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May 8, 2009
DECISION
TINGA, J.:
The present controversy concerns a matter of first impression,
requiring as it does the determination of the demarcation line between
the prerogative of the Department of Labor and Employment (DOLE)
Secretary and his duly authorized representatives, on the one hand,
and the jurisdiction of the National Labor Relations Commission, on the
other, under Article 128 (b) of the Labor Code in an instance where the
employer has challenged the jurisdiction of the DOLE at the very first
level on the ground that no employer-employee relationship ever
existed between the parties.
I.
The instant petition for certiorari under Rule 65 assails the decision and
the resolution of the Court of Appeals dated 26 October 2006 and 26
June 2007, respectively, in C.A. G.R. CEB-SP No. 00855.1
The petition traces its origins to a complaint filed by Jandeleon Juezan
(respondent) against Peoples Broadcasting Service, Inc. (Bombo Radyo
Phils., Inc) (petitioner) for illegal deduction, non-payment of service
incentive leave, 13th month pay, premium pay for holiday and rest day
and illegal diminution of benefits, delayed payment of wages and noncoverage of SSS, PAG-IBIG and Philhealth before the Department of
Labor and Employment (DOLE) Regional Office No. VII, Cebu City. 2 On
the basis of the complaint, the DOLE conducted a plant level inspection
on 23 September 2003. In the Inspection Report Form,3 the Labor
Inspector wrote under the heading "Findings/Recommendations" "nondiminution of benefits" and "Note: Respondent deny employeremployee relationship with the complainant- see Notice of Inspection
results." In the Notice of Inspection Results 4 also bearing the date 23
September 2003, the Labor Inspector made the following notations:
The Court of Appeals held that petitioner was not deprived of due
process as the essence thereof is only an opportunity to be heard,
which petitioner had when it filed a motion for reconsideration with the
DOLE Secretary. It further ruled that the latter had the power to order
and enforce compliance with labor standard laws irrespective of the
amount of individual claims because the limitation imposed by Article
29 of the Labor Code had been repealed by Republic Act No.
7730.10 Petitioner sought reconsideration of the decision but its motion
was denied.11
Before this Court, petitioner argues that the National Labor Relations
Commission (NLRC), and not the DOLE Secretary, has jurisdiction over
respondents claim, in view of Articles 217 and 128 of the Labor
Code.12 It adds that the Court of Appeals committed grave abuse of
discretion when it dismissed petitioners appeal without delving on the
issues raised therein, particularly the claim that no employer-employee
relationship had ever existed between petitioner and respondent.
Finally, petitioner avers that there is no appeal, or any plain, speedy
and adequate remedy in the ordinary course of law available to it.
On the other hand, respondent posits that the Court of Appeals did not
abuse its discretion. He invokes Republic Act No. 7730, which "removes
the jurisdiction of the Secretary of Labor and Employment or his duly
authorized representatives, from the effects of the restrictive
provisions of Article 129 and 217 of the Labor Code, regarding the
confinement
of
jurisdiction
based
on
the
amount
of
claims."13 Respondent also claims that petitioner was not denied due
process since even when the case was with the Regional Director, a
hearing was conducted and pieces of evidence were presented.
Respondent stands by the propriety of the Court of Appeals ruling that
there exists an employer-employee relationship between him and
petitioner. Finally, respondent argues that the instant petition for
certiorari is a wrong mode of appeal considering that petitioner had
earlier filed a Petition for Certiorari, Mandamus and Prohibition with the
Court of Appeals; petitioner, instead, should have filed a Petition for
Review.14
II.
The significance of this case may be reduced to one simple question
does the Secretary of Labor have the power to determine the existence
of an employer-employee relationship?
To resolve this pivotal issue, one must look into the extent of the
visitorial and enforcement power of the DOLE found in Article 128 (b)
of the Labor Code, as amended by Republic Act 7730. It reads:
Article 128 (b) Notwithstanding the provisions of Articles 129 and 217
of this Code to the contrary, and in cases where the relationship of
employer-employee still exists, the Secretary of Labor and Employment
or his duly authorized representatives shall have the power to issue
compliance orders to give effect to the labor standards provisions of
this Code and other labor legislation based on the findings of labor
employment and enforcement officers or industrial safety engineers
made in the course of inspection. The Secretary or his duly authorized
representative shall issue writs of execution to the appropriate
authority for the enforcement of their orders, except in cases where
the employer contests the findings of the labor employment and
enforcement officer and raises issues supported by documentary
proofs which were not considered in the course of inspection.
(emphasis supplied)
xxx
The provision is quite explicit that the visitorial and enforcement power
of the DOLE comes into play only "in cases when the relationship of
employer-employee still exists." It also underscores the avowed
objective underlying the grant of power to the DOLE which is "to give
effect to the labor standard provision of this Code and other labor
legislation." Of course, a persons entitlement to labor standard
benefits under the labor laws presupposes the existence of employeremployee relationship in the first place.
The clause "in cases where the relationship of employer-employee still
exists" signifies that the employer-employee relationship must have
existed even before the emergence of the controversy. Necessarily, the
DOLEs power does not apply in two instances, namely: (a) where the
employer-employee relationship has ceased; and (b) where no such
relationship has ever existed.
The first situation is categorically covered by Sec. 3, Rule 11 of the
Rules on the Disposition of Labor Standards Cases15 issued by the DOLE
Secretary. It reads:
Rule II MONEY
INSPECTION
CLAIMS
ARISING
FROM
COMPLAINT/ROUTINE
The Court further examined the records and discovered to its dismay
that even the Regional Director turned a blind eye to the evidence
presented by petitioner and relied instead on the self-serving claims of
respondent.
