G.R. No.

88538 April 25, 1990

ABOITIZ SHIPPING CORPORATION, petitioner,

vs.
HON. DIONISIO C. DELA SERNA, IN HIS CAPACITY AS UNDERSECRETARY OF LABOR AND
EMPLOYMENT; HON. LUNA C. PIEZAS IN HIS CAPACITY AS DIRECTOR, NATIONAL CAPITAL
REGION, DEPARTMENT OF LABOR AND EMPLOYMENT; and, ABOITIZ SHIPPING
EMPLOYEES ASSOCIATION, respondents.

Alejandro B. Cinco for petitioner.

Rogelio B. De Guzman for private respondent.

PADILLA, J.:

The principal issue in this special civil action for certiorari is whether the respondent Regional
Director, National Capital Region, Department of Labor and Employment (Regional Director, for
short) correctly assumed jurisdiction over the money claims filed with him by the complainants
(members of herein private respondent).

Assailed specifically in this petition is the Order dated 9 February 1989 of the respondent
Undersecretary of Labor and Employment affirming the Order dated 13 October 1988 of the
Regional Director, ordering petitioner company to pay the seven hundred seventeen (717)
complainants a total amount of P1,350,828.00., orP1,884.00 each, representing underpayment of an
allowance of P2.00 per day, reckoned from 16 February 1982 to 15 February 1985.

The facts of the case, as found by respondent Undersecretary, are as follows:

. . . a complaint was filed by the Aboitiz Shipping Employees Association against Aboitiz
Shipping Corporation for non-compliance of the mandated minimum wage rates and
allowances pursuant to P.D. Nos. 1713, 1751, Wage Order Nos. 1, 2, 3, 4, 5 and 6.
Accordingly, the Labor Regulation Officers of the Regional Office a quo inspected the
respondent's employment records.

On the other hand, the respondent filed a Motion to Dismiss contending that the
complainant-union has no legal capacity to sue because a representation issue is still
pending with Med-Arbiter Edgardo Cruz in LRD CASE NO. M-001-85.

Series of hearings were conducted whereby the Office a quo repeatedly directed the
respondent to present and submit all its pertinent papers/employment records covered by
the investigation. However, on several occasions, the respondent failed to appear. Likewise,
despite repeated notices, the respondent failed to present any of the documents due for
inspection evidencing correct payments of salaries and allowances.

On December 28, 1987, the hearing officer submitted his report and recommended for the
payment to the union's members amounting to an aggregate sum of P16,200,877.47.
On January 20, 1988, the Office a quo formally issued subpoena duces tecum, requiring the
presentation by the respondent of its employees' payrolls and vouchers covering the period
from February 16, 1982 to December 31, 1985. This, the respondent ignored. In lieu thereof,
it filed a second Motion to Dismiss alleging that on July 24, 1986, the parties entered into a
compromise agreement whereby they agreed that all cases filed against and by respondent
would be dropped and/or dismissed, including the above entitled case; that pursuant to and
by virtue of the compromise agreement, cases filed against the Aboitiz Shipping Corporation
and its officers were dropped and/or withdrawn and/or dismissed; and that similarly, cases
filed by Aboitiz Shipping Corporation and its officers against the union and its officers were
dropped, withdrawn and/or dismissed.

In the subsequent hearing of February 16, 1988 however, the parties agreed that on March
4, 1988, the respondent shall submit to the Office a quo the required payrolls/vouchers for
wages and salaries covering the period from February 16, 1982 to December 31, 1985. On
that date, the respondent again failed to make good its commitment. Nevertheless, it agreed
to submit the payrolls of its Manila-based employees for the period from January 1982 to
December 1982. Together with the submission of the photocopies of the payrolls of the
Manila-based employees, the respondent also filed a Manifestation of Compliance stating
that the following should be taken into consideration:

Annex 1. Which is a BWF/ISM Form No. 5 an advance notice dated October 1987 issued by
the DOLE Regional Office No. 7 notifying respondent of their intent to check payrolls etc. . . .

