Handbook on Workers' Statutory Monetary Benefits 2023 PDF

HANDBOOK ON WORKERS’ STATUTORY MONETARY BENEFITS DEPARTMENT OF LABOR AND EMPLOYMENT BUREAU OF WORKING CONDITIONS INTRAMUROS, MANILA 2023 The Project Team Atty. Alvin B. Curada, Nicanor V. Bon, Emila T. de Guzman, Pauli Andrenette Grace D. Ong, and other BWC staff All Rights Reserved This Handbook, or any part thereof, may not be reproduced for commercial purposes without the written permission of the Bureau of Working Conditions, Department of Labor and Employment. This Handbook is published by the: Bureau of Working Conditions (BWC) Department of Labor and Employment (DOLE) 3rd Floor, DOLE Building, Muralla cor. Gen. Luna Streets, Intramuros, Manila Tel. No. (02) 8527-3000 locals 306 or 308; Telefax No. (02) 8527-3478; email: [email protected]; website: bwc.dole.gov.ph – NOT FOR SALE – Cover Art : Marc Vincent M. Labrador TABLE OF CONTENTS COMPLIANCE GUIDE......................................................................................... 1 1. MINIMUM WAGE................................................................................................ 2 A. COVERAGE..................................................................................................................................3 B. MINIMUM WAGE RATES....................................................................................................... 4 C. RULES IN DETERMINING COMPENSABLE WORKING HOURS....................................5 1. Hours worked.............................................................................................................5 2. Principles in determining hours worked..................................................5 3. Treatment on waiting time...............................................................................5 4. Attendance at lectures, meetings, training programs, and other similar activities.......................................................................................... 6 5. Meal and Rest Periods......................................................................................... 6 D. MONTHLY-PAID EMPLOYEES AND DAILY-PAID EMPLOYEES.................................. 6 E. COMPUTATION OF THE ESTIMATED EQUIVALENT MONTHLY RATE (EEMR) OF MONTHLY-PAID AND DAILY-PAID EMPLOYEES........................................................... 7 F. SUBSIDIZED MEALS AND SNACKS..................................................................................... 8 G. WAGE OF KASAMBAHAY....................................................................................................... 8 H. WAGE OF KASAMBAHAY WHO WORKS AS SALESCLERK........................................... 9 I. EFFECT OF REDUCTION OF WORKDAYS ON WAGES.................................................. 9 J. PENALTY AND DOUBLE INDEMNITY FOR VIOLATION OF THE PRESCRIBED INCREASES OR ADJUSTMENTS IN THE WAGE RATES (RA 8188).......................... 10 K. BARANGAY MICRO BUSINESS ENTERPRISES (BMBES).......................................... 10 L. WAGE OF WORKERS PAID BY RESULTS.......................................................................... 11 M. WAGE OF APPRENTICES, LEARNERS, AND PERSONS WITH DISABILITY................ 11 N. ANNUAL ESTABLISHMENT REPORT ON WAGES (AERW)........................................ 11 O. COVERAGE FROM INCOME TAX......................................................................................... 12 2. HOLIDAY PAY................................................................................................... 14 A. DEFINITION.............................................................................................................................. 14 B. COVERAGE............................................................................................................................... 14 C. REGULAR HOLIDAYS............................................................................................................. 15 D. HOLIDAY PAY RATES............................................................................................................. 15 E. ABSENCES................................................................................................................................. 16 F. SUCCESSIVE REGULAR HOLIDAYS.................................................................................... 17 G. TEMPORARY OR PERIODIC SHUTDOWN/CESSATION OF WORK............................ 17 H. HOLIDAY PAY OF CERTAIN EMPLOYEES......................................................................... 17 3. PREMIUM PAY.................................................................................................. 18 A. DEFINITION...............................................................................................................................18 B. COVERAGE................................................................................................................................18 C. SPECIAL DAYS......................................................................................................................... 19 1. Special (Non-Working) Days.......................................................................... 19 2. Special (Working) Days...................................................................................... 19 D. PREMIUM PAY RATES........................................................................................................... 19 4. OVERTIME PAY................................................................................................. 21 A. DEFINITION...............................................................................................................................21 B. COVERAGE................................................................................................................................21 C. OVERTIME PAY RATES..........................................................................................................21 D. STIPULATED OVERTIME RATES.........................................................................................22 5. NIGHT SHIFT DIFFERENTIAL....................................................................... 23 A. DEFINITION..............................................................................................................................23 B. COVERAGE...............................................................................................................................23 C. NIGHT SHIFT DIFFERENTIAL RATE.................................................................................. 24 D. GUIDE COMPUTATIONS FOR HOLIDAY PAY, PREMIUM PAY, OVERTIME PAY, AND NIGHT SHIFT DIFFERENTIAL.................................................................................... 24 6. SERVICE CHARGES......................................................................................... 26 A. DEFINITION............................................................................................................................. 26 B. COVERAGE.............................................................................................................................. 26 C. DISTRIBUTION OF SERVICE CHARGES............................................................................ 26 D. FREQUENCY OF DISTRIBUTION........................................................................................ 26 E. INCREASE IN MINIMUM WAGE......................................................................................... 26 7. SERVICE INCENTIVE LEAVE......................................................................... 27 A. DEFINITION..............................................................................................................................27 B. COVERAGE...............................................................................................................................27 C. MEANING OF “ONE YEAR OF SERVICE”.......................................................................... 28 D. CONVERSION.......................................................................................................................... 28 8. MATERNITY LEAVE......................................................................................... 29 A. DEFINITION............................................................................................................................. 29 B. COVERAGE.............................................................................................................................. 29 C. DURATION............................................................................................................................... 29 D. CONDITIONS FOR ENTITLEMENT...................................................................................... 30 E. FREQUENCY OF AVAILMENT............................................................................................. 30 9. PATERNITY LEAVE........................................................................................... 31 A. DEFINITION...............................................................................................................................31 B. COVERAGE................................................................................................................................31 C. DURATION.................................................................................................................................31 D. CONDITIONS FOR ENTITLEMENT.......................................................................................32 E. FREQUENCY OF AVAILMENT..............................................................................................32 10. PARENTAL LEAVE FOR SOLO PARENTS.................................................. 33 A. DEFINITION.............................................................................................................................. 