STANDARD RICE AND CORN MILL AND/OR AURELIO SIA, PETITIONERS, VS. THE HON. DIONISIO C. DELA­-SERNA ACTING BY AUTHORITY OF THE HONORABLE SECRETARY OF LABOR, AND ASSOCIATION OF TRA…

Standard Rice and Corn Mill versus Dela-Serna

The Case

This is a petition for review filed by Standard Rice and Corn Mill and its owner and manager, Aurelio Sia, against the Acting Secretary of Labor, Dionisio Dela-Serna, and the Association of Trade Unions, the union representing the mill's workers. The petitioners ask the Supreme Court to annul two orders of the Secretary of Labor which found the company liable for unpaid emergency living allowance, thirteenth month pay, and service incentive leave pay, and which reversed the findings of the Regional Director. The case matters because it is a compact lesson on the probative value of cash vouchers as proof of payment of labor benefits, and on the deference the Supreme Court gives to the factual findings of the Regional Director when they are supported by substantial evidence.

Procedural History

The complaint for non-payment of labor benefits was filed with the Regional Office of the Ministry of Labor and Employment. The Regional Director dismissed the complaint for insufficiency of evidence. On appeal, the Office of the Minister of Labor and Employment reversed that order, doubting the genuineness of the cash vouchers, and remanded the case to the Regional Office of origin for further proceedings. After hearings, the Regional Director again dismissed the case, holding that payment was fully established by the vouchers. The union appealed once more to the Office of the Secretary, which sustained the appeal and ruled that the vouchers could not be given probative value. The petitioner's motion for reconsideration was denied. The company then elevated the matter to the Supreme Court by petition for review, alleging that the orders were issued without or in excess of jurisdiction or with grave abuse of discretion.

Facts

Standard Rice and Corn Mill is a private company engaged in milling rice and corn, with Aurelio Sia as owner and manager. The union filed a complaint on behalf of fifteen workers, alleging that from the time they began working, some in 1981 and others in 1983, up to January 1986, they were not paid emergency living allowance, thirteenth month pay, and service incentive leave pay. They claimed that whenever they were paid their daily salaries, they were made to sign blank vouchers because the office had no time to make entries. In the course of the proceedings, only eight complainants pursued the case; the seven others executed affidavits of quitclaim and waiver.

Labor Standards and Welfare Officers conducted an actual inspection of the company's records and found that the complainants were seasonal workers paid daily at the close of working hours, and that the company had substantially complied with the legal requirements on the three benefits. The Regional Director dismissed the complaint. On appeal, the Minister of Labor reversed, noting variances in the signatures on the cash vouchers and doubting their genuineness and due execution, and remanded the case.

On remand, the complainants personally examined the vouchers. Two of them, whom the others regarded as their leaders, admitted that the signatures were genuine. The six others likewise admitted the genuineness of their signatures but alleged that they had signed blank vouchers. The Regional Director then dismissed the case, finding payment fully established. The Secretary of Labor again reversed, holding that the vouchers were not properly accomplished because they bore no numbers and lacked the signature of the approving officer, which strengthened the claim that the workers had signed them blank.

Issues

• Whether or not the cash vouchers constitute indubitable and authentic proof of payment of the workers' claims for emergency living allowance, thirteenth month pay, and service incentive leave pay.
• Whether or not the Secretary of Labor committed grave abuse of discretion in reversing the findings of the Regional Director.

Applicable Provisions

The decision does not quote any statutory provision in full. It applies the labor standards laws on emergency living allowance, thirteenth month pay, and service incentive leave pay, which are the benefits claimed by the workers and which the company is alleged to have failed to pay. The Court also relies on the settled rule that the factual findings of the Regional Director, when supported by substantial evidence, are binding on the Supreme Court.

Ruling

On the first issue, the Court held that the cash vouchers are valid proof of payment. The complainants themselves admitted the genuineness of their signatures despite the variances, so there was no longer any question as to genuineness and due execution. The absence of voucher numbers and of the approving officer's signature is not a fatal defect. Vouchers are numbered merely as an accounting device for internal control, and their absence only reflects poor accounting practice. As for the missing approval, the Court reasoned that if the company had schemed to fabricate fully accomplished vouchers, all of them would have been signed by the approving official; the fact that not all were signed showed no attempt at a cover-up. The Court also stressed that the probative value of the vouchers cannot be impugned by mere affidavits or self-serving allegations that the workers signed blank vouchers, nor by blank forms offered as samples, since the workers themselves testified to the genuineness of their signatures. As between the oral allegations of the union and the documentary evidence of the company, the documents prevail.

On the second issue, the Court held that the Regional Director's findings were supported by substantial evidence and were therefore binding. It found that the Secretary of Labor committed grave abuse of discretion in reversing those findings without adequate basis, disregarding the evidence on record. The Court observed that the workers were unionized and vigilant in protecting their rights, and would not have allowed the employer to repeatedly require them to sign falsified or blank vouchers.

Doctrine

Cash vouchers, once their genuineness and due execution are admitted by the workers who signed them, are competent documentary evidence of payment of labor benefits. The lack of voucher numbers and of the approving officer's signature does not invalidate them, for numbering is a mere internal accounting device and the omission reflects only poor accounting practice. Self-serving allegations that the workers signed blank vouchers cannot overcome the documentary evidence and the workers' own testimony. Finally, the factual findings of the Regional Director, when supported by substantial evidence, are binding on the Supreme Court and may not be reversed by the Secretary of Labor without adequate basis.

Disposition

The petition was granted; the orders of the Secretary of Labor were set aside and the order of the Regional Director dismissing the complaint was reinstated, so the company prevailed.

Remember This

Memorize the line that the absence of voucher numbers and of the approving officer's signature is not a fatal defect and does not invalidate the cash vouchers. Examiners use this case to test the probative value of documentary evidence in labor standards claims and the binding effect of the Regional Director's factual findings supported by substantial evidence.