SERVICE INCENTIVE LEAVE (SIL) is a 5 days leave with pay for every employee who has rendered at least

1 yr of service. It is commutable to its money

equivalent if not used or exhausted at the end of year.
At least 1 year of service means service for not less than 12 months, whether continuous or broken reckoned from the date the employee started working,
including authorized absences and paid regular holidays unless the working days in the establishment as a matter of practice or policy, or that provided in the
employment contract is less than 12 months, in which case said period shall be considered as one year. (Sec. 3, Rule V, Book III, IRR)
Service Incentive Leave (SIL) applies to every employee who has rendered at least 1 year of service. (Art. 95[a]), EXCEPT
1. Government employees and any of its political subdivisions including Government Owned and Controlled Corporations (GOCCs),
2. Those already enjoying the benefit Domestic helpers and persons in the personal services of another,
3. Those already enjoying vacation leave with pay of at least 5 days,
4. Managerial employees
5. Field personnel and other employee whose performance is unsupervised by the employer
6. Employed in establishments regularly employing less than 10 workers
7. Exempt establishments
8. Engaged on task or contract basis, purely commission basis, or those who are paid in a fixed amount of performing work irrespective of the time
consumed in the performance thereof. (Art. 95[b])
Teachers of private schools on contract basis are entitled to SIL. The phrase "those who are engaged on task or contract basis" should, however, be
related with "field personnel" applying the rule on ejusdem generis that general and unlimited terms are restrained and limited by the particular terms that they
follow. Clearly, Cebu Institute of Technology teaching personnel cannot be deemed as field personnel which refers "to nonagricultural Ees who regularly perform
their duties away from the principal place of business or branch office of the Er and whose actual hours of work in the field cannot be determined with reasonable
certainty. (Par. 3, Art. 82, LC). (CIT vs. Ople, G.R. No. 70203, Dec. 18, 1987)
Q: Is SIL commutable to its monetary equivalent if not used or exhausted at the end of the year? A: Yes. It is aimed primarily at encouraging workers to work
continuously and with dedication to the company. Q: What is the basis for cash conversion? A: The basis shall be the salary rate at the date of commutation. The
availment and commutation of the SIL may be on a prorata basis. (No. VI(c), DOLE Handbook on Workers Statutory Monetary Benefit)
Q: Are parttime workers entitled to the full benefit of the yearly 5 day SIL? A: Yes. Art. 95 of Labor Code speaks of the number of months in a year for entitlement
to said benefit. (Bureau of Working Conditions Advisory Opinion to Phil. Integrated Exporters, Inc.)
Q: Are piecerate workers entitled to the full benefit of the yearly 5 day SIL? A: It depends. 1. 2. Yes. Provided: a. They are working inside the premises of the
employer (Er) and b. Under the direct supervision of the Er. No. Provided: a. They are working outside the premises of the Er b. Hours spent in the performance of
work cannot be ascertained with reasonable certainty c. The are not under the direct supervision of the Er
Q: Does it apply to Ees with salaries above minimum wage? A: No. The difference between the minimum wage and the actual salary received by the Ees cannot
be deemed as their 13th month pay and SIL pay as such difference is not equivalent to or of the same import as the said benefits contemplated by law. (JPL
Marketing Promotions v. CA, G.R. No. 151966, July 8, 2005.)
Q: Explain the entitlement of terminated Ees to SIL. A: 1. 2. Illegally dismissed Ees entitled to SIL until actual reinstatement. (Integrated Contractor and Plumbing
Works, Inc. v. NLRC, G.R.No. Aug.9, 2005) Legally dismissed Ees the Ee who had not been paid of SIL from outset of employment is entitled only of such pay
after a year from commencement of service until termination of employment or contract. (JPL Marketing Promotions v. CA, G.R. No. 151966, July 8, July 8, 2005)