Labor
laws are meant to promote, not defeat, social justice.

This view is in consonance with the present "Rules on the Disposition of Labor
Standard Cases in the Regional Offices " 7 issued by the Secretary of Labor,
Franklin M. Drilon on September 16, 1987.
Thus, Sections 2 and 3 of Rule II on "Money Claims Arising from Complaint
Routine Inspection", provide as follows:
Section 2. Complaint inspection. All such complaints shall
immediately be forwarded to the Regional Director who shall
refer the case to the appropriate unit in the Regional Office for
assignment to a Labor Standards and Welfare Officer (LSWO)
for field inspection. When the field inspection does not produce
the desired results, the Regional Director shall summon the
parties for summary investigation to expedite the disposition of
the case. . . .
Section 3. Complaints where no employer-employee relationship
actually exists. Where employer-employee relationship no
longer exists by reason of the fact that it has already been
severed, claims for payment of monetary benefits fall within the
exclusive and original jurisdiction of the labor arbiters. . . .
(Emphasis supplied)
Likewise, it is also clear that the limitation embodied in MOLE Policy Instructions
No. 7 to amounts not exceeding P100,000.00 has been dispensed with, in view of
the following provisions of pars. (b) and (c), Section 7 on "Restitution", the same
Rules, thus:
xxx xxx xxx
(b) Plant-level restitutions may be effected for
money claims not exceeding Fifty Thousand
(P50,000.00). . . .
(c) Restitutions in excess of the aforementioned
amount shall be effected at the Regional Office
or at the worksite subject to the prior approval
of the Regional Director.
which indicate the intention to empower the Regional Director to award money
claims in excess of P100,000.00;provided of course the employer does not
contest the findings made, based on the provisions of Section 8 thereof:
Section 8. Compromise agreement. Should the parties arrive
at an agreement as to the whole or part of the dispute, said
agreement shall be reduced in writing and signed by the parties

in the presence of the Regional Director or his duly authorized

representative.
E.O. No. 111 was issued on December 24, 1986 or three (3) months after the
promulgation of the Secretary of Labor's decision upholding private respondents'
salary differentials and ECOLAs on September 24, 1986. The amendment of the
visitorial and enforcement powers of the Regional Director (Article 128-b) by said
E.O. 111 reflects the intention enunciated in Policy Instructions Nos. 6 and 37 to
empower the Regional Directors to resolveuncontested money claims in cases
where an employer-employee relationship still exists. This intention must be given
weight and entitled to great respect. As held in Progressive Workers' Union, et. al.
vs. F.P. Aguas, et. al. G.R. No. 59711-12, May 29, 1985, 150 SCRA 429:

underpayment of wages and ECOLAs, we limit the award to only

those who signed the complaint to the exclusion of the majority
of the workers who are similarly situated. Indeed, this would be
not only render the enforcement power of the Minister of Labor
and Employment nugatory, but would be the pinnacle of injustice
considering that it would not only discriminate but also deprive
them of legislated benefits.
. . . (pp. 38-39, Rollo).
This view is further bolstered by the provisions of Sec. 6, Rule II of the "Rules on
the Disposition of Labor Standards cases in the Regional Offices" (supra)
presently enforced, viz:

. . The interpretation by officers of laws which are entrusted to

their administration is entitled to great respect. We see no reason
to detract from this rudimentary rule in administrative law,
particularly when later events have proved said interpretation to
be in accord with the legislative intent. ..
The proceedings before the Regional Director must, perforce, be upheld on the
basis of Article 128(b) as amended by E.O. No. 111, dated December 24, 1986,
this executive order "to be considered in the nature of a curative statute with
retrospective application." (Progressive Workers' Union, et al. vs. Hon. F.P.
Aguas, et al. (Supra); M. Garcia vs. Judge A. Martinez, et al., G.R. No. L- 47629,
May 28, 1979, 90 SCRA 331).
We now come to the question of whether or not the Regional Director erred in
extending the award to all hospital employees. We answer in the affirmative.
The Regional Director correctly applied the award with respect to those
employees who signed the complaint, as well as those who did not sign the
complaint, but were still connected with the hospital at the time the complaint was
filed (See Order, p. 33 dated August 4, 1986 of the Regional Director, Pedrito de
Susi, p. 33, Rollo).
The justification for the award to this group of employees who were not signatories
to the complaint is that the visitorial and enforcement powers given to the
Secretary of Labor is relevant to, and exercisable over establishments, not over
the individual members/employees, because what is sought to be achieved by its
exercise is the observance of, and/or compliance by, such firm/establishment with
the labor standards regulations. Necessarily, in case of an award resulting from a
violation of labor legislation by such establishment, the entire members/employees
should benefit therefrom. As aptly stated by then Minister of Labor Augusto S.
Sanchez:
. . It would be highly derogatory to the rights of the workers, if
after categorically finding the respondent hospital guilty of

SECTION 6. Coverage of complaint inspection. A complaint

inspection shall not be limited to the specific allegations or
violations raised by the complainants/workers but shall be a
thorough inquiry into and verification of the compliance by
employer with existing labor standards and shall cover all
workers similarly situated. (Emphasis supplied)
However, there is no legal justification for the award in favor of those employees
who were no longer connectedwith the hospital at the time the complaint was filed,
having resigned therefrom in 1984, viz:
1.
2.
3.
4.
5.
6.
7.
8.
9.

Jean (Joan) Venzon (See Order, p. 33, Rollo)

Rosario Paclijan
Adela Peralta
Mauricio Nagales
Consesa Bautista
Teresita Agcopra
Felix Monleon
Teresita Salvador
Edgar Cataluna; and
10. Raymond Manija ( p.7, Rollo)

The enforcement power of the Regional Director cannot legally be upheld in cases
of separated employees. Article 129 of the Labor Code, cited by petitioner (p.
54, Rollo) is not applicable as said article is in aid of the enforcement power of the
Regional Director; hence, not applicable where the employee seeking to be paid
underpayment of wages is already separated from the service. His claim is purely
a money claim that has to be the subject of arbitration proceedings and therefore
within the original and exclusive jurisdiction of the Labor Arbiter.

Petitioner has likewise questioned the order dated August 4, 1986 of the Regional
Director in that it does not clearly and distinctly state the facts and the law on
which the award is based.
We invite attention to the Minister of Labor's ruling thereon, as follows:

monetary claims and benefits of workers, thereby settling any ambiguity on the
matter. Thus:
SEC. 2. Article 129 of the Labor Code of the Philippines, as
amended, is hereby further amended to read as follows:
Art. 129. Recovery of wages, simple money
claims and other benefits. Upon complaint of
any interested party, the Regional Director of
the Department of Labor and Employment or
any of the duly authorized hearing officers of
the Department is empowered, through
summary proceeding and after due notice, to
hear and decide any 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 reinstatement: Provided,
further, That the aggregate money claims of
each employee or househelper do not exceed
five thousand pesos (P5,000.00). The Regional
Director or hearing officer shall decide or
resolve the complaint within thirty (30) calendar
days from the date of the filing of the same. ...

Finally, the respondent hospital assails the order under appeal

as null and void because it does not clearly and distinctly state
the facts and the law on which the awards were based. Contrary
to the pretensions of the respondent hospital, we have carefully
reviewed the order on appeal and we found that the same
contains a brief statement of the (a) facts of the case; (b) issues
involved; (c) applicable laws; (d) conclusions and the reasons
therefor; (e) specific remedy granted (amount awarded). (p.
40, Rollo)
ACCORDINGLY, this petition should be dismissed, as it is hereby DISMISSED, as
regards all persons still employed in the Hospital at the time of the filing of the
complaint, but GRANTED as regards those employees no longer employed at that
time.
SO ORDERED.
Fernan, C.J., Narvasa, Gutierrez, Jr., Cruz, Paras, Feliciano, Gancayco, Padilla,
Bidin, Cortes, Grio-Aquino and Regalado, JJ., concur.

Separate Opinions
SARMIENTO, J., concurring:
Separate Opinions
Subject to my opinion in G.R. Nos. 82805 and 83205.
SARMIENTO, J., concurring:
MELENCIO-HERRERA, J., concurring:
Subject to my opinion in G.R. Nos. 82805 and 83205.
I concur, with the observation that even as reconciled, it would seem inevitable to
state that the conclusion in the Zambales and Ong cases that, prior to Executive
Order No. 111, Regional Directors were not empowered to share the original and
exclusive jurisdiction conferred on Labor Arbiters over money claims, is now
deemed modified, if not superseded.
It may not be amiss to state either that under Section 2, Republic Act No. 6715,
which amends further the Labor Code of the Philippines (PD No. 442), Regional
Directors have also been granted adjudicative powers, albeit limited, over

MELENCIO-HERRERA, J., concurring:

I concur, with the observation that even as reconciled, it would seem inevitable to
state that the conclusion in the Zambales and Ong cases that, prior to Executive
Order No. 111, Regional Directors were not empowered to share the original and
exclusive jurisdiction conferred on Labor Arbiters over money claims, is now
deemed modified, if not superseded.

It may not be amiss to state either that under Section 2, Republic Act No. 6715,
which amends further the Labor Code of the Philippines (PD No. 442), Regional
Directors have also been granted adjudicative powers, albeit limited, over
monetary claims and benefits of workers, thereby settling any ambiguity on the
matter. Thus:
SEC. 2. Article 129 of the Labor Code of the Philippines, as
amended, is hereby further amended to read as follows:
Art. 129. Recovery of wages, simple money
claims and other benefits. Upon complaint of
any interested party, the Regional Director of
the Department of Labor and Employment or
any of the duly authorized hearing officers of
the Department is empowered, through
summary proceeding and after due notice, to
hear and decide any 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 reinstatement: Provided,
further, That the aggregate money claims of
each employee or househelper do not exceed
five thousand pesos (P5,000.00). The Regional
Director or hearing officer shall decide or
resolve the complaint within thirty (30) calendar
days from the date of the filing of the same. ...
Footnotes
1 Cited in J. Nolledo, Labor Code of the Philippines, Ann., 1988 Rev. Ed. p. 217.
2 (See Critical Areas in the Administration of Labor Justice) (Proceedings of the
16th Annual Institute on Labor Relations Law 1979, U.P. Law Center, p. 5).
3 Ibid.
4 as amended by Section 2, PD 1691.
5 EO 111 expressly declared that its provisions would become effective fifteen
(15) days after publication in the Official Gazette. The executive order was
published on February 16, 1987 (83 O.G. No. 7, p. 5770) and therefore became
effective on March 3, 1987.
6 A present exception may be found in Section 2 of RA 6715, effective March 20,
1989 which gives Regional Director, "through summary proceeding, to hear and

decide any matter involving the recovery of wages and other monetary claims and
benefits, ... to an employee or person employed in domestic or household service
or househelper ... arising from employee-employer relations: Provided, That such
complaint does not include a claim for reinstatement; Provided, further, That the
aggregate money claims of each employee or househelper do not exceed five
thousand pesos (P5,000.00) ....
7 Cited in J. Nolledo, Labor Code of the Philippines, Ann., 1988 Rev. Ed., p. 216.

Maternity Childrens Hospital vs. Secretary of

Labor G . R .
N o .
7 8 9 0 9 J u n e
EN BANC: MEDIALDEA, J.:Facts:

3 0 ,

1 9 8 9

Petitioner is a semi-government hospital, managed by the Board of Directors of the

Cagayan deOro Women's Club and Puericulture Center, headed by Mrs. Antera Dorado,
as holdover President. The hospital derives its finances from the club itself as well
as from paying patients,averaging 130 per month. It is also partly subsidized by the
Philippine Charity SweepstakesOffice and the Cagayan De Oro City
government.Petitioner has forty-one (41) employees. Aside from salary and living
allowances, theemployees are given food, but the amount spent therefor is deducted
from their respectivesalariesOn May 23, 1986, ten (10) employees of the petitioner
employed in different capacities/positionsfiled a complaint with the Office of the Regional
Director of Labor and Employment, Region X,for underpayment of their salaries and
ECOLAS, which was docketed as ROX Case No. CW-71-86.On June 16, 1986, the
Regional Director directed two of his Labor Standard and WelfareOfficers to inspect the
records of the petitioner to ascertain the truth of the allegations in thecomplaints. Based
on their inspection report and recommendation, the Regional Director issuedan Order
dated August 4, 1986, directing the payment of P723,888.58, representingunderpayment
of wages and ECOLAs to all the petitioner's employees.Petitioner appealed from this
Order to the Minister of Labor and Employment, Hon. Augusto S.Sanchez, who rendered
a Decision on September 24, 1986, modifying the said Order in thatdeficiency wages and
ECOLAs should be computed only from May 23, 1983 to May 23, 1986,On October 24,
1986, the petitioner filed a motion for reconsideration which was denied by theSecretary
of Labor in his Order dated May 13, 1987, for lack of merit.
Issue:
Whether or not the Regional Director had jurisdiction over the case and if so, the extent
of coverage of any award that should be forthcoming, arising from his visitorial and
enforcementpowers under Article 128 of the Labor Code.
Held:
This is a labor standards case, and is governed by Art. 128-b of the Labor Code, as
amendedby E.O. No. 111. Under the present rules, a Regional Director exercises
both visitorial andenforcement power over labor standards cases, and is therefore
empowered to adjudicatemoney claims, provided there still exists an employer-employee
relationship, and the findings of the regional office is not contested by the employer
concerned.

