The 13th-Month Pay

Whenever the “ber” months come up most of our employees are excited because this is the payoff of the annual 13th-month pay, However, many employees often ask if they have or will receive such benefits especially if they are new to the company. Here is some information on the topic.

What is the 13th month?

It is mandatory based under Presidential Decree No. 851. Typically this is equivalent to a full monthly salary paid every December but no later than the 24th of December each year. 

Who and when should I receive the 13th-month pay?

All rank-and-file employees are entitled to receive the 13th-month pay regardless of their job status. The employee who has worked for at least one (1) month in the calendar year are entitled to receive the 13th-month pay.

How the 13th-month pay is computed?

The 13th-month pay is based on or calculated based on 1/12 of the employee’s basic salary or compensation for one year or basic monthly salary for the whole year divided by 12 months. Basic salary does not include COLA or regular allowances.

The basis for computing 13th-month pay

Total Basic Monthly Salary Earned during the Year/12 = 13th Month Pay

For a resigned employee or whose services were terminated at any time before the time for payment of 13th month is still entitled to the benefit.

The 13th-month pay of a resigned /separated/terminated employee is in proportion to the length of time he or she has worked during the year, reckoned

(a) from the time she has started working during the calendar year or

(b) the time the last 13th-month pay was given, up to the time of his/her resignation or separation/termination from the service.

Thus, if he/she worked only from January to September, his/her 13th-month pay shall be equal to 1/12 of his total basic salary earned during that period.[i]

[i] http://bwc.dole.gov.ph/faqs-on-13th-month-pay

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Barque Raul

I am an HR practitioner by profession. I have a passion for writing but definitely not a writer. I created this blog 2008 just to journal my thoughts, ideas and my opinions that went through my mind.

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