GR 109583; (September, 1997) (Digest)
G.R. No. 109583 September 5, 1997
TRANS ACTION OVERSEAS CORPORATION, petitioner, vs. THE HONORABLE SECRETARY OF LABOR, et al., respondents.
FACTS
Petitioner Trans Action Overseas Corporation, a licensed private employment agency, recruited private respondents for jobs in Hong Kong. The applicants paid substantial placement fees to the agency’s employees but were never deployed. Their demands for refund were ignored, prompting them to file complaints for illegal recruitment and violations of the Labor Code. Petitioner denied liability, arguing that the employees who collected the fees, Luzviminda Aragon and the spouses Domincil, were not authorized to do so. The Labor Undersecretary found petitioner liable, ordering it to refund the fees and cancel its license based on multiple violations of Articles 32 and 34(a) of the Labor Code, applying the POEA’s Schedule of Penalties. Petitioner moved for reconsideration, contesting the jurisdiction of the Secretary of Labor to cancel its license.
ISSUE
The primary issue is whether the Secretary of Labor has jurisdiction to cancel or revoke the license of a private fee-charging employment agency.
RULING
The Supreme Court ruled affirmatively, dismissing the petition. The legal logic is anchored on a concurrent jurisdiction framework. The Court clarified that the power to suspend or cancel a license for overseas recruitment is vested concurrently in the Philippine Overseas Employment Administration (POEA) and the Secretary of Labor. This interpretation is derived from Article 35 of the Labor Code, which explicitly grants the Secretary of Labor the authority to suspend or cancel any license or authority upon violation of recruitment rules. The Court rejected petitioner’s theory that the creation of the POEA via executive orders divested the Secretary of this power. Instead, it held that the POEA’s charter and the Labor Code provisions must be harmonized, recognizing the Secretary’s overarching administrative authority over all recruitment agencies, whether for local or overseas employment. The penalty of cancellation was thus validly imposed by the Secretary. The Court also dismissed petitioner’s ancillary argument that the POEA Schedule of Penalties was invalid for non-registration with the U.P. Law Center, noting that the cancellation was based directly on the Labor Code’s substantive provisions, not merely on the administrative schedule. The decision underscores the Secretary of Labor’s plenary power to regulate and discipline recruitment agencies to protect overseas workers.