SALARY COMPUTATION - PHILIPPINES

Computing Pay for Work Done on

• A Regular Day (basic daily rate = monthly rate x number of months in a year (12) / total working days in a year)
• A Special Day (130% x basic daily rate)
• A Special Day, which is also a scheduled Rest Day (150% x basic daily rate)
• A Regular Holiday (200% x basic daily rate)
• A Regular Holiday, which is also a scheduled Rest Day (260% x basic daily rate)
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Computing Night Shift Premium where Night Shift is a Regular Work

• Ordinary Day (110% x basic hourly rate)
• Rest Day, Special Day or Regular Holiday (110% of regular hourly rate)

Computing Overtime

• On Ordinary Days
  • Number of hours in excess of 8 hours (125% x hourly rate)
• On a Rest Day, Special Day, or Regular Day
  • Number of hours in excess of 8 hours (130% x hourly rate)
• On a Night Shift
  • Ordinary Day (110% x basic hourly rate)
  • Rest Day, Special Day or Regular Holiday (110% x overtime hourly rate)
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Computing 13th Month Pay

• Total basic salary earned for the year exclusive of overtime, holiday, and night shift differential pay divided by 12 = 13thmonth pay

Conditions of Employment and Benefits provided for Employees

• Employment Conditions
  • Normal working hours shall not exceed eight (8) hours a day
  • Payment of overtime work shall consist of an addition of at least 25% of the regular wage per hour worked or 30% thereof during holidays or rest days
  • Minimum wage rates for Agricultural and Non-Agricultural lines of work vary in every region and should be properly observed
  • Minimum age of employment is 18 years old but those aged 15 to 18 can be employed given that they work in non-hazardous environments
  • In the event of a bankruptcy or liquidation, workers shall be paid their full salary before other creditors may establish any claim to a share in the employer’s assets
• Mandatory Benefits and Contributions
• Companies are mandated by the Labor Code to give their regular employees a thirteenth month pay equivalent to one (1) month of their annual salary
• Service incentive leave of at least 5 days with pay for every year of service
• Employees have a right to a weekly rest period of not less than 24 consecutive hours after every 6 consecutive normal work days
• Withholding a portion of an employee’s monthly salary to remit as contributions to government agencies is a requisite for employers, these agencies are as follows:
  • Social Security System (SSS)
  • Home Development Mutual Fund (HDMF)
  • Philhealth
• Provision of holiday pay
• Paternity and maternity leave benefits

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