The benefits of regular employees in the Philippines are currently being improved our Labor Laws.

As
of but as of November 2018, here are the important things you need to know about employee benefits in
the Philippines, as mandated by the government:

1. Wage and compensation benefits

Minimum Wage Rate per Region and Industry in Philippine Peso as of November 2018

o 13th month pay

It’s not a Christmas bonus as other people consider it. It’s a government-imposed bonus for private sector
employees, no matter their position in the company.
Below is a sample Computation of 13th Month Pay:
In case of perfect attendance, the employee will get the full monthly salary for 13th month pay.
Gross Monthly Salary P30,000.00

Perfect attendance (12 months) P30,000 x 12 months / 12 months

Total take home 13th month pay P30,000

But in the instances where an employee has unpaid leaves, it will be deducted from the 13th month pay.
Gross Monthly Salary P30,000

30 days of office leaves, be it sick, vacation, or maternity leave. This means you P30,000 x 11 (months) /
only had 11 months of total attendance 12 months
Total take home 13th month pay P27,500

o Retirement pay
Upon the age of 60 years or more, the employee who has served at the establishment for at least five years
may be granted a retirement pay equivalent to at least one-half month of salary for every year of service.
A fraction of at least six months is considered as one whole year.
As stipulated by the DOLE National Wages and Productivity Commission, “The minimum retirement pay
shall be equivalent to one-half (1/2) month salary for every year of service, a fraction of at least six (6)
months being considered as one (1) whole year.”
The “one-half month salary” includes:
o
 1. 15 days salary based on the latest salary rate;
 2. Cash equivalent of 5 days of service incentive leave;
 3. One-twelfth (1/12) of the 13th month pay
(1/12 x 365/12 = .083 x 30.41 = 2.5)
Minimum Retirement Pay = Daily Rate x 22.5 days x number of years in service

o Overtime pay
The employee who renders overtime will be given additional compensation equivalent to his regular wage
plus at least 25% premium.
Overtime pay for holiday or rest day shall be paid an additional compensation from the rate of the first
eight hours on a holiday or rest day plus at least 30%.
On a Special Non-Working day, or rest day, an additional compensation of 30% premium will be paid in
addition to the rate of the first eight hours on holiday or rest day.
Monthly salary P20,000.00

Working days per month 26

daily salary P769.23

per hour rate P96.15

overtime rate 125%

per hour rate-overtime P120.19

employee A overtime (in hours) 3.50

Overtime pay P420.67

2. Leave Benefits
While sick leave and vacation leave benefits are not specifically stated under the law, it stipulates that
private employees are allowed to provide employees a yearly Service Incentive Leave of five days with
pay. This applies to employees with work tenure of at least one year within the company.

 Maternity Leave
Any pregnant woman employee who has worked with the company for at least six months will be granted
a maternity leave of at least two weeks prior to her due date (expected date of delivery) and four weeks
after normal delivery or miscarriage with full pay based on her regular salary.A total of 60 days is granted
for government employees, and 60 to 80 days for employees in the private sector.The Maternity Leave
benefit is effective up to the first four deliveries of the woman employee working in the
company.However, Senate Bill 2982, or the Expanded Maternity Leave Law of 2015, has been approved
on its third (3rd) reading on January 18, 2016. If enacted into law, will grant 100 days of maternity leave
for employees in the government and private sector, regardless of the type of delivery.

 Paternity Leave
The R.A No. 8187, or Paternity Leave Act of 1996, grants seven days of fully paid leave to married
fathers. This is effective up to the first four deliveries of the legitimate spouse.

 Parental Leave for Solo Parents, or Solo Parenting Leave (SPL)

Seven days leave with pay for every year of service, on top of other leave privileges, e.g. Maternity or
Paternity Leave.
  Special Leave Benefits for Women
This entitles women who underwent surgery due to gynecological disorders to two months’ leave with
full pay, as stipulated in R.A. 9710 or the Magna Carta of Women. This applies to employees who have
rendered at least six months of service with the company.
On the other hand, victims of violence against women, as stipulated in R.A. 9262 or the Anti-Violence
Against Women and Their Children Act of 2004, are entitled to 10 days leave with full pay.

3. Mandatory Government Benefits and Contributions

The following government contribution will be automatically deducted from regular employees based on
their salary, with the following benefits:

 Social Security System (SSS) benefits

The SSS Employees’ Compensation (EC) program has been in place to help workers who
encounter work-related illnesses or injury resulting in disability or death. This includes compensation for:
medical services, appliances, and supplies in an accredited hospital; rehabilitation services, including
medical, surgical, and hospital treatment; and income cash benefit.More information can be found here.

 Pag-IBIG benefits
This entitles employees to avail of a Housing Loan, Calamity Loan, and Multi-Purpose Loans that aim to
provide financial assistance to their needs. For a full list of Pag-IBIG benefits and
membership requirements, visit their website

 PhilHealth benefits
Provides financial assistance for inpatient and outpatient hospitalization, as well as Z Benefit Packages
for patients undergoing prolonged hospitalization and expensive treatments and suffering from
Millennium Development Goal (MDG)-related illnesses.If you want to get a detailed list of employee
benefits in the Philippines, it’s always best to consult your human resources personnel, or visit the DOLE
website here. –Kristel Serran

5. HOW LONG IS THE MEAL PERIOD IN A DAY?

Meal period is not less than 60 minutes or 1 hour time-off for regular meals of
employees which is non-compensable. Rest periods or coffee breaks running from 5 to
20 minutes shall be considered compensable working time.

