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SECOND DIVISION

G.R. No. 104215 May 8, 1996

ERECTORS, INC., petitioner,
vs.
NATIONAL LABOR RELATIONS COMMISSION, HON.
JULIO ANDRES, JR. and FLORENCIO
BURGOS, respondents.

PUNO, J.:p

Petitioner Erectors, Inc. challenges the jurisdiction of

respondent Labor Arbiter Julio F. Andres, Jr. to hear and
decide the complaint1 for underpayment of wages and non-
payment of overtime pay filed by private respondent Florencio
Burgos, an overseas contract worker.

The facts are undisputed:

In September 1979, petitioner recruited private respondent to

work as service contract driver in Saudi Arabia for a period of
twelve (12) months with a salary of US$165.00 and an
allowance of US$165.00 per month. They further agreed that
private respondent shall be entitled to a bonus of US$1,000.00
if after the 12-month period, he renews or extends his
employment contract without availing of his vacation or home
leave. Their contract dated September 20, 1979, was duly
approved by the Ministry of Labor and Employment.

The aforesaid contract was not implemented. In December,

1979, petitioner notified private respondent that the position of
service driver was no longer available. On December 14, 1979,
they executed another contract which changed the position of
private respondent into that of helper/laborer with a salary of
US$105.00 and an allowance of US$105.00 per month. The
second contract was not submitted to the Ministry of Labor and
Employment for approval.

On December 18, 1979, private respondent left the country and

worked at petitioner's Buraidah Sports Complex project in
Saudi Arabia, performing the job of a helper/laborer. He
received a monthly salary and allowance of US$210.00, in
accordance with the second contract. Private respondent
renewed his contract of employment after one year. His salary
and allowance were increased to US$231.00.
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Private respondent returned to the Philippines on August 24,

1981. He then invoked his first employment contract. He
demanded from the petitioner the difference between his salary
and allowance as indicated in the said contract, and the
amount actually paid to him, plus the contractual bonus which
should have been awarded to him for not availing of his
vacation or home leave credits. Petitioner denied private
respondent's claim.

On March 31, 1982, private respondent filed with the Labor

Arbiter a complaint against the petitioner for underpayment of
wages and non-payment of overtime pay and contractual
bonus.

On May 1, 1982, while the case was still in the conciliation

stage, Executive Order (E.O. No. 797 creating the Philippine
Overseas Employment Administration (POEA) took effect.
Section 4(a) of E.O. No. 797 vested the POEA with "original
and exclusive jurisdiction over all cases, including money
claims, involving employer-employee relations arising out of or
by virtue of any law or contract involving Filipino workers for
overseas employment."2

Despite E.O. No. 797, respondent Labor Arbiter proceeded to

try the case on the merits. On September 23, 1983, he
rendered a Decision3 in favor of private respondent, the
dispositive portion of which reads:

WHEREFORE, judgment is hereby rendered

ordering the respondent to pay the complainant as
follows:

1. The sum of US$2,496.00 in its peso equivalent on

August 25, 1981 as difference between his
allowance as Service Driver as against his position
as Helper/Laborer;

2. The sum of US$1,000.00 in its peso equivalent as

of the same date, as his contractual bonus.

The complaints for non-payment/underpayment of

overtime pay and unpaid wages or commission are
DISMISSED for lack of merit.4

Petitioner appealed to respondent National Labor Relations

Commission (NLRC). It questioned the jurisdiction of the Labor
Arbiter over the case in view of the enactment of E.O. No. 797.
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In a Resolution dated July 17, 1991,5 respondent NLRC

dismissed the petitioner's appeal and upheld the Labor Arbiter's
jurisdiction. It ruled:

To begin with, the Labor Arbiter has the authority to

decide this case. On May 29, 1978, the Labor
Arbiters were integrated into the Regional Offices
under P.D. 1391. On May 1, 1980, P.D. 1691 was
promulgated giving the Regional Offices of the
Ministry of Labor and Employment the original and
exclusive jurisdiction over all cases arising out of or
by virtue of any law or contract involving Filipino
workers for overseas employment. There is no
dispute that the Labor Arbiter had the legal authority
over the case on hand, which accrued and was filed
when the two above mentioned Presidential Decrees
were in force.6

Petitioner filed this special civil action for certiorari reiterating

the argument that:

The NLRC committed grave abuse of discretion

tantamount to lack of jurisdiction in affirming the
Labor Arbiter's void judgment in the case a quo.7

It asserts that E.O. No. 797 divested the Labor Arbiter of his
authority to try and resolve cases arising from overseas
employment contract. Invoking this Court's ruling in Briad Agro
Development Corp. vs. Dela Cerna,8 petitioner argues that E.O.
No. 797 applies retroactively to affect pending cases, including
the complaint filed by private respondent.