Republic of the Philippines

SUPREME COURT
Manila
EN BANC
G.R. No. L-46892

June 28, 1940

ANTAMOK GOLDFIELDS MINING COMPANY, recurrente,

vs.
COURT OF INDUSTRIAL RELATIONS, and NATIONAL LABOR UNION,
INC., recurridos.
Sres. DeWitt, Perkins y Ponce Enrile en representacionde la recurrente.
Sres. Paguia y Lerum en represetacion de la recurrida, National Labor Union.
IMPERIAL, J.:
Esta es una apelacion mediante certiorari interpuesta por la recurrente contra la
orden dictada por el Tribunal de Relaciones Industriales el 6 de mayo de 1939
que le obligo a que reponga en sus anteriores trabajos o en otros
substancialmente equivalentes a los 45 obreros enumerados en la peticion del 31
de marzo de 1939 y a los 10 obreros encabezados por A. Haber que fueron
excluidos indefinidamente, dentro de 10 dias desde que reciba copia de la orden;
que pague a estos 55 obreros los jornales que debieron haber percibido desde la
fecha de su suspension o separacion hasta la de su reposicion; y que pendiente
de resolucion las otras cuestiones que las partes han sometido, la recurrente se
abstenga, bajo pena de desacato, de despedir o excluir, sin permiso previo del
tribunal, a cualquier obrero o empleado que se hallaba bajo su servicio en la
epoca en que surgio la disputa que este actualmente trabajando en las minas o
que sea repuesto en su trabajo de conformidad con la orden; y contra la
resolucion del mismo tribunal del 17 de agosto de 1939 que denego la mocion de
reconsideracion de la recurrente presentada el 26 de mayo de 1939.
El 12 de diciembrre de 1938 la recurrida National Labor union, Inc., en
representacion de los obreros y empleados de la recurrente que eran miembros
de dicha union obrera, dirigio una carta a la recurrente solicitando 21
reclamaciones en favor de sus afiliados. La carta fue recibida por la oficina de la
recurrente en Manila en un sobre timbrado por la estafeta de Baguio el 30 de
mismo mes. Los funcionarios de la recurrente convocaron a un meeting a sus
empleados el 2 de enero de 1939 y en el informaron a todos sus obreros que
algunad de las demandas se habian aceptado y se habian puesto ya en practica,
otras serian consideradas y las restantes iban a ser rechazadas por ser
irrazonables, y se les aconsejo que no recurrieran a la violencia y observaran
metodos legales en el arreglo de sus diferencias con la recurrentes. En la noche
del mismo dia los obreros y empleados de la recurrente se declararon en huelga y
abandonaron sus trabajos. La recurrnte dio cuenta inmediatamente de esta

huelga al Departamento del Trabajo y solicito su intervencion con el fin de

solucionarla. El Secretario del Trabajo designo a Adolfo Umengan, Investigador
Especial del Departamento, y a Eladio C. Leao, Defensor Publico de la Provincia
Montaosa, para que intervinieran y vieran la manera de solucionar la huelga.
Estos funcionarios convocaron una conferencia a la que acudieron funcionarios
de la recurrente, representante de los huelguistas y Luis Lardizabal, Jefe de la
Baguio Federation of Labor, una organizacion obrera afiliada a National Labor
Union, Inc. Como resultado de la conferencia las partes convinieron en el
siguiente arreglo amistoso:
AMICABLE SETTLEMENT
In order to have the present strike of the contractors and laborers of the
respondent company who staged a walkout on January 3, 1939, amicably
settled, the parties hereby mutually agree to end the said strike under the
condition that all laborers will be readmitted upon the execution of this
agreement; provided, that all laborers whose services should be
dispensed with due to lack of work in those tunnels where they are no
longer needed will be given not less than fifteen days employment from
the date of this settlement or resumption of work, and provided, further,
that as soon as the stopes in 1360 and 1460 levels are opened and the
services of men are needed, the company will give preference to efficient
laborers when reducing the personnel as above mentioned in those
working places and may transfer them to other division to replace
inefficient men.
In witness hereof, the laborers represented by a committee composed of
Messrs. Luis Lardizabal, Tomas Dirige, Victoriano Madayag, Maximo
Conaoi, Daniel Lambinicio, and Juan Cerilo and the Antamok Goldfields
Mining Co. as represented by its President, Mr. Andres Soriano, have
hereunto placed their signatures this 4th day of January, 1939.
El convenio fue firmado por las partes el 4 de enero de 1939, pero los obreros no
se presentaron sino a las 9 de la maana del 6 del mismo mes. La gerencia de la
recurrente no permitio, sin embargo, a ningun obrero que entrara en la seccion
subterranea conocida como "830 level" por la razon de que el aire se habia
viciado con motivo de la huelga y era necesario renovarlo con aire puro con el fin
de evitar desgracias personales. Esta precaucion la tomaron los obreros como
uan negativa de la recurrente a que ellos trabajaran de nuevo, por lo que se
declararon otra vez en huelga. A los huelguistas se unieron por simpatia los
obreros que trabajaban en la mina denominada "680 division," que es otra mina
separada y situada a 3 kilometros de la fabrica. Otra vez internivo el
Departamento del Trabajo y por la mediacion de Eladio C. Leao los obreros
volvieron al trabajo en la noche del 6 de enero de 1939 en que los trabajos de
mina se reanudaron paulatinamente.
El 9 de enero de 1939 el Departamento del Trabajo endoso la disputa al Tribunal
de Relaciones Industriales de conformidad con el articulo 4 de la Ley No. 103 del

Commonwealth y dicho Tribunal celebro la primera vista del asunto el 13 del

mismo mes en la Ciudad De Baguio. En esta vista se discutieron una por una las
21 reclamaciones de la recurrida National Labor Union, Inc., y se llego por las
partes a un acuerdo sobre algunas de ellas, se sometieron otras a la decision del
Triunal y las demas se dejaron pendientes para ser vistas y resueltas mas tarde.
El 31 de marzo de 1939, hallandose pendiente aun de decision la mayor parte de
las reclamaciones antes mencionadas, la recurrida National Labor Union, Inc.,
presento una mocion en que alego que el capataz A. Haber y otros 9 obreros de
la recurrente habian sido indefinidamente suspendidos el 29 del mismo mes; que
estos obreros habian sido transferidos anteriormente a trabajos exteriores con el
fin de proporcionar a la recurrente una excusa para separarles mas tarde del
servicio; que otro grupo de cerca de 30 obreros fueron despedidos por la
compaia sin motivo alguno y sin autorizacion del tribunal; y que las
suspensiones y separaciones que asi se hicieron eran actos de venganza y
discriminatorios para los obreros, por cuya razon se pidio que los funcinarios de la
recurrente responsables de dichos actos sean castigados por desacato y que la
recurrente sea obligada a reponer a los obreros en sus primitivos trabajos dentro
de las minas y a pagarles sus salarios correspondientes al periodo en que fueron
separados del sevicio. La recurrente contesto la mocion negando los hechos
imputados y alego que Haber y sus 9 compaeros fueron suspendidos por su
continua holgazaneria durante las horas de trabajo y por haberse negado
constantemente a trabajar, y que los 45 obreros encabezados por el capataz
Victoriano Madayag fueron despedidos por haber rehusado sealar a los
responsables del maltrato del capataz Juan Moldero en la maana del 30 de
marzo de 1939. La mocion se vio el 3 de abril de 1939 y en la vista las partes
presentaron sus testigos. El tribunal designo a uno de sus agentes especiales
para que se constituya en las minas de la recurrente y practicara una
investigacion con el fin de suplementar los hechos que se probarondurante la
vista. Despues de considerar las pruebas presentadas ante el y los hechos
hallados por el comisionado nombrado, el tribunal en su orden del 6 de mayo de
1939 declaro probados los hechos siguientes:
1. The discharges and indefinite suspensions alleged in the motion were
made by the respondent without first securing the consent of the Court in
violation of the order of this Court of January 23, 1939.
2. The discharges and indefinite suspensions were made by the
respondent without just cause.
El la misma orden el Tribunal de Relaciones Industriales hace las siguientes
consideraciones que apoyan las conclusiones a que la llegado:
In the order of January 23, 1939, the respondent was enjoined to refrain
from discharging any laborer involved in the dispute without just cause
and without previous authority of the Court. It appears and no denial of
the fact is made by the respondent that the dismissal is one case and
alleged suspension for an indefinite time in the other, which has all the

effects of a discharge, were made without seeking the authority of the

Court.
The charge that Haber and the group of nine laborers were indefinitely
suspended of continuous loafing and refusal to work was not established.
The real motive behind the lay was the completion of their work "outside."
Under the circumstances, the provision of the order of March 21, to the
effect that these men should be returned to their work underground after
the completion of their work "outside" should have been observed. The
respondent instead of complying with the order laid off the men.
The discharge of Victoriano Madayag and his forty-four companions as a
result of the Moldero incident also lacks justification. In the case of
Madayag, although he was present with Haber when Moldero was
attacked, neither one is accused of the aggression. The two of them were
conversing with Moldero with the latter was stoned from behind without
anybody apparently being able to point out the aggressor. Less
justification can be found for the discharge of the forty-four men as a
result of the incident. The investigation disclosed that at the time of the
assault, they were at the Creek busy with their work. Both the distance
and the topographical situation of the place where the men were working,
which is far and well below the bank of the place of the incident,
precluded their hearing of seeing clearly what transpired above them in
the place where Moldero was assaulted. An ocular inspection of the
premises made by the investigator confirmed this view. So far as is
known, despite the investigations conducted by the officials of the
company and the policeman of the camp and by the constabulary
authorities in Baguio, the person or persons responsible for the stoning
has not been determined. The precipitate and unwarranted dismissal of
the forty-five men after the incident seems to have been spurred by an
over anxious desire on the part of the company to get rid of these men.
As previously found, in the order of this Court of March 21, 1939, about
134 underground laborers of the respondent were transferred and made
to work 'outside of the mines' or surface work. The majority of these men
were muckers, miners, timbermen, trammers, and mine helpers and had
to their favor from 6 months to 5 years service in the mines of the
company and not a few of them have done underground work in several
capacities and in different tunnels and divisions of the mine. Among them
are found leaders of the movement of the laborers for higher pay and
better working conditions which culminated in the strike called on January
3, 1939. These leaders have been prominent in the formation of the union
its activities and in connection with the strike. The temporary transfer of
these men to "outside" work was authorized by the Court in said order on
the strength of the assurance of the respondent that no more work suited
for them inside the mines existed. It was directed, however, in the
aforesaid order that as soon as their outside was completed the laborers
should be immediately returned to their respective work inside the mines.

Subsequent events and acts of the officials of the respondent in charge of

the mines have convinced the Court work existed and exists for the men
inside the tunnels and their transfers were made to provide an opportunity
to the company to dispense with their services as soon as the work is
completed. The unwarranted discharges of Haber and nine others and
those of Victoriano Madayag and his forty-four companions amply
demonstrated this conclusion. Upon the company's own admission, as
shown in its reports in the records and upon the findings of the
investigator of the Court, more than four hundred (400) workers of
different classes among them, muckers, miners, timbermen, trammers
and capataces coming from different mines in the region have been
employed by the respondent as fresh laborers. Almost all, if not all, of
these men are not members of the petitioner, the National Laborer Union,
Inc.
At the same time the work in different tunnels and division in the mines
are allegedly being completed, the old workers are being laid off.
Although a small number of the men found transfer to other divisions
being operated, the majority are being left without work. Instead of laying
hands on the old men laid off and making them work in the tunnels
needing hands and reinstating in the tunnel work those laborers
transferred to the 'outside' department, the respondent preferred to take
in and hire other workers coming from different places because evidently
they are not members of the union.
There is no doubt in the mind of the Court that a good number of the
position given of the men who were employed after the strike numbering
more than four hundred to date could have been offered to the strikes
who are now doing work "outside" and other who have been laid off on
the allegation that the underground work in which they were engaged had
been completed. To believe that not a single man or say a few among the
latter could have met the requirements set by the technical men of the
company to perform the different classes of work for which the fresh men
were engaged because they lack the required efficiency, experience,
physique. intelligence and skill of the four hundred fresh laborers would
be shutting the eyes of the court to realities. These men prior to the
occurence of the dispute, had worked for months and many for years in
the mines of the respondent and it can not be easily accepted that their
experience gained in their particular lines in the very property of the
respondent would be inferior to that attained by the other workmen in
other mines in the district for an equal period of time. Their inefficiency as
a whole group can not be successfully sustained now because they were
not transferred to surface work for this reason but because of the alleged
lack of work or completion of their work underground. Had any of them
been inefficient in the past, it can not be explained why the company
laborer continued in the service as the records of the company abound
with instance of discharges made in the past of laborers who were found
either inefficient or incompetent or whose services were unsatisfactory.