Annex 2. Which is the notice of inspection results no. 05598 dated October 23, 1987 stating
that the respondent (company-wide payrolls, etc.) has no violation insofar as wages,
salaries, etc. are concerned as well as the benefits. Its indicated in the CBA. . . .

Annex 3. Which is the certification of the ASEA Union President based in Cebu City and the
Union Vice President that company records inspected coveting the period 1984-1987 were
true correct and in order, and in compliance with the Labor and Standard Laws;

Annex 4. Which is the existing CBA between the respondent and complainant ASEA
employees Union;

Annex 5. Which is the letter of Bureau of Working Conditions dated July 17, 1987 signed by
Director Augusto Sanchez sustaining and validating respondent's use of 314 as divisor in the
computation of wages and COLA for land based employees of respondent.

Again, on July 5, 1988, the respondent filed a supplemental Motion to Dismiss, questioning
this time the jurisdiction of the Office a quo. The motion alleged that ". . . considering the
complaint involves money claims, the original and exclusive jurisdiction rests not before the
Honorable Director but before the labor Arbiter . . ."

xxx xxx xxx

Another hearing was conducted on August 17, 1988, whereby the respondent was required
to submit its payrolls for the year 1984. The respondent manifested however, that its Motion
to Dismiss be resolved first by the Office a quo. Further, the respondent averred that the
payroll for 1984 need not be submitted, and thus moved for the resolution of this case based
on the available records and motions submitted. 1
Subsequently, respondent Regional Director issued the now assailed Order dated 13 October 1988,
the dispositive portion of which reads:

WHEREFORE, premises considered, the Aboitiz Shipping Corporation is hereby Ordered to

pay the herein listed complainants the total amount of ONE MILLION THREE HUNDRED
FIFTY THOUSAND EIGHT HUNDRED TWENTY EIGHT and 00/100 PESOS
(P1,350,828.00.) representing underpayment of daily allowance of TWO (P2.00) PESOS per
day reckoned from 16 February 1982 to 15 February 1985.

FURTHER, the Aboitiz Shipping Corporation is hereby Ordered to pay each and every one of
its employees the deficiency in allowance of two (P2.00) PESOS per day from 16 February
1985 onward until this Order is fully complied with.2

On appeal to the Office of the Secretary of Labor and Employment, in which petitioner questioned,
among others, the jurisdiction of respondent Regional Director over the instant claims, respondent
Undersecretary issued the Order dated 9 February 1989 dismissing petitioner's appeal and affirming
the Order dated 13 October 1988 of the respondent Director. The motion for reconsideration of the
order dated 9 February 1989 having been denied by respondent Undersecretary in the Order dated
2 June 1989, petitioner interposed this present petition.

Petitioner contends that it is the Labor Arbiter, not the Regional Director who has jurisdiction over
money claims, citing Article 217 of the Labor Code, and invoking this Court's ruling in Zambales
Base Metals, Inc. vs. Minister of Labor. 3

We rule against petitioner's contention.

Pertinent to the issue at bar are Articles 129 and 217 of the Labor Code, as amended by Sections 2
and 9 of Republic Act 6715 approved on 2 March 1989 which read as follows:

Article 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 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 of househelper do not exceed five thousand pesos (P5,000.00). The Regional
Director hearing officer shall decide to resolve the complaint within thirty (30) calendar days
from the date of the filing of the same. Any sum thus recovered on behalf of any employee or
househelper pursuant to this Article shall be held in a special deposit account, and shall be
paid, on order of the Secretary of Labor and Employment or the Regional Director directly to
the employee or househelper concerned. Any such sum not paid to the employee or
househelper, because he cannot be located after diligent and reasonable effort to locate him
within a period of three (3) years, shall be held as a special fund of the Department of Labor
and Employment to be used exclusively for the amelioration and benefit of workers.

