2023 Handbook on Workers' Statutory Monetary Benefits

• The 2023 Handbook on Workers' Statutory Monetary Benefits incorporates updates and developments on labor standards, rules, and regulations
• The handbook introduces the latest increase in private sector workers' daily minimum wage rates and updated monthly minimum wage of domestic helpers or kasambahay, including applicable wage orders
• Computation factors for the estimated equivalent monthly rate of monthly-paid and daily-paid employees are updated following the amended proclamation of national holidays and special non-working days for 2023
• Updated provisions and amendments of Republic Act No. 11861, or the Expanded Solo Parents Welfare Act, are included, covering parental leave benefits, entitlement conditions, solo parent categories, and benefit limitations and termination

Minimum Wage

• Republic Act No. 6727, or the "Wage Rationalization Act," mandates fixing minimum wages for different industrial sectors like non-agriculture, agriculture plantation/non-plantation, cottage/handicraft, and retail/service, depending on worker number, capitalization, or annual gross sales
• "Agriculture" includes farming and related activities but excludes processing sugar, coconut, abaca, tobacco, pineapple, or aquatic products
• A "Retail establishment" primarily sells goods to end-users
• A "Service establishment" primarily sells services to individuals
• Wage determination was rationalized by establishing Regional Tripartite Wages and Productivity Boards (RTWPBs) to determine daily minimum wage rates based on criteria
• Wage increases apply to private sector workers receiving minimum wage or up to a daily wage ceiling, regardless of position, designation, or employment status, but not to workers of duly registered Barangay Micro Business Enterprises (BMBEs) with a Certificate of Authority pursuant to Republic Act No. 10644
• RTWPBs may grant establishments exemption from compliance with a Wage Order for up to one year upon application

Minimum Wage Rates

• As of July 2023, in the National Capital Region, the daily minimum wage is P610.00 for non-agriculture, P573.00 for service/retail establishments employing 15 or fewer workers, and P573.00 for manufacturing establishments regularly employing less than 10 workers.

Compensable Working Hours

• Minimum wage rates are based on normal working hours of eight (8) hours a day
• Compensable hours include all time employees are required to be on duty or at the employer's premises, and all time employees are suffered or permitted to work
• All hours an employee is required to give to the employer are considered hours worked, regardless of whether they involve productive labor or physical/mental exertion
• Employees don't have to leave the workplace for rest periods to be excluded from working time; stopping work is enough
• If work was necessary, benefited the employer, or the employee couldn't leave, all time spent is considered hours worked if done with the employer's knowledge
• Inactive time due to interruptions beyond the employee's control is working time if resumption is imminent or the interval is too brief to use effectively
• Waiting time is considered working time if it's integral to the job or the employee is required to wait
• Employees required to remain on call on the employer's premises are considered working while on call
• Attendance at lectures, meetings, or training programs is not working time if outside regular hours, voluntary, and no productive work is done
• Employers must provide at least one (1) hour time-off for regular meals, except when a 20-minute meal period is given and credited as compensable hours in certain situations

Monthly-Paid vs. Daily-Paid Employees

• "Monthly-paid employees" are paid every day of the month, including unworked rest days, special days, and regular holidays, using a factor of 365 days to determine the equivalent monthly salary
• "Daily-paid employees" are paid only for days worked and unworked regular holidays

Computation of Estimated Equivalent Monthly Rate (EEMR)

• For monthly-paid employees, the EEMR uses a factor of 365 days to determine the equivalent annual and monthly salary
• EEMR = (Applicable Daily Rate x 365) / 12 months
• For daily-paid employees required to work everyday, including Sundays, special days and holidays EEMR = (Applicable Daily Rate x 395.0) / 12 months
• For daily-paid employees not required to work everyday EEMR = (Applicable Daily Rate x 313) / 12 months

Subsidized Meals and Snacks

• Employers may provide subsidized meals and snacks if the subsidy is at least 30% of the fair value
• Employees may have up to 70% of the value deducted from their wages

