Monday, January 30, 2012

Maternity Children's Hospital vs. Secretary of Labor, 174 SCRA 632

Facts: The petitioner is a semi-government hospital, managed by the Board of Directors of the Cagayan de Oro Women's Club and Puericulture Center, headed by Mrs. Antera Dorado, as holdover President. The hospital derives its finances from the club itself as well as from paying patients, averaging 130 per month. It is also partly subsidized by the Philippine Charity Sweepstakes Office and the Cagayan De Oro City government.

On May 23, 1986, ten employees of the petitioner employed in different capacities/positions filed a complaint with the Office of the Regional Director of Labor and Employment for underpayment of their salaries and ECOLAs, which was docketed as ROX Case No. CW-71-86. On June 16, 1986, the Regional Director directed two of his Labor Standard and Welfare Officers to inspect the records of the petitioner to ascertain the truth of the allegations in the complaints. Payrolls covering the periods of May, 1974, January, 1986, November, 1985 and May, 1986, were duly submitted for inspection. On July 17, 1986, the Labor Standard and Welfare Officers submitted their report confirming that there was underpayment of wages and ECOLAs of all the employees by the petitioner. As a result, the petitioner appealed from this Order to the Minister of Labor and Employment, Hon. Augusto S. Sanchez, who rendered a Decision on September 24, 1986, modifying the said Order in that deficiency wages and ECOLAs, should be computed only from May 23, 1983 to May 23, 1986. On October 24, 1986, the petitioner filed a motion for reconsideration which was denied by the Secretary of Labor in his Order dated May 13, 1987, for lack of merit. Petitioner likewise maintains that the Order of the respondent Regional Director of Labor, as affirmed with modifications by respondent Secretary of Labor, does not clearly and distinctly state the facts and the law on which the award was based. In its "Rejoinder to Comment,” the petitioner further questions the authority of the Regional Director to award salary differentials and ECOLAs to private respondents, alleging that the original and exclusive jurisdiction over money claims is properly lodged in the Labor Arbiter, based on Article 217, paragraph 3 of the Labor Code.

Issue: Whether or not the Regional Director had jurisdiction over the case.

Held: This is a labor standards case, and is governed by Art. 128 of the Labor Code. Labor standards refer to the minimum requirements prescribed by existing laws, rules, and regulations relating to wages, hours of work, cost of living allowance and other monetary and welfare benefits, including occupational, safety, and health standards. Under the present rules, a Regional Director exercises both visitorial and enforcement power over labor standards cases, and is therefore empowered to adjudicate money claims, provided there still exists an employer-employee relationship, and the findings of the regional office is not contested by the employer concerned.

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