Any decision or resolution of the Regional Director or hearing officer pursuant to this
provision may be appealed on the same grounds provided in Article 223 of this Code, within
five (5) calendar days from receipt of a copy of said decision or resolution, to the National
Labor Relations Commission which shall resolve the appeal within ten (10) calendar days
from the submission of the last pleading required or allowed under its rules.
 The Secretary of Labor and Employment or his duly authorized representative may
supervise the payment of unpaid wages and other monetary claims and benefits, including
legal interest, found owing to any employee or househelper under this Code.

xxx xxx xxx

Art. 217. Jurisdiction of Labor Arbiters and the Commission. (a) Except as otherwise
provided under this Code, the Labor Arbiters shall have original and exclusive jurisdiction to
hear and decide, within thirty (30) calendar days after the submission of the case by the
parties for decision without extension, even in the absence of stenographic notes, the
following cases involving all workers, whether agricultural or non-agricultural:

(1) Unfair labor practice cases;

(2) Termination disputes;

(3) If accompanied with a claim for reinstatement, those cases that workers may file
involving wages, rates of pay, hours of work and other terms and conditions of
employment;

(4) Claims for actual, moral, exemplary and other forms of damages arising from the
employer-employee relations;

(5) Cases arising from any violation of Article 264 of this Code, including questions
involving the legality of strikes and lockouts; and

(6) Except claims for employees compensation, social security, medicare and
maternity benefits, all other claims arising from employer-employee relations,
including those of persons in domestic or household service, involving an amount
exceeding five thousand pesos (P5,000.00) whether or not accompanies with a claim
for reinstatement.

(b) The Commission shall have exclusive appellate jurisdiction over all cases decided
by Labor Arbiters.

(c) Cases arising from the interpretation or implementation of collective bargaining

agreements and those arising from the interpretation or enforcement of company
personnel policies shall be disposed of by the Labor Arbiter by referring the same to
the grievance machinery and voluntary arbitration as may be provided in said
agreements.

It should be pointed out that, following the ruling in Briad Agro vs. Dela Cerna, and L.M. Camus
Engineering vs.Secretary of Labor, the above-cited amendments, being curative in nature, have
4

retroactive effect and, thus, find application in the instant case.

Under the foregoing provisions of Articles 129 and 217 of the Labor Code, as amended, the
Regional Director is empowered, through summary proceeding and after due notice, to hear and
decide cases involving recovery of wages and other monetary claims and benefits, including legal
interest, provided the following requisites are present, to wit:
5
 1) the claim is presented by an employee or person employed in domestic or household
service, or househelper;

2) the claim arises from employer-employee relations;

3) the claimant does not seek reinstatement; and

4) the aggregate money claim of each employee or househelper does not exceed P5,000.00
(Art. 129, Labor Code, as amended by R.A. 6715).

In the absence of any of the requisites above enumerated, it is the Labor Arbiter who shall have
exclusive original jurisdiction over claims arising from employer-employee relations, except claims
for employees' compensation, social security, medicare and maternity benefits, all these pursuant to
Article 217 of the Labor Code, particularly paragraph six (6) thereof.

This power of the Regional Directors qualified under R.A. 6715 is recognized in the modificatory
resolution dated 9 November 1989 in said Briad Agro vs. Dela Cerna which modified the earlier
decision therein dated 29 June 1989. 6

In view of the enactment of R.A. 6715, and the modificatory resolution in the Briad Agro case, the
ruling inZambales Base Metals, Inc. vs. Minister of Labor, supra, is no longer applicable.

In the case at bar, it is noted that in the Order dated 13 October 1988 of the Regional Director, the
latter foundeach of the seven hundred seventeen (717) complainants entitled to a uniform amount of
P1,884.00. (Rollo, pp. 11 7-131,). All the other requisites for the exercise of the power of the
Regional Director under Article 129 of the Labor Code, as amended by R.A. 6715, are present. It
follows that the respondent Regional Director properly took cognizance of the claims, subject of this
petition.

To the petitioner's contention that it was denied due process of law as it was not afforded time and
opportunity to present its evidence, the records show that on several occasions despite due notice,
petitioner failed to either appear at the scheduled hearings, or to present its employees' payrolls and
vouchers for wages and salaries, particularly, those covering the period from 16 February 1982 to 31
December 1985. Therefore, petitioner was not denied due process of law.

