ALBAY I ELECTRIC COOPERATIVE, INC. (ALECO I), PETITIONER, VS. RICARDO S. MARTINEZ, SR., ARNOLD B. BONAGUA AND CONRADO S. BUBAN, RESPONDENTS.

This special civil action for certiorari seeks the
annulment of the Orders dated September 11, 1989 and September 3, 1990 issued
by respondent Ricardo Martinez, Sr., Regional Director, Department of Labor and
Employment, Regional Office No. 5, Legazpi City, for having been rendered in excess
of jurisdiction.

Petitioner avers that on August 15, 1988, private respondents
Conrado Buban and Arnaldo Bonagua were designated as acting manager (Commercial
Services Department) and supervisor (Service Center), respectively, of Albay I
Electric Cooperative, Inc. by Israel Garcia, petitioner’s Acting General
Manager. Garcia allegedly made the appointments after his own appointment was recalled by
the National Electrification Administration (NEA) by virtue of Office Order No.
454 issued on August 10, 1988 effective immediately. (Rollo p. 31)

On August 27, 1988, the Board of Directors of ALECO I considered
the midnight appointments of respondents Buban and Bonagua as null and void. In
a Memorandum dated June 7, 1989, Romulo Maristaza, Chief of the Legal Service
Office of the NEA, considered as defective the appointments of private
respondents there being serious doubts as to their validity. (Rollo, p. 14-15)

On August 15, 1989, private respondents filed a complaint with
the Office of the Regional Director for the recovery of salary differentials
corresponding to their new positions. They also claimed that since they held their
respective positions for more than one year, their status should be classified
as permanent and they should be paid the corresponding salaries.

Petitioner moved to dismiss the complaint for lack of
jurisdiction. Nonetheless, on September 11, 1989, respondent Regional Director
issued an Order requiring the petitioner to pay respondents Bonagua and Buban
P11,962.31 and
P12,593.36, respectively, corresponding to the underpayment of wages for their
new positions (Rollo, p. 16).

On September 19, 1989, petitioner filed a notice of appeal and
Memorandum of Appeal. Instead of giving due course to the appeal, the
Med-Arbiter denied the same and directed the parties to present evidence (Rollo, p. 23). In its
position paper, petitioner assailed the Order denying its appeal and further
argued that since the amount claimed by private respondents is in excess of
P5,000.00, the Regional Director has no jurisdiction to entertain the
complaint.

On September 3, 1990, the Regional Director issued another Order,
this time requiring petitioner to pay respondent Bonagua the amount of
P9,259.72 and respondent Buban P38,243.21 corresponding to their salary differentials
and 13th month pay (Rollo p. 32). Public respondent also held that since the
complainants (private respondents) were allowed to discharge their functions
for more than one year without objection or adverse action on the part of the
petitioner, this amounted to acquiescence and an implied approval of their
appointments. Thereafter, a writ of
execution was issued on September 26, 1990.

Hence this petition.

Petitioner contends that since each of the money claims of
private respondents exceeded P5,000.00, the complaint falls outside the
jurisdiction of the respondent Regional Director and should properly be heard
by the Labor Arbiter.

Public respondent argues however that under his visitorial power,
the P5,000,00 jurisdictional limit does not apply, citing for the purpose
Brokenshire Memorial Hospital Inc. vs. Minister of Labor and Employment (182 SCRA 5 [1990]), to wit:

“If the amount involved does not exceed P5,000.00, the
Regional Director undeniably has jurisdiction. But even if the amount of the claim exceeds P5,000.00, the claim is not
on that account necessarily removed from the Regional Director’s competence. In
respect thereof he may still exercise the visitorial powers vested in him by
Article 128 of the Labor Code, as amended, supra; that is to say, he may still
direct his labor regulations officers or industrial safety engineers to inspect
the employer’s premises and examine his records; and if the officers should
find that there have been violations of labor standards provisions, the Regional
Director may, after due notice and hearing order compliance by the employer
therewith and issue a writ of execution to the appropriate authority for the
enforcement thereof. However, this power may not, repeat, be exercised by him
where the employer contests the labor regulation officers’ findings and raises
issues which cannot be resolved without considering the evidentiary matters not
verifiable in the normal course of inspection. In such an event, the case will
have to be referred to the corresponding Labor Arbiter for adjudication, since
it falls within the latter’s exclusive original jurisdiction” (citing
Briad Agro Development Corp.).