6. WHAT IS HOLIDAY PAY?

Holiday pay refers to payment of the regular daily wage for any unworked regular
holiday.For the list of regular holidays, log in at dole.gov.ph/pages/view/9
7. WHAT IS THE CONDITION SO THAT AN EMPLOYEE WILL BE ENTITLED TO

HOLIDAY PAY?

He/She should be present on the workday immediately preceding the regular holiday;
or
He/She should be on leave of absence with pay on the day immediately preceding
the regular holiday.

8. HOW CAN AN EMPLOYEE BE ENTITLED TO THE TWO (2) SUCCESSIVE

REGULAR HOLIDAYS?

An employee can be entitled to two (2) successive regular holidays, like Holy
Thursday and Good Friday if he/she works or is on leave of absence with pay on the
day immediately preceding the first holiday.

9. HOW MUCH IS THE HOLIDAY PAY OF AN EMPLOYEE?

For any unworked regular holiday, 100% of the employee’s daily wage rate (Basic
pay + COLA).
For work performed on a regular holiday, plus 100% or a total of 200% of the
employee’s daily wage rate (Basic pay + COLA).

10. WHAT IS PREMIUM PAY?

Premium pay refers to the additional payment for work within 8 hours on rest days
or special days. For list of special days, log in at dole.gov.ph/pages/view/9

11. HOW MUCH IS THE PREMIUM PAY OF AN EMPLOYEE?

Plus 30% of the daily basic rate or a total of 130% for work performed on rest day
or special day.

Plus 50% of the daily basic rate or a total of 150% for work performed on special
day falling on the employee’s rest day.
Plus 30% of the daily basic rate or a total of 260% for work performed on a regular
holiday falling on the employee’s rest day.
12. WHAT IS OVERTIME PAY?

Overtime pay refers to the additional pay for work performed in excess of 8 hours a
day.

13. HOW MUCH IS THE OT PAY OF AN EMPLOYEE?

Plus 25% of the hourly rate for work performed in excess of 8 hours on ordinary day.

Plus 30% of the hourly rate for work performed in excess of 8 hours on rest day,
special day or regular holiday.

16. WHAT ARE THE LEAVE BENEFITS THAT AN EMPLOYEE IS ENTITLED TO

UNDER EXISTING LAWS?

a. 5 days service incentive leave with pay for employee who has rendered at
least 1 year of service. (Article 95 of the Labor Code, as amended)
b. Maternity Leave with pay of 60 days for normal delivery and 78 days for
caesarian section delivery for every pregnant employee in the private sector, whether
married or unmarried. A female employee should be an SSS member and must have
paid at least 3 monthly contributions within the 12-month period. (RA 1161, as
amended by RA 8282)
c. 7 days Paternity Leave with pay for all married male employees in the private
sector regardless of status of employment, to allow the husband to lend support to his
wife during her period of recovery and/or in nursing her newborn child, provided he is:
(RA 8187)
1. An employee at the time of the delivery of his child;
2. Cohabiting with his spouse at the time that she gives birth or suffers a
miscarriage;
3. Applied for paternity leave with his employer within a reasonable period of time;
and
4. His wife has given birth or suffered a miscarriage.
 d. 7 days Solo Parent Leave with pay is granted to a solo parent to enable him/her
to perform parental duties and responsibilities where physical presence is required
provided he/she has: (RA 8972)
1. Rendered at least 1 year of service, whether continuous or broken which
includes authorized absences and paid regular holidays;
2. Notified his/her employer that he/she will avail himself/herself of it, within a
reasonable period of time; and
3. Presented Solo Parent Identification Card, which may be obtained from the
DSWD office of the city or municipality where he/she resides.
e. Special Leave for Women of maximum 2 months with full pay who have
rendered continuous aggregate employment service of 6 months for the last 12 months,
following surgery caused by gynecological disorders. (RA 9710)

21. WHO ARE ENTITLED TO 13TH MONTH PAY?

All rank and file employees are entitled to receive 13th month pay regardless of the
nature of their employment and irrespective of the methods by which their wages are
paid, provided they worked for at least one (1) month during a calendar year.

22. HOW MUCH IS THE REQUIRED 13TH MONTH PAY?

The amount of 13th month pay shall at least be 1/12 of the total basic salary earned
for the year which shall n include all earnings paid by his/her employer for services
rendered but does not include allowances and other monetary benefits such as the cash
equivalent of unused vacation and sick leave credits, overtime, premium, night shift
differential, holiday pay and COLA.

23. WHEN SHOULD THE 13TH MONTH PAY BE GIVEN?

It should be given to the employees not later than December 24 of every year.

24. WHAT IS RETIREMENT PAY?

 It is the amount given an employee who has reached the age of 60 years for
optional retirement and 65 years old for compulsory and who has served the company
for at least 5 years in the service.

25. HOW IS THE RETIREMENT BENEFITS COMPUTED?

Minimum retirement pay = 22.5 days x daily rate x number of years of service