Tuesday, May 15, 2012

Overtime Compensation During Holidays in the Philippines

  


What is the computation of overtime pay during holidays in the Philippines?

The Department of Labor and Employment or DOLE has prescribed the specific rules on how to compute for the pay rate during holidays. These are guidelines which should be observed by employers in the private sector, pursuant to the Labor Code.

The guidelines for the government sector is covered by specific Civil Service laws.

The computation of overtime pay during holidays depends on three things:
  1. Whether the holiday is a regular or a special holiday;
  2. Whether the holiday falls on an employee's regular workday or rest day;
  3. Whether the employee worked during the holiday or not.

Computation of Overtime Compensation During Regular Holidays


First, here are the rules on how to compute the overtime pay for regular holidays:

If the holiday falls on an employee’s regular workday:

If the day is worked, the employee is entitled to 200 percent of his or her daily wage on the first eight hours and, for work in excess of the eight hours, to an additional 30 percent of his or her hourly rate on the said day.

If unworked, the employee is entitled to 100 percent of the regular daily rate, provided he or she was present, or was on leave with pay, on the workday immediately preceding the holiday.

If the day is the employee’s rest day:

If the day is worked, he or she is entitled to 260 percent of his or her daily rate on the first eight hours, plus 30 percent for work in excess of eight hours on the said day.

If unworked, the employee is entitled only to 100 percent of his regular rate, provided he or she was present, or was on leave with pay, on the workday immediately preceding the holiday.

Finally, in case the day immediately preceding the holiday is a non-working day in the establishment, or is the scheduled rest day of the employee, the employee shall not be deemed on leave of absence on that day, in which case he or she shall be entitled to the regular holiday pay.

Computation of Overtime Compensation During Special Non-Working Holidays


Here is how to compute for the overtime pay for special non-working holidays:

If unworked, there will be no pay, unless there is a favorable company policy, practice or collective bargaining agreement (CBA) granting payment of wages on special days even if unworked.

If worked and falls on an employee's regular day, the employee is entitled to 130 percent of his regular rate on the first eight hours and, for work in excess of the eight hours, to an additional 30 percent of his hourly rate for the said day.

If worked and falls on the employee's rest day, he is entitled to 150 percent of his daily rate on the first eight hours, plus 30 percent for work in excess of eight hours on the said day.

Computation of Overtime Compensation During Special Working Holidays


Lastly, for those declared as special working holidays, the following rules shall apply:

For work performed, an employee is entitled only to his basic rate. No premium pay is required since work performed on said days is considered work on ordinary working days.

  


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