13th-Month Pay in the Philippines 2022
The 13th month's wage is a compulsory benefit that all Philippine employers are required to pay to their regular employees annually. The 13th Month Salary was first signed into law by former President Ferdinand E. Marcos by Executive Order No. 851 series of 1975 to "protect the level of real wages from the ravages of world inflation." Additionally, essential services were created to make up for the failure to raise the legal minimum wage in the 1970s and show concern for the plight of the working public so that Christmas and New Year can be properly celebrated.
13th-Month Pay vs Christmas Bonus
Philippine law requires all employers to pay their employees 13 months' wages. On the other hand, the Christmas bonus is not compulsory and it is left to the discretion of each company whether to give it to employees. Employers can reward employees with Christmas bonuses in recognition of the hard work they've done at the company throughout the year.
Who can receive a 13th-Month Pay?
All low-level private sector employees are entitled to their 13th month of pay, regardless of the type of company they work for, their title, title, employment status, and how they are paid. Note, however, that the 13th month's wages are calculated on a monthly basis. This means that an employee must have worked at least one month in a calendar year to be eligible for the thirteenth month's wages.
Employees who do not hold managerial positions in a company are considered ordinary employees. Posts are considered management positions for those who make important decisions related to the operation of the company, such as B. Hire, Terminate, Suspend or Terminate an Employee.
Who are not eligible to receive 13th-Month Pay?
Employers who have already paid their employees' salaries for 13 months or more in a calendar year or equivalent at the time of issuance
Governments are not entitled to a 13th-month salary, except for companies operating essentially as private government subsidiaries.
Workers are paid on a pure commission or task basis and workers are paid a fixed amount to perform a specific job. except where workers are paid on a piece basis.
Persons engaged in the personal services of others in relation to such workers
Computing for the 13th-Month Pay
To calculate your 13th-month salary, take the total base salary you earned that year and divide it by 12 months.
Example: For an employee who earns 20,000 pesos a month, has perfect attendance, has worked for 12 months, and has never taken a day off, then divide it by 12 (months). It will be equal to 20,000 as his/her 13th month's pay.
Penalty for companies not paying the 13th-Month Pay
Non-payment of the 13th monthly salary is considered a monetary claim. Employees may file complaints against their employers for violations of Executive Order 851 to the Department of Labor and Employment Local Arbitration Board that governs their workplace. Employers convicted of breaking the law face penalties and pay compensation to affected workers.
13th Month Salary Payment Deadline for Employees
For 2022, employers must pay their employees the 13th month's wages by December 24, 2022. The company must report its 13th month of payroll compliance to the Department of Labor and Employment (DOLE). This can be done by submitting an online Chapter Report by January 15, 2023.