Public respondent hastens to add that the purpose of the law is
to afford to the workers an expeditious delivery of what legally belongs to
them; thus, the jurisdictional P5,000.00 limit need not apply. On the other
hand, private respondents submit that the Regional director has the power and
authority in complaints for inspection cases to hear and decide
labor standard cases where employer-employee relationship still exists between
the parties. The law does not put a limit as to what should be the minimum
claim of the employees in order to seek relief under Article 128 of the Labor
Code.

In his Manifestation in Lieu of Comment, the Solicitor General
submits that the claims of private respondents for unpaid wages properly fall
under the exclusive and original jurisdiction of the Labor Arbiter, mainly
because the money claims of private respondents exceed P5,000.00. In addition, the Regional Director ordered
the payment of the salary differentials not in connection with his visitorial
powers but in the adjudication of the claims or complaints of the private
respondents.

Article 129 and Article 217 of the Labor Code, as amended by RA
6715, provide:

“Art. 129. Recovery of wages, simple money claims and other
benefits. — Upon complaint of any interested party, the Regional Director of
the Department of Labor and Employment or any of the duly authorized hearing
officers of the Department is empowered, through summary proceeding and after
due notice, to hear and decide any matter involving the recovery of wages and
other monetary claims and benefits, including legal interest, owing to an
employee or person employed in domestic or household service or househelper
under this Code, arising from employer-employee relations. Provided, That such
complaint does not include a claim for reinstatement; Provided, further, That
the aggregate money claims of each employee or househelper do not exceed five
thousand pesos (P5,000.00). x x
x.”

“Art. 217. Jurisdiction of Labor Arbiters and the Commission.
– Except as otherwise provided under this Code, the Labor Arbiters shall have
original and exclusive jurisdiction to hear and decide, within thirty (30)
calendar days after the submission of the case by the parties for decision
without extension, even in the absence
of stenographic notes, the following cases involving workers, whether
agricultural or non- agricultural:

x x x                             x x x                               x
x x

“(6)     Except claims
for employees compensation, social security, medicare and maternity benefits,
all other claims arising from employer-employee relations, including those of
persons in domestic or household service, involving an amount exceeding five
thousand pesos (P5,000.00), whether or not accompanied with a claim for
reinstatement.”

Clearly, the jurisdiction over the instant dispute lies
exclusively and originally with the Labor Arbiter, the claims being in excess
of P5,000.00 each. Thus, respondents’ reliance in Brokenshire (supra)
is evidently misplaced. For, and in construing the aforequoted provisions, the
Court did not confer unlimited jurisdiction on the Regional Director. Rather, it qualified the Regional Director’s
jurisdiction to hear and decide employee’s claims, to wit:

“It will be observed that what in fact conferred upon Regional
Directors and other hearing officers of the Department of Labor (aside from the
Labor Arbiters) adjudicative powers, i.e., the power to try and decide, or hear
and determine any claim brought before them for recovery of wages, simple money
claims, and other benefits, is Republic Act 6715, provided that the following
requisites concur, to wit:

“1) The claim is presented by an employee or person employed
in domestic or household service or househelper under the code;

“2) The claimant, no longer being employed, does not seek
reinstatement; and

“3) The aggregate money claim of the employee or househelper does
not exceed five thousand pesos (P5,000.00).

“In the absence of any of the three (3) requisites, the Labor
Arbiters have exclusive original jurisdiction over all claims arising from
employer-emloyee relations, other than claims for employees compensation,
social security, medicare and maternity benefits” (Brokenshire Memorial
Hospital, Inc. vs. Minister of Labor and Employment supra).

