How to compute separation pay in the Philippines?

If you’re a business owner who employs people, you must know how much is the minimum legal amount of separation pay you must give to your employees who are leaving your company. Likewise, if you’re an employee who has been terminated by your boss for whatever reason, you may also need to have an idea if you are entitled to separation pay or not. The law understands the need of employees when they become jobless for reasons covered by Article 283 and 284 of the Labor Code. Separation pay gives employees a livelihood after he leaves his former company and while he is looking for a new job. Read more

Philippine labor laws that employers must know

Knowing laws on labor and employment is vital to one’s business because a minor violation could lead you to big trouble. Most employers, especially those who do not have legal counsel, violate these laws usually not because they intend to, but because of sheer ignorance. Unfortunately, ignorance of the law does not excuse them from complying with it. Companies have closed shop after their employees slapped them with labor suits which ended up with these companies paying huge amounts of money representing unpaid wages or benefits and damages. To avoid being in the same situation, the following are relevant laws which you should always bear in mind as you go about your business and deal with your employees: Read more

Overtime pay laws and computation in the Philippines

Man is not a machine. At the end of the day, he has to rest to rejuvenate and prepare himself for tomorrow’s work. That is why labor standard laws in many countries set up maximum hours of work for employees. In the Philippines, our Labor Code fixed the maximum at eight (8) hours a day (see Article 83, Labor Code of the Philippines) for six consecutive work days (Article 91, LCP). If the employee works beyond eight hours, the employer is required to pay an additional compensation equivalent to the employee’s regular wage plus at least twenty-five percent (25%) of such regular wage. The rate is increased to thirty percent (30%) if the worker renders overtime on a holiday or rest day. (Article 87, LCP).   Read more

How to compute 13th Month Pay: DOLE Philippines

We are already on the month of October and after a few months, Christmas season is here again. For employees, that season sounds delightful. Aside from the enjoyable Christmas party and the series of vacations, the long awaiting 13th Month pay will finally land in our hands. For employers, this extra month pay is an additional mandated expense given to employees once or twice (installment) a year. However, some good business owners and employers see the giving of this added remuneration to employees as an appreciation and gratitude for their valuable contribution to their companies.

An employer must know how to compute the lawful amount of 13th month pays to be distributed to his employees. On the other hand, it is clever for an employee to know the computation of his thirteenth month paycheck to ensure that he is receiving it in the right amount of money. So to know what must be known, the following guidelines are presented below. Read more