The company asserts ignorance of the union affiliations of the men in the
mine but the evidence stands uncontradicted that before the strike was
called a petition was presented by the men to the management carrying
the signatures of about eight hundred (800) worker demanding higher pay
and better working conditions. When the men struck, the operation of the
mine was completely paralyzed and there is a strong indication that a
great majority of the workers joined openly the strike. It would not have
been difficult for the respondent, with the means at its command, to find
for itself the employees and laborers who remained loyal to the company
and to consider those who struck as either members of the union or its
sympathizer.
The respondent's claim as to the motive for the suspension and
discharges lacks substance and support in the evidence and the
inferences to be drawn from it. From all what appears, it is inferred that
the respondent desire to discourage membership in the union and to rout
it if possible. The wholesale discharges were the expression of such
desire. The acts in the mind of the Court, are calculated to have two
effects. They will not only immediately affect the discharged laborers but
would also discourage other laborers from joining or remaining members
of the union.
The allegation that it has always been policy to consider the laborer's
connection with the company terminated upon termination of the working
place in which he is employed is not supported by the facts. It has been
shown that as a general rule when work in a place is completed, workers
are transferred to another working place in one level or to another level,
although in some instances days may elapse before all the men in a
bunch can be absorbed in different levels.
It is alleged that mining operations in the property vary and involve
several types, and that a miner, for example, may be good in one type,
but that it does not necessarily follow that he can do good work in another
type. And that the employment of men in particular jobs not suitable for
them increased the cost of production as a result of lower output.
Consequently, the respondent vehemently insists in its right of selecting
the men that it should employ and that in the exercise of this right it
should not be restrained or interfered with by the Court. It contends that
as to fitness of a laborer to do a particular type of work the opinion of the
management or its technical men should be respected. But all these
arguments are meaningless in the face of the finding of the Court that the
underground laborers transferred to the 'outside' work are not wanting in
experience, efficiency and other conditions alleged to be found among
the fresh laborers. The special qualifications to do particular work can not
rightly be invoked in favor of the employment of new laborers most
specially in those cases of common or unskilled labor like muckers,
trammers, helpers, etc.

Under normal circumstances, the exercise of judgment of the employer in

selecting men he is to employ should not be interfered with. But when
such judgment is arbitrarily exercised to the prejudice of members of a
labor union whose rights should be safeguarded in consonance with the
policies of the law, the Court not only feels it justified but rightly its duty to
interfere to afford protection to the laborers affected.
La recurrente presento una extensa mocion de reconsideracion de la indicada
orden, mocion que fue denegada por la resolucion del 17 de agosto de 1939. La
orden del 6 de mayo de 1939 y la resolucion del 17 de agosto del mismo ao son
las que dieron lugar a la apelacion interpuesta por la recurrente.
La recurrente sostiene que la Ley No. 103 del Commonwealth, conforme ha sido
enmendada por las leyes Nos. 254 y 355, es anticonstitucional (1) porque infringe
el principio de separacion de poderes; (2) porque por ella la Asamblea Nacional
abdico de su facultad legislativa violando la doctrina sobre delegacion de poderes;
(3) porque las facultades judiciales que la ley confiere al Tribunal de Relaciones
Industriales, consideradas separadamente, son arbitrarias e irrazonables y
permiten la privacion de la libertad y propiedad sin el debido proceso de ley; y (4)
porque suponiendo que la ley es valida y constitucional en su totalidad, la porcion,
por lo menos, del articulo 20 que dispone que el Tribunal de Relaciones
Industriales "adoptara sus reglamentos de procedimiento" debe declararse nula e
invalida porque infringe el articulo 13 del Titulo VIII de la Constitucion de Filipinas
que obliga al Tribunal de Relaciones Industriales a observar las reglas generales
de procedimiento aplicables a los tribunales de justicia. La recurrente alega en
este respecto que como a ella se le ha sometido a un procedimiento arbitrario y
distinto del que se aplica a los demas litigantes en los tribunales de Filipinas, se le
ha negado el debido proceso de ley y el principio de igual proteccion ante las
leyes.
La Ley No. 103 del Commonwealth que, como su titulo indica, provee a la
proteccion del obrero, creando un Tribunal de Relaciones Industriales facultado
para fijar un jornal minimo para los obreros y la renta maxima que se ha de pagar
por los inquilinos; para poner en vigor el arbitraje obligatorio entre patronos o
propietarios y empleados o inquilinos, respectivamente, y prescribe penas por la
infraccion de sus decretos, se ha promulgado por la Asamblea Nacional en virtud
de los preceptos contenidos en el articulo 5, Titulo II; articulo 6, Titulo XIII; y
articulos 1 y 2, Titulo VIII, de la Constitucion de Filipinas que disponen:
ART. 5. El Estado cuidara de promover la justicia social a fin de asegurar
el bienestar y la estabilidad economica de todo el pueblo.
ART. 6. El Estado debera proteger a todos los trabajadores,
especialmente a las mujeres y a los menores de edad, y debera regular
las relaciones entre propietarios e inquilinos, y entre el trabajo y el capital
en la industria y la agricultura. El Estado podra establecer el arbitraje
obligatorio.

ART. 1. El Poder Judicial estara investido en un Tribunal Supremo y en

otros tribunales inferiores que se establezcan por ley.
ART. 2. La Asamblea Nacional tendra la facultad de definir, prescribir y
distribuir la jurisdiccion de los varios tribunales, . . .
En cumplimiento de los preceptos constitucionales transcritos, la Asamblea
Nacional promulgo la Ley No. 103 del Commonwealth que crea el Tribunal de
Relaciones Industriales que es un tribunal especial con facultades judiciales
(Pambusco Employees Union vs. Court of Industrial Relations et al., G.R. No.
46727; Ang Tibay et al. vs. Court of Industrial Relations et al., G.R. No. 46496,
opinion concurrente del Magistrado Jose P. Laurel). El articulo 1 de dicha ley
provee que el Tribunal de Relaciones Industriales ejercera jurisdiccion para
considerar, investigar, decidir y zanjar toda cuestion, asunto, conflicto o disputa
que afecte o surja entre patronos y empleados u obreros, y entre propietarios e
inquilinos o aparceros, y para regular las relaciones entre los mismos, con arreglo
y sujecion a las disposiciones de la ley. El articulo 4 dispone que el tribunal
tomara conocimiento, para fines de prevencion, arbitraje, decision y ajuste, de
cualquier conflicto agrario o industrial que motive o de lugar a una huelga o paro a
causa de diferencias que surjan en la cuestion de jornales, participacion o
compensacion, horas de trabajo o condiciones de aparceria o empleo, entre
patronos y empleados u obreros, y entre propietarios e inquilinos o aparceros,
siempre que el numero de empleados, obreros, inquilinos o aparceros afectados
exceda de treinta, y que el conflicto agrario o industrial se someta al tribunal por el
Secretario del Trabajo, o por una o ambas partes interesadas, cuando el referido
Secretario del Trabajo certifique en cuanto a su existencia y la conveniencia de la
intervencion del tribunal en bien del interes publico. Y el articulo 20 preceptua que
en la vista, investigacion y resolucion de cualquier cuestion o conflicto, y en el
ejercicio de cualquiera de sus deberes y facultades, el tribunal actuara de acuerdo
con la justicia y la equidad y los meritos substanciales de la causa, sin
consideracion a los tecnicismos y formulismos legales, y no estara sujeto a
cualesquier reglas tecnicas de prueba legal, sino que formara juicio de la manera
que crea justa y equitativo. La Ley No. 103 confiere al Tribunal de Relaciones
Industriales plena facultad disrecional para resolver y decidir las disputas agrarias
e industriales de la manera que crea justo e equitativo, prescindiendo de los
tecnicismos y formulismos legales, y la facultad asi concedida es judicial y no
legislativa, por lo que no infringe el principio de separacion de poderes, la
prohibicion sobre delegacion de facultades legislativas ni la proteccion igualitaria
ante la ley. Como se ha dicho en el asunto de Cincinnati, W. & Z. R. Co. vs.
Comm'rs, of Clinton County '1852), 1 Ohio St., 88, citado en el asunto de Rubi et
al. contra La Junta Provincial de Mindoro, 39 Jur. Fil., 675, "Existe una verdadera
diferencia entre delegar la facultad para dictar leyes, lo cual supone
necesariamente discrecion en cuanto a lo que hayan de ser aquellas, y conferir
atribucion o discrecion para hacerlas cumplir, discrecion que debe ejecitarse con
arreglo a la ley. La primera no puede hacerse en modo alguno; contra la segunda
no cabe interponer objecion alguna."

Para reforzar los argumentos en favor de la anticonstitucionalidad de la Ley No.

103 la recurrente hace hincapie en lo resuelto en el asunto de Schechter vs.
United States (1935), 295 U. S., 496, 79 Law. ed. 270, en que el Tribunal
Supremo de los Estados Unidos declaro anticonstitucional la National Recovery
Act. Existe, sin embargo, una marcada diferencia entre dicho asunto y el que se
considera porque la National Recovery Act en vez de crear un tribunal de justicia,
creo juntas con facultades legislativas y autorizo al Presidente de los Estados
Unidos a promulgar codigos que prescriban las reglas de precedimiento con el fin
de realizar los propositos de la ley.
El ultimo fundamento que se alega en contra de la validez de la Ley No. 103 se
hace consistir en que las facultades judiciales que concede al Tribunal de
Relaciones Industriales son tan artibrarias e irrazonables que permiten la
privacion de la libertad y la propiedad sin el debido proceso de ley; y que se
articulo 20, por lo menos, adolece de este defecto fundamental porque confiere al
Tribunal de Relaciones Industriales la facultad de dictar sus propias reglas de
procedimiento, lo cual contraviene el articulo 13, Titulo VIII, de la Constitucion que
prescribe que el Tribunal Supremo dictara reglas concernientes a los escritos de
alegaciones, practica y procedimiento uniformes para todos los tribunales de la
misma categoria.
El articulo 20 de la Ley No. 103 se lee asi:
ART. 20. Reglamentos del Tribunal. El Tribunal de Relaciones
Industriales promulgara sus reglas de procedimiento y tendra las demas
atribuciones que en general corresponden a un tribunal de
justicia:Entendiendose, sin embargo, Que en la vista, investigacion y
resolucion de cualquier cuestion o conflicto, y en el ejercicio de cualquier
de sus deberes y faculades en virtud de esta Ley, el Tribunal actuara de
acuerdo con la justicia y la equidad y los meritos substanciales de la
causa, sin consideracion a los tecnicismos o formulismos legales, y no
estara sujeto a cualquiera reglas, tecnicas de prueba legal, sino que
formara juicio de la manera que crea justo y equitativo.
Una simple lectura de dicho articulo demuestra que la ley no ha facultado al
Tribunal de Relaciones Industriales a investigar y resolver las cuestiones y
conflictos entre obreros y patronos, e inquilinos y propietarios, de una manera
arbitraria y caprichosa sin someterse a una norma de conducta determinada. El
articulo dispone claramente que las reglas de procedimiento que adopte, a las
cuales debera ajustarse el tribunal, deberan insperarse en la justicia y la equidad,
y prescribe que el criterio que se forma debera fundarse en los meritos
substanciales de la causa sin consideracion a los tecnicismos o formulismos
legales. La Ley No. 103 que crea un tribunal especial denominado Tribunal de
Relaciones Industriales con facultad para dictar sus propios reglamentos y para
resolver y decidir los conflictos agrarios e industriales de acuerdo con los dictados
de la justicia y equidad, no puede ser impugnada bajo el fundamento de que
auoriza la privacion de la libertad y propiedad sin el debido proceso de ley; ni
pugna con el precepto del articulo 13, Titulo VIII, de la Constitucion porque el

Tribunal de Relacines Industriales no es de la misma categoria que los juzgados

municipales, juzgados de paz y juzgados de primera instancia para los cuales se
han dictado los reglamenos de los tribunales por el Tribunal Supremo.
En relacion con la validez y constitucionalidad de la Ley No. 103 y sus
enmiendas, insertamos a continuacion la opinion concurrente del Magistrado
Lauren en el asunto de Ang Tibay, supra, cuyas observaciones serviran para
rebustecer la proposicion sentada de que la referida ley y sus enmiendas es
valida y no infringe la Constitucion.
It should be observed at the outset that our Constitutionwas adopted in
the midst of surging unrest and dissatisfaction resulting from economic
and social distresswhich was threatening the stability of governments
theworld over. Alive to the social and economic forces atwork, the farmers
of our Constitution boldly met the problems and difficulties which faced
them and endeavored to crystallize, with more or less fidelity, the political,
social; and economic proposition of their age, and this they did, with the
consciousness that the political and philosophicalaphorism of their
generation will, in the language of a great jurist, "be doubted by the next
and perhaps entirely discarded by the third." (Chief Justice Winslow in
Gorgnis v. Falk Co., 147 Wis., 327; 133 N. W., 209.) Embodying the spirit
of the present epoch, general provisions were inserted in the Constitution
which are intended to bring about the needed social and economic
equilibrium between component elements of society through the
application of what may be termed as the justitia communis advocated by
Grotius and Leibnits many years ago to be secured through the
counterbalancing of economic and social forces and opportunities which
should be regulated, if not controlled, by the State or placed, as it were,
in custodia societatis. "The promotion of social justice to insure the wellbeing and economic security of all the people' was thus inserted as vital
principle in our Constitution. (Sec. 5, Art. II, Constitution.) And in order
that this declaration of principle may not just be an empty medley of
words, the Constitution in various sections thereof has provided the
means towards its realization. For instance, section 6 of Articles XIII
declares that the State "shall afford protection to labor, especially to
working women and minors, and shall regulated the relations between
landowner and tenant, and between labor and capital in industry and in
agriculture." The same section also states that "the State may provide for
compulsory arbitration." In extraordinary cases mentioned in section 16,
Articles VI, of the Constitution, the President of the Philippines may be
authorized by law, for a limited period and subject to such restrictions as
the National Assembly may prescribed, to "promulgate rules and
regulations to carry out a declared national policy." Albeit, almost at the
same time the Congress of the United States approved the National
Labor Regulations Act (49 Stat., 449) on July 5, 1935, commonly known
as the Wagner Act, we were in the Philippines headway towards the
adoption of our fundamental law, pursuant to congressional authority
given in the Tydings-McDuffie Independence Act, approved March 24,

