Visitorial powers

Money claims of employees exceeding P5,000 is within the jurisdiction of the Labor Arbiter (Article 127 and 217, Labor Code). But this rule was not applied in this case of a security agency (EBVSAI).

On complaint filed by 21 Security Guards for underpayment of wages against EBVSAI before the Regional Office of the Department of Labor and Employment (DOLE-RO), the latter conducted an inspection at the SGs place of work and noted the following violations: (1) non-presentation of records; (2) non-payment of holiday pay; (3) non-payment of rest day premium; (4) under payment of night shift differential pay; (5) non-payment of service incentive leave; (6) under payment of 13th month pay; (8) absence of medical report; (9) no annual work accidental report; (10) no safety committee; and (11) no trained first aider.

On the same date, the Regional Office issued a notice of hearing requiring EBVSAI and the SGs to attend on four hearing dates it scheduled. But despite the several opportunities given to it, EBVSAI failed to present any evidence to controvert the findings of DOLE-RO. So the DOLE-RO ordered EBVSAI to pay the computed deficiencies owing to the 21 SGs totaling P763,997.85 within 10 calendar days otherwise a writ of execution shall be issued to enforce the order.

EBVSAI questioned this order and asked DOLE-RO to reconsider it claiming, among others that under Articles 129 and 217(6) of the Labor Code, it does not have jurisdiction over the subject matter of the case because the money claim of each SG exceeded P5,000. It pointed out that the DOLE-RO should have endorsed the case to the Labor Arbiter (LA). But the latter denied EBVSAI’s motion. This denial was affirmed by the Secretary of DOLE. Was the Secretary correct?

Yes. Articles 129 and 217 of the Labor Code do not cover nor contemplate the visitorial and enforcement powers of the Secretary of Labor or his duly authorized representatives. In cases where the employer-employee relationship still exists, the Secretary of Labor or his duly authorized representatives shall have the power to issue compliance orders to give effect to the labor standards provisions of the Labor Code and other labor legislations based on the findings of the labor enforcement officers or industrial safety engineers made in the course of inspection (Article 128). The visitorial and enforcement powers of the DOLE-RO to order and enforce compliance with labor standard laws can be exercised even where the individual claim exceeds P5,000.

In order to divest the DOLE-RO or his representatives of jurisdiction, the following elements must be present: (a) that the employer contests the findings of the labor regulations officer and raises issues thereon; (b) that in order to resolve such issues, there is a need to examine evidentiary matters and (c) that such matters are not verifiable in the normal course of inspection. The employer shall contest or raise such objections during the hearing of the case or at any time after receipt of inspection results.

In this case the EBVSAI did not contest the findings of the regulations officer during the hearing or after receipt of the notice of the inspection results. It was only after the DOLE-RO issued the order when EBVSAI questioned the findings. Moreover, the pieces of evidence presented by EBVSAI were verifiable in the normal course of inspection because all employment records of the employees should be kept and maintained in or about the premises of the workplace which in this case is the establishment where the SGs are assigned (Ex-Bataan Veterans Security Agency Inc. vs. Secretary of Labor et. al. G.R. 152396, November 20, 2007).

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