33 B. COVERAGE............................................................................................................................... 33 C. DURATION................................................................................................................................34 D. CONDITIONS FOR ENTITLEMENT...................................................................................... 35 E. FREQUENCY OF AVAILMENT.............................................................................................. 35 11. LEAVE FOR VICTIMS OF VIOLENCE AGAINST WOMEN AND THEIR CHILDREN (VAWC)......................................................................................... 36 A. DEFINITION.............................................................................................................................. 36 B. COVERAGE............................................................................................................................... 36 C. DURATION................................................................................................................................ 36 D. CONDITIONS FOR ENTITLEMENT...................................................................................... 36 E. FREQUENCY OF AVAILMENT.............................................................................................. 37 12. SPECIAL LEAVE FOR WOMEN.....................................................................38 A. DEFINITION..............................................................................................................................38 B. COVERAGE............................................................................................................................... 38 C. DURATION................................................................................................................................ 38 D. CONDITIONS FOR ENTITLEMENT...................................................................................... 39 E. FREQUENCY OF AVAILMENT.............................................................................................. 39 13. THIRTEENTH-MONTH PAY........................................................................... 40 A. DEFINITION............................................................................................................................. 40 B. COVERAGE.............................................................................................................................. 40 C. AMOUNT................................................................................................................................... 41 D. COMPUTATION....................................................................................................................... 41 E. TIME OF PAYMENT................................................................................................................42 F. THIRTEENTH-MONTH PAY FOR CERTAIN TYPES OF EMPLOYEES.........................42 G. THIRTEENTH-MONTH PAY OF RESIGNED OR SEPARATED EMPLOYEE...............43 H. THIRTEENTH-MONTH PAY OF FEMALE EMPLOYEE WHO IS ON MATERNITY LEAVE........................................................................................................................................43 I. NON-INCLUSION IN REGULAR WAGE.............................................................................43 J. COVERAGE FROM INCOME TAX OF THIRTEENTH-MONTH PAY AND OTHER BENEFITS..................................................................................................................................43 K. NO EXEMPTION OR DEFERMENT.................................................................................... 44 L. REPORT OF COMPLIANCE................................................................................................. 44 14. SEPARATION PAY........................................................................................... 45 A. DEFINITION..............................................................................................................................45 B. COVERAGE...............................................................................................................................45 C. AMOUNT...................................................................................................................................45 D. COMPUTATION...................................................................................................................... 46 E. NOTICE OF TERMINATION.................................................................................................. 47 F. COVERAGE FROM INCOME TAX OF SEPARATION PAY.............................................. 47 15. RETIREMENT PAY............................................................................................48 A. DEFINITION............................................................................................................................. 48 B. COVERAGE.............................................................................................................................. 48 C. AMOUNT.................................................................................................................................. 48 D. COMPUTATION....................................................................................................................... 48 E. RETIREMENT BENEFIT UNDER A COLLECTIVE BARGAINING AGREEMENT OR APPLICABLE CONTRACT..................................................................................................... 49 F. RETIREMENT BENEFIT OF WORKERS WHO ARE PAID BY RESULTS..................... 49 G. RETIREMENT BENEFIT OF PART-TIME WORKERS...................................................... 49 H. RETIREMENT BENEFIT OF UNDERGROUND OR SURFACE MINE EMPLOYEES UNDER REPUBLIC ACT NO. 8558, AS AMENDED BY REPUBLIC ACT NO. 10757................................................................................................................................................... 50 I. RETIREMENT BENEFIT OF RACEHORSE JOCKEYS...................................................... 50 J. OTHER BENEFITS UPON RETIREMENT........................................................................... 50 K. COVERAGE FROM INCOME TAX OF RETIREMENT PAY................................................51 16. EMPLOYEES’ COMPENSATION PROGRAM............................................. 52 A. EMPLOYEES’ COMPENSATION PROGRAM.....................................................................52 B. COVERAGE...............................................................................................................................52 C. CONDITIONS OF COMPENSABILITY..................................................................................52 1. Compensable Diseases.....................................................................................52 2. Compensable Injuries.........................................................................................53 D. BENEFITS..................................................................................................................................53 E. NOTIFICATION AND FILING OF CLAIMS...........................................................................55 F. CONTRIBUTION.......................................................................................................................55 17. PHILHEALTH BENEFITS................................................................................. 57 A. NATIONAL HEALTH INSURANCE PROGRAM..................................................................57 B. COVERAGE...............................................................................................................................57 C. BENEFITS..................................................................................................................................57 D. CONTRIBUTION.......................................................................................................................57 18. SOCIAL SECURITY BENEFITS....................................................................... 59 A. SOCIAL SECURITY BENEFITS............................................................................................. 59 B. COVERAGE.............................................................................................................................. 59 C. BENEFITS................................................................................................................................. 59 D. CONTRIBUTION...................................................................................................................... 60 19. PAG-IBIG BENEFITS......................................................................................... 61 A. HOME DEVELOPMENT MUTUAL FUND.......................................................................... 61 B. COVERAGE............................................................................................................................... 61 C. PROGRAMS AND BENEFITS................................................................................................. 61 D. MEMBERSHIP CONTRIBUTION......................................................................................... 64 DIRECTORY OF DOLE REGIONAL OFFICES............................................ 66 DIRECTORY OF DOLE-NCR FIELD OFFICES........................................... 67 THE BWC........................................................................................................... 68 VISION............................................................................................................................................. 68 MISSION......................................................................................................................................... 