Name: Cris James N. Pañares
Course: PCHRS Compensation Administration
Year: 3rd Year
Schedule: (T-TH 9:00am-10:30am)
Program: BSBA – Human Resource Management
Date: February 18, 2025
Compensation in the Philippines
Compensation – any form of payment that can be a form of salary, wage, commission
which is made on an individual for the services rendered as an employee by an employer.
A. Monetary Compensation

13th Month Pay (Presidential Decree No. 851) – A mandatory bonus equal to onetwelfth (1/12) of an employee’s annual salary, paid before December 24.

Employees’ Compensation Program (ECP) (Republic Act No. 11199) – Provides
financial assistance to employees suffering from work-related illnesses, injuries, or
death.

Holiday Pay (Article 94) – Employees receive 100% of their daily wage even if
they do not work on a regular holiday.

Leave for Victims of Violence Against Women & Children (Republic Act No.
9262) – 10 days of paid leave for female employees who are victims of domestic
violence.

Maternity Leave (Republic Act No. 11210) – 105 days of paid leave for female
employees who have given birth (extendable by 30 days unpaid).

Minimum Wage (Articles 99-101, Republic Act No. 6727) – The lowest legal
amount an employer can pay an employee. It varies by region and industry,
determined by the Regional Tripartite Wages and Productivity Board.

Night Differential Pay (Article 86) – Additional 10% of the hourly wage for work
performed between 10 PM and 6 AM.

Overtime Pay (Articles 87-90) – Compensation for work exceeding 8 hours per
day, paid at 125% of the regular rate (or 130% on rest days).

Pag-IBIG Benefits (Republic Act No. 9679) – Employees contribute to Pag-IBIG
for housing loans, savings, and financial assistance.

Parental Leave for Solo Parents (Republic Act No. 8972) – 7 days of paid leave
per year for single parents who have worked for at least one year.

Paternity Leave (Republic Act No. 8187) – 7 days of paid leave for married male
employees whose wife has given birth.

PhilHealth Benefits (Republic Act No. 11223) – Covers hospitalization, medical
expenses, and preventive healthcare for employees.

Premium Pay (Article 93) – Additional pay for employees working on special nonworking days, rest days, or special holidays (usually 30% extra on top of the daily
wage).

Retirement Pay (Article 287) – Employees aged 60 to 65 who have served at least
5 years receive at least one-half month’s salary per year of service.

Separation Pay (Articles 283-284) – Employees terminated due to redundancy,
business closure, or retrenchment receive half to one month’s salary per year of
service.

Service Charges (Article 96) – Employees in hotels, restaurants, and similar
establishments receive 85% of collected service charges.

Service Incentive Leave (Article 95) – Employees who have worked at least one
year are entitled to five days of paid leave per year.

Social Security Benefits (SSS) (Republic Act No. 11199) – Provides retirement,
disability, sickness, maternity, and death benefits to private-sector employees.

Special Leave for Women (Gynecological Disorders) (Republic Act No. 9710)
– 60 days of paid leave for female employees who undergo gynecological surgery.
B. Non-Monetary Compensation

Employee Benefits (Voluntary by Employers) – Additional health insurance,
retirement plans, and allowances offered by some employers.

Wage Deduction Limits (Articles 113-117) – Employers cannot deduct wages
unless allowed by law (e.g., taxes, SSS contributions).

Wage Payment Regulations (Articles 102-107) - Wages must be paid on time, in
legal tender, and without unauthorized deductions.

Weekly Rest Period (Articles 91-93) – Employees are entitled to at least one rest
day per week.
Reference:
Act
No.
3428
–
Supreme
Court
E-Library.
Retrieved
from
https://elibrary.judiciary.gov.ph/thebookshelf/showdocs/28/54268
Chan, J. G. (2019). Bar reviewer on labor law (4th revised ed.). ChanRobles Internet Bar
Review.
Department of Labor and Employment. (2023). Handbook on workers’ statutory monetary
benefits. Bureau of Working Conditions.
Department of Budget and Management. (n.d.). Manual on position classification and
compensation.
Labor Code Law Of The Philippines (4). (n.d.). AMSLAW. Retrieved from
https://amslaw.ph/philippine-laws/labor-law/labor-code-law-of-the-philippines-(4)
The Employer’s Guide to Labor Codes in the Philippines – Omni HR. (2024, December
5). Omni HR.
Veremark. (2024, April 10). Employment Laws in the Philippines: A Guide for Employers.
Wages, Salaries, Remuneration – Labor Law PH. (2024, November 29). Labor Law PH.