Maternity Children’s Hospital vs.

Secretary of Labor

G.R. No. 78909

June 30, 1989

EN BANC:

MEDIALDEA, J.:

Labor Law Defined

Jurisdiction of the Regional Director

Facts:

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.

Petitioner has forty-one (41) employees. Aside from salary and living allowances, the
employees are given food, but the amount spent therefor is deducted from their respective
salaries (pp. 77-78, Rollo).

On May 23, 1986, ten (10) employees of the petitioner employed in different capacities/positions
filed a complaint with the Office of the Regional Director of Labor and Employment, Region X,
for underpayment of their salaries and ECOLAS, which was docketed as ROX Case No.
CW-71-86.

The Regional Director issued and order based on the reports of the Labor Standard and Welfare
Officers, directing payment of P723, 888.58 representing underpayment of wages and ECOLAs
to all the petitioner’s employees. Petitioner appealed to the Minister of Labor and Employment
which modified the decision as to the period for the payment ECOLAs only. A motion for
reconsideration was filed by petitioner and was denied by the Secretary of Labor.

Issues:

1. Whether or not the award granted by the Regional Director involving several ECOLAs,
covers not only hospital employees but also those (a) who are not signatories to the
complaint, and (b) those no longer in the service of the hospital at the time the
complaints were filed.
2. Whether or not the Regional Director erred in extended the award to all hospital
employees.
 3. Whether or not the Regional Director exercised jurisdiction over the case and if so, the
extent of coverage of any award that should be forthcoming, arising from his visitorial
and enforcement powers under Article 128 of the Labor Code.

Held:

1. Yes. The Regional Director, however, correctly applied the award to all employees, with
respect to those who signed the complaint as well as those who did not but ​still
worked/connected to the hospital at the time the complaint was filed. ​Why? What is
sought to be achieved is by the exercise of visitation and enforcement powers of the
Secretary of Labor is the ​observance or, and/or compliance by, such
firm/establishment with labor standard regulations. In case of an award resulting
from violation of labor legislation by such establishment, the entire employees
should benefit therefrom.

2. No. ​It would be ​highly derogatory to the rights of the workers, if the hospital is found
guilty of underpayment of wages and ECOLAs, ​we limit the award to those only who
signed the complaint to the exclusion of the majority. ​This would render the visitorial
and enforcement powers of the Secretary of Labor and Employment nugatory.

3. No. This is a labor standards case, and is governed by Art. 128-b of the Labor Code, as
amended by E.O. No. 111. 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.

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
(Section 7, Rule I, Ruleson the Disposition of Labor Standards Cases in the Regional
Office, dated September 16,1987).

Decision:

ACCORDINGLY, this petition should be dismissed, as it is hereby ​DISMISSED​, as regards all

persons still employed in the Hospital at the time of the filing of the complaint, but GRANTED as
regards those employees no longer employed at that time. SO ORDERED.

Fernan, C.J., Narvasa, Gutierrez, Jr., Cruz, Paras, Feliciano, Gancayco, Padilla, Bidin,
Cortes,Griño-Aquino and Regalado, JJ., concur