68 1 COMPLIANCE GUIDE Retail & Service Non- Establishments Ref. Agriculture/ Applicable Labor Standards Employing Employing (Page Agriculture 1 to 5 1 to 9 no.) workers workers Minimum Wage* ✓ ✓ ✓ 2 Holiday Pay N/A N/A ✓ 14 Premium Pay ✓ ✓ ✓ 18 Overtime Pay ✓ ✓ ✓ 21 Night Shift Differential N/A ✓ ✓ 23 Service Charges ✓ ✓ ✓ 26 Service Incentive Leave N/A N/A ✓ 27 Maternity Leave ✓ ✓ ✓ 29 Paternity Leave ✓ ✓ ✓ 31 Parental Leave ✓ ✓ ✓ 33 Leave for VAWC ✓ ✓ ✓ 36 Special Leave for Women ✓ ✓ ✓ 38 13th-Month Pay ✓ ✓ ✓ 40 Separation Pay ✓ ✓ ✓ 45 Retirement Pay N/A N/A*** ✓ 48 ECC Benefits** ✓ ✓ ✓ 52 PhilHealth Benefits** ✓ ✓ ✓ 57 SSS Benefits** ✓ ✓ ✓ 59 Pag-IBIG Benefits ** ✓ ✓ ✓ 61 * rates may vary per region ** will be paid by the Government *** employing not more than 10 workers 2 1 MINIMUM WAGE Republic Act No. 6727 or the “Wage Rationalization Act” mandates the fixing of the minimum wages applicable to different industrial sectors, namely, non- agriculture, agriculture plantation, and non-plantation, cottage/handicraft, and retail/service, depending on the number of workers or capitalization or annual gross sales in some sectors. The Rules Implementing RA 6727 define the following as basis for wage classification: “Agriculture” refers to farming in all its branches and, among others, includes the cultivation and tillage of the soil, production, cultivation, growing and harvesting of any agricultural or horticultural commodities, dairying, raising of livestock or poultry, the culture of fish and other aquatic products in farms or ponds, and any activities performed by a farmer or on a farm as an incident to or in conjunction with such farming operations, but does not include the manufacturing and/or processing of sugar, coconut, abaca, tobacco, pineapple, aquatic or other farm products. “Retail establishment” is one principally engaged in the sale of goods to end-users for personal or household use. A retail establishment that regularly engages in wholesale activities loses its retail character. “Service establishment” is one principally engaged in the sale of service to individuals for their own or household use and is generally recognized as such. The said law rationalized wage determination by establishing the mechanism and proper standards through the creation of Regional Tripartite Wages and Productivity Boards (RTWPBs) authorized to determine the daily minimum wage rates in the following different regions based on established criteria: National Capital Region (NCR) or Metro Manila Cordillera Administrative Region (CAR) Region I - Northern Luzon or Ilocos Region II - Cagayan Valley Region III - Central Luzon CALABARZONa - Provinces of Cavite, Laguna, Batangas, Rizal, and Quezon a See Executive Order No. 103, Series of 2002 (Dividing Region IV into Region IV-A and Region IV-B, Transferring the Province of Aurora to Region III and for Other Purposes). 3 MIMAROPA - Provinces of Mindoro Oriental, Mindoro Regionb Occidental, Marinduque, Romblon, and Palawan Region V - Bicol Region VI - Western Visayas Region VII - Central Visayas Region VIII - Eastern Visayas Region IX - Western Mindanao or Zamboanga Peninsula Region X - Northern Mindanao Region XI - Southern Mindanao or Davao Region XII - Central Mindanao or SOCCSKSARGEN (South Cotabato, North Cotabato, Sultan Kudarat, Sarangani, and General Santos) Caraga - Provinces of Agusan del Norte, Agusan del Sur, Regionc Surigao del Norte, and Surigao del Sur Bangsamoro Autonomous Region in Muslim Mindanao (BARMM)d The Regional Wage Orders prescribe the daily minimum wage rates per industry per locality within the region and in some instances depending on the number of workers and the capitalization of enterprises. The Wage Orders likewise provide the basis and procedure for application for exemption from compliance therefrom. A. Coverage The wage increases prescribed under Wage Orders apply to all private sector workers and employees receiving the daily minimum wage rates or those receiving up to a certain daily wage ceiling, where applicable, regardless of their position, designation, or status of employment, and irrespective of the method by which their wages are paid, except workers of duly registered Barangay Micro Business Enterprises (BMBEs) with Certificate of Authority pursuant to Republic Act No. 10644. Upon application with and as determined by an RTWPB, based on documentation and other requirements in accordance with applicable rules and regulations issued by the National Wages and Productivity Commission (NWPC), an establishment may be exempted from compliance with a Wage Order for a period not to exceed one (1) year. b See Republic Act No. 10879 or the MIMAROPA Act. c See Republic Act No. 7901 entitled An Act Creating Region XIII to be known as the Caraga Administrative Region, and for Other Purposes. d See Republic Act No. 11054 or the Organic Law for the Bangsamoro Autonomous Region in Muslim Mindanao and Wage Order issued by the BTWPB. 4 B. Minimum Wage Rates DAILY MINIMUM WAGE (MW)e National Capital Region (As of July 2023) Cities/Municipalities: Cities of Caloocan, Las Piñas, Makati, Malabon, Mandaluyong, Manila, Marikina, Muntinlupa, Parañaque, Pasay, Pasig, Quezon, San Juan, Taguig, Valenzuela, and Municipalities of Navotas and Pateros Current New New Wage Sector/Industry Minimum Minimum Increase Wage Rates Wage Rates Non-agriculture ₽ 570.00 ₽ 40.00 ₽ 610.00 Agriculture (Plantation and Non-Plantation) Service/Retail Establishments employing 15 workers or less ₽ 533.00 ₽ 40.00 ₽ 573.00 Manufacturing Establishments regularly employing less than 10 workers SOURCE: National Wages and Productivity Commission Summary of Current Regional Daily Minimum Wage Rates (MWR) (As of July 2023) REGION WO NO./ DATE OF EFFECTIVITY MWR (PHP) NCR WO 24 / 16 July 2023 573.00 - 610.00 CAR WO 21 / 14 June 2022 400.00 I WO 21 / 06 June 2022 372.00 - 400.00 II WO 21 / 08 June 2022 400.00 - 420.00 III WO 23 / 20 June 2022 344.00 - 460.00 CALABARZON WO 19 / 30 June 2022 350.00 - 470.00 MIMAROPA WO 10 / 10 June 2022 329.00 - 355.00 V WO 20 / 18 June 2022 365.00 VI WO 26 / 05 June 2022 410.00 - 450.00 VII WO 23 / 14 June 2022 382.00 - 435.00 VIII WO 22 / 27 June 2022 345.00 - 375.00 IX WO 21 / 25 June 2022 338.00 - 351.00 X WO 21 / 18 June 2022 378.00 - 405.00 XI WO 21 / 19 June 2022 428.00 - 443.00 XII WO 22 / 09 June 2022 347.00 - 368.00 Caraga WO 17 / 06 June 2022 350.00 BARMM WO 02 / 21 July 2022 306.00 - 341.00 SOURCE: National Wages and Productivity Commission e Wage Order No. NCR-24. Published in The Philippine Star on 30 June 2023. 5 The National Wages and Productivity Commission updates monthly the summary of current regional daily minimum wage rates which may be accessed at www.nwpc.dole.gov.ph under Statistics. C. Rules in Determining Compensable Working Hoursf The basis of the minimum wage rates prescribed by law shall be the normal working hours of eight (8) hours a day. 1. Hours worked The following shall be considered as compensable hours worked: a. All time during which an employee is required to be on duty or to be at the employer's premises or to be at a prescribed work place; and b. All time during which an employee is suffered or permitted to work. 2. Principles in determining hours worked The following general principles shall govern in determining whether the time spent by an employee is considered hours worked: a. All hours are hours worked which the employee is required to give his employer, regardless of whether or not such hours are spent in productive labor or involve physical or mental exertion. b. An employee need not leave the premises of the work place in order that his rest period shall not be counted, it being enough that he stops working, may rest completely and may leave his work place, to go elsewhere, whether within or outside the premises of his work place. c. If the work performed was necessary, or it benefited the employer, or the employee could not abandon his work at the end of his normal working hours because he had no replacement, all time spent for such work shall be considered as hours worked, if the work was with the knowledge of his employer or immediate supervisor. d. The time during which an employee is inactive by reason of interruptions in his work beyond his control shall be considered working time either if the imminence of the resumption of work requires the employee's presence at the place of work or if the interval is too brief to be utilized effectively and gainfully in the employee's own interest. 3. Treatment on waiting time a. Waiting time spent by an employee shall be considered as working time if waiting is an integral part of his work or the employee is required or engaged by the employer to wait. f Rule I, Book III of the Omnibus Rules Implementing the Labor Code of the Philippines. 6 b. An employee who is required to remain on call in the employer's premises or so close thereto that he cannot use the time effectively and gainfully for his own purpose shall be considered as working while on call. An employee who is not required to leave word at his home or with company officials where he may be reached is not working while on call. 4. Attendance at lectures, meetings, training programs, and other similar activities Attendance at lectures, meetings, training programs, and other similar activities shall not be counted as working time if all of the following conditions are met: a. Attendance is outside of the employee's regular working hours; b. Attendance is in fact voluntary; and c. The employee does not perform any productive work during such attendance. 