In his position paper, respondent claimed that he was hired by
petitioner in September 1996 as a radio talent/spinner, working from
8:00 am until 5 p.m., six days a week, on a gross rate of P60.00 per
script, earning an average of P15,0000.00 per month, payable on a
semi-monthly basis. He added that the payment of wages was delayed;
that he was not given any service incentive leave or its monetary
commutation, or his 13th month pay; and that he was not made a
member of the Social Security System (SSS), Pag-Ibig and PhilHealth.
By January 2001, the number of radio programs of which respondent
was a talent/spinner was reduced, resulting in the reduction of his
monthly income from P15,000.00 to only P4,000.00, an amount he
could barely live on. Anent the claim of petitioner that no employeremployee relationship ever existed, respondent argued that that he
was hired by petitioner, his wages were paid under the payroll of the
latter, he was under the control of petitioner and its agents, and it was
petitioner who had the power to dismiss him from his employment. 23 In
support of his position paper, respondent attached a photocopy of an
identification card purportedly issued by petitioner, bearing
respondents picture and name with the designation "Spinner"; at the
back of the I.D., the following is written: " This certifies that the card
holder is a duly Authorized MEDIA Representative of BOMBO RADYO
PHILIPPINES THE NO.1 Radio Network in the Country ***BASTA
RADYO BOMBO***"24 Respondent likewise included a Certification which
reads:
This is to certify that MR. JANDELEON JUEZAN is a program employee of
PEOPLES BROADCASTING SERVICES, INC. (DYMF- Bombo Radyo Cebu)
since 1990 up to the present.
Furtherly certifies that Mr. Juezan is receiving a monthly salary of
FIFTEEN THOUSAND (P15,000.00) PESOS.
This certification is issued upon the request of the above stated name
to substantiate loan requirement.
Given this 18th day of April 2000, Cebu City , Philippines.
(signed)
GREMAN B. SOLANTE
Station Manager
On the other hand, petitioner maintained in its position paper that
respondent had never been its employee. Attached as annexes to its
IV.
The records show that petitioners appeal was denied because it had
allegedly failed to post a cash or surety bond. What it attached instead
to its appeal was the Letter Agreement34 executed by petitioner and its
bank, the cash voucher, 35 and the Deed of Assignment of Bank
Deposits.36 According to the DOLE, these documents do not constitute
the cash or surety bond contemplated by law; thus, it is as if no cash or
surety bond was posted when it filed its appeal.
The Court does not agree.
The provision on appeals from the DOLE Regional Offices to the DOLE
Secretary is in the last paragraph of Art. 128 (b) of the Labor Code,
which reads:
An order issued by the duly authorized representative of the Secretary
of Labor and Employment under this article may be appealed to the
latter. In case said order involves a monetary award, an appeal by the
employer may be perfected only upon the posting of a cash or surety
bond issued by a reputable bonding company duly accredited by the
Secretary of Labor and Employment in the amount equivalent to the
monetary award in the order appealed from. (emphasis supplied)
While the requirements for perfecting an appeal must be strictly
followed as they are considered indispensable interdictions against
needless delays and for orderly discharge of judicial business, the law
does admit exceptions when warranted by the circumstances.
Technicality should not be allowed to stand in the way of equitably and
Agreement and the Cash Voucher were made in good faith, and
constituted clear manifestation of petitioners willingness to pay the
judgment amount.
The Deed of Assignment must be distinguished from the type of bank
certification submitted by appellants in Cordova v. Keysas
Boutique,41 wherein this Court found that such bank certification did
not come close to the cash or surety bond required by law. The bank
certification in Cordova merely stated that the employer maintains a
depository account with a balance of P23,008.19, and that the
certification was issued upon the depositors request for whatever legal
purposes it may serve. There was no indication that the said deposit
was made specifically for the pending appeal, as in the instant case.
Thus, the Court ruled that the bank certification had not in any way
ensured that the award would be paid should the appeal fail. Neither
was the appellee in the case prevented from making withdrawals from
the savings account. Finally, the amount deposited was measly
compared to the total monetary award in the judgment.42
V.
Another question of technicality was posed against the instant petition
in the hope that it would not be given due course. Respondent asserts
that petitioner pursued the wrong mode of appeal and thus the instant
petition must be dismissed.1avvphi1.zw+ Once more, the Court is not
convinced.
A petition for certiorari is the proper remedy when any tribunal, board
or officer exercising judicial or quasi-judicial functions has acted
without or in excess of its jurisdiction, or with grave abuse of discretion
amounting to lack or excess of jurisdiction and there is no appeal, nor
any plain speedy, and adequate remedy at law. There is "grave abuse
of discretion" when respondent acts in a capricious or whimsical
manner in the exercise of its judgment as to be equivalent to lack of
jurisdiction.43
Respondent may have a point in asserting that in this case a Rule 65
petition is a wrong mode of appeal, as indeed the writ of certiorari is an
extraordinary remedy, and certiorari jurisdiction is not to be equated
with appellate jurisdiction. Nevertheless, it is settled, as a general
proposition, that the availability of an appeal does not foreclose
recourse to the extraordinary remedies, such as certiorari and
prohibition, where appeal is not adequate or equally beneficial, speedy
and sufficient, as where the orders of the trial court were issued in
excess of or without jurisdiction, or there is need to promptly relieve
the aggrieved party from the injurious effects of the acts of an inferior
court or tribunal, e.g., the court has authorized execution of the