Wage of Kasambahay

• Regional Tripartite Wages and Productivity Boards (RTWPBs) review and adjust minimum wage rates for Kasambahay

Wage of Kasambahay as of July 2023

• NCR: P6,000.00
• CAR: P4,500.00
• Region I: P5,000.00
• Region II: P5,000.00
• Region III: P5,000.00 or P4,500.00
• CALABARZON: P5,000.00 or P4,000.00
• MIMAROPA: P4,500.00
• Region V: P4,000.00
• Region VI: P4,500.00
• Region VII: P5,500 or P4,500.00
• Region VIII: P5,000.00 or P4,500.00
• Region IX: P4,000 or P3,500.00
• Region X: P4,500 or P3,500.00
• Region XI: P4,500.00
• Region XII: P4,500 or P4,000.00
• CARAGA: P4,000.00

Wage of Kasambahay who Works as Salesclerk

• A Kasambahay who works as salesclerk should receive wage in accordance with the prescribed minimum wage

Reduction of Workdays on Wages

• If the employer reduces workdays to prevent losses, wages may be deducted based on "no work, no pay," unless an agreement or company policy provides otherwise

Penalties

• Entities failing to pay prescribed wage increases face fines from P25,000.00 to P100,000.00 and imprisonment of two to four years
• Employers must pay an amount equivalent to double the unpaid benefits

Barangay Micro Business Enterprises (BMBES)

• BMBEs with assets up to P3,000,000 are not covered by minimum wage laws
• Employees of BMBEs are still entitled to social security and health care benefits

Wage of Workers Paid by Results

• Workers paid by results must receive no less than the prescribed minimum wage rates

Wage of Apprentices, Learners, and Persons with disability

• Apprentices and learners should receive a wage of seventy-five (75%) percent of the applicable minimum wage rates

Annual Establishment Report on Wages (AERW)

• Private establishments must submit an annual report with a verified itemized listing of their labor component

Coverage from Income Tax

• Effective January 1, 2018 compensation income of Minimum Wage Earners (MWEs) is exempted from the requirement of withholding tax on compensation
• Holiday pay, overtime pay, night shift differential pay, and hazard pay earned by MWEs are also covered
• Additional compensation such as commissions, honoraria, fringe benefits, benefits in excess of P90,000.00, taxable allowances, and other taxable income given to an MWE by the same employer other than those which are expressly exempt from income tax shall be subject to withholding tax using the withholding tax table
• Compensation during the year not exceeding Two hundred fifty thousand pesos (P250,000.00) also exempted from the tax.

Holiday Pay

• Holiday pay refers to the payment of the regular daily wage for any unworked regular holiday
• This benefit applies to all employees except government employees, retail and service establishments regularly employing les than ten (10) workers, kasambahay, and managerial employees

Holiday Pay Rates

• Every employee covered by the Holiday Pay Rule is entitled to at least 100% of his/her minimum wage rate even if he/she did not report for work, provided he/she is present or is on leave of absence with pay on the workday immediately preceding the holiday
• Work performed on that day merits at least twice (200%) the daily wage of the employee
• Twelve regular holidays for the year 2023 include: New Year's Day, Maundy Thursday, Good Friday, Araw ng Kagitingan, Eidul Fitr, Labor Day, Independence Day, Eidul Adha, National Heroes Day, Bonifacio Day, Christmas Day, & Rizal Day

Absences

• All covered employees shall be entitled to holiday pay when they are on leave of absence with pay on the workday immediately preceding the regular holiday
• Employees who are on leave of absence without pay on the day immediately preceding a regular holiday may not be paid the required holiday pay if they do not work on such regular holiday

Successive Regular Holidays

• If there are two (2) successive regular holidays, employee may not be paid for both holidays if he/she absents himself/herself from work on the day immediately preceding the first holiday, unless he/she works on the first holiday, in which case he/she is entitled to his/her holiday pay on the second holiday

