G.R. No. 112323 July 28, 1997
HELPMATE, INC., petitioner, vs. NATIONAL LABOR RELATIONS COMMISSION (Fourth Division), FELIPE CABARON, EMILIANO M. BELEÑA, JR., RAYMUNDO CAÑAZARES, HONORIO VIRTUCIO, EMMA ESPINA, ROSARIO TIZON, JR., RENATO DABUAYAN, ROMULO MATILOS, RONELO BELEÑA, RENO GUALEN, HOMER DATANAGAN, ROMMEL ENCENZO, GERONIMO ONDONG, HORACE ANGANA, TEOFILO EMNACEN, ALFREDO PACAÑA, DOMINGO MARAÑAN, NERIO C. ONDONG, and MARIO NUÑEZ, respondents.

FACTS

Petitioner Helpmate, Inc. is a corporation rendering janitorial and similar services to clients, including the Bureau of Internal Revenue (BIR). Private respondents are janitors and messengers employed by Helpmate. On March 24, 1986, private respondents filed a complaint against Helpmate for illegal dismissal and payment of various monetary claims. The Labor Arbiter initially ruled in favor of the private respondents. On appeal, the NLRC set aside the decision and remanded the case to the labor arbiter for further proceedings to determine factual issues, including the authenticity of release and quitclaim documents and the potential liability of the BIR as principal. Helpmate moved to implead the BIR as a third-party respondent, arguing that under Wage Orders and the Labor Code, the principal (BIR) should be liable for the payment of wage and allowance increases. The BIR opposed, stating it was merely a client. On remand, the Labor Arbiter ordered Helpmate to pay the money claims of Felipe Cabaron and Homer Datanagan, and ordered Helpmate to pay solidarily with the BIR the claims of several other private respondents. The NLRC affirmed this decision in toto. Helpmate filed this petition for certiorari, raising several issues.

ISSUE

1. Whether the NLRC committed grave abuse of discretion in granting the money claim of respondent Homer Datanagan despite no award being made in his favor in the initial Labor Arbiter decision.
2. Whether petitioner was denied procedural due process.
3. Whether the NLRC erred in granting separation pay to Cabaron and fixing it at one month per year of service.
4. Whether the NLRC awarded amounts more than what private respondents sought.
5. Whether the NLRC erred in holding the BIR only solidarily liable with petitioner instead of solely liable as the principal.

RULING

The Supreme Court found the petition without merit and dismissed it, affirming the NLRC decision.
1. On Datanagan’s claim: The Court held that when the NLRC set aside the initial Labor Arbiter decision, it was set aside in its entirety, including any denial of claims. The remand for determination of factual issues meant all issues could be considered, not just those favorable to the petitioner.
2. On due process: The Court held the essence of due process in administrative proceedings is the opportunity to be heard and to submit evidence. Petitioner was given this opportunity through position papers and documentary evidence. Its failure to present evidence to controvert the claim of illegal dismissal justified the finding that the dismissal was unjustified.
3. On separation pay for Cabaron: The Court found no error. The Labor Arbiter’s decision, which awarded separation pay, was based on the finding that Cabaron was illegally dismissed. This finding was not appealed by Helpmate and thus became final. The NLRC correctly affirmed the award.
4. On the amounts awarded: The Court found that the awards were based on the computation by the Corporate Auditing Examiner as directed in the Labor Arbiter’s decision. There was no showing that the amounts exceeded what was prayed for in the complaint.
5. On the liability of the BIR: The Court, citing Eagle Security Agency, Inc. v. NLRC, held that under the Labor Code (Articles 106, 107, 109) and the relevant Wage Orders, the principal (BIR) is solidarily liable with the contractor (Helpmate) for the wage and allowance increases mandated by law. The contractor’s immediate recourse is to its direct employer, but ultimate liability rests with the principal. The NLRC did not err in holding them solidarily liable.