IV.

Wage Order

Salaries are paid twice in a month; therefore first half of the month will be paid on the

25th day of the month and the second half on the 10th of the next month. Cut-off for payroll

computation is every 15th and 30th of the month. If payday falls on holidays, salaries shall be paid

the day before the standard pay date.

Minimum wage of Region IV-A as of June 30, 2017 (Philippine Statistics Authority)

ranges from Php 283.00 – Php 351.50, which the business is implementing in their salary design.

Employees are expected to be given Php 315.00/day. Managerial employees are given Php

410.00/day.

Overtime Rates. According to article 87 of the Labor Code of the Philippines, there are 2

different overtime rates. The overtime rate for a normal working day in the Philippines is 25%

plus the employee’s regular wage. However, if overtime time is performed on a rest day or

holiday, the overtime rate shall be increased to 30% plus the employee’s regular wage rate.

 Overtime Pay for Managers in the Philippines

Managerial employees and officers or members of the managerial staff are not

entitled to overtime pay. However, the designation or the employee’s job title does

not automatically exclude the employee from overtime pay entitlement. It depends if

the employee’s duties and responsibilities qualify to be considered as a managerial

employee or a member of the managerial staff.

V. Employees contract, benefits and compensation

 Sick leave – The pertinent provision of the Labor Code applicable to your query is in

Article 95, which provides: Every employee who has rendered at least one year of

service shall be entitled to a yearly service incentive leave of five days with pay. This

provision shall not apply to those who are already enjoying the benefit herein

provided, those enjoying vacation leave with pay of at least five days, and those

employed in establishments with fewer than 10 employees or in establishments

exempted from granting this benefit by the Secretary of Labor after considering the

viability or financial condition of such establishment. The grant of benefit in excess

of that provided the Labor Code shall not be made subject of arbitration or any court

or administrative action.

 Rest Day – Every employee shall be provided with a rest period of 1 to 2 days after

every 6 or 5 consecutive working days.

 Holiday- On regular holidays, the covered employees are entitled to holiday pay

equivalent to a regular daily wage even if no work is done. If the employer required

work on a regular holiday, the employee is entitled compensation equivalent to twice

the regular rate. There is no holiday pay in retail and service establishments regularly

employing less than 10 employees.

 Maternity leave- Senate Bill 1305- Under the bill, all female workers, regardless of

civil status or legitimacy of her child, shall be granted 120 days maternity leave with

pay and an option to extend it for another 30 days without pay. Under the current law,

expectant mothers are allowed only 60 days of paid leave. Single mothers shall also

be granted a total of 150 days maternity leave with pay.

 Paternity Leave- Refers to the benefits granted to a married male employee in the

private and public sectors allowing him to take a leave for 7 days, with full pay, for

the first 4 deliveries of his legitimate spouse with whom he is cohabiting.

Conditions for Entitlement to Paternity Leave:

 The employee is lawfully married;

 He is cohabiting with his legitimate wife;

 His wife is pregnant or has delivered a child or suffered a miscarriage or

abortion;

 Must be of the first four deliveries;

 The employer is notified within reasonable time of the pregnancy and of

date of expected delivery.

 13th month pay- The 13th month pay in the Philippines is equivalent to 1/12 of the

basic salary received by an employee within the year. If a Filipino employee for less

than a year (regardless of the cause for the termination of his employment), the

amount due to him is determined by dividing the total salary he received by the

number of months he was employed. The computation of the basic salary does not

include allowances and monetary benefits that are not considered or integrated as part

of the employee’s regular compensation. The items that are taken off the list are: cash

equivalent of unused vacation and sick leave credits; overtime, premium, night

differential and holiday pay, and cost-of-living allowance.

 Social Security System (SSS)- Provides benefits and services to the covered

employees and their families. The company and the employees make monthly

contribution to the SSS.

  Philippine Health Insurance- Provides health insurance for the covered employees

and their families including allowances for hospitalization, medicines, laboratory

examination, medical fee, surgeon fee etc. However, the allowance will not

necessarily cover the total expense incurred.

VI. Business permit and legal forms

The legal requirements for starting a business in the Philippines depend on its type of

business and industry. Partnerships and corporations are required to be registered with the

Securities and Exchange Commission (SEC), while single proprietorship businesses are not.

Proprietorships are instead required to register with the Department of Trade and Industry (DTI)

for the registration of their business name. The following are the basic requirements to operate

legally:

 SEC registration- for registering as a partnership or corporation

 DTI registration- for registering your business trade name (BTR)

 Mayor’s business permit- for getting the license to operate within the city or

municipality and payment of your local business taxes.

 BIR registration- for getting TIN, official receipts and invoices, registering your

books of accounts, and paying your national internal revenue taxes (Income tax,

VAT or Percentage Tax, Withholding Taxes, etc.).

 SSS, Phil Health and Pag-Ibig Fund registration- for registering yourself or

company as an employer for remitting your employee’s contribution together with

your employer’s share.

 Usually, the BIR and the City/ Municipality Office require the certificates of registration

with the SEC or DTI before a business can be registered with them.

VII. Payslip- is a piece of paper given to an employee every payday which states how

much money he or she has earned, how much tax and deduction for SSS, Phil.Health and Pag-

ibig fund has been taken off.