Temporary or Periodic Shutdown/Cessation of Work

• In cases of temporary or periodic shutdown and temporary cessation of work of an establishment the regular holidays falling within the period shall be compensated in accordance with the Rules Implementing the Labor Code, as amended

Holiday Pay of Piece-Rate Employees

• His / her holiday pay shall not be less than his/her average daily earnings for the last seven (7) actual work days preceding the regular holiday

Holiday Pay of Seasonal Workers

• Seasonal workers may not be paid the required holiday pay during off-season when they are not at work

Premium Pay

• Premium pay refers to the additional compensation for work performed within eight (8) hours on rest days and special days
• It applies to all employees except government employees, managerial employees, and officers or members of a managerial staff

Special Days

• Special (Non-Working) Days for 2023 include: Additional Special (Non-Working) Day, EDSA People Power Revolution Anniversary, Black Saturday, Ninoy Aquino Day, All Saints' Day, Additonal Special (Non-Working) Day, Feast of the Immaculate Conception of Mary, Last Day of the Year
• For work on a declared Special (Working) Day, no premium pay is required since work performed on said day is considered work on an ordinary workday

Premium Pay Rates

• "No work, no pay" principle applies during special days
• On the other hand, work performed on special days merits additional compensation of at least thirty percent (30%) of the basic wage or a total of one hundred thirty percent (130%)
• Where the employee works on a special day falling on his rest day, he/she shall be entitled to an additional compensation of at least fifty percent (50%) of his/her basic wage or a total of one hundred fifty percent (150%)

Overtime Pay

• Overtime pay refers to the additional compensation for work performed beyond eight (8) hours a day
• Rate depends on the type of day (ordinary working day, rest day, special day, holiday)
• Premium pay for work performed on rest days, special days, or regular holidays is included in the regular rate of the employee in the computation of overtime pay for overtime work rendered on said days, especially if the employer pays only the minimum overtime rates prescribed by law

Night Shift Differential

• Night Shift Differential (NSD) refers to the additional compensation of ten percent (10%) of an employee's regular wage for each hour of work performed between 10 p.m. and 6 a.m.

Guide Computations for Holiday Pay, Premium Pay, Overtime Pay, and Night Shift Differential

• Work On/Equivalent Pay
  • Ordinary day = 1 or 100%
  • Sunday or rest day = 1.3 or 130%
  • Special (non-working) day = 1.3 or 130%
  • Special (non-working) day falling on rest day = 1.5 or 150%
  • Double special (non-working) days = 1.5 or 150%
  • Double special (non-working) days falling on rest day = 1.95 or 195%
  • Regular holiday = 2 or 200%
  • Regular holiday falling on rest day = 2.6 or 260%
  • Double holiday = 3 or 300%
  • Double holiday falling on rest day = 3.9 or 390%
  • Ordinary day, night shift = 1 x 1.1 = 1.1 or 110%
  • Rest day, night shift = 1.3 x 1.1 = 1.43 or 143%
  • Special (non-working) day, night shift = 1.3 x 1.1 = 1.43 or 143%
  • Special (non-working) day, rest day, night shift = 1.5 x 1.1 = 1.65 or 165%
  • Double special (non-working) days, rest day, night shift = 1.95 x 1.1 = 2.145 or 214.5%
  • Regular holiday, night shift = 2 x 1.1 = 2.2 or 220%
  • Regular holiday, rest day, night shift = 2.6 x 1.1 = 2.86 or 286%
  • Double holiday, night shift = 3 x 1.1 = 3.3 or 330%
  • Double holiday, rest day, night shift = 3.9 x 1.1 = 4.29 or 429%
  • Ordinary day, overtime (OT) = 1 x 1.25 = 1.25 or 125%
  • Rest day, OT = 1.3 x 1.3 = 1.69 or 169%
  • Special (non-working), OT = 1.3 x 1.3 = 1.69 or 169%
  • Special (non-working) day, rest day, OT = 1.5 x 1.3 = 1.95 or 195%
  • Double special (non-working) days, rest day, OT = 1.95 x 1.3 = 2.535 or 253.5%
  • Regular holiday, OT = 2 x 1.3 = 2.6 or 260%
  • Regular holiday, rest day, OT = 2.6 x 1.3 = 3.38 or 338%
  • Double holiday, OT = 3 x 1.3 = 3.9 or 390%
  • Double holiday, rest day, OT = 3.9 x 1.3 = 5.07 or 507%
  • Ordinary day, night shift, OT = 1 x 1.1 x 1.25 = 1.375 or 137.5%
  • Rest day, night shift, OT = 1.3 x 1.1 x 1.3 = 1.859 or 185.9%
  • Special (non-working) day, night shift, OT = 1.3 x 1.1 x 1.3 = 1.859 or 185.9% Special (non-working) day, rest day, night shift, OT =
• 1.5 x 1.1 x 1.3 = 2.145 or 214.5%
  • Double special (non-working) days, rest day, night shift, OT = 1.95 x 1.1 x 1.3 = 2.7885 or 278.85%
  • Regular holiday, night shift, OT = 2 x 1.1 x 1.3 = 2.86 or 286%
  • Reg. holiday, rest day, night shift, OT = 2.6 x 1.1 x 1.3 = 3.718 or 371.8%
  • Double holiday, night shift, OT = 3 x 1.1 x 1.3 = 4.29 or 429%
  • Double holiday, rest day, night shift, OT = 3.9 x 1.1 x 1.3 = 5.577 or 557.7%

