1.

The case of Lagatic vs. NLRC have the following issues:

a. Whether or not NLRC committed grave abuse of discretion in not finding that petitioner Lagatic
was illegally dismissed
b. Whether or not respondent NLRC committed grave abuse of discretion in ruling that petitioner is
not entitled to salary differentials, backwages, separation pay, overtime pay, rest day pay,
unpaid commissions, moral and exemplary damages and attorney’s fees.

With the first issue, the Court says, to constitute a valid dismissal from employment, two
requisites must be met, namely: employee must be afforded due process, and the dismissal must be
for a valid cause. Petitioner contends that he was illegally dismissed on both substantive and
procedural aspects. But the Court finds no merit with his contention. An employer is free to
regulate all aspects of employment thus they may make reasonable rules and regulations for the
government of their employees. The company policies are generally valid and binding and must be
complied with. Petitioner’s continued violation of company policy requiring cold call reports, as
evidenced by the instances of non-submission of aforesaid reports justifies his dismissal.

As to the second issue, the Court says while it is true that an increase in salary cause an increase
in Amounts Received (AR) with the same being deducted from credits earned, thus lessening his
commissions, the fact remains that Lagatic still receives his basic salary without deductions.
Additionally, there is no law which requires employers to pay commissions. With respect to
petitioner’s claims to overtime pay, rest day pay and holiday premiums, Cityland maintains that
Saturday and Sunday call-ins were voluntary activities on the part of sales personnel who wanted to
realize more sales and earn more commissions.

The labor arbiter and NLRC sanctioned respondent’s practice of offsetting rest day or holiday
work with equivalent time on regular workdays on the ground that the same is authorized by
Department Order 21 series of 1990, which involves the shortening of the workweek from 6 to 5
days but with prolonged hours on those five days. Petitioner’s workweek was never compressed.
Overtime cannot be offset by undertime, to allow offsetting would prejudice the worker. Regardless,
petitioner Lagatic failed to show his entitlement to overtime and rest day pay due to the lack of
sufficient evidence as to the number of days and hours when he rendered overtime and rest day
work. With the finding that petitioner’s dismissal was just and valid, the Court says his claim to
moral and exemplary damages and attorney’s fees, must fail.

2.

A. Petitioner Romeo Lagatic filed a complaint against Cityland for illegal dismissal, illegal
deduction, underpayment, overtime and rest day pay, damages and attorney’s fees before Labor
Arbiter Ricardo C. Nova. The Labor Arbiter dismissed the petition for lack of merit.

B. Petitioner filed an appeal, the same was affirmed by the NLRC.

C. Petitioner filed petition for certiorari under Rule 65 to the Supreme Court, the reversal of the
resolution of the NLRC affirming the decision of Labor Arbiter Nova.
3.

The respondent was a responsible officer of the petitioner Bank; by his own admission, he
granted DAUD/BP accommodations in excess of the authority given to him and in violation of the bank’s
standard operating procedures; the petitioner Bank’s Code of Ethics provides that restitution/forfeiture
of benefits may be imposed on the employees for, among other things, infraction of the bank’s standard
operating procedures; and the respondent resigned from the petitioner Bank on May 31, 1998.

4.

The Labor Arbiter decided the case on the basis of the position papers and evidence submitted
by the parties. Due process demands an opportunity to be heard and the respondent was not denied of
this as he was given the opportunity to file a supplemental position paper and other supporting
documents. The Labor Arbiter submitted the case for resolution upon finding that he could judiciously
pass on the merits without the necessity of further hearing.

5.

A. Respondent filed with the NLRC, Regional Arbitration Branch, the complaint for payment of
separation pay, mid-year bonus, profit share and damages against the petitioner Bank.

B. The parties submitted their respective position papers to the Labor Arbiter. Respondent filed a motion
to set case for trial or hearing. Acting thereon, Labor Arbiter denied the same.

C. Respondent, appealed to the NLRC. After the parties had filed their respective memoranda, the NLRC
dismissed the appeal as it affirmed in toto the findings and conclusions of the Labor Arbiter.

D. The respondent moved for a reconsideration of the said decision but the NLRC denied his motion.

E. The respondent filed a petition for certiorari with the Court of Appeals alleging that the NLRC
committed grave abuse of discretion when it affirmed the findings and conclusions of the Labor Arbiter.
The CA set aside the decision of the NLRC and ordered that the records of the case be remanded to the
Labor Arbiter for further hearings on the factual issues involved.

F. Petitioner Bank filed a motion for reconsideration of the said decision, but the CA denied the same as
it found no compelling ground to warrant reconsideration.

G. Petitioner bank filed a petition for review on certiorari filed by CBC seeking the reversal of the
decision of the CA remanding to the Labor Arbiter for further hearings the complaint for payment of
separation pay, mid-year bonus, the profit share and damages filed by respondent Mariano M.
Borromeo against the petitioner.