We also do not agree with the petitioner's allegation that it was improper for the respondent Regional
Director to order in the questioned Order dated 13 October 1988, compliance with P.D. 1678 as the
7

issue on the said decree was never raised by private respondent in its complaint filed before the
Regional Director. While it may be true that P.D. 1678 is not one of the laws where non-compliance
therewith was complained of, still, the Regional Director correctly acted in ordering petitioner to
comply therewith, as he (Regional Director) has such power under his visitorial and enforcement
authority provided under Article 128(a) of the Labor Code, which provides:

Art. 128. Visitorial and enforcement power. (a) The Secretary of Labor or his duly
authorized representatives, including labor regulation officers, 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
which may aid in the enforcement of this Code and of any labor law, wage order or rules and
regulations issued pursuant thereto.
Petitioner also claims that the complaint filed against it should have been dismissed outright,
considering the compromise agreement dated 24 July 1986, which purportedly contains the
agreement of the parties therein to dismiss the cases filed by one against the other. 8

We find no merit in said contention, in the light of the Regional Director's finding that the said
agreement can not bind the complainant-union vis-a-vis the instant claims, for the reason that it was
entered into by one Mr. Elizardo Manuel in his personal capacity, one Luis M. Moro, Jr. representing
9

Aboitiz Shipping Corporation, and Atty. Luis D. Flores in his capacity as legal counsel of ASEA-
CLO, which finding is supported by the records of the case before us. Such records show that the
10

compromise agreement primarily binds only the said Mr. Manuel, and that, therefore, it has nothing
to do with the rest of the other complainant-union members. The said agreement reads:
1wphi1
11

COMPROMISE AGREEMENT

This Agreement, entered into by and among Mr. ELIZARDO MANUEL in his personal capacity, LUIS
M. MORO, JR. representing Aboitiz Shipping Corporation and Atty. LUIS D. FLORES in his capacity
as Legal Counsel of ASEA-CLO.

Based on a compromise agreement Mr. Elizardo Manuel is requesting Aboitiz Shipping Corporation
for payment of P70,000.00 in full settlement of all monetary claims for back wages and benefits he
has, including the settlement decided by the NLRC which presently is under appeal.

For and in consideration of the above stated amount Mr. Elizardo Manuel and Aboitiz Shipping
Corporation mutually agree that:

Mr. Elizardo Manuel is deemed resigned from Aboitiz Shipping Corporation upon
payment of the above stated amount;

xxx xxx xxx

Aboitiz Shipping Corporation will furnish Mr. E. Manuel a certificate of good moral
character;

All pending cases as attested by our Legal Counsel that are related on filed by E.
Manuel against the Officers of Aboitiz Shipping Corporation and Aboitiz Shipping
Corporation itself will be immediately dropped;

Aboitiz Shipping Corporation also agrees to drop all pending cases related to and
filed against Mr. E. Manuel and Officers of the Union.

Done this 24th day of July, 1986 in Metro Manila, Philippines.

(SGD) (SGD)
ELIZARDO MANUEL LUIS M. MORO, JR.

(SGD)
ATTY. LUIS D, FLORES

Considering the terms of the said compromise agreement, we rule that said Mr. Manuel shall be
excluded from the list of complainants who shall receive money awards from the petitioner.
Finally, petitioner Avers: that the award of P1,350,828.00. is without factual and legal basis; that
petitioner did not commit any labor standards violation pursuant to the DOLE inspection results and
the union certification to that effect; and that 291 of the 717 complainants are non-employees of
petitioner, and that the other 136 of the said 717 commenced employment only after February 1982.
hence, not entitled to receive money awards. The foregoing contentions being evidentiary in nature,
we have to respect the factual findings of public respondents regarding the above-cited petitioner's
averments, the long-settled rule being that factual findings of labor officials are, generally, conclusive
and binding on this Court when supported by substantial evidence. 12

WHEREFORE, the assailed Order dated 9 February 1989 of the respondent Undersecretary of
Labor and Employment affirming the Order dated 13 October 1988 of the Regional Director is
hereby AFFIRMED, with the modification that Mr. Elizardo Manuel shall be excluded from the list of
complainants at bar who are entitled to money awards of P1,884.00. each. Petition is DISMISSED.

SO ORDERED.

Melencio-Herrera, Paras, Sarmiento and Regalado, JJ., concur.