Service Charges

• Service charges are amounts collected by establishments like hotels and restaurants, added to bills for work or services rendered
• It applies to all employees under the direct employ of the establishment, regardless of their positions, designations or employment status, except managerial employees
• Collected service charges must be distributed completely and equally, based on actual hours or days of work or service rendered, among the covered employees

Service Incentive Leave

• Service incentive leave refers to the paid leave of five (5) days granted to an employee who has rendered at least one (1) year of service that may be used for sick, vacation, and other leave purposes
• It applies to every employee who has rendered at least one (1) year of service, except for government employees, persons in personal service, managerial employees, and those in establishments regularly employing less than ten (10) employees
• “One year of service” means service within 12 months, continuous or broken, from the employee's start date, including authorized absences, unworked rest days, and paid holidays
• Employees can either use leave credits or commute them to monetary equivalent at year-end; unused leave is entitled upon resignation or separation
• The basis is the salary rate on the date of conversion, and use/conversion can be on a pro rata basis

Maternity Leave

• Maternity leave is paid leave for a female employee for every instance of pregnancy, miscarriage, and emergency termination of pregnancy
• It applies to all female employees, regardless of civil status or employment status
• The maternity leave shall be for one hundred five (105) days with full pay, and additional fifteen (15) days with full pay in case the female employee qualifies as a solo parent under RA 8972, as amended by RA 11861
• In cases of live childbirth, an additional maternity leave of thirty (30) days without pay, can be availed of, at the option of the female employee
• Employers from the private sector pay for the difference between the full salary and the actual cash benefits received from the SSS
• Female employees must have at least three (3) monthly contributions to the SSS in the twelve-month period immediately preceding the semester of childbirth, miscarriage, or emergency termination of pregnancy to qualify for leave

Paternity Leave

• Paternity leave refers to the paid leave granted to a married male employee allowing him to lend support to his lawful wife during her period of recovery and/or in nursing of their newborn child, including miscarriage
• Benefit applies to all married male employees, regardless of employment status
• The qualified employee will be granted the full pay for the seven (7) days which he is allowed not to report for work
• Paternity leave benefit shall apply to the first four (4) deliveries of the employee's lawful wife with whom he is cohabiting