1934. In our Bill of Rights we now find the following provision "The right to
form associations or societies for purposes not contrary to law shall not
be abridged." (Par. 6, section 1, art. III, Constitution.) What was an
agitation in the United States which brought about the recommendation
by the Commission on Industrial Relations created by an Act of Congress
in 1912 for the adoption of a Labor Bill of Rights as an amendment to the
United States Constitution is, in our case, virtually an accepted principle,
which may be expanded and vitalized by legislation to keep pace with the
development of time and circumstances.
By and large, these provisions in our Constitution all evince and express
the need of shifting emphasis to community interest with a view to
affirmative enhancement of human values. In conformity with the
constitutional objective and cognizant of the historical fact that industrial
and agricultural disputes had given rise to disquietude, bloodshed and
revolution in our country, the National Assembly enacted Commonwealth
Act No. 103, entitled "An Act to afford protection of labor by creating a
Court of Industrial Relations empowered to fix minimum wages for
laborers and maximum rental to be paid tenants, and to enforce
compulsory arbitration between employers or landlords, and employees
or tenants, respectively; and by prescribing penalties for the violation of
the orders" and, later, Commonwealth Act. No. 213, entitled, "An Act to
define and regulate legitimate labor organizations." (Asto this last
act, vide "finding and policy," preamble [sec. 1]of the Wagner Act [49 Sta.,
449]).
Commonwealth Act No. 103, approved October 29, 1936, was originally
Bill No. 700 of the National Assembly. More light is shed by the
explanatory statement of the Bill than by what transpired in the course of
the deliberation of the measure in the legislative chamber. "El presente
proyecto de ley," thus the explanatory statement of Bill No. 700, 'crea una
Junta de Relaciones Industriales . . . y provee el arbitraje obligatorio. . .
de acuerdo con el Articulo 6, Titulo XIII de la Constitucion, el provee que
"El Estado podrs establacerel arbitraje obligatorio." "Incorporating the
conclusion reached by a committee appointed, a year or so before it was
observed that 'bajo la legislacion actual' " evidently referring to Act No.
4055 "no existe instrumento adecuado para evitar las huelgas. El
Departamentode Trabajo desempea maramente el papel de
pacificadorentre las partes en controversia y sus decisiones no
sonobligatorias ni para los patronos ni para los obreros. El pueblo la
allegado a un grado de desarrollo industrial, quehace imperiosa el que la
intervencion del gobierno en estosconflictos sea mas efectiva . . . ." The
creation of a Court of Industrial Relations was thus proposed, endowed
"no solamente del poder de arbitrar sino tambien del deberde investigar,
decidir, y hacer recomendaciones sobre las cuestiones en conflicto y los
problem as que afectan al Capitaly al Trabajo en la Industria y la
Agricultuta bajola direccion del Presidente de la Mancomunidad de
Filipinaso a peticion del Secretario del Trabajo.

xxx

xxx

xxx

From what has been stated, it appears that the legislation which are now
called upon to construe was enacted in pursuance of what appears to be
deliberate embodiment of a new social policy, founded on the conception
of a society integrated not by independent individuals dealing at arms'
length, but by interdependent members of a consolidated whole whose
interests must be protected against mutual aggression and warfare
among and between divers and diverse units which are impelled by
counter vailing and opposite individual and group interests, and this is
particularly true in the relationship between labor and capital. Social and
industrial disturbances which fifty years ago were feudal-like and of
isolated importance may now well result in a serious strain upon the
entire economic organism of the nation . In the United States labor
legislation has undergone a long process of development too long to
nature here, culminating in the enactments of what were commonly
known as the Clayton Act, the Norris-La Guardia Act, and finally, the
Wagner Act and the Fair Labor Standards Act of 1938. The Wagner Act
created the National Labor Relations Board as an instrumentality of the
Federal Government in the settlement of labor disputes, which device is
aimed at the avoidance of unnecessary friction between labor and capital
and the establishment of industrial peace. Scrutiny of legislation in that
country and of pronouncement made by its Supreme Court reveals a
continuous renovation and change made necessary by the impact of
changing needs and economic pressure brought about by the irresistible
momentum of new social and economic forces developed there. In the
light of changes that have occured, it is doubted if the pronouncement
made by the said Supreme Court in 1905 (Lochner v. New York, 198,
U.S., 45) or in 1908 (Adair v. U.S., 52 Law. ed. 430, 208 U.S., 161, and
Coppage v. Kansas, 236 U.S., 1) cases which are relied upon by the
petitioner in its printed memorandum still retain their virtuality at the
present time. In the Philippines, social legislation has had a similar
development although of course to a much smaller degree and of
different adaptation giving rise to several attempts at meeting and solving
our peculiar social and economic problems. (See Commonwealth to the
National Assembly, September 2,1936; Executive Order No. 49, S. 1936).
The system of voluntary arbitration devised by Act No. 4055 of the
defunct Philippine Legislature has apparently been abandoned by the
enactment of the aforementioned Commonwealth Acts Nos. 103 and 213.
In the midst of changes that have taken place, it may likewise be doubted
if the pronouncement made by this court in the case of People vs. Pomar
(46 Phil., 440) also relied upon by the petitioner in its printed
memorandum still retains its virtually as a living principle. The policy of
laissez faire has to some extent given way the assumption by the
government of the right of intervention even in contractual relations
affected with public interests.
xxx

xxx

xxx

In Commonwealth Act No. 103, and it, our Government no longer

performs the role of a mere mediator or intervenor but that of the supreme
arbiter.
En su siguiente senalmiento de error la recurrentealega que la conducta del
investigador, la investigacion quepracticio y la manera como conocio del asunto el
Tribunalde Relaciobes Industriales le privaron de una vista i,parcialy justa, y
constituyen privacion de supropiedad sinel debido proceso de ley. Para demostrar
la carencia de fundamento del senalmiento de error, creemos suficientereproducir
a continuacion la forma como se practicio la investigacion por el comisionado
nombrado por el Tribunal de Relacionbes Industriales y la manera como
secelebro la vista por dicho tribunal, tal como se expone en laorden del 6 de mayo
de 1939.
Hearing was held on April 3, 1939, where witnessesfor both the
petitioners and the respondent testified. To supplement the facts brought
out at the hearing, the Court ordered one of its Special Agents to proceed
to the premises of the mines to conduct a further investigation.
El comisionado fue nombrado por el Tribumal de RelacionesIndustriales en el su
facultad conferidapor el articulo 10 de la ley No. 103 de Commonwealth yel la
inspeccion y vistas que celebraron el comisionado y eltribunal, respectivamente,
las partes estuvieron representadasdebidamente, fueron oidas y presentaron las
pruebasque tenian disponibles y creyeron conveniente ofrecerTales inspeccion y
vistas tenian el caracter de una vistajudicial imparcial y justa y constituyen el
debido procesode ley que garantiza la Constitucion.
Sostiene igualmente la recurrente que la orden del 6 demayo de 1939 es
arbitraria porque no existen pruebassubstanciales ni competentes que la
sostengan. Sobre esteextremo, las conclusiones de hecho que ha sentado el
Tribunalde Relaciones Industriales demuestran que la ordenimpugnada esta
sostenida por el resultado de la investigacion practicada por el comisionado y las
pruebas que laspartes presentaron directamente ante el Tribunal. Endichas
conclusiones se han considerado y analizado por elTribunal de Relaciones
Industriales todas las pruebas quelas partes presentaron y resulta inevitable la
conclusionde que la orden no es arbitraria y esta justificada y sotenida por los
hechos probados.
El ultimo senalmiento de error guarda relacion conla parte de la orden del 6 mayo
de 1939 que disponeque la recurrente pague a los 55 obreros repustos
losjornales que dejaron de percibir durante su separaciondel servicio. La
recurrente sostiene que esta parte dela orden equivale a una sentencia por danos
y perjuiciosque el Tribunal de Relaciones Industriales no puede pronunciar por
carecer de jurisdiccion. La pretension noes meritoria. El Tribunal de Relaciones
Industriales,conforme ya se ha dicho, es un tribunal especial y comotal tiene
facultad para disponer que la recurrente paguelos jornales de sus empleados y
obreros que han sido repuestos.Los articulos 1 y 4 de la Ley No. 103 de
Commonwealth,segun ha sido enmendado el primero por elarticulo 1 de la Ley

No. 254, confieren facultad y jurisdiccion al tribunal de Relaciones Inbdustriales

para conocer, resolver y decidir todas las cuestiones, controversiasy disputas
entre patronos y obreros y propietarios y terratenientes, y los jornales de los
obreros repuestos, duranteel tiempo en que fueron separados del
servicio,esteban incluidos en las controverias y disputas sometidasal
Departamento del Trabajo y certificados por este al Tribunal de Relaciones
Industriales.
Se deniega el recurso de certiorari y se confiman laorden del 6 de mayo de 1939
y la resolucion del 17 deagosto del mismo ano, con las costas a la recurrente.
Asise ordena.
Avancea, Diaz, Laurel y Moran, MM., estan conformes.

FIRST DIVISION
[G.R. No. 47800. December 2, 1940.]
MAXIMO CALALANG, Petitioner, v. A. D. WILLIAMS, ET
AL., Respondents.
Maximo Calalang in his own behalf.
Solicitor General Ozaeta and Assistant Solicitor General Amparo for
respondents Williams, Fragante and Bayan
City Fiscal Mabanag for the other respondents.
SYLLABUS
1. CONSTITUTIONAL LAW; CONSTITUTIONALITY OF COMMONWEALTH ACT No.
648; DELEGATION OF LEGISLATIVE POWER; AUTHORITY OF DIRECTOR OF
PUBLIC WORKS AND SECRETARY OF PUBLIC WORKS AND COMMUNICATIONS
TO PROMULGATE RULES AND REGULATIONS. The provisions of section 1 of
Commonwealth Act No. 648 do not confer legislative power upon the Director of
Public Works and the Secretary of Public Works and Communications. The
authority therein conferred upon them and under which they promulgated the
rules and regulations now complained of is not to determine what public policy
demands but merely to carry out the legislative policy laid down by the National
Assembly in said Act, to wit, "to promote safe transit upon, and avoid
obstructions on, roads and streets designated as national roads by acts of the
National Assembly or by executive orders of the President of the Philippines"
and to close them temporarily to any or all classes of traffic "whenever the
condition of the road or the traffic thereon makes such action necessary or
advisable in the public convenience and interest." The delegated power, if at all,
therefore, is not the determination of what the law shall be, but merely the
ascertainment of the facts and circumstances upon which the application of said
law is to be predicated. To promulgate rules and regulations on the use of
national roads and to determine when and how long a national road should be
closed to traffic, in view of the condition of the road or the traffic thereon and
the requirements of public convenience and interest, is an administrative
function which cannot be directly discharged by the National Assembly. It must
depend on the discretion of some other government official to whom is confided
the duty of determining whether the proper occasion exists for executing the
law. But it cannot be said that the exercise of such discretion is the making of
the law.
2. ID.; ID.; POLICE POWER; PERSONAL LIBERTY; GOVERNMENTAL AUTHORITY.
Commonwealth Act No. 548 was passed by the National Assembly in the
exercise of the paramount police power of the state. Said Act, by virtue of which
the rules and regulations complained of were promulgated, aims to promote
safe transit upon and avoid obstructions on national roads, in the interest and
convenience of the public. In enacting said law, therefore, the National
Assembly was prompted by considerations of public convenience and welfare. It
was inspired by a desire to relieve congestion of traffic, which is, to say the
least, a menace to public safety. Public welfare, then, lies at the bottom of the

enactment of said law, and the state in order to promote the general welfare
may interfere with personal liberty, with property, and with business and
occupations. Persons and property may be subjected to all kinds of restraints
and burdens, in order to secure the general comfort, health, and prosperity of
the state (U.S. v. Gomer Jesus, 31 Phil., 218). To this fundamental aim of our
Government the rights of the individual are subordinated. Liberty is a blessing
without which life is a misery, but liberty should not be made to prevail over
authority because then society will fall into anarchy. Neither should authority be
made to prevail over liberty because then the individual will fall into slavery.
The citizen should achieve the required balance of liberty and authority in his
mind through education and, personal discipline, so that there may be
established the resultant equilibrium, which means peace and order and
happiness for all. The moment greater authority is conferred upon the
government, logically so much is withdrawn from the residuum of liberty which
resides in the people. The paradox lies in the fact that the apparent curtailment
of liberty is precisely the very means of insuring its preservation.
3. ID.; ID.; SOCIAL JUSTICE. Social justice is "neither communism, nor
despotism, nor atomism, nor anarchy," but the humanization of laws and the
equalization of social and economic forces by the State so that justice in its
rational and objectively secular conception may at least be approximated. Social
justice means the promotion of the welfare of all the people, the adoption by
the Government of measures calculated to insure economic stability of all the
competent elements of society, through the maintenance of a proper economic
and social equilibrium in the interrelations of the members of the community,
constitutionally, through the adoption of measures legally justifiable, or extraconstitutionally, through the exercise of powers underlying the existence of all
governments on the time-honored principle of salus populi est suprema lex.
Social justice, therefore, must be founded on the recognition of the necessity of
interdependence among divers and diverse units of a society and of the
protection that should be equally and evenly extended to all groups as a
combined force in our social and economic life, consistent with the fundamental
and paramount objective of the state of promoting the health, comfort, and
quiet of all persons, and of bringing about "the greatest good to the greatest
number."

