Pro-labor

The jurisdiction of the National Labor Relations Commission (NLRC) is separate and distinct from that of the Secretary of Labor and Employment (DOLE). The DOLE is governed by its own rules of procedure on the disposition of labor standards cases. This is illustrated in this case of Sam and Ed.

Sam and Ed were hired by a security agency (PVSIA) as security guards sometime in 1988. They were stationed at a food factory in Laguna. When the factory terminated its security contract with PVSIA in 2000, Sam and Ed were not given new assignments nor paid their 13th month pay, overtime pay, holiday pay and wage differentials due to underpayment of wages. Hence Sam and Ed filed a complaint for violation of labor standards with the DOLE Regional Office.

Acting on the complaint, the labor employment officer of the DOLE Region, Mr. Carlos, conducted an inspection during which PVSIA failed to present its payroll and the daily time records of Sam and Ed in violation of the Labor Standards. So Mr. Carlos issued a notice of inspection to the duly authorized representative of PVSIA, Mr. Julio. Carlos explained to Julio the significance and contents of the notice and emphasized the need for PVSIA either to comply with the labor standards by paying the claims of Sam and Ed as computed by him, or to raise any question regarding the notice to the Regional Office.

PVSIA neither paid the claims of Sam and Ed nor questioned the findings of Carlos. Hence the DOLE Regional Director adopted the findings of Carlos and issued an order dated May 10, 2001 requiring PVSIA and or Mr. Julio to pay the aggregate amount of P206,569.20 within 10 days.

When their motion for reconsideration was denied, PVSIA and Julio filed an appeal (with motion to reduce cash or surety bond) to the DOLE Secretary. In his July 9, 2002 order, the DOLE Secretary found that PVSIA and Julio failed to perfect their appeal since they did not post a cash or surety bond equivalent to the monetary award. Thus the appeal was dismissed and the DOLE Regional Director’s order dated May 10, 2001 was declared final and executory.

When PVSIA and Julio questioned the said ruling via a petition for certiorari, the Court of Appeals (CA) reversed the DOLE order and eventually ruled that PVSIA and Julio can still pursue their appeal in the DOLE. According to the CA, in practice, a motion to reduce the appeal bond may be filed within the reglamentary period for appealing and may be granted on meritorious grounds. Hence in the meantime, the appeal is not perfected until a ruling on the motion to reduce the appeal bond is acted upon. The CA cited by analogy, the practice in the NLRC which was recognized as valid in one case (Star Angel Handicraft vs. NLRC 236 SCRA 580). Was the CA correct?

No. Article 128 of the Labor Code explicitly provides that in case an order issued by the duly authorized representative of the DOLE involves a monetary award, an appeal by the employer may be perfected only by posting of a cash or surety bond in an amount equivalent to the monetary award within 10 calendar days from receipt of the order. The word “only” makes it clear that the lawmakers intended the posting by the employer of the required cash or surety bond as the exclusive means by which its appeal may be perfected. In this case PVSIA and Julio admit that they failed to post the required bond when they filed their appeal to the DOLE Secretary. Because of such failure, the appeal is never perfected and the May 10, 2001 order of the Regional Director attained finality.

The motion to reduce appeal bond is not allowed in appeals to the DOLE Secretary. No provision in the Rules on the Disposition of Labor Standards Cases allows the filing of a motion for reduction of the amount of the bond. By ruling that the Rules of Procedure of the NLRC should be applied by analogy to PVSIA and Julio’s appeal to the DOLE, the CA effectively amended the rules on disposition of labor standards cases and encroached on the rule making power of the DOLE Secretary.

The posting of a cash or surety bond in an amount equivalent to the monetary award to perfect an appeal has a two-fold purpose: (1) to assure the employee that if he finally prevails in the case, the monetary award will be given to him; and (2) to discourage the employer from using the appeal to delay or evade payment of the obligations to the employee. The CA disregarded these pro labor objectives when it treated PVSIA and Julio’s failure to post the required bond with undue leniency (Secretary of Labor etc. vs. Panay Veteran’s Security etc. G.R. 167708, August 22, 2008).

Note: Books containing compilation of my articles on Labor Law and Criminal Law (Vols. I and II) are now available. Call tel. 7249445.

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