4. HOLIDAY PAY
The Labor Code requires the payment of an employee’s daily basic wage for all non working regular holidays.
There are 12 regular and 3 special non working holidays (see above) in the Philippines.
12 regular holidays are (Republic Act No. 9849):
– New Year’s day
– Maundy Thursday
– Good Friday
– Araw ng Kagitingan
– Labour Day
– Independence Day
– National Heroes’ Day
– Eidl Fitr
– Eidl Adha
– Bonifacio Day
– Christmas Day
– Rizal Day
Rate Example:
If work is accomplished on a regular holiday (up to 8 hours), an employee is entitled to at least twice (200%) of his basic wage. If the holiday corresponds to a scheduled rest day, the employee is entitled to an additional 30% based on his regular holiday rate of 200%, which comes to a total of at least 260%.
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 notwork day or rest day.
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.
5. What are the Service Charges that the Companies are deducting in their Employees Wage?
SERVICE CHARGES
Employees of employers collecting service charges are entitled to an equal share in the 85% of the total of such charges, except managerial employees. The remaining 15% of the charges may be retained by the management to answer for losses and breakages and for distribution to managerial employees, at the discretion of the management in the latter case. Service charges are collected by most hotels and some restaurants, night clubs, cocktail lounges, among others.
Exceptions to Coverage of Benefits granted under the provisions on Overtime, Premium, Holiday, Night Shift Differential Pays and Service Charges
These mentioned benefits apply to all employees except:
1. Government employees.
2. Workers of retail and service establishments regularly employing less than 10 workers.
3. Managerial employees and officers or members of a managerial staff.
4. Househelpers and persons in the personal service of another.
5. Workers who are paid by results/output.
6. Field personnel if they regularly perform their duties away from the office or place of business.
6. Is there any Service Incentive Leave for an employee?
SERVICE INCENTIVE LEAVE
Every employee who has rendered at least one (1) year of service is entitled to a Service Incentive Leave (SIL) of five (5) days with pay. SIL may be used for sick and vacation leave purposes. The unused SIL at the end of the year can be converted into cash using the salary rate at the date of conversion. It is the employer’s prerogative to grant additional vacation leave.
Meaning of “one year of service”
The phrase “one year of service” of the employee means service within 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. Where by individual or collective agreement, practice or policy, the period of working days is less than 12 months, said period shall be considered as one year for the purpose of determining entitlement to the service incentive leave.
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