5. Meal and Rest Periods Every employer shall give his employees, regardless of sex, not less than one (1) hour time-off for regular meals, except in the following cases when a meal period of not less than twenty (20) minutes may be given by the employer provided that such shorter meal period is credited as compensable hours worked of the employee: a. Where the work is non-manual work in nature or does not involve strenuous physical exertion; b. Where the establishment regularly operates not less than sixteen (16) hours a day; c. In case of actual or impending emergencies or there is urgent work to be performed on machineries, equipment or installations to avoid serious loss which the employer would otherwise suffer; and d. Where the work is necessary to prevent serious loss of perishable goods. Rest periods or coffee breaks running from five (5) to twenty (20) minutes shall be considered as compensable working time. D. Monthly-Paid Employees and Daily-Paid Employees “Monthly-paid employees” are those who are paid every day of the month, including unworked rest days, special days, and regular holidays. Factor 365 days in a year is used in determining the equivalent monthly salary of monthly- paid employees. 7 “Daily-paid employees” are those who are paid on the days they actually worked and on unworked regular holidays. E. Computation of the Estimated Equivalent Monthly Rate (EEMR) of Monthly-Paid and Daily-Paid Employees The following factors are based on the declared regular holidays and special non-working days in Proc. No. 42-22, as amended by Proc. No. 90-22: 1. For monthly-paid employees: Factor 365 days in a year is used in determining the equivalent annual and monthly salary of monthly-paid employees. To compute their Estimated Equivalent Monthly Rate (EEMR), the procedure is as follows: Applicable Daily Rate (ADR)×365 =EEMR 12 months Where 365 days/year = 293.0 Ordinary working days 52.0 Rest days 12.0 Regular holidays 8.0 Special non-working days 365.0 Total equivalent no. of days/year 2. For daily-paid employees: The following factors and formula may be used in computing the EEMR of different groups of daily-paid employees for purposes of entitlement to minimum wages and allied benefits under existing laws: a. For those who are required to work everyday, including Sundays or rest days, special days and regular holidays Applicable Daily Rate (ADR)×395.7 =EEMR 12 months Where 394.4 days/year = 293.0 Ordinary working days 67.6 Rest days (52 x 1.3) 24.0 Regular holidays (12 x 2) 10.4 Special non-working days (8 x 1.3) 395.0 Total equivalent no. of days/year b. For those who do not work and are not considered paid on Sundays or rest days Applicable Daily Rate (ADR)×313 =EEMR 12 months 8 Where 313 days/year = 293.0 Ordinary working days 12.0 Regular holidays 8.0 Special non-working days (10.4 if worked) 313g Total equivalent no. of days/year c. For those who do not work and are not considered paid on Saturdays and Sundays or rest days Applicable Daily Rate (ADR)×261 =EEMR 12 months Where 261 days/year = 241 Ordinary working days 12 Regular holidays 8 Special non-working days (10.4 if worked) 261h Total equivalent no. of days/year Without prejudice to existing company policies, practices and/or agreements, the above formula are merely suggestions and may be used as guides in determining the equivalent monthly minimum wage rates. F. Subsidized Meals and Snacks The employer may provide subsidized meals and snacks to his employees provided that the subsidy shall not be less than 30% of the fair and reasonable value of such facilities. In such case, the employer may deduct from the wages of the employees not more than 70% of the value of the meals and snacks enjoyed by the employees, pursuant to the Facility Evaluation Order issued by the RTWPB concerned. (Sec. 4, Rule VII-A, Book III of the Rules Implementing the Labor Code) For the computation of the fair and reasonable value of the meals given, the employer may seek assistance from concerned Regional Tripartite Wages and Productivity Board (RTWPBs) for the conduct of facility evaluation. G. Wage of Kasambahayi After one year from the effectivity of the Batas Kasambahay and periodically thereafter, the Regional Tripartite Wages and Productivity Boards (RTWPBs) were mandated to review and, if proper, determine and adjust the minimum wage rates of Kasambahay. The RTWPBs shall conduct consultations/hearings with stakeholders prior to the issuance of a wage order. g Factor 305 may be used instead of 313 if the 8 special non-working days are not considered paid. h Factor 253 may be used instead of 261 if the 8 special non-working days are not considered paid. i See also DOLE Q&A on Batas Kasambahay (Republic Act No. 10361) Revised Edition. Published by the DOLE- Bureau of Workers with Special Concerns. 9 As of July 2023, the monthly minimum wage of Kasambahay shall not be less than the following: MONTHLY MINIMUM WAGE WO NO./ Cities & 1st REGION Other DATE OF EFFECTIVITY Class Municipalities Municipalities NCR NCR-DW-03 / 13 July 2022 ₱6,000.00 CAR CAR-DW-04 / 14 June 2022 4,500.00 I RBI-DW-03 / 06 June 2022 5,000.00 II RBII-DW-04 / 08 June 2022 5,000.00 III RBIII-DW-03 / 20 June 2022 5,000.00 4,500.00 CALABARZON RBIVA-DW-03 / 16 July 2022 5,000.00 4,000.00 MIMAROPA RB-IVB-DW-03 / 10 June 2022 4,500.00 V RBV-DW-02 / 18 June 2022 4,000.00 VI RBVI-DW-04 / 05 June 2022 4,500.00 VII RBVII-DW-03 / 14 June 2022 5,500.00 4,500.00 VIII RBVIII-DW-03 / 27 June 2022 5,000.00 4,500.00 IX RBIX-DW-03 / 25 June 2022 4,000.00 3,500.00 X RBX-DW-03 / 18 June 2022 4,500.00 3,500.00 XI RBXI-DW-02 / 20 June 2022 4,500.00 XII RBXII-DW-03 / 16 July 2022 4,500.00 4,000.00 CARAGA RBXIII-DW-03 / 30 June 2022 4,000.00 SOURCE: National Wages and Productivity Commission/RTWPBs The National Wages and Productivity Commission updates monthly the summary of monthly minimum wage of Kasambahay which may be accessed at www.nwpc.dole.gov.ph under Statistics. H. Wage of Kasambahay who Works as Salesclerk A Kasambahay who works as salesclerk should receive wage in accordance with the prescribed minimum wage which is applicable in the retail and service establishments, under existing Wage Orders. I. Effect of Reduction of Workdays on Wages In situations where the employer has to reduce the number of regular working days to prevent serious losses, such as when there is a substantial slump in the demand for his/her goods or services or when there is lack of raw materials, the employer may deduct the wages corresponding to the days taken off from the workweek, consistent with the principle of “no work, no pay.” This is without prejudice to an agreement or company policy which provides otherwise. 10 J. Penalty and Double Indemnity for Violation of the Prescribed Increases or Adjustments in the Wage Rates (RA 8188) Any person, corporation, trust, firm, partnership, association or entity which refuses or fails to pay any of the prescribed increases or adjustments in the wage rates made in accordance with RA 6727, shall be punished by a fine of not less than Twenty-five Thousand Pesos (P25,000.00) nor more than One Hundred Thousand Pesos (P100,000.00) or imprisonment of not less than two (2) years nor more than four (4) years, or both such fine and imprisonment at the discretion of the court: Provided, That any person convicted hereof shall not be entitled to the benefits provided for under the Probation Law. The employer concerned shall be ordered to pay an amount equivalent to double the unpaid benefits owing to the employees: Provided, That payment of indemnity shall not absolve the employer from the criminal liability imposable hereof. If the violation is committed by a corporation, trust, firm, partnership, association or any other entity, the penalty of imprisonment shall be imposed upon the entity’s responsible officers, including, but not limited to, the president, vice-president, chief executive officer, general manager, managing director or partner. K. Barangay Micro Business Enterprises (BMBEs) BMBEs or business enterprises engaged in the production, processing or manufacturing of products or commodities including agro-processing, trading and services whose total assets, excluding the land on which the particular business entity’s office, plant and equipment are situated are not more than Three Million Pesos (P3,000,000) are not covered from the coverage of the Minimum Wage Law: Provided, that all employees shall still be entitled to the same benefits given to regular employees such as social security and health care benefits. The DTI, through the Negosyo Center in the city or municipality level, shall have the sole power to issue the Certificate of Authority for BMBEs to avail of the benefits provided by R.A. No. 9178, otherwise known as the “Barangay Micro Business Enterprises (BMBE’s) Act of 2002”.j The BMBE workers and owners shall agree on the acceptable wage rates based on the wage advisories issued by the RTWPBs. j Section 5(b) of Republic Act No. 10644 entitled An Act Promoting Job Generation and Inclusive Growth Through the Development of Micro, Small and Medium Enterprises. Issued on 15 July 2014. 11 L. Wage of Workers Paid by Resultsk All workers paid by results, including homeworkers and those who are paid on piecework, takay, pakyaw or task basis, shall receive not less than the prescribed minimum wage rates under the Regional Wage Orders for the normal working hours which shall not exceed eight (8) hours a day, or a proportion thereof for work less than the normal working hours. To ensure the payment of fair and reasonable wage rates, the wage rates of workers who are paid by results as may be determined through time and motion studies or in consultation with representatives of employers’ and workers’ organizations. A Piece-Rate Order or Production Standard Order shall be issued by the DOLE Regional Director, in his capacity as DOLE Chairperson, based on the recommendation of the Secretariat of the RTWPB as a result of the time and motion study conducted in the workplace of the applicant. It should be adjusted every time a new Wage Order is issued by the RTWPB to ensure that piece rates correspond to the applicable minimum wage. M. Wage of Apprentices, Learners, and Persons with disability Wage of apprentices and learners shall in no case be less than seventy-five (75%) percent of the applicable minimum wage rates. Apprentices and learners are those who are covered by apprenticeship and learnership agreements duly approved by the Technical Education and Skills Development Authority (TESDA).l A qualified employee with disability shall be subject to the same terms and conditions of employment and the same compensation, privileges, benefits, fringe benefits or allowances as a qualified able-bodied person.m N. Annual Establishment Report on Wages (AERW)n Pursuant to Article 124 of the Labor Code, as amended by Republic Act No. 6727 or the Wage Rationalization Act, all private establishments are required to submit an annual report on “a verified itemized listing of their labor component, specifying the names of their workers and employees below the managerial level, including learners, apprentices and disabled/handicapped workers who were hired under the terms prescribed in the employment contracts, and their corresponding salaries and wages.” k See Department Order No. 125, Series of 2013 or the Revised Guidelines on the Conduct of Time and Motion Study (TMS). Issued on 01 April 2013. l See Revised Guidelines in the Implementation of the Apprenticeship and Learnership Programs. m Sec. 1 of Republic Act No. 10524 or the Magna Carta for Persons with Disability. n See DOLE Labor Advisory No. 09, Series of 2022 for reference. 