WORKERS’ STATUTORY

1 HANDBOOK ON. WORKERS' STATUTORY . MONETARY BENEFITS. DEPARTMENT OF LABOR AND EMPLOYMENT. BUREAU OF WORKING CONDITIONS. INTRAMUROS, MANILA. 2016. The Project Team Alvin B. Curada, Catherine Legados -Parado, Nicanor V. Bon, Emila T. de Guzman, Lalaine M. Familara, Julienne C. Recamara, Euniz, Johanne M. Garcia 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 Burea u of Working Conditions, Department of Labor and Employme nt. This Handbook is published by the Bureau of Working Conditions (BWC). Department of Labor and Employme nt (DOLE). 3 r d Floor, DOLE Bldg.

2 , Intra m ur os , Manila Tel. No. 5273000 locals 303, 308; Telefax No. 527-3478;. email: bwcsecretar y@g mai m ; website: h - NOT FOR SALE . Cover Art : Ma. Alea Razelle S. Gaela Republic of the Philippines DEPARTMENT OF LABOR AND EMPLOYMENT. Intramuros, Manila FOREWORD. We are pleased to present a reprint of the 2016 Handbook on Workers' STATUTORY Monetary Benefits an updated and comprehensive material on recent developments in Philippine labor laws and regulations. Through the years, this Handbook has become a dependable guide not only for workers and employers, but also to students, labor law practitioners, and the general public. The consistently enthusiastic reception extended to this work has prompted us to issue a reprinted edition.

3 This reprint forms part of our vigorous and strengthened enforcement activities under the new administration. We commit to be steadfast in addressing abuses in employment arrangements while remaining strict yet equitable. Toward such end, we intend to educate stakeholders and inspire a culture of voluntary compliance with labor laws in as many workplaces as possible. In this edition, we added more detailed illustrations and sample wage computations to facilitate the computation of equivalent monthly rates for daily-paid and monthly-paid workers. Another new item is the enumeration of the regional minimum wage rates prescribed in the latest wage Orders. We also included entries on the exemption from the minimum wage law of barangay micro business enterprises under the BMBE Act of 2002, as amended by the Go Negosyo Act of 2014.

4 An equally important development is the inclusion of entries on the income tax exemption on minimum wage earners under No. 9504; the tax treatment on separation pay and retirement pay; and the tax implication on 13 th month pay in view of the passage of No. 10653 which raised the income tax exemption ceiling to P82,000. We sincerely hope that, with this Handbook, we can stay true to our mandate of promoting full, decent, and productive employment opportunities for every Filipino worker in every workplace throug ho ut the countr y. SILVESTRE H. BELLO III. Secretary CONTENTS. COM PLIANCE GUIDE 1. 1. M INIM UM wage . A. Coverage 3. B. Minimum wage Rates 4. C. Basis 6. D.

5 Monthly-Paid and Daily-Paid Employees 6. E. Minimum wage and Rights of Kasam bahay 8. F. Effect of Reduction of Workdays on Wages 9. G. Penalty and Double Indemni ty for Violation of the Prescribed Increases or Adjustme nts in the wage Rates (RA 8188) 9. H. Barangay Micro Business Enterprises (BMBEs) 9. I. Minimum wage of Workers Paid by Results 10. J. Minimum wage of Apprentices, Lea rners, & Persons with Disability 10. K. Coverage from Income Tax of Minimum wage Earners 11. 2. HOLIDAY PAY (Article 94). A. Definition 12. B. Coverage 12. C. Regular Holidays 13. D. Muslim Holidays 14. E. Absences 15. F. Successive Regular Holidays 16. G. Temporar y or Periodic Shutdown/Ces sa tio n of Work 16.