Neither can private respondents successfully invoke the
visitorial power of the Regional Director as provided under Article 128 of the
Labor Code. In Servando’s Inc. vs. Secretary of Labor and Employment (198 SCRA
156 [1991]) the Court ruled:

“To construe the visitorial power of the Secretary of Labor to
order and enforce compliance with labor laws as including the power to hear and
decide cases involving employees’ claims for wages, arising from
employer-employee relations, even if the amount of said claims exceed P5,000.00
for each employee, would, in our considered opinion, emasculate and render
meaningless, if not useless, the provisions of Article 217 (a)(6) and Article 129 of the Labor Code which, as
above pointed out, confer exclusive jurisdiction on the Labor Arbiter to hear
and decide such employee’s claims (exceeding P5,000.00 for each employee). To
sustain the respondent’s position would,
in effect, sanction a situation where
all employee’s claims, regardless of amount, can be heard and determined
by the Secretary of Labor under his visitorial power. This does not however, appear to be the legislative intent.

xxx

“xxx the power to hear and decide employee’s claim exceeding
P5,000.00 for each employee should be left to the Labor Arbiter as the
exclusive repository of the power to hear and decide such claims.

“Nor is this position devoid of sound reason or purpose, because –

“1. The proceedings before the Secretary of Labor (or his
agents) exercising his visitorial powers is summary in nature.
On the other hand, proceedings before the Labor Arbiters are more formal and in
accord with rules of evidence. When the employee’s claim is less than
P5,000.00, a summary procedure for its settlement can be justified, but not
when a claim is more or less substantial, from the standpoint of both employee
and management, for which reason, an employee’s claim exceeding P5,000.00 is
placed within the exclusive jurisdiction of the Labor Arbiter to hear
and decide.

“2. Article 129 of the Labor Code expressly provides that upon
complaint of any interested party, the Regional Director (and, consequently,
the Secretary of Labor to whom appeals from the Regional Directors are taken)
is empowered to hear and decide simple money claims, i.e., those that do not
exceed P5,000.00 for each employee, employing for this purpose a summary
procedure. If Article 128 (b) of the Labor Code were to be construed as
empowering the Secretary of Labor, under his visitorial power, to hear and
decide all types of employee’s claims, including those exceeding
P5,000.00 for each employee, employing for this
purpose a summary procedure, then, Article 129 (limiting the Regional Director’s jurisdiction to a claim not
exceeding P5,000.00) becomes a useless surplusage in the Labor Code.

Since the amount claimed by each respondent exceeded the
P5,000.00 jurisdictional limit conferred upon public respondent, the latter
acted without jurisdiction in ordering petitioner to pay private respondents’
claims for salary differentials and 13th month pay (Midland Insurance
Corporation v. Secretary of Labor and Employment, 214 SCRA 578 [1992]).

Furthermore, the fact that petitioner raised the propriety of
granting the claimed salary differentials in favor of private respondents
should have alerted public respondent to exercise utmost restraint in assuming
jurisdiction over the complaint. When the employer contests the findings of the
Regional Director, the case must be referred to the Labor Arbiter. This is also
a question of fact which cannot be dealt with by the Regional Director view of
the summary nature of the proceedings attendant to the excercise of his
visitorial powers (See Art. 128 [b]). It may be argued, however, that respondent
Regional Director found that respondents Buban and Bonagua were issued appointment
papers on February 9, 1988 and March 22, 1988, respectively. Nevertheless, the
fact that each of the private respondents’ claim exceeded P5,000.00
ousted respondent Martinez of jurisdiction, by operation of law, to hear and
decide complainant’s claim for underpayment of wages.

It is a rule that when a tribunal acts in excess or lack of
jurisdiction, all decisions, orders and processes emanating therefrom are null
and void. Thus, on the issue posed by the petitioner regarding the denial of
its appeal, suffice it to say that in taking cognizance of the case at the
first instance, the Regional Director already acted beyond the scope of his
jurisdiction. Necessarily, all orders and processes subsequently issued by
him are without force and effect.

WHEREFORE,  the
assailed Orders of the Regional Director dated September 11, 1989 and September
3, 1990 including the writ of execution
dated September 26, 1990, are hereby SET ASIDE and declared null and
void. Each claim of private respondents as regards their salary differentials
and 13th month pay is hereby referred to the proper Labor Arbiter for
appropriate determination.

SO ORDERED.

Feliciano, (Chairman), Romero, Melo, and Vitug, JJ., concur.