The petition is devoid of merit.

The rule is that jurisdiction over the subject matter is

determined by the law in force at the time of the
commencement of the action.9 On March 31, 1982, at the time
private respondent filed his complaint against the petitioner, the
prevailing laws were Presidential Decree No. 1691 10 and
Presidential Decree No. 139111 which vested the Regional
Offices of the Ministry of Labor and the Labor Arbiters with
"original and exclusive jurisdiction over all cases involving
employer-employee relations including money claims arising
out of any law or contracts involving Filipino workers for
overseas employment."12 At the time of the filing of the
complaint, the Labor Arbiter had clear jurisdiction over the
same.
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E.O. No. 797 did not divest the Labor Arbiter's authority to hear
and decide the case filed by private respondent prior to its
effectivity. Laws should only be applied prospectively unless
the legislative intent to give them retroactive effect is expressly
declared or is necessarily implied from the language
used.13 We fail to perceive in the language of E.O. No. 797 an
intention to give it retroactive effect.

The case of Briad Agro Development Corp. vs. Dela

Cerna 14 cited by the petitioner is not applicable to the case at
bar. In Briad, the Court applied the exception rather than the
general rule. In this case, Briad Agro Development Corp. and
L.M. Camus Engineering Corp. challenged the jurisdiction of
the Regional Director of the Department of Labor and
Employment over cases involving workers' money claims, since
Article 217 of the Labor Code, the law in force at the time of the
filing of the complaint, vested in the Labor Arbiters exclusive
jurisdiction over such cases. The Court dismissed the petition
in its Decision dated June 29, 1989.15 It ruled that the
enactment of E.O. No. 111, amending Article 217 of the Labor
Code, cured the Regional Director's lack of jurisdiction by
giving the Labor Arbiter and the Regional Director concurrent
jurisdiction over all cases involving money claims. However, on
November 9, 1989, the Court, in a Resolution,16 reconsidered
and set aside its June 29 Decision and referred the case to the
Labor Arbiter for proper proceedings, in view of the
promulgation of Republic Act (R.A.) 6715 which divested the
Regional Directors of the power to hear money claims. It bears
emphasis that the Court accorded E.O. No. 111 and R.A. 6715
a retroactive application because as curative statutes, they fall
under the exceptions to the rule on prospectivity of laws.

E.O. No. 111, amended Article 217 of the Labor Code to widen
the workers' access to the government for redress of
grievances by giving the Regional Directors and Labor Arbiters
concurrent jurisdiction over cases involving money claims. This
amendment, however, created a situation where the jurisdiction
of the Regional Directors and the Labor Arbiters overlapped.
As a remedy, R.A. 6715 further amended Article 217 by
delineating their respective jurisdictions. Under R.A. 6715, the
Regional Director has exclusive original jurisdiction over cases
involving money claims provided: (1) the claim is presented by
an employer 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 P5,000.00. All other cases are within the
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exclusive and original jurisdiction of the Labor Arbiter. E.O. No.

111 and R.A. 6715 are therefore curative statutes. A curative
statute is enacted to cure defects in a prior law or to validate
legal proceedings, instruments or acts of public authorities
which would otherwise be void for want of conformity with
certain existing legal requirements.

The law at bar, E.O. No. 797, is not a curative statute. It was
not intended to remedy any defect in the law. It created the
POEA to assume the functions of the Overseas Employment
Development Board, the National Seamen Board and the
overseas employment functions of the Bureau of Employment
Services. Accordingly, it gave the POEA "original and exclusive
jurisdiction over all cases, including money claims, involving
employer-employee relations arising out of or by virtue of any
law or contract involving Filipino workers for overseas
employment, including seamen." 17 The rule on prospectivity of
laws should therefore apply to E.O. No. 797. It should not affect
jurisdiction over cases filed prior to its effectivity.