12 For this purpose, all private establishments are required to register and log- in to the online report of the AERW at https://annualwagereport.nwpc.dole.gov.ph/. For 2022, the report shall be submitted not later than 31 May 2023. While for succeeding years, submission shall not be later than January 31 of the following year (e.g. for calendar year 2023, submission shall not be later than 31 January 2024). Establishments which do not have access to online facilities may go to the nearest RTWPB so they can be assisted with the encoding of entries. Concerns and technical problems encountered may be sent to: [email protected] or to the Wage Report Hotlines at 8527-5519, 85278011 and 09178630855. O. Coverage from Income Taxo Effective January 1, 2018, the following income payments are exempted from the requirement of withholding tax on compensation: 1. Compensation income of Minimum Wage Earners (MWEs) who work in the private sector and being paid the Statutory Minimum Wage (SMW), as fixed by Regional Tripartite Wage and Productivity Board (RTWPB)/National Wages and Productivity Commission (NWPC), applicable to the place where he/she is assigned. Aside from the SMW, the holiday pay, overtime pay, night shift differential pay, and hazard pay, earned by the aforementioned MWE shall likewise be covered by the above exemption. For this purpose, hazard pay shall mean the amount paid by the employer to MWEs who were actually assigned to danger or strife-torn areas, disease-infested places, or in distressed or isolated stations and camps, which expose them to great danger or contagion or peril to life. Any hazard paid to MWEs which does not satisfy the above criteria is deemed subject to income tax and consequently, withholding tax on the said hazard pay. Additional compensation such as commissions, honoraria, fringe benefits, benefits in excess of the allowable statutory amount of ₱90,000.00, 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. o BIR Revenue Regulations No. 11-2018 [Amending Certain Provisions of Revenue Regulations No. 2-98, as Amended, to Implement Further Amendments Introduced by Republic Act No. 10963, Otherwise Known as the “Tax Reform for Acceleration and Inclusion (TRAIN)” Law, Relative to Withholding of Income Tax]. Issued on 31 January 2018. 13 2. Compensation during the year not exceeding Two hundred fifty thousand pesos (₱250,000.00). For questions regarding minimum For questions regarding rights and wage rates, please contact the benefits of domestic workers, please contact the NATIONAL WAGES AND BUREAU OF WORKERS WITH PRODUCTIVITY COMMISSION SPECIAL CONCERNS Address: 2F & 3F, DY Intl., Building, Address: DOLE Annex Building, San Marcelino corner Gen. Malvar Cabildo Street corner Muralla Street, Streets, Malate, Manila Intramuros, Manila Telephone numbers: (02) 8527-8014 Telephone number: (02) 8527-5858 or (02) 8527-5171 Website: https://bwsc.dole.gov.ph Website: https://nwpc.dole.gov.ph Facebook: Facebook: www.fb.com/dole.nwpc www.fb.com/BWSC.DOLE E-mail address: E-mail address: [email protected] [email protected] 14 2 HOLIDAY PAY (Article 94) A. Definition Holiday pay refers to the payment of the regular daily wage for any unworked regular holiday. B. Coverage This benefit applies to all employees except: 1. Government employees, whether employed by the National Government or any of its political subdivisions, including those employed in government-owned and/or controlled corporations with original charters or created under special laws; 2. Those of retail and service establishments regularly employing less than ten (10) workers; 3. Kasambahay and persons in the personal service of another; 4. Managerial employees, if they meet all of the following conditions: 4.1 Their primary duty is to manage the establishment in which they are employed or of a department or subdivision thereof; 4.2 They customarily and regularly direct the work of two or more employees therein; and 4.3 They have the authority to hire or fire other employees of lower rank; or their suggestions and recommendations as to hiring, firing, and promotion, or any other change of status of other employees are given particular weight. 5. Officers or members of a managerial staff, if they perform the following duties and responsibilities: 5.1 Primarily perform work directly related to management policies of their employer; 5.2 Customarily and regularly exercise discretion and independent judgment; 5.3 (a) Regularly and directly assist a proprietor or managerial employee in the management of the establishment or subdivision thereof in which he or she is employed; or (b) execute, under general supervision, work along specialized or technical lines requiring special training, experience, or knowledge; or (c) execute, under general supervision, special assignments and tasks; and 15 5.4 Do not devote more than twenty percent (20%) of their hours worked in a workweek to activities which are not directly and closely related to the performance of the work described in paragraphs 5.1, 5.2, and 5.3 above. 6. Field personnel and other employees whose time and performance is unsupervised by the employer, including those who are engaged on task or contract basis, purely commission basis or those who are paid a fixed amount for performing work irrespective of the time consumed in the performance thereof. C. Regular Holidays Pursuant to Proclamation No. 42 s. 2022, as amended by Proclamation No. 90 s. 2022, the following are the twelve (12) regular holidays for the year 2023: New Year’s Day - 01 January (Sunday) Maundy Thursday - 06 April (Thursday) Good Friday - 07 April (Friday) Araw ng Kagitingan - 10 April (Monday nearest April 9) Eidul Fitr - Movable Date Labor Day - 01 May (Monday) Independence Day - 12 June (Monday) Eidul Adha - Movable Date National Heroes Day - 28 August (Monday) Bonifacio Day - 27 November (Monday nearest November 30) Christmas Day - 25 December (Monday) Rizal Day - 30 December (Saturday) D. Holiday Pay Rates Every employee covered by the Holiday Pay Rule is entitled to the minimum wage rate. This means that the employee 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 work day immediately preceding the holiday. Work performed on that day merits at least twice (200%) the daily wage of the employee. The above mentioned is without prejudice to any voluntary practice or provision in the Collective Bargaining Agreement (CBA) providing for payment of wages and other benefits for days declared as special days even if unworked. 16 Illustration: Using the NCR minimum wage of ₽610.00 per day for the non- agricultural sector, effective 16 July 2023 under Wage Order No. NCR-24. For work within eight (8) hours, plus 100% of the minimum wage of 100% or a total of 200%. Sector/Industry Rate Amount Non-Agriculture ₽610.00 ₽610 x 200% = ₽1,220.00 Retail and service establishments regularly ₽573.00 Not covered employing less than ten (10) workers Where the holiday falls on the scheduled rest day of the employee, work performed on said day merits at least an additional 30% of the employee’s regular holiday rate of 200% or a total of at least 260% (Please see 3. Premium Pay). When a regular holiday falls on a Sunday, the following Monday shall not be a holiday, unless a proclamation is issued declaring it a special day. When Araw ng Kagitingan falls on the same day as Maundy Thursday or Good Friday, a covered employee is entitled to at least two hundred percent (200%) of his/her daily wage even if said day is unworked. Where the employee is required to work on that day, he/she is entitled to an additional 100% of the daily wage. E. Absences 1. 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. 2. Employers shall grant the same percentage of the holiday pay as the benefit granted by competent authority in the form of employee’s compensation or social security payment, whichever is higher, if the employees are not reporting for work while on such leave benefits. 3. Where the day immediately preceding the holiday is a non-work day in the establishment or the scheduled rest day of the employee, he/she shall not be deemed to be on leave of absence on that day, in which case he/she shall be entitled to the holiday pay if he/she worked on the day immediately preceding the nonwork day or rest day. 17 F. Successive Regular Holidays Where there are two (2) successive regular holidays, like Maundy Thursday and Good Friday, an 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. G. Temporary or Periodic Shutdown/Cessation of Work In cases of temporary or periodic shutdown and temporary cessation of work of an establishment, as when a yearly inventory or when the repair or cleaning of machineries and equipment is undertaken, the regular holidays falling within the period shall be compensated in accordance with the Rules Implementing the Labor Code, as amended. H. Holiday Pay of Certain Employees 1. Where the covered employee is paid on piece-rate basis, 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; provided, however, that in no case shall the holiday pay be less than the applicable statutory minimum wage rate. 2. Seasonal workers may not be paid the required holiday pay during off-season when they are not at work. 3. Workers who do not have regular working days, such as stevedores, shall be entitled to this benefit. 