The Supreme Court has ordered the finance executive officer of Kentex Manufacturing Corp., owner of a slipper factory which burned down in May 2015, to pay P1.4 million to 57 underpaid workers.
In a July 8, 2019 decision, the SC’s First Division resolved to reinstate an order of the Department of Labor and Employment holding Kentex general manager and treasurer Ong King Guan liable to pay its underpaid workers.
The SC decision penned by Associate Justice Mariano del Castillo reversed a 2017 Court of Appeals ruling that discharged Kentex official from monetary liability that had been set by an order of the DOLE – National Capital Region (DOLE-NCR) in 2015.
The DOLE order, “finding respondent Ong King Guan solidarily liable to pay the employees named in the Order the amount of Php 1,440,641.39 is hereby reinstated,” the SC ruled.
The P1.4 million represents underpayment of basic wages, premium pay, night shift and overtime pay; non-payment of cost-of-living allowance and regular holiday pay; and unauthorized deduction of cash bond, among others.
The DOLE order originally held Kentex and/or Kentex chairman and CEO Beato Ang and Ong to pay the amount.
The Labor department brought the case to the SC after the CA ruled that Ong could not be personally held liable for the debts of Kentex “without a showing of bad faith or wrongdoing on his part for the corporation’s unlawful act.”
The DOLE argued that its 2015 order had become final and executory, and therefore unalterable by the CA, after Ong failed to file an appeal before the DOLE secretary within the allowed period.
In ruling against Ong, the tribunal sided with the DOLE that its order had lapsed into finality.
“The June 26, 2015 Order having become final, it could no longer be altered or modified by discharging or releasing Ong from his accountability,” the high court said.
The High Court also found no merit in Kentex and Ong’s claim that they had been deprived of due process, finding that they “substantially participated” in the DOLE-NCR proceedings.
“Thus, it is self-evident that the CA committed serious error when it ordered the discharge or release of Ong from the obligations of Kentex,” the tribunal pointed out.
The SC held that the DOLE order must be upheld without any showing that its alteration by the CA “falls within the exceptions to the rule of immutability of final judgments.”
Chief Justice Lucas Bersamin and Associate Justices Francis Jardeleza, Alexander Gesmundo, and Rosmari Carandang concurred with the ruling.