WORLDWIDE PAPER MILLS, INC., PETITIONER AND APPELLANT, VS. LABOR STANDARDS COMMISSION AND ERNESTO PALOMIQUE, RESPONDENTS AND APPELLEES.

On June 20, 1958, Ernesto Palomique presented with the Regional Office No. 3
of the Department of Labor, Manila, a complaint against the Worldwide Paper
Mills, Inc. for the recovery of a sum of money, consisting of unpaid overtime
wages and separation pay (RO3-LS Case No. 1495).

In answer to the complaint, Worldwide Paper Mills, after the usual admissions
and denials, interposed, among others, the special defense of lack of authority
and jurisdiction of the Regional officer over the subject-matter, contending
that Reorganization Plan No. 20-A and the rules and regulations issued to
implement the same, are unconstitutional.

Upon the facts and proofs presented by the parties, the hearing officer in
Regional Office No. 3, on November 10, 1958, rendered judgment finding that
Palomique was entitled to overtime pay from June 23, 1955 to May 12, 1958,
amounting to P341.85 and P340.00 as separation pay, and ordered Worldwide Paper
Mills to pay said Palomique the total sum of P681.85 with legal interest from
June 23, 1958.

An appeal from the above judgment to the Labor Standards Commission was
interposed by Worldwide on November 24, 1958, asking for the dismissal of the
case, for lack of jurisdiction of the Regional Office. The Labor Standards
Commission on June 15, 1959, sustained the Regional Office, holding that the
Reorganization Act (Rep. Act No. 997, as amended by Act 1241), upon which
Reorganization Plan No. 20-A was based, conferred sufficient authority and
jurisdiction upon the Regional Office to hear and decide claims of the same
nature involved in the litigation. Worldwide also brought the matter to the CFI
of Manila on a Petition for Certiorari and Prohibition with Preliminary
Injunction (Civil Case No. 41193), under the same issues as presented by them
with the Regional Office and the Labor Standards Commission. The CFI, likewise
upheld the validity of Reorganization Plan No. 20-A.

The case is now before Us on the singular issue of “the validity of
Reorganization Plan No. 20-A.”

We have in a number of cases ruled upon the above issue. Thus, in the case of
Cagalawan vs. Customs Canteen, et al., 113 Phil., 386, We said—

“* * *. So that it was not the intention of Congress, in enacting Rep Act No.
997, to authorize the transfer of powers and jurisdiction granted to courts of
justice from these, to the officials to be appointed or offices to be created by
the Reorganization Plan. * * *. The Legislature could not have intended to grant
such powers to the Reorganization Commission, an executive body, as the
Legislature may not and cannot delegate its powers to legislate or create courts
of justice to any other agency of the Government. * * * the provision of
Reorganization Plan No. 20-A, particularly Sec. 25, which grants to the regional
offices original and exclusive jurisdiction over money claims of laborers, is
null and void, said grant having been made without authority by Rep. Act No.
997 (Corominas, Jr., et al., vs. Labor Standards Commission, et al., MCU vs.
Calupitan, et al., 112 Phil., 651; 69 Off. Gaz., [43] 7432. Wong vs. Carlim, et
al., Balrodgen Co., et al., vs. Puentes, et al., See also Pitogo, vs. Sen
Bee Trading Co., et al., 112 Phil., 842; 59 Off. Gaz., 7446).”

Under the authority of the cases cited above, the case at bar should be, as
it is hereby dismissed, reserving to Ernesto Palomique the right to bring the
appropriate action before the proper court. The decision appealed from is set
aside. No costs.

Bengzon, C. J., Padilla, Bautista Angelo, Labrador, Concepcion, Reyes, J.
B. L., Barrera, and Dizon, JJ., concur.