GR 161794; (June, 2009) (Digest)
G.R. No. 161794 ; June 16, 2009
NESTOR J. BALLADARES, et al., Petitioners, vs. PEAK VENTURES CORPORATION/EL TIGRE SECURITY AND INVESTIGATION AGENCY and YANGCO MARKET OWNERS ASSOCIATION/LAO TI SIOK BEE, Respondents.
FACTS
Petitioners, security guards employed by respondent Peak Ventures Corporation and assigned to respondent Yangco Market Owners Association (YMOAA), filed a complaint for underpayment of wages with the Department of Labor and Employment (DOLE). A DOLE inspection revealed violations, including underpayment and absence of employment records. A Notice of Inspection Result was issued, but Peak Ventures failed to correct the violations or contest the findings. The Regional Director subsequently ruled in favor of petitioners, ordering Peak Ventures and YMOAA to pay jointly and severally a total award exceeding one million pesos. Peak Ventures’ appeals to the Secretary of Labor were denied.
Peak Ventures then elevated the case to the Court of Appeals (CA). The CA granted the petition, setting aside the DOLE orders. It ruled that the Regional Director had no jurisdiction because each petitioner’s claim exceeded Five Thousand Pesos (P5,000.00). The CA held that such claims fall under the exclusive original jurisdiction of the Labor Arbiter pursuant to Article 129 of the Labor Code and the ruling in Servando’s, Inc. v. Secretary of Labor. The case was referred to the appropriate Labor Arbiter.
ISSUE
Whether the Court of Appeals erred in ruling that the DOLE Regional Director had no jurisdiction over the money claims of the petitioners.
RULING
Yes, the Court of Appeals erred. The Supreme Court reversed the CA decision and reinstated the orders of the DOLE Secretary. The pivotal legal logic hinges on the distinction between the visitorial and enforcement powers of the DOLE Secretary under Article 128 of the Labor Code and the adjudicatory power under Article 129.
The Court clarified that the jurisdictional limit of Five Thousand Pesos (P5,000.00) per employee under Article 129 applies only when the Regional Director exercises adjudicatory functions upon a filed complaint. However, in this case, the DOLE’s action originated from its visitorial and enforcement powers under Article 128(b). This power is triggered by the Secretary’s own initiative or by a worker’s complaint, authorizing the issuance of compliance orders to rectify violations discovered during an inspection. The employer’s failure to contest the findings within the prescribed period renders the order final and executory. The Court abandoned the contrary doctrine in Servando’s and established that the P5,000.00 threshold does not apply to cases arising from the DOLE’s exercise of its enforcement powers under Article 128. Since the proceedings commenced from a routine inspection and the employer waived its right to dispute the findings, the Regional Director validly exercised jurisdiction, and the monetary award, regardless of amount, stands.