Supreme Court Limits Its Own Power: NLRC Cases Now Start at the Court of Appeals

The Supreme Court has clarified an important point in Philippine administrative law: when a party wants to challenge a decision of the National Labor Relations Commission (NLRC), the petition must be filed first with the Court of Appeals, not directly with the Supreme Court. In St. Martin Funeral Home v. NLRC (G.R. No. 130866, September 16, 1998), the Court En Banc reexamined its own long-standing practice and ruled that the doctrine on the hierarchy of courts must be strictly observed. This decision affects how labor disputes are reviewed and helps ease the Supreme Court's workload.

The Case Behind the Ruling

The case began as an illegal dismissal complaint. A private respondent claimed he worked as Operations Manager of St. Martin Funeral Home starting February 1995, but was dismissed in January 1996 for allegedly misappropriating P38,000.00 meant for VAT payment to the BIR. The petitioner, on the other hand, argued that the respondent was not an employee but a relative who voluntarily helped manage the business.

The labor arbiter ruled in favor of the funeral home, holding that no employer-employee relationship existed. On appeal, the NLRC reversed and remanded the case for further proceedings. The petitioner then went directly to the Supreme Court via a petition for certiorari, alleging grave abuse of discretion.

The Legal Question

The Court did not immediately rule on the merits. Instead, it took the opportunity to address a procedural issue of wider significance: where should petitions for certiorari against NLRC decisions be filed?

For years, the Supreme Court had accepted these petitions directly. But the Court noted that Republic Act No. 7902, which amended Section 9 of Batas Pambansa Blg. 129 (the Judiciary Reorganization Act of 1980), expanded the Court of Appeals' jurisdiction over decisions of quasi-judicial agencies. The law contained confusing language about "appeals" from the NLRC to the Supreme Court. The Court examined the legislative records and concluded that Congress intended to reduce the Supreme Court's workload by directing these cases to the Court of Appeals first.

The Ruling

The Supreme Court held that the proper remedy to question NLRC decisions is a special civil action for certiorari under Rule 65 of the Rules of Court, not an appeal. All references in the amended law to "appeals" from the NLRC to the Supreme Court were interpreted to mean petitions for certiorari under Rule 65.

More importantly, the Court ruled that these petitions must now be initially filed with the Court of Appeals, in strict observance of the doctrine on the hierarchy of courts. The Court explained that it is not a trier of facts and that the Court of Appeals is procedurally equipped to review factual findings. Direct resort to the Supreme Court would only be allowed if the redress cannot be obtained in the lower courts or where exceptional and compelling circumstances justify it.

Because the petition in this case was filed directly with the Supreme Court, it was remanded to the Court of Appeals for proper disposition.

Practical Takeaways

• File NLRC petitions at the Court of Appeals first. A party aggrieved by an NLRC decision must file a petition for certiorari under Rule 65 with the Court of Appeals, not directly with the Supreme Court.
• Observe the reglementary period. Petitions for certiorari under Rule 65 must be filed within 60 days from notice of the NLRC decision, judgment, or order.
• A motion for reconsideration is a precondition. Before filing a petition for certiorari, a party must first file a motion for reconsideration with the NLRC.
• The Supreme Court is not a trier of facts. The Court of Appeals can examine and reweigh evidence; the Supreme Court generally limits itself to questions of law and jurisdictional issues.
• Direct resort to the Supreme Court is exceptional. It is allowed only when the remedy cannot be obtained in the lower courts or when exceptional and compelling circumstances warrant it.

This article is general information and not legal advice. For your specific situation, consult a lawyer or ask ASG Legal AI.