6 H. Holiday Pay of Certain Employees 16. 3. PREM IUM PAY (Articles 91 -93). A. Definition 17. B. Coverage 17. C. Special Days 18. D. Premium Pay Rates 19. 4. OVERT IM E PAY (Article 87). A. Definition 20. B. Coverage 20. C. Overtime Pay Rates 20. D. Stipulated Overtime Rates 21. 5. NIGHT SHIFT DIFFERENT IAL (Article 86). A. Definition 22. B. Coverage 22. C. Computation of Night Shift Differential 23. 6. SERVICE CHARGES (Article 96). A. Sharing 25. B. Payments 25. C. Tips 25. 7. SERVICE INCENT IVE LEAVE (Article 95). A. Coverage 26. B. Meaning of one year of service 27. C. Usage/Conver sio n to Cash 27. 8. M AT ERNIT Y LEAVE (RA 1161, as amended by RA 8282). A. Coverage 28.

7 B. Entitleme nt 28. 9. PAT ERNIT Y LEAVE (RA 8187). A. Coverage 29. B. The Paternity Leave Benefit 29. C. Conditions for Entitleme nt 30. D. Application for Paternity Leave 30. E. Non-conve rsi o n to Cash 30. F. Crediting of Existing Benefits 30. 10. PARENTAL LEAVE FOR SOLO PARENT S (RA 8972). A. Coverage 31. B. Definition of Terms 32. C. The Parental Leave Benefit 32. D. Conditions for Entitleme nt 32. E. Non-conve rsi o n to Cash 32. F. Crediting of Existing Leave 33. G. Terminatio n of the Benefit 33. H. Protection Against Work Discrimination 33. 11. LEAVE FOR VICT IM S OF VIOLENCE AGAINST WOM EN. AND T HEIR CHILDREN (RA 9262). A. Definition 34. B. Coverage and Purpose 34.

8 C. Requireme nt for Entitleme nt 34. D. The Benefit 35. E. Usage of the Benefit 35. 12. SPECIAL LEAVE FOR WOM EN (RA 9710). A. Coverage 36. B. Definition of Term 36. C. Conditions for Entitleme nt 36. D. The Special Leave Benefit 36. E. Usage 37. F. Nonconver sio n to Cash 37. 13. T HIRT EENT H-M ONT H PAY (PD 851). A. Coverage 38. B. Definition of Rank-and- File Employees 38. C. Minimum Amount 38. D. Formula and Computatio n of 13 th Month Pay 39. E. Exempted Employers 40. F. Time of Payment of Thirteenth -M o nth Pay 40. G. Thirteenth- Mo nth Pay for Certain Types of Employees 41. H. Thirteenth- Mo nth Pay of Resigned or Separated Employee 41. I. Non-inclusio n in Regular wage 42.

9 J. Coverage from Income Tax of the 13 th Month Pay 42. 14. SEPARAT ION PAY (Articles 2 98- 299). A. One-Half Month Pay per Year of Service 43. B. One-Month Pay per Year of Service 44. C. Notice of Terminatio n 44. D. Basis of Separation Pay 44. E. Inclusio n of Regular Allowance in the Computation 44. F. Coverage from Income Tax of Separation Pay 45. 15. RET IREM ENT PAY (Article 302). A. Coverage 46. B. Amount of Retirement Pay 46. C. Retirement Benefits under a Collective Bargaining Agreement/. Applicable Contract 47. D. Retirement Benefits of Workers who are Paid by Results 47. E. Retirement Benefit of Part-time Workers 48. F. Retirement Benefit of Undergro und or Surface Mine Employees under Republic Act No.

10 8558 as amended by Republic Act No. 10757 48. G. Other Benefits upon Retirement 49. H. Coverage from Income Tax of Retirement Pay 49. 16. BENEFIT S UNDER T HE EM PLOYEES' COM PENSAT ION. PROGRAM (PD 626). A. The Employees' Compensation Program 50. B. Coverage 50. C. The Benefits 50. D. Kinds of Disability 51. E. Filing of Claims 52. F. Obligations /Respo nsibi li ties of Employers 53. 17. PHILHEALT H BENEFIT S (RA 7875, as amended by RA 9241). A. The National Health Insura nce Program 54. B. Coverage 54. C. The Benefits 55. 18. SOCIAL SECURIT Y BENEFIT S (RA 1161, as amended by RA 8282). A. The Social Security Program 59. B. Coverage 59. C. The Benefits 59. 19. PAG-IBIG BENEFIT S (RA 9679).