DECISION

LAUREL, J.:

Maximo Calalang, in his capacity as a private citizen and as a taxpayer of

Manila, brought before this court this petition for a writ of prohibition against
the respondents, A. D. Williams, as Chairman of the National Traffic
Commission; Vicente Fragante, as Director of Public Works; Sergio Bayan, as
Acting Secretary of Public Works and Communications; Eulogio Rodriguez, as
Mayor of the City of Manila; and Juan Dominguez, as Acting Chief of Police of
Manila.

It is alleged in the petition that the National Traffic Commission, in its resolution
of July 17, 1940, resolved to recommend to the Director of Public Works and to
the Secretary of Public Works and Communications that animal-drawn vehicles
be prohibited from passing along Rosario Street extending from Plaza Calderon
de la Barca to Dasmarias Street, from 7:30 a.m. to 12:30 p.m. and from 1:30
p.m. to 5:30 p.m.; and along Rizal Avenue extending from the railroad crossing
at Antipolo Street to Echague Street, from 7 a.m. to 11 p.m., from a period of
one year from the date of the opening of the Colgante Bridge to traffic; that the
Chairman of the National Traffic Commission, on July 18, 1940 recommended to
the Director of Public Works the adoption of the measure proposed in the
resolution aforementioned, in pursuance of the provisions of Commonwealth Act
No. 548 which authorizes said Director of Public Works, with the approval of the
Secretary of Public Works and Communications, to promulgate rules and
regulations to regulate and control the use of and traffic on national roads; that
on August 2, 1940, the Director of Public Works, in his first indorsement to the
Secretary of Public Works and Communications, recommended to the latter the
approval of the recommendation made by the Chairman of the National Traffic
Commission as aforesaid, with the modification that the closing of Rizal Avenue
to traffic to animal-drawn vehicles be limited to the portion thereof extending
from the railroad crossing at Antipolo Street to Azcarraga Street; that on August
10, 1940, the Secretary of Public Works and Communications, in his second
indorsement addressed to the Director of Public Works, approved the
recommendation of the latter that Rosario Street and Rizal Avenue be closed to
traffic of animal-drawn vehicles, between the points and during the hours as
above indicated, for a period of one year from the date of the opening of the
Colgante Bridge to traffic; that the Mayor of Manila and the Acting Chief of
Police of Manila have enforced and caused to be enforced the rules and
regulations thus adopted; that as a consequence of such enforcement, all
animal-drawn vehicles are not allowed to pass and pick up passengers in the
places above-mentioned to the detriment not only of their owners but of the
riding public as well.
It is contended by the petitioner that Commonwealth Act No. 548 by which the
Director of Public Works, with the approval of the Secretary of Public Works and
Communications, is authorized to promulgate rules and regulations for the
regulation and control of the use of and traffic on national roads and streets is
unconstitutional because it constitutes an undue delegation of legislative power.
This contention is untenable. As was observed by this court in Rubi v. Provincial
Board of Mindoro (39 Phil, 660, 700), "The rule has nowhere been better stated
than in the early Ohio case decided by Judge Ranney, and since followed in a
multitude of cases, namely: The true distinction therefore is between the
delegation of power to make the law, which necessarily involves a discretion as
to what it shall be, and conferring an authority or discretion as to its execution,
to be exercised under and in pursuance of the law. The first cannot be done; to
the latter no valid objection can be made. (Cincinnati, W. & Z. R. Co. v.
Commrs. Clinton County, 1 Ohio St., 88.) Discretion, as held by Chief Justice
Marshall in Wayman v. Southard (10 Wheat., 1) may be committed by the
Legislature to an executive department or official. The Legislature may make
decisions of executive departments or subordinate officials thereof, to whom it
has committed the execution of certain acts, final on questions of fact. (U.S. v.
Kinkead, 248 Fed., 141.) The growing tendency in the decisions is to give
prominence to the necessity of the case."
cralaw virtua1aw library

Section 1 of Commonwealth Act No. 548 reads as follows:

jgc:chanrobles.com.ph

"SECTION 1. To promote safe transit upon, and avoid obstructions on, roads
and streets designated as national roads by acts of the National Assembly or by
executive orders of the President of the Philippines, the Director of Public Works,
with the approval of the Secretary of Public Works and Communications, shall
promulgate the necessary rules and regulations to regulate and control the use
of and traffic on such roads and streets. Such rules and regulations, with the
approval of the President, may contain provisions controlling or regulating the
construction of buildings or other structures within a reasonable distance from
along the national roads. Such roads may be temporarily closed to any or all
classes of traffic by the Director of Public Works and his duly authorized
representatives whenever the condition of the road or the traffic thereon makes
such action necessary or advisable in the public convenience and interest, or for
a specified period, with the approval of the Secretary of Public Works and
Communications."
cralaw virtua1aw library

The above provisions of law do not confer legislative power upon the Director of
Public Works and the Secretary of Public Works and Communications. The
authority therein conferred upon them and under which they promulgated the
rules and regulations now complained of is not to determine what public policy
demands but merely to carry out the legislative policy laid down by the National
Assembly in said Act, to wit, "to promote safe transit upon and avoid
obstructions on, roads and streets designated as national roads by acts of the
National Assembly or by executive orders of the President of the Philippines"
and to close them temporarily to any or all classes of traffic "whenever the
condition of the road or the traffic makes such action necessary or advisable in
the public convenience and interest." The delegated power, if at all, therefore, is
not the determination of what the law shall be, but merely the ascertainment of
the facts and circumstances upon which the application of said law is to be
predicated. To promulgate rules and regulations on the use of national roads
and to determine when and how long a national road should be closed to traffic,
in view of the condition of the road or the traffic thereon and the requirements
of public convenience and interest, is an administrative function which cannot
be directly discharged by the National Assembly. It must depend on the
discretion of some other government official to whom is confided the duty of
determining whether the proper occasion exists for executing the law. But it
cannot be said that the exercise of such discretion is the making of the law. As
was said in Lockes Appeal (72 Pa. 491): "To assert that a law is less than a law,
because it is made to depend on a future event or act, is to rob the Legislature
of the power to act wisely for the public welfare whenever a law is passed
relating to a state of affairs not yet developed, or to things future and
impossible to fully know." The proper distinction the court said was this: "The
Legislature cannot delegate its power to make the law; but it can make a law to
delegate a power to determine some fact or state of things upon which the law
makes, or intends to make, its own action depend. To deny this would be to
stop the wheels of government. There are many things upon which wise and
useful legislation must depend which cannot be known to the law-making
power, and, must, therefore, be a subject of inquiry and determination outside
of the halls of legislation." (Field v. Clark, 143 U. S. 649, 694; 36 L. Ed. 294.)

In the case of People v. Rosenthal and Osmea, G.R. Nos. 46076 and 46077,
promulgated June 12, 1939, and in Pangasinan Transportation v. The Public
Service Commission, G.R. No. 47065, promulgated June 26, 1940, this Court
had occasion to observe that the principle of separation of powers has been
made to adapt itself to the complexities of modern governments, giving rise to
the adoption, within certain limits, of the principle of "subordinate legislation,"
not only in the United States and England but in practically all modern
governments. Accordingly, with the growing complexity of modern life, the
multiplication of the subjects of governmental regulations, and the increased
difficulty of administering the laws, the rigidity of the theory of separation of
governmental powers has, to a large extent, been relaxed by permitting the
delegation of greater powers by the legislative and vesting a larger amount of
discretion in administrative and executive officials, not only in the execution of
the laws, but also in the promulgation of certain rules and regulations calculated
to promote public interest.
The petitioner further contends that the rules and regulations promulgated by
the respondents pursuant to the provisions of Commonwealth Act No. 548
constitute an unlawful interference with legitimate business or trade and abridge
the right to personal liberty and freedom of locomotion. Commonwealth Act No.
548 was passed by the National Assembly in the exercise of the paramount
police power of the state.
Said Act, by virtue of which the rules and regulations complained of were
promulgated, aims to promote safe transit upon and avoid obstructions on
national roads, in the interest and convenience of the public. In enacting said
law, therefore, the National Assembly was prompted by considerations of public
convenience and welfare. It was inspired by a desire to relieve congestion of
traffic. which is, to say the least, a menace to public safety. Public welfare,
then, lies at the bottom of the enactment of said law, and the state in order to
promote the general welfare may interfere with personal liberty, with property,
and with business and occupations. Persons and property may be subjected to
all kinds of restraints and burdens, in order to secure the general comfort,
health, and prosperity of the state (U.S. v. Gomez Jesus, 31 Phil., 218). To this
fundamental aim of our Government the rights of the individual are
subordinated. Liberty is a blessing without which life is a misery, but liberty
should not be made to prevail over authority because then society will fall into
anarchy. Neither should authority be made to prevail over liberty because then
the individual will fall into slavery. The citizen should achieve the required
balance of liberty and authority in his mind through education and personal
discipline, so that there may be established the resultant equilibrium, which
means peace and order and happiness for all. The moment greater authority is
conferred upon the government, logically so much is withdrawn from the
residuum of liberty which resides in the people. The paradox lies in the fact that
the apparent curtailment of liberty is precisely the very means of insuring its
preservation.
The scope of police power keeps expanding as civilization advances. As was said
in the case of Dobbins v. Los Angeles (195 U.S. 223, 238; 49 L. ed. 169), "the
right to exercise the police power is a continuing one, and a business lawful
today may in the future, because of the changed situation, the growth of
population or other causes, become a menace to the public health and welfare,

and be required to yield to the public good." And in People v. Pomar (46 Phil.,
440), it was observed that "advancing civilization is bringing within the police
power of the state today things which were not thought of as being within such
power yesterday. The development of civilization, the rapidly increasing
population, the growth of public opinion, with an increasing desire on the part of
the masses and of the government to look after and care for the interests of the
individuals of the state, have brought within the police power many questions
for regulation which formerly were not so considered."
cralaw virtua1aw library

The petitioner finally avers that the rules and regulations complained of infringe
upon the constitutional precept regarding the promotion of social justice to
insure the well-being and economic security of all the people. The promotion of
social justice, however, is to be achieved not through a mistaken sympathy
towards any given group. Social justice is "neither communism, nor despotism,
nor atomism, nor anarchy," but the humanization of laws and the equalization
of social and economic forces by the State so that justice in its rational and
objectively secular conception may at least be approximated. Social justice
means the promotion of the welfare of all the people, the adoption by the
Government of measures calculated to insure economic stability of all the
competent elements of society, through the maintenance of a proper economic
and social equilibrium in the interrelations of the members of the community,
constitutionally, through the adoption of measures legally justifiable, or extraconstitutionally, through the exercise of powers underlying the existence of all
governments on the time-honored principle of salus populi est suprema lex.
Social justice, therefore, must be founded on the recognition of the necessity of
interdependence among divers and diverse units of a society and of the
protection that should be equally and evenly extended to all groups as a
combined force in our social and economic life, consistent with the fundamental
and paramount objective of the state of promoting the health, comfort, and
quiet of all persons, and of bringing about "the greatest good to the greatest
number."
cralaw virtua1aw library

In view of the foregoing, the writ of prohibition prayed for is hereby denied, with
costs against the petitioner. So ordered.
Avancea, C.J., Imperial, Diaz. and Horrilleno. JJ. concur.

Republic of the Philippines

SUPREME COURT
Manila
SECOND DIVISION
G.R. No. 77875 February 4, 1993
PHILIPPINE AIRLINES, INC., petitioner,
vs.
ALBERTO SANTOS, JR., HOUDIEL MAGADIA, GILBERT ANTONIO, REGINO
DURAN, PHILIPPINE AIRLINES EMPLOYEES ASSOCIATION, and THE NATIONAL
LABOR RELATIONS COMMISSION, respondents.
Fortunato Gupit, Jr., Solon R. Garcia, Rene B. Gorospe, Bienvinodo T. Jamoralin, jr.
and Paulino D. Ungos, Jr. for petitioner.
Adolpho M. Guerzon for private respondents.
REGALADO, J.:
The instant petition for certiorari seeks to set aside the decision of The National Labor
Relations Commission (NLRC) in NLRC Case No. 4-1206-85, promulgated on
1
December 11, 1986, containing the following disposition:
WHEREFORE, in view of the foregoing consideration, the Decision
appealed from is set aside and another one entered, declaring the
suspension of complainants to be illegal and consequently,
respondent PAL is directed to pay complainants their salaries
corresponding to the respective period(s) of their suspension, and to
2
delete the disciplinary action from complainants' service records.
These material facts recited in the basic petition are virtually undisputed and we
reproduce the same hereunder:
1. Individual respondents are all Port Stewards of Catering SubDepartment, Passenger Services Department of petitioner. Their
duties and responsibilities, among others, are:
Prepares meal orders and checklists, setting up
standard equipment in accordance with the
requirements of the type of service for each flight;
skiing, binning, and inventorying of Commissary
supplies and equipment.
2. On various occasions, several deductions were made from their
salary. The deductions represented losses of inventoried items
charged to them for mishandling of company properties . . . which
respondents resented. Such that on August 21, 1984, individual
respondents, represented by the union, made a formal notice
regarding the deductions to petitioner thru Mr. Reynaldo Abad,
Manager for Catering. . . .