18 3 PREMIUM PAY (Articles 91-93) A. Definition Premium pay refers to the additional compensation for work performed within eight (8) hours on rest days and special days. B. Coverage This benefit applies to all employees except: 1. Government employees, whether employed by the National Government or any of its political subdivisions, including those employed in government-owned and/or controlled corporations with original charters or created under special laws; 2. Managerial employees, if they meet all of the following conditions: 2.1 Their primary duty is to manage the establishment in which they are employed or of a department or subdivision thereof; 2.2 They customarily and regularly direct the work of two or more employees therein; and 2.3 They have the authority to hire or fire other employees of lower rank; or their suggestions and recommendations as to hiring, firing, and promotion, or any other change of status of other employees are given particular weight. 3. Officers or members of a managerial staff, if they perform the following duties and responsibilities: 3.1 Primarily perform work directly related to management policies of their employer; 3.2 Customarily and regularly exercise discretion and independent judgment; 3.3 (a) Regularly and directly assist a proprietor or managerial employee in the management of the establishment or subdivision thereof in which he or she is employed; or (b) execute, under general supervision, work along specialized or technical lines requiring special training, experience, or knowledge; or (c) execute, under general supervision, special assignments and tasks; and 3.4 Do not devote more than twenty percent (20%) of their hours worked in a workweek to activities which are not directly and 19 closely related to the performance of the work described in paragraphs 3.1, 3.2, and 3.3 above. 4. Kasambahay and persons in the personal service of another; 5. Workers who are paid by results, including those who are paid on piece rate, takay, pakyaw, or task basis, and other non-time work, if their output rates are in accordance with the standards prescribed in the regulations, or where such rates have been fixed by the Secretary of Labor and Employment; and 6. Field personnel, if they regularly perform their duties away from the principal or branch office or place of business of the employer and whose actual hours of work in the field cannot be determined with reasonable certainty. C. Special Days 1. Special (Non-Working) Days Pursuant to Proclamation No. 42 s. 2022, as amended by Proclamation No. 90 s. 2022, the following are the eight (8) special (non-working) days for the year 2023: Additional Special (Non-Working) Day - 02 January (Monday) EDSA People Power Revolution - 25 February (Saturday) Anniversary Black Saturday - 08 April (Saturday) Ninoy Aquino Day - 21 August (Monday) All Saints’ Day - 01 November (Wednesday) Additional Special (Non-Working) Day - 02 November (Thursday) Feast of the Immaculate Conception - 08 December (Friday) of Mary Last Day of the Year - 31 December (Sunday) 2. Special (Working) Days For work performed on a declared Special (Working) Day, an employee is entitled only to his/her daily wage. No premium pay is required since work performed on said day is considered work on an ordinary workday. D. Premium Pay Rates The “no work, no pay” principle applies during special days and on such other special days as may be proclaimed by the President or by Congress. Workers who are not required or permitted to work on special days are not entitled to any compensation. This, however, is without prejudice to any voluntary practice or provision in the Collective Bargaining Agreement (CBA) providing for payment of wages and other benefits for days declared as 20 special days even if unworked. 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%). The minimum statutory premium pay rates are as follows: 1. For work performed on rest days or on special days: Plus 30% of the daily basic wage of 100% or a total of 130%. Sector/Industry Rate Amount Non-agriculture ₽610.00 ₽610 x 130% = ₽793.00 Retail/Service ₽573.00 ₽573 x 130% = ₽744.90 Establishment 2. For work performed on a rest day which is also a special day: Plus 50% of the daily basic wage of 100% or a total of 150%. Sector/Industry Rate Amount Non-agriculture ₽610.00 ₽610 x 150% = ₽915.00 Retail/Service ₽573.00 ₽573 x 150% = ₽859.50 Establishment 3. For work performed on a regular holiday which is also the employee’s rest day (not applicable to employees who are not covered by the holiday pay rule): Plus 30% of the regular holiday rate of 200% based on his/her daily basic wage rate or a total of 260%. Sector/Industry Rate Amount Non-agriculture ₽610.00 ₽610.00 x 260% = ₽1,586.00 Retail/Service ₽573.00 Not covered by holiday pay Establishment rule 21 4 OVERTIME PAY (Article 87) A. Definition Overtime pay refers to the additional compensation for work performed beyond eight (8) hours a day. B. Coverage Same as those covered under 3. Premium Pay. C. Overtime Pay Rates The minimum overtime pay rates vary according to the day the overtime work is performed, as follows: 1. For work in excess of eight (8) hours performed on ordinary working days: Plus 25% of the hourly rate. Sector/Industry Rate Amount Non-agriculture ₽610.00 ₽610/8 x 125% = ₽76.25 x 125% x number of hours OT work Retail/Service ₽573.00 ₽573/8 x 125% = ₽71.63 x 125% x Establishment number of hours OT work 2. For work in excess of eight (8) hours performed on a scheduled rest day or a special day: Plus 30% of the hourly rate on said days. Sector/Industry Rate Amount Non-agriculture ₽610.00 ₽610/8 x 130% x 130% = ₽76.25 x 130% x 130% x number of hours OT work Retail/Service ₽573.00 ₽573/8 x 130% x 130% = ₽71.63 x 130% Establishment x 130% x number of hours OT work 3. For work in excess of eight (8) hours performed on a special day which falls on a scheduled rest day: Plus 30% of the hourly rate on said days. Sector/Industry Rate Amount Non-agriculture ₽610.00 ₽610/8 x 150% x 130% = ₽76.25 x 150% x 130% x number of hours OT work Retail/Service ₽573.00 ₽573/8 x 150% x 130% = ₽71.63 x 150% Establishment x 130% x number of hours OT work 22 4. For work in excess of eight (8) hours performed on a regular holiday: Plus 30% of the hourly rate on said days. Sector/Industry Rate Amount Non-agriculture ₽610.00 ₽610/8 x 200% x 130% = ₽76.25 x 200% x 130% x number of hours OT work Retail/Service ₽573.00 Not covered by holiday pay rule Establishment 5. For work in excess of eight (8) hours performed on a regular holiday which falls on a scheduled rest day: Plus 30% of the hourly rate on said days. Sector/Industry Rate Amount Non-agriculture ₽610.00 ₽610/8 x 260% x 130% = ₽76.25 x 260% x 130% x number of hours OT work Retail/Service ₽573.00 Not covered by holiday pay rule Establishment D. Stipulated Overtime Rates Generally, the premium pay for work performed on rest days, special days, or regular holidays is included as part of 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. The employees and employer, however, may stipulate in their collective agreement the payment for overtime work at rates higher than those provided by law. 23 5 NIGHT SHIFT DIFFERENTIAL (Article 86) A. Definition 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. B. Coverage This benefit applies to all employees except: 1. Government employees, whether employed by the National Government or any of its political subdivisions, including those employed in government-owned and/or controlled corporations with original charters or created under special laws; 2. Those of retail and service establishments regularly employing not more than five (5) workers; 3. Kasambahay and persons in the personal service of another; 4. Managerial employees, if they meet all of the following conditions: 4.1 Their primary duty is to manage the establishment in which they are employed or of a department or subdivision thereof; 4.2 They customarily and regularly direct the work of two or more employees therein; and 4.3 They have the authority to hire or fire other employees of lower rank; or their suggestions and recommendations as to hiring, firing, and promotion, or any other change of status of other employees are given particular weight. 