Our ruling in Philippine-Singapore Ports Corp. vs. NLRC18 is

more apt to the case at bar. In this case, PSPC hired Jardin to
work in Saudi Arabia. Jardin filed a complaint against PSPC for
illegal dismissal and recovery of backwages on January 31,
1979 with the Labor Arbiter. PSPC questioned the jurisdiction
of the Labor Arbiter because at that time, the power to hear
and decide cases involving overseas workers was vested in the
Bureau of Employment Services. We held:

When Jardin filed the complaint for illegal dismissal

on January 31, 1979, Art. 217 (5) of the Labor Code
provided that Labor Arbiters and the NLRC shall
have "exclusive jurisdiction to hear and decide" all
cases arising from employer-employee relations
"unless expressly excluded by this Code." At that
time Art. 15 of the same Code had been amended by
P.D. No. 1412 which took effect on June 9, 1978.
The pertinent provision of the said presidential
decree states:

Art. 15. Bureau of Employment Services. —

(a) . . .

(b) The Bureau shall have the original and exclusive

jurisdiction over all matters or cases involving
employer-employee relations including money
claims, arising out of or by virtue of any law or
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contracts involving Filipino workers for overseas

employment, except seamen. The decisions of the
Bureau shall be final and executory subject to appeal
to the Secretary of Labor whose decision shall be
final and inappealable.

Considering that private respondent Jardin's claims

undeniably arose out of an employer-employee
relationship with petitioner PSPC and that private
respondent worked overseas or in Saudi Arabia, the
Bureau of Employment Services and not the Labor
Arbiter had jurisdiction over the case. . . .

Art. 15 was further amended by P.D. No. 1691 which

took effect on May 1, 1990. Such amendment
qualifies the jurisdiction of the Bureau of Employment
Services as follows:

(b) The regional offices of the Ministry of Labor shall

have the original and exclusive jurisdiction over all
matters or cases involving employer-employee
relations including money claims, arising out of or by
virtue of any law or contracts involving Filipino
workers for overseas employment except
seamen: Provided that the Bureau of Employment
Services may, in the case of the National Capital
Region, exercise such power, whenever the Minister
of Labor deems it appropriate. The decisions of the
regional offices or the Bureau of Employment
Services if so authorized by the Minister of Labor as
provided in this Article, shall be appealable to the
National Labor Relations Commission upon the same
grounds provided in Article 223 hereof. The
decisions of the National Labor Relations
Commission shall be final and inappealable.

Hence, as further amended, Art. 15 provided for

concurrent jurisdiction between the regional offices of
the then Ministry of Labor and Bureau of
Employment Services "in the National Capital
Region." It is noteworthy that P.D. No. 1691, while
likewise amending Art. 217 of the Labor Code, did
not alter the provision that Labor Arbiters shall have
jurisdiction over all claims arising from employer-
employee relations "unless expressly excluded by
this Code."
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The functions of the Bureau of Employment Services

were subsequently assumed by the Philippine
Overseas Employment Administration (POEA) on
May 1, 1982 by virtue of Executive Order No. 797 by
granting the POEA "original and exclusive
jurisdiction over all cases, including money claims,
involving employer-employee relations arising out of
or by virtue of any law or contract involving Filipino
workers for overseas employment, including
seamen." (Sec. 4 (a); Eastern Shipping Lines v.
Philippine Overseas Employment Administration
[POEA], 200 SCRA 663 [1991]). This development
showed the legislative authority's continuing intent to
exclude from the Labor Arbiter's jurisdiction claims
arising from overseas employment.

These amendments notwithstanding, when the

complaint for illegal dismissal was filed on January
31, 1979, under Art. 15, as amended by
P.D. No. 1412, it was the Bureau of Employment
Services which had jurisdiction over the case and not
the Labor Arbiters. It is a settled rule that jurisdiction
is determined by the statute in force at the time of
the commencement of the action (Municipality of
Sogod v. Rosal, 201 SCRA 632, 637 [1991]). P.D.
1691 which gave the regional offices of the Ministry
of Labor concurrent jurisdiction with the Bureau of
Employment Services, was promulgated more than a
year after the complaint was filed. (emphasis
supplied)

In sum, we hold that respondent NLRC did not commit grave

abuse of discretion in upholding the jurisdiction of respondent
Labor Arbiter over the complaint filed by private respondent
against the petitioner.

IN VIEW WHEREOF, the Petition is DISMISSED. Costs

against petitioner.

SO ORDERED.