3. As there was no action taken on said representation, private

respondents filed a formal grievance on November 4, 1984 pursuant
to the grievance machinery Step 1 of the Collective Bargaining
Agreement between petitioner and the union. . . . The topics which
the union wanted to be discussed in the said grievance were the
illegal/questionable salary deductions and inventory of bonded
goods and merchandise being done by catering service personnel
which they believed should not be their duty.
4. The said grievance was submitted on November 21, 1984 to the
office of Mr. Reynaldo Abad, Manager for Catering, who at the time
was on vacation leave. . . .
5. Subsequently, the grievants (individual respondents) thru the shop
steward wrote a letter on December 5, 1984 addressed to the office
of Mr. Abad, who was still on leave at the time, that inasmuch as no
reply was made to their grievance which "was duly received by your
secretary" and considering that petitioner had only five days to
resolve the grievance as provided for in the CBA, said grievance as
believed by them (private respondents) was deemed resolved in
their favor. . . .
6. Upon Mr. Abad's return on December 7, 1984, he immediately
informed the grievants and scheduled a meeting on December 12,
1984. . . .
7. Thereafter, the individual respondents refused to conduct
inventory works. Alberto Santos, Jr. did not conduct ramp inventory
on December 7, 10 and 12. Gilbert Antonio did not conduct ramp
inventory on December 10. In like manner, Regino Duran and
Houdiel Magadia did not conduct the same on December 10 and 12.
8. At the grievance meeting which was attended by some union
representatives, Mr. Abad resolved the grievance by denying the
petition of individual respondents and adopted the position that
inventory of bonded goods is part of their duty as catering service
personnel, and as for the salary deductions for losses, he
rationalized:
1. It was only proper that employees are charged
for the amount due to mishandling of company
property which resulted to losses. However, loss
may be cost price 1/10 selling price.
9. As there was no ramp inventory conducted on the mentioned
dates, Mr. Abad, on January 3, 1985 wrote by an inter-office
memorandum addressed to the grievants, individual respondents
herein, for them to explain on (sic) why no disciplinary action should
be taken against them for not conducting ramp inventory. . . .

10. The directive was complied with . . . . The reason for not
conducting ramp inventory was put forth as:

Sec. 2 Processing of Grievances

xxx xxx xxx

4. Since the grievance step 1 was not decided and

no action was done by your office within 5 days
from November 21, 1984, per provision of the
PAL-PALEA CBA, Art. IV, Sec. 2, the grievance is
deemed resolved in PALEA's favor.
11. Going over the explanation, Mr. Abad found the same
unsatisfactory. Thus, a penalty of suspension ranging from 7 days to
30 days were (sic) imposed depending on the number of infractions
committed. *
12. After the penalty of suspension was meted down, PALEA filed
another grievance asking for lifting of, or at least, holding in
abeyance the execution of said penalty. The said grievance was
forthwith denied but the penalty of suspension with respect to
respondent Ramos was modified, such that his suspension which
was originally from January 15, 1985 to April 5, 1985 was shortened
by one month and was lifted on March 5, 1985. The union, however,
made a demand for the reimbursement of the salaries of individual
respondents during the period of their suspension.
13. Petitioner stood pat (o)n the validity of the suspensions. Hence,
a complaint for illegal suspension was filed before the
Arbitration Branch of the Commission, . . . Labor Arbiter Ceferina J.
Diosana, on March 17, 1986, ruled in favor of petitioner by
3
dismissing the complaint. . . .
Private respondents appealed the decision of the labor arbiter to respondent
commission which rendered the aforequoted decision setting aside the labor arbiter's
order of dismissal. Petitioner's motion for reconsideration having been denied, it
interposed the present petition.
The Court is accordingly called upon to resolve the issue of whether or not public
respondent NLRC acted with grave abuse of discretion amounting to lack of jurisdiction
in rendering the aforementioned decision.
Evidently basic and firmly settled is the rule that judicial review by this Court in labor
cases does not go so far as to evaluate the sufficiency of the evidence upon which the
labor officer or office based his or its determination, but is limited to issues of
4
jurisdiction and grave abuse of discretion. It has not been shown that respondent
NLRC has unlawfully neglected the performance of an act which the law specifically
enjoins it to perform as a duty or has otherwise unlawfully excluded petitioner from the
exercise of a right to which it is entitled.
The instant case hinges on the interpretation of Section 2, Article IV of the PAL-PALEA
Collective Bargaining Agreement, (hereinafter, CBA), to wit:

STEP 1 Any employee who believes that he has a justifiable

grievance shall take the matter up with his shop steward. If the shop
steward feels there is justification for taking the matter up with the
Company, he shall record the grievance on the grievance form
heretofore agreed upon by the parties. Two (2) copies of the
grievance form properly filled, accepted, and signed shall then be
presented to and discussed by the shop steward with the division
head. The division head shall answer the grievance within five (5)
days from the date of presentation by inserting his decision on the
grievance form, signing and dating same, and returning one copy to
the shop steward. If the division head fails to act within the five (5)day regl(e)mentary period, the grievance must be resolved in favor
of the aggrieved party. If the division head's decision is not appealed
to Step II, the grievance shall be considered settled on the basis of
the decision made, and shall not be eligible for further
5
appeal. (Emphasis ours.)
Petitioner submits that since the grievance machinery was established for both labor
and management as a vehicle to thresh out whatever problems may arise in the
course of their relationship, every employee is duty bound to present the matter before
management and give the latter an opportunity to impose whatever corrective measure
is possible. Under normal circumstances, an employee should not preempt the
6
resolution of his grievance; rather, he has the duty to observe the status quo.
Citing Section 1, Article IV of the CBA, petitioner further argues that respondent
employees have the obligation, just as management has, to settle all labor disputes
through friendly negotiations. Thus, Section 2 of the CBA should not be narrowly
7
interpreted. Before the prescriptive period of five days begins to run, two concurrent
requirements must be met, i.e., presentment of the grievance and
its discussion between the shop steward and the division head who in this case is Mr.
Abad. Section 2 is not self-executing; the mere filing of the grievance does not trigger
8
the tolling of the prescriptive period.
Petitioner has sorely missed the point.
It is a fact that the sympathy of the Court is on the side of the laboring classes, not only
because the Constitution imposes such sympathy, but because of the one-sided
9
relation between labor and capital. The constitutional mandate for the promotion of
labor is as explicit as it is demanding. The purpose is to place the workingman on an
equal plane with management with all its power and influence in negotiating for
10
the advancement of his interests and the defense of his rights. Under the policy of
social justice, the law bends over backward to accommodate the interests of the
working class on the humane justification that those with less privileges in life should
11
have more privileges in law.

It is clear that the grievance was filed with Mr. Abad's secretary during his
12
absence. Under Section 2 of the CBA aforequoted, the division head shall act on the
grievance within five (5) days from the date of presentation thereof, otherwise "the
grievance must be resolved in favor of the aggrieved party." It is not disputed that the
grievants knew that division head Reynaldo Abad was then "on leave" when they filed
13
their grievance which was received by Abad's secretary. This knowledge, however,
should not prevent the application of the CBA.
On this score, respondent NLRC aptly ruled:
. . . Based on the facts heretofore narrated, division head Reynaldo
Abad had to act on the grievance of complainants within five days
from 21 November 1984. Therefore, when Reynaldo Abad, failed to
act within the reglementary period, complainants, believing in good
faith that the effect of the CBA had already set in, cannot be blamed
if they did not conduct ramp inventory for the days thereafter. In this
regard, respondent PAL argued that Reynaldo Abad was on leave at
the time the grievance was presented. This, however, is of no
moment, for it is hard to believe that everything under Abad's
authority would have to stand still during his absence from office. To
be sure, it is to be expected that someone has to be left to attend to
Abad's duties. Of course, this may be a product of inadvertence on
the part of PAL management, but certainly, complainants should not
14
be made to suffer the consequences.
15

Contrary to petitioner's submission, the grievance of employees is not a matter which

requires the personal act of Mr. Abad and thus could not be delegated. Petitioner could
at least have assigned an officer-in-charge to look into the grievance and possibly
make his recommendation to Mr. Abad. It is of no moment that Mr. Abad immediately
looked into the grievance upon returning to work, for it must be remembered that the
grievants are workingmen who suffered salary deductions and who rely so much on
their meager income for their daily subsistence and survival. Besides, it is noteworthy
that when these employees first presented their complaint on August 21, 1984,
petitioner failed to act on it. It was only after a formal grievance was filed and after Mr.
Abad returned to work on December 7, 1984 that petitioner decided to turn an ear to
their plaints.
As respondent NLRC has pointed out, Abad's failure to act on the matter may have
16
been due to petitioner's inadvertence, but it is clearly too much of an injustice if the
employees be made to bear the dire effects thereof. Much as the latter were willing to
discuss their grievance with their employer, the latter closed the door to this possibility
by not assigning someone else to look into the matter during Abad's absence. Thus,
private respondents should not be faulted for believing that the effects of the CBA in
their favor had already stepped into the controversy.
If the Court were to follow petitioner's line of reasoning, it would be easy for
management to delay the resolution of labor problems, the complaints of the workers
in particular, and hide under the cloak of its officers being "on leave" to avoid being
caught by the 5-day deadline under the CBA. If this should be allowed, the
workingmen will suffer great injustice for they will necessarily be at the mercy of their

employer. That could not have been the intendment of the pertinent provision of the
CBA, much less the benevolent policy underlying our labor laws.
ACCORDINGLY, on the foregoing premises, the instant petition is hereby DENIED and
the assailed decision of respondent National Labor Relations Commission is
AFFIRMED. This judgment is immediately executory.
SO ORDERED.
Narvasa, C.J., Feliciano, Nocon and Campos, Jr., JJ., concur.

Republic of the Philippines

SUPREME COURT
Manila
EN BANC
G.R. No. 81958 June 30, 1988
PHILIPPINE ASSOCIATION OF SERVICE EXPORTERS, INC., petitioner,
vs.
HON. FRANKLIN M. DRILON as Secretary of Labor and Employment, and TOMAS
D. ACHACOSO, as Administrator of the Philippine Overseas Employment
Administration, respondents.
Gutierrez & Alo Law Offices for petitioner.
SARMIENTO, J.:
The petitioner, Philippine Association of Service Exporters, Inc. (PASEI, for short), a
firm "engaged principally in the recruitment of Filipino workers, male and female, for
1
overseas placement," challenges the Constitutional validity of Department Order No.
1, Series of 1988, of the Department of Labor and Employment, in the character of
"GUIDELINES GOVERNING THE TEMPORARY SUSPENSION OF DEPLOYMENT
OF FILIPINO DOMESTIC AND HOUSEHOLD WORKERS," in this petition for certiorari
and prohibition. Specifically, the measure is assailed for "discrimination against males
2
or females;" that it "does not apply to all Filipino workers but only to domestic helpers
3
and females with similar skills;" and that it is violative of the right to travel. It is held
likewise to be an invalid exercise of the lawmaking power, police power being
legislative, and not executive, in character.
In its supplement to the petition, PASEI invokes Section 3, of Article XIII, of the
Constitution, providing for worker participation "in policy and decision-making
4
processes affecting their rights and benefits as may be provided by law." Department
Order No. 1, it is contended, was passed in the absence of prior consultations. It is
claimed, finally, to be in violation of the Charter's non-impairment clause, in addition to
the "great and irreparable injury" that PASEI members face should the Order be further
enforced.
On May 25, 1988, the Solicitor General, on behalf of the respondents Secretary of
Labor and Administrator of the Philippine Overseas Employment Administration, filed a
Comment informing the Court that on March 8, 1988, the respondent Labor Secretary
lifted the deployment ban in the states of Iraq, Jordan, Qatar, Canada, Hongkong,
United States, Italy, Norway, Austria, and Switzerland. * In submitting the validity of the
challenged "guidelines," the Solicitor General invokes the police power of the
Philippine State.
It is admitted that Department Order No. 1 is in the nature of a police power measure.
The only question is whether or not it is valid under the Constitution.
The concept of police power is well-established in this jurisdiction. It has been defined
as the "state authority to enact legislation that may interfere with personal liberty or
5
property in order to promote the general welfare." As defined, it consists of (1) an
imposition of restraint upon liberty or property, (2) in order to foster the common good.

It is not capable of an exact definition but has been, purposely, veiled in general terms
to underscore its all-comprehensive embrace.
"Its scope, ever-expanding to meet the exigencies of the times, even to anticipate the
future where it could be done, provides enough room for an efficient and flexible
6
response to conditions and circumstances thus assuring the greatest benefits."
It finds no specific Constitutional grant for the plain reason that it does not owe its
origin to the Charter. Along with the taxing power and eminent domain, it is inborn in
the very fact of statehood and sovereignty. It is a fundamental attribute of government
that has enabled it to perform the most vital functions of governance. Marshall, to
7
whom the expression has been credited, refers to it succinctly as the plenary power
8
of the State "to govern its citizens."
"The police power of the State ... is a power coextensive with self- protection, and it is
not inaptly termed the "law of overwhelming necessity." It may be said to be that
inherent and plenary power in the State which enables it to prohibit all things hurtful to
9
the comfort, safety, and welfare of society."
It constitutes an implied limitation on the Bill of Rights. According to Fernando, it is
"rooted in the conception that men in organizing the state and imposing upon its
government limitations to safeguard constitutional rights did not intend thereby to
enable an individual citizen or a group of citizens to obstruct unreasonably the
enactment of such salutary measures calculated to ensure communal peace, safety,
10
good order, and welfare." Significantly, the Bill of Rights itself does not purport to be
an absolute guaranty of individual rights and liberties "Even liberty itself, the greatest of
11
all rights, is not unrestricted license to act according to one's will." It is subject to the
far more overriding demands and requirements of the greater number.
Notwithstanding its extensive sweep, police power is not without its own limitations.
For all its awesome consequences, it may not be exercised arbitrarily or unreasonably.
Otherwise, and in that event, it defeats the purpose for which it is exercised, that is, to
advance the public good. Thus, when the power is used to further private interests at
12
the expense of the citizenry, there is a clear misuse of the power.
In the light of the foregoing, the petition must be dismissed.
13

As a general rule, official acts enjoy a presumed vahdity. In the absence of clear and
convincing evidence to the contrary, the presumption logically stands.
The petitioner has shown no satisfactory reason why the contested measure should be
nullified. There is no question that Department Order No. 1 applies only to "female
14
contract workers," but it does not thereby make an undue discrimination between the
15
sexes. It is well-settled that "equality before the law" under the Constitution does not
import a perfect Identity of rights among all men and women. It admits of
classifications, provided that (1) such classifications rest on substantial distinctions; (2)
they are germane to the purposes of the law; (3) they are not confined to existing
16
conditions; and (4) they apply equally to all members of the same class.