5. Officers or members of a managerial staff, if they perform the following duties and responsibilities: 5.1 Primarily perform work directly related to management policies of their employer; 5.2 Customarily and regularly exercise discretion and independent judgment; 5.3 (a) Regularly and directly assist a proprietor or managerial employee in the management of the establishment or subdivision thereof in which he or she is employed; or (b) execute, under general supervision, work along specialized or technical lines requiring special training, experience, or knowledge; or (c) execute, under general supervision, special assignments and tasks; and 24 5.4 Do not devote more than twenty percent (20%) of their hours worked in a workweek to activities which are not directly and closely related to the performance of the work described in paragraphs 5.1, 5.2, and 5.3 above; and 6. Field personnel and those whose time and performance are unsupervised by the employer. C. Night Shift Differential Rate The minimum night shift differential rate varies according to the day the night shift work is performed. Sector/Industry Rate Amount Non-agriculture ₽610.00 P610/8 x *110% = ₱76.25 x 110% x number of hours work Retail/Service ₽573.00 P573/8 x *110% = ₱71.63 x 110% x Establishment number of hours work * This value may be substituted based on the above rates depending on the day the night shift work is performed. D. Guide Computations for Holiday Pay, Premium Pay, Overtime Pay, and Night Shift Differential The table below may be used to guide computations: 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 1.5 or 150% rest day Double special (non-working) days 1.5 or 150% Double special (non-working) days 1.95 or 195% falling on rest day 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, 1.5 x 1.1 = 1.65 or 165% night shift Double special (non-working) days, 1.95 x 1.1 = 2.145 or 214.5% rest day, night shift Regular holiday, night shift 2 x 1.1 = 2.2 or 220% 25 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, 1.95 x 1.3 = 2.535 or 253.5% rest day, OT 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, 1.3 x 1.1 x 1.3 = 1.859 or 185.9% OT Special (non-working) day, rest day, 1.5 x 1.1 x 1.3 = 2.145 or 214.5% night shift, OT Double special (non-working) days, 1.95 x 1.1 x 1.3 = 2.7885 or rest day, night shift, OT 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% 26 6 SERVICE CHARGES (Article 96, as amended by RA No. 11360p) A. Definition Service charges refer to the amount collected by establishments, such as hotels, restaurants and other similar establishments, that is added to the bills for work or services rendered. B. Coverage This applies to all employees, except managerial employees as defined by law, under the direct employ of the establishment, regardless of their positions, designations or employment status, and irrespective of the method by which their wages are paid. C. Distribution of Service Chargesq All service charges actually collected shall be distributed completely and equally, based on actual hours or days of work or service rendered, among the covered employees, including those already receiving the benefit of sharing in the service charges. D. Frequency of Distribution The service charges collected shall be distributed and paid to the covered employees once every two (2) weeks or twice a month at intervals not exceeding sixteen (16) days. E. Increase in Minimum Wage In the event that the minimum wage is increased by law or wage order, the service charges paid to the employees shall not be considered in determining the establishment’s compliance with the increased minimum wage. p See also DOLE Department Order No. 206, Series of 2019 or the Implementing Rules and Regulations of Republic Act No. 11360 entitled “An Act Providing that Service Charges Collected by Hotels, Restaurants and other Similar establishments be Distributed in Full to All Covered Employees Amending for the Purpose Presidential Decree No. 442, As Amended, Otherwise Known as the “Labor Code of the Philippines.” Issued on 19 November 2019. See also DOLE Labor Advisory No. 10, Series of 2020 entitled Clarification on the Effectivity Date of Republic Act. No. 11360 (issued on 28 February 2020). Republic Act 11360 was signed into law on 07 August 2019. It was published on 19 August 2019 in Manila Bulletin and Business Mirror, and took effect fifteen days after its publication or on 04 September 2019. Its Implementing Rules and Regulations was signed on 19 November 2019 and published on 26 November 2019 in Manila Times. q See also DOLE Labor Advisory No. 14, Series of 2019 entitled Distribution of Collected Service Charge in Relation to Non-Diminution of Benefits. Issued on 26 December 2019. 27 7 SERVICE INCENTIVE LEAVE (Article 95) A. Definition 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. B. Coverage This benefit applies to every employee who has rendered at least one (1) year of service, except the following: 1. Government employees, whether employed by the National Government or any of its political subdivisions, including those employed in government-owned and/or controlled corporations with original charters or created under special laws; 2. Persons in the personal service of another; 3. Managerial employees, if they meet all of the following conditions: 3.1 Their primary duty is to manage the establishment in which they are employed or of a department or subdivision thereof; 3.2 They customarily and regularly direct the work of two or more employees therein; and 3.3 They have the authority to hire or fire other employees of lower rank; or their suggestions and recommendations as to hiring, firing, and promotion, or any other change of status of other employees are given particular weight. 4. Officers or members of a managerial staff, if they perform the following duties and responsibilities: 4.1 Primarily perform work directly related to management policies of their employer; 4.2 Customarily and regularly exercise discretion and independent judgment; 4.3 (a) Regularly and directly assist a proprietor or managerial employee in the management of the establishment or subdivision thereof in which he or she is employed; or (b) execute, under general supervision, work along specialized or technical lines requiring special training, experience, or knowledge; or (c) execute, under general supervision, special assignments and tasks; and 28 4.4 Do not devote more than twenty percent (20%) of their hours worked in a workweek to activities which are not directly and closely related to the performance of the work described in paragraphs 4.1, 4.2, and 4.3 above; 5. Field personnel and those whose time and performance is unsupervised by the employer; 6. Those already enjoying this benefit; 7. Those enjoying vacation leave with pay of at least five (5) days; and 8. Those employed in establishments regularly employing less than ten (10) employees. C. Meaning of “one year of service” The phrase “one year of service” of the employee means service within twelve (12) months, whether continuous or broken, reckoned from the date the employee started working. The period includes authorized absences, unworked weekly rest days, and paid regular holidays. If through individual or collective agreement, company practice or policy, the period of the working days is less than twelve (12) months, said period shall be considered as one year for the purpose of determining the entitlement to the service incentive leave.r D. Conversion The employee may choose to either use his/her leave credits or commute it to its monetary equivalent if not exhausted at the end of the year. If the employee does not use or commute the service incentive leave, he/she is entitled upon his/her resignation or separation from work to the commutation of the same.s In computing, the basis shall be the salary rate at the date of conversion. The use and conversion of this benefit may be on a pro rata basis. t Illustration: An employee was hired on 1 January 2022 and resigned on 1 March 2023. Assuming that he/she has not used or commuted any of his/her accrued SIL, he/she is entitled to the conversion of his/her accrued SIL, upon his/her resignation, as follows: SIL earned as of 31 December 2022 5.000 days Proportionate SIL for January and February 2023 0.833 days (2/12) x 5 days Total accrued SIL as of 1 March 2023 5.833 days r Sec. 3, Rule V of the Omnibus Rules Implementing the Labor Code of the Philippines. s Auto Bus Transport System, Inc. v. Bautista, 497 Phil. 863 (2005). t DOLE Legal Service Opinion. 29 8 MATERNITY LEAVE (RA 8282, as amended by RA 11210u) A. Definition Maternity leave refers to the paid leave granted to a female employee for every instance of pregnancy, miscarriage, and emergency termination of pregnancy, regardless of frequency, providing her an ample transition time to regain health and overall wellness and to assume maternal roles. B. Coverage This benefit applies to female employees, regardless of civil status, employment status, and the legitimacy of her child. C. Duration 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, provided that the employer shall be given due notice. Further, this leave benefit may also be credited as combinations of prenatal and postnatal leave as long as it does not exceed one hundred five (105) days and provided that compulsory postnatal leave shall not be less than sixty (60) days. In case of miscarriage or emergency termination of pregnancy, the maternity leave shall be for sixty (60) days with full pay. In both cases, employers from the private sector shall pay for the difference between the full salary and the actual cash benefits received from the SSS.v Nothing in RA 11210 and its IRR shall be construed as to diminish existing maternity benefits currently enjoyed whether or not these are granted under collective bargaining agreements (CBA) or present laws, if the same are more beneficial to the female worker. Any other working arrangement which the u Entitled An Act Increasing the Maternity Leave Period to One Hundred Five (105) Days for Female Workers with an Option to Extend for an Additional Thirty (30) Days Without Pay, and Granting an Additional Fifteen (15) Days for Solo Mothers, and for Other Purposes. Enacted on 20 February 2019 and was published in the Manila Bulletin on 23 February 2019. RA 11210 took effect on 11 March 2019. See also the Implementing Rules and Regulations of RA 11210 issued on 01 May 2019. v See also DOLE Department Advisory No. 1, Series of 2019 or the Guidelines on the Computation of Salary Differential of Female Workers during her Maternity Leave and its Criteria for Exemption Pursuant to Republic Act No. 11210 and its Implementing Rules and Regulations. Issued on 09 July 2019. 