Parental Leave for Solo Parents

• Parental leave refers to the paid leave granted to a qualified solo parent to enable the performance of parental duties and responsibilities where physical presence is required or beneficial to the child
• Solo parents are those who provide sole parental care to a child or children due to various reasons including rape, death of a spouse, or abandonment
• All solo parents may apply for a Solo Parent Identification Card (SPIC)
• Leave applies to the guardian or spouse of an Overseas Filipino Worker (OFW)
• Qualified parent will be given noncumulative parental leave of not more than seven (7) working days with pay every year

Leave for Victims of Violence Against Women and Their Children (VAWC)

• Refers to the paid leave granted to a female employee who is a victim to violence
• Provides 10 day leave with full pay to be extended according to the victim status
• A certification from a public official or legal officer is required to grant this incentive

Special Leave for Women

• Special leave for women refers to the paid leave granted to a female employee allowing her to recuperate following surgery caused by gynecological disorders for a period of up to two (2) months
• Includes surgical procedures affecting reproductive organs, certified by a physician
• Has a service condition of at least 6 months, for the past twelve months

Thirteenth-Month Pay

• Means one twelfth of an employees salary earned in a calendar year
• Only available to rank-and-file employees paid for at least one month of the year
• Expressly exempt are the government and those already receiving an equivalent
• For resignation or separation a portion of their salary is due for the length of time worked
• Shall be paid not later than December 24 of every year
• Thirteenth-month pay is not part of the regular wage of employees for determining overtime and premium payments
• No request or application for exemption is allowed for payment of 13th month pay

Separation Pay

• Article 298 and 299 of the Labor Code of the Philippines sets out the rule and requirements
• An entitled employee must have their service terminated for some authorized cause
• Such as one half month pay per year in service, if such termination is authorized
• Retrenchment to prevent losses i.e. reduction of personnel
• Or because of the employees health or lack of service hours
• One-month pay for an employee is also an option, or in lieu of providing labor saving services
• An employee must also be given a chance to be reinstated, but is made impossible because of circumstances on the company, not the employee

Retirement Pay

• Article 302 of the Labor Code of the Philippines sets out the rule and requirements
• Retirement can be optional if from sixty (60) years old to sixty-five (65) years old, and have served the establishment for at least five years
• Does not cover retail and farmhands with 10 or less staff
• Can be computed as one half month salary each month, or one-month salary
• Upon retirement, an employee is entitled to prorated pay for the calendar
• A plan maintained by the employer for the benefit of their employees.

Employee's Compensation Program

• Provides compensation and other benefits to workers who get injured or ill through a work related injury or disease

Conditions of Compensability

• An injury must occur within the work hours and premises
• An accident may be considered to have risen out of and in the course of employment when it happened at the workplace

PhilHealth Benefits

• The National Health Insurance Program (NHIP) is a compulsory health insurance program of the government established to provide universal health insurance coverage and ensure affordable, acceptable, available and accessible health care services for all citizens of the Philippines
• The NHIP covers all Filipinos pursuant to Republic Act No. 11223 or the Universal Health Care (UHC) Act
• Inpatient and Outpatient and all Philippine citizens are entitled to a program
• The premium contributions for 2023 will amount to 4.5%
• Direct Contributors are the following: employees, kasambahays, self-earning individuals and professional practitioners, overseas Filipino Workers, and citizens abroad.
• Contributions can be checked at www.philhealth.gov.ph

Social Security Benefits

• Social security benefits are a composition of events such as, death, disability, sickness, maternity,
• Work accidents covered by Employee's compensation
• As well as coverage for domestic workers under sixty (60) years of age to be covered
• Benefits include sickness and injury, maternity for childbirth, and pensions if unable to work

Pag-IBIG Benefits

• Pagtutulungan sa Kinabukasan: Ikaw, Bangko, Industriya at Goberyno
• Government-Owned and Controlled Corporation that provides secured savings.
• Membership for Pag-IBIG membership is mandatory for all employees covered by the Social Security System (SSS)
• There are services such as Pag-IBIG Regular Savings, MP2 Savings, and financial assistance for Pag-IBIG members