Bay Haven vs Abuan (Labor Law)

Bay Haven, Inc. vs Abuan

GR No. 160859 

July 30, 2008

 

Facts:

Upon complaint of Florentino Abuan, one of herein respondents, the DOLE, in the exercise of its visitorial, inspection and enforcement powers, through its Regional Director for NCR, issued an Order commanding petitioners to pay respondents a total of P638,187.15 corresponding to the latter’s claims for underpayment as petitioners’ workers. The Regional Director based his Order on the results of the inspection conducted by one of its inspectors who found that petitioner New Bay Haven Restaurant, located at the Army and Navy Club, Kalaw St., Manila, under the ownership or management of petitioner Te, committed violations of Labor Standards Law. New Bay-Haven Restaurant and its co-petitioner Te filed with the DOLE-NCR Regional Office a Motion for Reconsideration of order, alleging that the office had no jurisdiction over the case and that the order was issued in denial of petitioners’ right to due process. They argued that jurisdiction over the case was lodged with the NLRC, and not the DOLE-NCR, due to the amount of the claims involved. They added that their right to due process was also denied because the order was issued without them being furnished copies of the complaint and the inspection report and without being notified of the hearings held in the case.

Petitioners filed a Motion for Reconsideration of the Order. In the motion, petitioners insisted that their documentary evidence proved that their obligations to respondents had been discharged and that the DOLE had no jurisdiction over the case.

Treating the motion for reconsideration as an appeal, the DOLE Undersecretary issued a Resolution, denying the appeal filed by petitioners, 16 upholding the Regional Director’s finding that the quitclaims could not be relied upon to deny respondents’ claims, and reiterating that the DOLE had jurisdiction to decide the case.

 

Issue:

Whether the DOLE Secretary and her authorized representatives have jurisdiction to impose the monetary liability against petitioners.

 

Ruling:

The DOLE Secretary and her authorized representatives such as the DOLE-NCR Regional Director, have jurisdiction to enforce compliance with labor standards laws under the broad visitorial and enforcement powers conferred by Article 128 of the Labor Code, and expanded by R.A. No. 7730. The Court has held that the visitorial and enforcement powers of the Secretary, exercised through his representatives, encompass compliance with all labor standards laws and other labor legislation, regardless of the amount of the claims filed by workers. This has been the rule since R.A. No. 7730 was enacted on June 2, 1994, amending Article 128(b) of the Labor Code, to expand the visitorial and enforcement powers of the DOLE Secretary. Under the former rule, the DOLE Secretary had jurisdiction only in cases where the amount of the claim does not exceed P5,000.00.

The records also clearly indicate that the Regional Director and the DOLE Secretary resolved the case based on violations found by the labor inspection officer, which do not include illegal dismissal. The said violations are within the jurisdiction of the DOLE Secretary and his representatives to address. The questioned Orders dated December 29, 1998, April 18, 2000 and September 19, 2001 did not mention illegal dismissal, and properly so, because there was no such finding in the inspector’s report. Being in the nature of compliance orders, said orders, under Art. 128(b) of the Labor Code, are strictly based on “the findings of labor employment and enforcement officers x x x made in the course of inspection,” and not on any complaint filed. Though a complaint may initiate the case or an inspection, its allegations may not necessarily be upheld by the labor inspector or the Regional Director.