G.R. No. 982767 February 15, 1995
COCOFED (Kalamansig) and/or CRISPIN ROSETE, petitioner, vs. HON. CRESENCIANO B. TRAJANO, Undersecretary of the Department of Labor and Employment and HON. MELENCIO Q. BALANAG, Director IV, DOLE, Regional XII, Cotabato City, respondents.

FACTS

The Department of Labor and Employment (DOLE) conducted a complaint inspection at petitioner COCOFED’s coconut plantation in Kalamansig, Sultan Kudarat, following complaints from employees Alex Edicto and Delia Pahuwayan. The inspection found petitioner guilty of underpayment of wages, emergency cost of living allowance (ECOLA), and 13th month pay. Petitioner claimed it was an establishment with less than 30 employees and paid-up capital of P500,000.00 or less, and that the complainants were piece-rate workers who worked only four to six hours daily, thus justifying payment below the statutory minimum wage. The complainants countered that they had not received the minimum wage since 1984 and that petitioner’s capital classification was erroneously based on real property value, not paid-up capital.
DOLE Regional Director Melencio Q. Balanag issued a Compliance Order, finding based on submitted payrolls from 1985 to 1989 that the workers were paid on a daily and weekly basis, not consistently by piece-rate, and were receiving below the minimum wage. The order directed petitioner to pay twenty-one workers the total underpayments. Petitioner’s motion for reconsideration and subsequent appeal to the DOLE Secretary, through Undersecretary Cresenciano B. Trajano, were denied. The appellate authority affirmed that the payrolls substantiated the workers were daily paid, any unilateral conversion to piece-rate violated the Labor Code, and petitioner’s claim regarding its paid-up capital was a bare allegation without evidence.

ISSUE

Whether public respondents committed grave abuse of discretion in affirming the finding that petitioner violated labor standards on minimum wage, ECOLA, and 13th month pay, and in rejecting petitioner’s defenses of being a small-scale establishment and employing piece-rate workers.

RULING

The Supreme Court dismissed the petition, finding no grave abuse of discretion. On the capital classification, the Court upheld the DOLE’s finding that petitioner’s claim of having a paid-up capital of P500,000.00 or less was unsupported. Petitioner presented asset values, but the Court, agreeing with the Office of the Solicitor General, emphasized that assets are distinct from paid-up capitalization. The best evidence would be the articles of incorporation and treasurer’s affidavit, which petitioner failed to submit.
Regarding the nature of employment, the Court deferred to the factual findings of the DOLE, based on the payrolls submitted by petitioner itself, which showed the workers were paid on a daily and weekly basis, not consistently by piece-rate. Administrative agencies’ factual findings, especially when based on expertise, are accorded respect and finality. The Court also noted the absence of proof that employees worked less than eight hours, and found petitioner’s offer to increase wages to P45.00 per day during proceedings inconsistent with its claim that the workers were properly paid piece-rate workers. The Temporary Restraining Order was lifted.