30 female worker shall agree to, during the additional maternity leave period, shall be allowed: Provided, that this shall be consented to in writing by the female worker and shall primarily uphold her maternal functions and the requirements of postnatal care. D. Conditions for Entitlement To qualify for the maternity leave, the female employee 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, w and she shall have notified her employer of her pregnancy and the probable date of her childbirth, which notice shall be transmitted to SSS in accordance its rules and regulations. E. Frequency of Availment Maternity leave shall be granted to a qualified female worker in every instance of pregnancy, miscarriage or emergency termination of pregnancy regardless of frequency. w You may view the step-by-step video illustration of the SSS at https://www.youtube.com/watch?v=qhwsbRR6OXc. 31 9 PATERNITY LEAVE (RA 8187) A. Definition 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. B. Coverage This benefit applies to all married male employees, regardless of their employment status (e.g., probationary, regular, contractual, project basis). C. Duration The paternity leave grants male employees his full pay for the seven (7) days during which he is allowed not to report for work. This is granted to an employee after the delivery by his wife, without prejudice to an employer allowing an employee to avail of the benefit before or during the delivery; Provided, that the total number of days shall not exceed seven (7) days for each delivery. In the event that the paternity leave is not availed of, said leave shall not be convertible to cash. Where a male employee is already enjoying the paternity leave benefits by reason of contract, company policy or collective bargaining agreement, the following rules shall apply: a. If the existing paternity leave benefit is greater than the benefit herein provided, the greater benefit shall prevail; and b. If the existing paternity leave is less than that provided herein, such existing benefit shall be adjusted to the extent of the difference. However, where a contract, company policy or collective bargaining agreement provides for an emergency or contingency leave without specific provisions on paternity leave, the paternity leave as provided in RA 8187 shall apply in full. 32 D. Conditions for Entitlement A married male employee shall be entitled to paternity leave benefit provided that he has met the following conditions: 1. He is an employee at the time of delivery of his child; 2. He is cohabiting with his spouse at the time that she gives birth or suffers a miscarriage; 3. He has applied for paternity leave with his employer within a reasonable period of time from the expected date of delivery by his pregnant spouse, or within such period as may be provided by company rules and regulations or by collective bargaining agreement, provided that prior application for leave shall not be required in case of miscarriage; and 4. His wife has given birth or suffered a miscarriage. For this purpose, “cohabiting” means the obligation of the husband and wife to live together. If the spouses are not physically living together because of the workstation or occupation, the male employee is still entitled to the paternity leave benefit. E. Frequency of Availment Paternity leave benefit shall apply to the first four (4) deliveries of the employee’s lawful wife with whom he is cohabiting. 33 10 PARENTAL LEAVE FOR SOLO PARENTS (RA 8972, as amended by RA 11861x) A. Definition 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. B. Coverage This benefit applies to all employees who belong to the following categories of solo parents: 1. A parent who provides sole parental care and support of the child or children due to – a. Birth as a consequence of rape, even without final conviction: Provided, That the mother has the sole parental care and support of the child or children: Provided, further, That the solo parent under this category may still be considered a solo parent under any of the categories in this section; b. Death of the spouse; c. Detention of the spouse for at least three (3) months or service of sentence for a criminal conviction; d. Physical or mental incapacity of the spouse as certified by a public or private medical practitioner; e. Legal separation or de facto separation for at least six (6) months, and the solo parent is entrusted with the sole parental care and support of the child or children; f. Declaration of nullity or annulment of marriage, as decreed by a court recognized by law, or due to divorce, subject to existing laws, and the solo parent is entrusted with the sole parental care and support of the child or children; or g. Abandonment by the spouse for at least six (6) months; 2. Spouse or any family member of an Overseas Filipino Worker (OFW), or the guardian of the child or children of an OFW: Provided, That the said OFW belongs to the low/semi-skilled worker category and is away from the Philippines for an uninterrupted period of twelve (12) months: Provided, further, That the OFW, his or her spouse, family x Known as the “Expanded Solo Parents Welfare Act.” Enacted on 04 June 2022. 34 member, or guardian of the child or children of an OFW falls under the requirements of this section; 3. Unmarried mother or father who keeps and rears the child or children; 4. Any legal guardian, adoptive or foster parent who solely provides parental care and support to a child or children; 5. Any relative within the fourth (4th) civil degree of consanguinity or affinity of the parent or legal guardian who assumes parental care and support of the child or children as a result of the death, abandonment, disappearance or absence of the parents or solo parent for at least six (6) months: Provided, That in cases of solo grandparents who are senior citizens but who have the sole parental care and support over their grandchildren who are unmarried, or unemployed and twenty- two (22) years old or below, or those twenty-two (22) years old or over but who are unable to fully take care or protect themselves from abuse, neglect, cruelty, exploitation, or discrimination because of a physical or mental disability or condition, they shall be entitled to the benefits of RA 8972, as amended in addition to the benefits granted to them by Republic Act No. 9257, otherwise known as the ‘Expanded Senior Citizens Act of 2003’; or 6. A pregnant woman who provides sole parental care and support to the unborn child or children. For the purpose of this leave benefit, the following terms shall mean: “Child” or “dependents” refer to those living with and dependent upon the solo parent for support who are unmarried, unemployed and twenty-two (22) years old or below, or those over twenty-two (22) years old but who are unable to fully take care or protect themselves from abuse, neglect, cruelty, exploitation, or discrimination because of a physical or mental disability or condition. “Parental care and support” refer to the acts of providing for the basic needs, health care, mental and physical safety, emotional support and formation of the personality of the child. C. Duration In addition to leave privileges under existing laws, a forfeitable and noncumulative parental leave of not more than seven (7) working days with pay every year shall be granted to any solo parent employee, regardless of employment status, who has rendered service of at least six (6) months. 35 Only a solo parent exercising sole parental care and support of the child or children is entitled to claim the benefits of a solo parent under the law. A solo parent shall not lose his or her status as solo parent if the other parent provides occasional assistance and/or seasonal gifts that do not meet the legal requirement of support under The Family Code of the Philippines. Moreover, the absence of a valid and legal marriage between the mother and father of a child or dependent does not automatically entitle either individual to the benefits under the law if the factual circumstances demonstrate that parental care and support are shared. In the event that the parental leave is not availed of, said leave shall not be convertible to cash unless specifically agreed upon previously by the employer and the employee. If there is an existing or similar benefit under a company policy or a collective bargaining agreement, the same shall be credited as such. If the same is greater than the seven (7) days provided for in RA 8972, as amended, the greater benefit shall prevail. Emergency or contingency leave provided under a company policy or a collective bargaining agreement shall not be credited as compliance with the parental leave provided for under RA 8972, as amended. D. Conditions for Entitlement A solo parent shall be entitled to the parental leave provided that: 1. They have rendered at least six (6) months of service, whether continuous or broken, at the time of the effectivity of RA 11861 y; 2. They have notified their employer of the availment thereof within a reasonable time; and 3. They have presented a valid Solo Parent Identification Card (SPIC). Qualified solo parents may apply for their SPIC at the Social Welfare and Development Officer of the city or municipality of their residence. E. Frequency of Availment The parental leave of seven (7) working days with pay shall be granted every year. When a solo parent ceases to be such by reason of change of status and circumstances, the said solo parent shall be ineligible to avail of the solo parent benefits. y RA 11861 was published on 30 June 2022 in Daily Tribune and took effect on 15 July 2022. 36 11 LEAVE FOR VICTIMS OF VIOLENCE AGAINST WOMEN AND THEIR CHILDREN (VAWC) (RA 9262) A. Definition Leave for victims of violence against women and their children refers to the paid leave granted to a female employee who is a victim of violence against women and their children allowing her to attend to medical and legal concerns at any time during the application of any protection order, investigation, prosecution and/or trial of the criminal case. B. Coverage This benefit applies to all female employees who are victims of VAWC. VAWC, as used in

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