The Court is satisfied that the classification made-the preference for female workers
rests on substantial distinctions.

measure, it is possessed of a necessary malleability, depending on the circumstances

of each case. Accordingly, it provides:

As a matter of judicial notice, the Court is well aware of the unhappy plight that has
befallen our female labor force abroad, especially domestic servants, amid exploitative
working conditions marked by, in not a few cases, physical and personal abuse. The
sordid tales of maltreatment suffered by migrant Filipina workers, even rape and
various forms of torture, confirmed by testimonies of returning workers, are compelling
motives for urgent Government action. As precisely the caretaker of Constitutional
rights, the Court is called upon to protect victims of exploitation. In fulfilling that duty,
the Court sustains the Government's efforts.

9. LIFTING OF SUSPENSION. The Secretary of Labor and

Employment (DOLE) may, upon recommendation of the Philippine
Overseas Employment Administration (POEA), lift the suspension in
countries where there are:

The same, however, cannot be said of our male workers. In the first place, there is no
evidence that, except perhaps for isolated instances, our men abroad have been
afflicted with an Identical predicament. The petitioner has proffered no argument that
the Government should act similarly with respect to male workers. The Court, of
course, is not impressing some male chauvinistic notion that men are superior to
women. What the Court is saying is that it was largely a matter of evidence (that
women domestic workers are being ill-treated abroad in massive instances) and not
upon some fanciful or arbitrary yardstick that the Government acted in this case. It is
evidence capable indeed of unquestionable demonstration and evidence this Court
accepts. The Court cannot, however, say the same thing as far as men are concerned.
There is simply no evidence to justify such an inference. Suffice it to state, then, that
insofar as classifications are concerned, this Court is content that distinctions are
borne by the evidence. Discrimination in this case is justified.
As we have furthermore indicated, executive determinations are generally final on the
Court. Under a republican regime, it is the executive branch that enforces policy. For
their part, the courts decide, in the proper cases, whether that policy, or the manner by
which it is implemented, agrees with the Constitution or the laws, but it is not for them
to question its wisdom. As a co-equal body, the judiciary has great respect for
determinations of the Chief Executive or his subalterns, especially when the legislature
itself has specifically given them enough room on how the law should be effectively
enforced. In the case at bar, there is no gainsaying the fact, and the Court will deal
with this at greater length shortly, that Department Order No. 1 implements the rulemaking powers granted by the Labor Code. But what should be noted is the fact that in
spite of such a fiction of finality, the Court is on its own persuaded that prevailing
conditions indeed call for a deployment ban.
There is likewise no doubt that such a classification is germane to the purpose behind
the measure. Unquestionably, it is the avowed objective of Department Order No. 1 to
17
"enhance the protection for Filipino female overseas workers" this Court has no
quarrel that in the midst of the terrible mistreatment Filipina workers have suffered
abroad, a ban on deployment will be for their own good and welfare.
The Order does not narrowly apply to existing conditions. Rather, it is intended to apply
indefinitely so long as those conditions exist. This is clear from the Order itself
("Pending review of the administrative and legal measures, in the Philippines and in
18
the host countries . . ." ), meaning to say that should the authorities arrive at a means
impressed with a greater degree of permanency, the ban shall be lifted. As a stop-gap

1. Bilateral agreements or understanding with the Philippines,

and/or,
2. Existing mechanisms providing for sufficient safeguards to ensure
19
the welfare and protection of Filipino workers.
The Court finds, finally, the impugned guidelines to be applicable to all female
20
domestic overseas workers. That it does not apply to "all Filipina workers" is not an
argument for unconstitutionality. Had the ban been given universal applicability, then it
would have been unreasonable and arbitrary. For obvious reasons, not all of them are
similarly circumstanced. What the Constitution prohibits is the singling out of a select
person or group of persons within an existing class, to the prejudice of such a person
or group or resulting in an unfair advantage to another person or group of persons. To
apply the ban, say exclusively to workers deployed by A, but not to those recruited by
B, would obviously clash with the equal protection clause of the Charter. It would be a
classic case of what Chase refers to as a law that "takes property from A and gives it
21
to B." It would be an unlawful invasion of property rights and freedom of contract and
22
needless to state, an invalid act. (Fernando says: "Where the classification is based
on such distinctions that make a real difference as infancy, sex, and stage of
civilization of minority groups, the better rule, it would seem, is to recognize its validity
only if the young, the women, and the cultural minorities are singled out for favorable
treatment. There would be an element of unreasonableness if on the contrary their
status that calls for the law ministering to their needs is made the basis of
discriminatory legislation against them. If such be the case, it would be difficult to
23
refute the assertion of denial of equal protection." In the case at bar, the assailed
Order clearly accords protection to certain women workers, and not the contrary.)
It is incorrect to say that Department Order No. 1 prescribes a total ban on overseas
deployment. From scattered provisions of the Order, it is evident that such a total ban
has hot been contemplated. We quote:
5. AUTHORIZED DEPLOYMENT-The deployment of domestic
helpers and workers of similar skills defined herein to the following
[sic] are authorized under these guidelines and are exempted from
the suspension.
5.1 Hirings by immediate members of the family of
Heads of State and Government;
5.2 Hirings by Minister, Deputy Minister and the
other senior government officials; and

5.3 Hirings by senior officials of the diplomatic

corps and duly accredited international
organizations.
5.4 Hirings by employers in countries with whom
the Philippines have [sic] bilateral labor
agreements or understanding.

The petitioners's reliance on the Constitutional guaranty of worker participation "in

29
policy and decision-making processes affecting their rights and benefits" is not welltaken. The right granted by this provision, again, must submit to the demands and
necessities of the State's power of regulation.
The Constitution declares that:
Sec. 3. The State shall afford full protection to labor, local and
overseas, organized and unorganized, and promote full employment
30
and equality of employment opportunities for all.

xxx xxx xxx

7. VACATIONING DOMESTIC HELPERS AND WORKERS OF
SIMILAR SKILLS--Vacationing domestic helpers and/or workers of
similar skills shall be allowed to process with the POEA and leave for
worksite only if they are returning to the same employer to finish an
existing or partially served employment contract. Those workers
returning to worksite to serve a new employer shall be covered by
the suspension and the provision of these guidelines.
xxx xxx xxx
9. LIFTING OF SUSPENSION-The Secretary of Labor and
Employment (DOLE) may, upon recommendation of the Philippine
Overseas Employment Administration (POEA), lift the suspension in
countries where there are:
1. Bilateral agreements or understanding with the
Philippines, and/or,
2. Existing mechanisms providing for sufficient
safeguards to ensure the welfare and protection of
24
Filipino workers.
xxx xxx xxx
The consequence the deployment ban has on the right to travel does not impair the
right. The right to travel is subject, among other things, to the requirements of "public
25
safety," "as may be provided by law." Department Order No. 1 is a valid
implementation of the Labor Code, in particular, its basic policy to "afford protection to
26
labor," pursuant to the respondent Department of Labor's rule-making authority
27
vested in it by the Labor Code. The petitioner assumes that it is unreasonable simply
because of its impact on the right to travel, but as we have stated, the right itself is not
absolute. The disputed Order is a valid qualification thereto.
Neither is there merit in the contention that Department Order No. 1 constitutes an
invalid exercise of legislative power. It is true that police power is the domain of the
legislature, but it does not mean that such an authority may not be lawfully delegated.
As we have mentioned, the Labor Code itself vests the Department of Labor and
28
Employment with rulemaking powers in the enforcement whereof.

"Protection to labor" does not signify the promotion of employment alone. What
concerns the Constitution more paramountly is that such an employment be above all,
decent, just, and humane. It is bad enough that the country has to send its sons and
daughters to strange lands because it cannot satisfy their employment needs at home.
Under these circumstances, the Government is duty-bound to insure that our toiling
expatriates have adequate protection, personally and economically, while away from
home. In this case, the Government has evidence, an evidence the petitioner cannot
seriously dispute, of the lack or inadequacy of such protection, and as part of its duty, it
has precisely ordered an indefinite ban on deployment.
The Court finds furthermore that the Government has not indiscriminately made use of
its authority. It is not contested that it has in fact removed the prohibition with respect
to certain countries as manifested by the Solicitor General.
The non-impairment clause of the Constitution, invoked by the petitioner, must yield to
31
the loftier purposes targetted by the Government. Freedom of contract and
enterprise, like all other freedoms, is not free from restrictions, more so in this
jurisdiction, where laissez faire has never been fully accepted as a controlling
economic way of life.
This Court understands the grave implications the questioned Order has on the
business of recruitment. The concern of the Government, however, is not necessarily
to maintain profits of business firms. In the ordinary sequence of events, it is profits
that suffer as a result of Government regulation. The interest of the State is to provide
a decent living to its citizens. The Government has convinced the Court in this case
that this is its intent. We do not find the impugned Order to be tainted with a grave
abuse of discretion to warrant the extraordinary relief prayed for.
WHEREFORE, the petition is DISMISSED. No costs.
SO ORDERED.
Yap, C.J., Fernan, Narvasa, Melencio-Herrera, Cruz, Paras, Feliciano, Gancayco,
Padilla, Bidin, Cortes and Grio-Aquino, JJ., concur.
Gutierrez, Jr. and Medialdea, JJ., are on leave.

Republic of the Philippines

SUPREME COURT
Manila
EN BANC
G.R. No. L-2216
January 31, 1950
DEE C. CHUAN & SONS, INC., petitioner,
vs.
THE COURT OF INDUSTRIAL RELATIONS, CONGRESS OF LABOR
ORGANIZATIONS (CLO), KAISAHAN NG MGA MANGGAGAWA SA KAHOY SA
PILIPINAS and JULIAN LUMANOG AND HIS WORK-CONTRACT
LABORERS, respondents.
Quisumbing, Sycip and Quisumbing for petitioner.
Lazatin and Caballero for respondents.
Arsenio I. Martinez for the Court of Industrial Relations.
TUASON, J.:
Dee C. Chuan & Sons, Inc. assails the validity of an order of the Court of Industrial
Relations. The order made upon petitioner's request for authority to hire" about
twelve(12) more laborers from time to time and on a temporary basis," contains the
proviso that "the majority of the laborers to be employed should be native." The petition
was filed pending settlement by the court of a labor dispute between the petitioner and
Kaisahan Ng Mga Manggagawa sa Kahoy sa Pilipinas.
At the outset, the appellant takes exception to the finding of the court below that Dee
C. Chuan & Sons, Inc. is capitalized with foreign descent. This question has little or no
bearing on the case and may well be passed over except incidentally as a point of
argument in relation to the material issues.
It is next said that "The Court of Industrial Relations cannot intervene in questions of
selection of employees and workers so as to impose unconstitutional restrictions," and
that "The restrictions of the number of aliens that nay be employed in any business,
occupation, trade or profession of any kind, is a denial of the equal protection of the
laws." Although the brief does not name the persons who are supposed to be denied
the equal protection of the laws, it is clearly to be inferred that aliens in general are in
petitioner's mind. certainly, the order does not, directly or indirectly, immediately or
remotely, discriminate against the petitioner on account of race or citizenship. The
order could have been issued in a case in which the employer was a Filipino. As a
matter of fact the petitioner insists that 75 % of its shares of stock are held by
Philippine citizens, a statement which is here assumed to be correct.
But is petitioner entitled to challenge the constitutionality of a law or an order which
does not adversely affect it, in behalf of aliens who are prejudiced thereby? The
answer is not in doubt. An alien may question the constitutionality of a statute (or court
order) only when and so far as it is being, or is about to be, applied to his
disadvantage. (16 C.J.S. 157 et seq.) The prospective employees whom the petitioner
may contemplate employing have not come forward to seek redress; their identity has
not even been revealed. Clearly the petitioner has no case in so far as it strives to
protect the rights of others, much less others who are unknown and undetermined.
U.S. vs. Wong Ku Ark, 169 U.S. 649; Truax vs. Reich, 239 U.S. 39 60 Law ed., 131.,
and other American decisions cited do not support the petitioner for the very simple

reasons that in those cases it was the persons themselves whose rights and
immunities under the constitution were being violated that invoked the protection of the
courts.
The petitioner is within its legitimate sphere of interest when it complains that the
appealed order restrains it in its liberty to engage the men it pleases. This complaint
merits a more detailed examination.
That the employer's right to hire labor is not absolute has to be admitted. "This
privilege of hiring and firing ad libitum is, of course, being subjected to restraints
today." Statutes are cutting in on it. And so does Commonwealth Act No. 103. The
regulations of the hours of labor of employees and of the employment of women and
children are familiar examples of the limitation of the employer's right in this regard.
The petitioner's request for permission to employ additional; laborers is an implicit
recognition of the correctness of the proposition. The power of the legislature to make
regulations is subject only to the condition that they should be affected with public
interest and reasonable under the circumstances. The power may be exercised directly
by the law-making body or delegated by appropriate rules to the courts or
administrative agencies.
We are of the opinion that the order under consideration meets the test of
reasonableness and public interest. The passage of Commonwealth Act No. 103 was
"in conformity with the constitutional objective and . . . the historical fact that industrial
and agricultural disputes have given rise to disquietude, bloodshed and revolution in
our country." (Antamok Goldfields Mining Co. vs. Court of Industrial Relations, 40 Off.
1
Gaz., 8th Supp., 173.) "Commonwealth Act No. 103 has precisely vested the Court of
Industrial Relations with authority to intervene in all disputes between employees or
strikes arising from the difference as regards wages, compensation, and other labor
conditions which it may take cognizance of." (Central Azucarera de Tarlac vs. Court of
2
Industrial Relations, 40 Off. Gaz., 3rd Supp., 319, 324.) Thus it has jurisdiction to
determine the number of men to be laid off during off-seasons. By the same token, the
court may specify that a certain proportion of the additional laborers to be employed
should be Filipinos, if such condition, in the court's opinion, "is necessary or expedient
for the purpose of settling disputes or doing justice to the parties."
The order in question has that specific end in view. In parallel view the court observed:
"Undoubtedly, without the admonition of the Court, nothing could prevent petitioner
from hiring purely alien laborers, and there is no gainsaying the fact that further conflict
or dispute would naturally ensue. To cope with this contingency, and acting within the
powers granted by the organic law, the court, believing in the necessity and
expediency of making patent its desire to avoid probable and possible further
misunderstanding between the parties, issued the order."
We are not prepared to declare that the order is not conducive to the aim pursued. The
question is a practical one depending on facts with which the court is best familiar. The
fact already noted should not be lost sight of that there is a pending strike and
besides, that the employment of temporary laborers was opposed by the striking
employees and was the subject of a protracted hearing.

