G.R. No. 164141 ; February 26, 2010
TIGER CONSTRUCTION AND DEVELOPMENT CORPORATION, Petitioner, vs. REYNALDO ABAY, et al., Respondents.

FACTS

Respondents, employees of petitioner Tiger Construction and Development Corporation (TCDC), filed a complaint for labor standards violations with the Department of Labor and Employment (DOLE) Regional Office No. V. After inspection, DOLE found violations including wage underpayments and non-payment of benefits. Initially, Regional Director Ma. Glenda A. Manalo issued an Order dated July 25, 2002, referring the case to the National Labor Relations Commission (NLRC) on the mistaken belief that the aggregate claims exceeded her jurisdictional limit of ₱5,000. However, DOLE Secretary Patricia A. Sto. Tomas issued another inspection authority, and after a subsequent investigation and summary hearing, Director Manalo issued an Order dated September 30, 2002, directing TCDC to pay ₱2,123,235.90 to its employees. TCDC filed a Motion for Reconsideration, arguing that the July 25, 2002 Order deprived Director Manalo of jurisdiction. Initially convinced, Director Manalo endorsed the case to the NLRC, but the NLRC returned the records, stating it lacked jurisdiction. Director Manalo then issued an Order dated January 29, 2003, denying TCDC’s motion. TCDC failed to appeal within the reglementary period, and a Writ of Execution was issued. While execution was pending, TCDC filed a belated appeal to the DOLE Secretary, which was denied. TCDC then filed a petition for certiorari with the Court of Appeals (CA), but it was dismissed due to a defective certification against forum shopping. The CA denied reconsideration, finding the submitted board resolution authorizing the signatory was an afterthought. TCDC elevated the case to the Supreme Court via a Petition for Review on Certiorari.

ISSUE

Whether petitioner can still assail the January 29, 2003 Order of Director Manalo on the ground of lack of jurisdiction after it has attained finality and is in the execution stage.

RULING

The Supreme Court denied the petition, ruling that Director Manalo acted within her jurisdiction. Under Article 128(b) of the Labor Code, as amended by Republic Act No. 7730 , the DOLE Secretary and regional directors have jurisdiction over labor standards violations discovered during inspections, regardless of the amount claimed. The initial referral to the NLRC was an error but did not divest Director Manalo of jurisdiction. Jurisdiction is conferred by law, not by the parties’ actions. The endorsement was a mere referral, not a final dismissal, and the case was properly returned to her. Procedural lapses in labor cases may be disregarded in the interest of substantial justice, and petitioner participated fully in the proceedings. The Court also doubted petitioner’s good faith, as it raised the jurisdictional issue only to delay execution after failing to timely appeal. Thus, the assailed Order, having attained finality, must be upheld.