G.R. No. 82805 and G.R. No. 83225 November 9, 1989
Briad Agro Development Corporation, petitioner, vs. Honorable Dionisio Dela Cerna, in his capacity as Undersecretary of the Department of Labor and Employment, et al., respondents. L.M. Camus Engineering Corporation, petitioner, vs. The Hon. Secretary of Labor, et al., respondents.

FACTS

These consolidated cases involve the jurisdiction over money claims of employees. In G.R. No. 82805 , the Court initially dismissed the petition, upholding the jurisdiction of the Regional Director under Executive Order No. 111. This Executive Order amended the Labor Code, granting the Secretary of Labor and Regional Directors the power to order compliance with labor standards provisions, which the Court interpreted as creating concurrent jurisdiction with Labor Arbiters over certain money claims, despite the exclusive jurisdiction seemingly granted to Labor Arbiters under Article 217.
The petitioners filed a motion for reconsideration. During the pendency of this motion, Republic Act No. 6715 was enacted, which further amended the Labor Code’s provisions on jurisdiction. This new law prompted the Court to reconsider its initial decision, as it explicitly delineated the jurisdictional boundaries between Labor Arbiters and Regional Directors.

ISSUE

The core issue is whether the Regional Director or the Labor Arbiter has jurisdiction over the employees’ money claims, in light of the enactment of Republic Act No. 6715 .

RULING

The Court granted the motion for reconsideration and set aside its prior decision. Republic Act No. 6715 clarified the jurisdictional landscape. The ruling establishes a clear test for determining jurisdiction over money claims arising from employer-employee relations. The Labor Arbiter retains exclusive original jurisdiction over all such claims, except for specific instances falling under the Regional Director’s authority.
The Regional Director has exclusive original jurisdiction only if three requisites concur: (1) the claim is presented by an employee or househelper; (2) the claimant is no longer employed and does not seek reinstatement; and (3) the aggregate money claim does not exceed Five Thousand Pesos (P5,000.00). If any of these conditions is absent—for instance, if the claim exceeds P5,000.00 or if reinstatement is sought—the case falls under the exclusive original jurisdiction of the Labor Arbiter.
Furthermore, the Court clarified the Regional Director’s visitorial and enforcement powers under Article 128. He may still order inspections and enforce labor standards compliance. However, if during the exercise of these powers the employer contests the findings and raises substantive issues requiring evidentiary determination beyond a simple inspection, the case must be referred to the Labor Arbiter for adjudication. The law aims to provide efficient redress while respecting due process, ensuring that complex disputes requiring a trial-type hearing are properly elevated to the Labor Arbiter.