[G.R. No. 104215.

May 8, 1996]
ERECTORS, INC., petitioner, vs. NATIONAL LABOR RELATIONS COMMISSION, HON. JULIO
ANDRES, JR. and FLORENCIO BURGOS, respondents.

SYLLABUS

1. REMEDIAL LAW; JURISDICTION; JURISDICTION OVER THE SUBJECT MATTER, DETERMINED

BY LAW IN FORCE AT THE COMMENCEMENT OF ACTION; LABOR ARBITER HAS
JURISDICTION OVER MONEY CLAIMS OF OVERSEAS WORKER FILED ON MARCH 31, 1982. –

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. On March 31, 1982, at the time private
respondent filed his complaint against the petitioner, the prevailing laws were Presidential
Decree No. 1691 and Presidential Decree No. 1391 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." At the time of the filing
of the complaint, the Labor Arbiter had clear jurisdiction over the same.

2. LABOR AND SOCIAL LEGISLATION; EXECUTIVE ORDER NO. 797 CREATING THE PHILIPPINE
OVERSEAS EMPLOYMENT ADMINISTRATION (POEA); WITHOUT RETROACTIVE
APPLICATION; LABOR ARBITER NOT DIVESTED OF JURISDICTION BY EFFECTIVITY OF E.O.
797.
- 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. We fail to perceive in the
language of E.O. No. 797 an intention to give it retroactive effect.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." 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.

3. STATUTORY CONSTRUCTION; STATUTES; CURATIVE STATUTE; DEFINED. - 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.

APPEARANCES OF COUNSEL
Bengzon, Zarraga, Narciso, Ardala, Pecson, Bengzon, and Jimenez for petitioner.
Fabian Gappi for private respondent.
DECISION

PUNO, J.:
Petitioner Erectors, Inc. challenges the jurisdiction of respondent Labor Arbiter Julio F.
Andres, Jr. to hear and decide the complaint[1] 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.
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 Decision[3] 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.

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
Developinent 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. 1391[11] 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.

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
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. NLRC[18] 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:
Article 15. Bureau of Employment Services. -x x x x x x x x x

(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 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 employeremployee
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. x x x

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.

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. (Italics 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.

Regalado (Chairman), Romero, Mendoza, and Torres, Jr., JJ., concur.

Facts:
In September 1979, Erectors recruited Florencio Burgos to work as Service Contract Driver in Saudi Arabia for
12 months with a salary of $165 and an allowance of $165 per month. Burgos will also be entitled a bonus of
$1ooo if after the 12-month period, he renews/extends his contract without availing his vacation or home leave 
His contract was approved by the Ministry of Labor and Employment.
However, the contract was not implemented. In December 1979, Erectors notified Burgos that the position of
Service Driver was no longer available. On December 14, 1979, they executed another contract changing his
position from driver to laborer with a salary of $105 and an allowance of $105 per month. This contract was not
submitted to the MLE.

On December 1979, Burgos left the country and worked at Erectors Buraidah Sports Complex project in Saudi
Arabia as a laborer. He received a monthly salary and allowance of $210. Burgos renewed his contract after one
year and his salary and allowance were increased to $231.
Burgos returned to Philippines on August 1981. He then invoked his first employment contract.
He demanded the difference between his salary and allowance in teh said contract and the amount paid to him.

On March 1982, Burgos filed wiht the Labor Arbiter a complaint for underpayment of wages and non-payment of
overtime pay and bonus.

While his case was still in conciliation stage, EO 797 creating POEA was established  Sec 4(a) of E) 797 vested
the POEA with "original and exclusive jurisdiction over all cases including money claims, involving employer-
employee relationship arising out of or by virtue of any law or contract involving Filipino workers for overseas
employment."

Despite EO 797, Labor Arbiter proceeded to try the case and rendered judgement in favor of Burgos. In view of
EO 797, Erectors questioned the jurisdiction of the LA in NLRC. NLRC dismissed the petitioner's appeal and
upheld the LA's jurisdiction.

Issue:
Whether or not EO 797 applies retroactively to affect pending cases, including the complaint filed by Burgos.

Held:
No. 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.  On March 31, 1982, at the time private respondent filed his complaint against the
petitioner, the prevailing laws were Presidential Decree No. 1691 and Presidential Decree No. 1391 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." At the time of the filing of the complaint, the
Labor Arbiter had clear jurisdiction over the same.