We can not agree with the petitioner that the order constitutes an unlawful intrusion
into the sphere of legislation, by attempting to lay down a public policy of the state or to
settle a political question. In the first place, we believe, as we have already explained,
that the court's action falls within the legitimate scope of its jurisdiction. In the second
place, the order does not formulate a policy and is not political in character. It is not a
permanent, all-embracing regulation. It is a compromise and emergency measure
applicable only in this case and calculated to bridge a temporary gap and to adjust
conflicting interests in an existing and menacing controversy. The hiring of Chinese
laborers by the petitioner was rightly considered by the court likely to lead the parties
away from the reconciliation which it was the function of the court to effectuate.
As far as the petitioner is concerned, the requirement that majority of the laborers to be
employed should be Filipinos is certain not arbitrary, unreasonable or unjust. The
petitioner's right to employ labor or to make contract with respect thereto is not
unreasonably curtailed and its interest is not jeopardized. We take it that the nationality
of the additional laborers to be taken in is immaterial to the petitioner. In its application
for permission to employ twelve temporary laborers it expressly says that these could
be Filipinos or Chinese. On the face of this statement, assuming the same to be
sincere, the petitioner objection to the condition imposed by the court would appear to
be academic and a trifle.
We should not close without adverting to the fact that the petitioner does not so much
as pretend that the hiring of additional laborers is its prerogative as a matter of right. It
seems to be conceded that during the pendency of the dispute the petitioner could
employ temporary laborers only with the permission of the Court of Industrial
Relations. The granting of the application thus lies within the sound judgment of the
court, and if the court could turn it down entirely, as we think it could, its authority to
quality the permission should be undeniable, provided only that the qualification is not
arbitrary, against law, morals, or established public policy, which it is not; it is an
expedient and emergency step designed to relieve petitioner's own difficulties. Also
important to remember is that it is not compulsory on petitioner's part to take
advantage of the order. Being a permute petitioner is the sole judge of whether it
should take the order as it is, or leave it if it does not suit its interest to hire new
laborers other than Chinese.
The order appealed from is affirmed with costs to this appeal against the petitionerappellant.
Moran, C.J., Pablo, Padilla, and Torres, JJ., concur.

Separate Opinions
OZAETA, J., with whom concur PARAS, MONTEMAYOR, and
REYES, JJ., dissenting:

During the trial of an industrial dispute between the petitioner and the respondent labor
union, the former applied to the Court of Industrial Relations for authority "to hire about
twelve more laborers from time to time and on a temporary basis, to be chosen by the
petitioner from either Filipinos or Chinese." the court granted the authority applied for
but imposed as a condition that the majority of the twelve new laborers to be hired
"should be native and only a nominal percentage thereof alien." In imposing such
condition the court said:
The hiring of laborers who are not native or Filipino should be discouraged, as
it is being discouraged by this court. In these critical moments of
unemployment, any competition of alien and native labor would be destructive
of our Nation that is in the making. By the act of God, this nation is the
Philippines, her soil is the patrimony of the Filipino people, and in this
Philippine soil the Filipino laborers must have priority and preference. No
capitalistic management can violate this written law, unless it wants to court
trouble and conflict. In the hiring, therefore, of laborers, it is the opinion of this
court that management, in employing aliens, should be prudent and cautious
and should, as much as possible, employ only a small percentage thereof
limited to those absolutely necessary and confidential.
The power of the Court of Industrial Relations to impose such condition as to limit the
authority of the employer to hire laborers than Filipinos is challenged by the petitioner.
"The petitioner is within its legitimate sphere of interest when it complains that the
appealed order restrains it in liberty to engage the men it pleases," says the majority
opinion, and we add "regardless of race or nationality." It is true that no alien laborer
who may be adversely affected by the order has been made a party herein. Under the
circumstances of the case he could not be expected to have intervened in the incident
which gave rise to the order complained of. But his intervention is not necessary in
order to determine whether or not the Court of Industrial Relations is empowered by
law to impose the condition above mentioned. If the court has no power to discriminate
against a certain class of laborers on account of their race or nationality, it has no
power to impose the condition in question, and the employer has legitimate right to
complain against such imposition.
The Court of Industrial Relations impliedly admits the nonexistence of any statue
providing that Filipino laborers must be preferred over aliens; but it claims or adopts an
"unwritten law" to that effect and says that "no capitalistic management can violate this
unwritten law, unless it wants to court trouble and conflict." Who made such unwritten
law? Certainly the Congress of the Philippines, the only entity authorized by the
Constitution to make laws, and which does not promulgate unwritten laws, did not do
so. The court, therefore, cannot take cognizance of, and much less apply, such
supposed unwritten law.
It is sheer usurpation of legislative power for the court to enact or make laws. Its power
is confined to interpreting and applying the laws enacted by the legislature.
The case of Truax vs. Reich (600 law. ed., 131), which was decided by the Supreme
Court of the United States on November 1, 1915, is of pertinent and persuasive
application to the question at issue in that, in our opinion, it emphasizes the utter lack
of power of the court to impose the condition here complained of; for in said case

Supreme Court of the United States ruled that the Legislature of the State of Arizona
could not validly enact a law similar to the supposed unwritten law which the Court of
Industrial Relations has conceived and has tried to enforce. The law involved in said
case pertinently reads as follows:
SEC. 1. Any company, corporation, partnership, association or individual who
is, may hereafter become, an employer of more than five (5) workers at any
one time, in the state of Arizona, regardless of kind or class of work, or sex of
workers, shall employ not less than (80) per cent qualified electors or nativeborn citizens of the United States or some subdivision thereof.
SEC. 2. Any company, corporation, partnership, association or individual,
their agent or agents, found guilty of violating any of the provisions of this act
shall be subject to a fine of not less than one hundred ($100) dollars, and
imprisoned for not less than thirty (30) days.
Mike Raich, a native of Austria and an inhabitant of the State of Arizona, but not a
qualified elector, was employed as a cook by William Truax in his restaurant, where he
had nine employees, of whom seven were neither native-born citizens of the United
States nor qualified electors. After the passage of said law Raich was informed by his
employer that because of its requirements and because of the fear of the penalties that
would be incurred in case of its violation, he would be discharged. Thereupon Raich
sued Truax and the Attorney General of Arizona to enjoin them from enforcing the law
on the ground that it was unconstitutional because it denied him the equal protection of
the laws. Both the District Court and the Supreme Court of the United States upheld
his contention. The court said that the complainant was entitled under the Fourteenth
Amendment to the equal protection of the laws of Arizona. "These provisions," said the
court, "are universal in their application, to all person within the territorial jurisdiction,
without regard to any differences of race, of color, or of nationality; and the equal laws.
. . . The discrimination defined by the act does not pertain to the regulation or
distribution of the public domain, or of the common property or resources of the people
of the state, the enjoyment of which may be limited to its citizens as against both aliens
and the citizens of other states." The court said further:
It is sought to justify this act as an exercise of the power of the state to make
reasonable classifications in legislating to promote the health, safety, morals,
and welfare of those within its jurisdiction. But this admitted authority, with the
broad range of legislative discretion that it implies, does not go so far as to
make it possible for the state to deny to lawful inhabitants, because of their
race or nationality, the ordinary means of earning a livelihood. It requires no
argument to show that the right to work for a living in the common
occupations of the community is of the very essence of the personal freedom
and opportunity that it was the purpose of the Amendment to secure. . . . If
this could be refused solely upon the ground of race or nationality, the
prohibition of the denial to any person of the equal protection of the laws
would be a barren form of words. It is no answer to say, as it is argued, that
the act proceeds upon the assumption that 'the employment of aliens, unless
restrained, was a peril to the public welfare. The discrimination against aliens
in the wide range of employments to which the acts relates is made an end in
itself, and thus the authority to deny to aliens, upon the mere fact of their

alienage, the right to obtain support in the ordinary fields of labor, is

necessarily involved.
Our own Constitution contains a provision similar to the Fourteenth Amendment to the
Constitution of the United States. Section 1 of Article III provides:
No person shall be deprived of life, liberty, or property without due process of
law, nor shall any person be denied the equal protection of the laws.
It is patent that if the lawmaking body itself cannot validly enact the supposed unwritten
law conceived or adopted by the lower court, much less could the latter do so.
Section 13 of Commonwealth Act No. 103, invoked by the trial court and by majority of
this court as authorizing the imposition of the discriminatory condition contained in the
order appealed from, reads as follows:
SEC. 13. Character of the award. In making an award, order or decision,
under the provision of section four of this Act, the Court shall not be restricted
to the specific relief claimed or demands made by the parties to the industrial
or agricultural dispute, but may include in the award, order or decision any
matter or determination which may be deemed necessary or expedient for the
purpose of setting the dispute or of preventing further industrial or agricultural
dispute.
As correctly stated by Judge Lanting of the lower court in his dissenting opinion:
The reference in the resolution of the majority to section 13 of Commonwealth
Act No. 103, authorizing this Court to include in its awards, orders or
decisions "any matter or determination which may be deemed necessary or
expedient for the purpose of setting the dispute or of preventing further . . .
disputes", is farfetched. This provision certainly does not authorize this Court
to go beyond its prescribed powers and issue an order which grossly violates
the fundamental law. More specifically, it cannot make any ruling which will
produce the effect of discriminating against and oppressing a person or class
of persons and deny them the equal protection of the laws, aside from
curtailing their individual freedom and their right to live.
As matter of fact the respondent labor union "manifested its conformity to the hiring of
additional laborers, provided that it be consulted by the petitioner and that it be given
the privilege of recommending the twelve new laborers that are to be hired." And
Judge Roldan in his order overruled that proposition by saying : "The stand taken by
the respondent labor union is not correct, because it attempts to encroach upon the
prerogative of the company to determine and adopt its own policy in the selection of its
employees and workers, and the Court should only intervene in questions of this
nature when there is discrimination or retaliation on the part of the company, which has
not been proven or even alleged in the case bar (Manila Trading & Supply
1
Co. vs. Judge Francisco Zulueta et al., G. R. No. 46853; Manila Chauffeurs
2
League vs. Bachrach Motor Co., G. R. No. 49138; Pampanga Bus Co. vs. Pampanga

Bus Co. Employees' Union, G. R. No. 46739; National Labor Union vs. San Miguel
Brewery, CIR case No. 26-V, June 12, 1947)."
Thus the Court of Industrial Relations itself correctly held that the respondent labor
union has no right to encroach upon the prerogative of the company to determine and
adopt its own policy in the selection of its employees and workers, and that the court
itself should not intervene in such selection because there was no proof of
discrimination or retaliation on the part of the company. Yet in the dispositive part of its
order the court not only intervenes in such selection but compels the company to
discriminate against a certain class of laborers. The inconsistency and illegality of the
order appealed from are too patent fro argument.
To hold that the Court of Industrial Relations may, under section 13, impose any
condition in its order or award in order to prevent further industrial disputes, regardless
of whether or not such condition is in violation of law or of the Constitution, is, in our
opinion, thinkable. It goes without saying that industrial dispute must be settled in
accordance with law and justice. Suppose that the members of a labor union should
demand of an employer that 80 per cent of the new laborers the latter may hire should
be Filipinos, or that all of them should be Tagalogs or Ilocanos, and should threaten to
declare a strike unless such demand be complied with; would the court be justified in
granting such demand under section 13 on the ground that by doing so it would
prevent a or strike or lockout and settle an industrial dispute? The negative answer can
hardly be disputed, since unreasonableness or illegal demands should not be
countenanced by the court. Yet the affirmance by this Court of the order appealed from
in effect authorizes the Court of Industrial Relations hereafter to commit such
arbitrariness.
For the foregoing reasons, we vote to modify the appealed order by eliminating
therefrom the discriminatory condition in question.