RULE IV

Holidays with Pay

SECTION 1. Coverage. — This rule shall apply to all employees except:

(a) Those of the government and any of the political subdivision, including government-owned and
controlled corporation;

(b) Those of retail and service establishments regularly employing less than ten (10) workers;

(c) Domestic helpers and persons in the personal service of another;

(d) Managerial employees as defined in Book Three of the Code;

(e) Field personnel and other employees whose time and performance is unsupervised by the employer
including those who are engaged on task or contract basis, purely commission basis, or those who are
paid a fixed amount for performing work irrespective of the time consumed in the performance
thereof.cralaw

SECTION 2. Status of employees paid by the month. — Employees who are uniformly paid by the month,
irrespective of the number of working days therein, with a salary of not less than the statutory or
established minimum wage shall be paid for all days in the month whether worked or not.cralaw

For this purpose, the monthly minimum wage shall not be less than the statutory minimum wage
multiplied by 365 days divided by twelve.cralaw

SECTION 3. Holiday Pay. — Every employer shall pay his employees their regular daily wage for any
worked regular holidays.cralaw

As used in the rule, the term 'regular holiday' shall exclusively refer to: New Year's Day, Maundy
Thursday, Good Friday, the ninth of April, the first of May, the twelfth of June, the last Sunday of August,
the thirtieth of November, the twenty-fifth and thirtieth of December. Nationwide special days shall
include the first of November and the last day of December.cralaw

As used in this Rule legal or regular holiday and special holiday shall now be referred to as 'regular
holiday' and 'special day', respectively.cralaw

SECTION 4. Compensation for holiday work. — Any employee who is permitted or suffered to work on
any regular holiday, not exceeding eight (8) hours, shall be paid at least two hundred percent (200%) of
his regular daily wage. If the holiday work falls on the scheduled rest day of the employee, he shall be
entitled to an additional premium pay of at least 30% of his regular holiday rate of 200% based on his
regular wage rate.cralaw

SECTION 5. Overtime pay for holiday work. — For work performed in excess of eight hours on a regular
holiday, an employee shall be paid an additional compensation for the overtime work equivalent to his
rate for the first eight hours on such holiday work plus at least 30% thereof.cralaw

Where the regular holiday work exceeding eight hours falls on the scheduled rest day of the employee,
he shall be paid an additional compensation for the overtime work equivalent to his regular holiday-rest
day for the first 8 hours plus 30% thereof. The regular holiday rest day rate of an employee shall consist
of 200% of his regular daily wage rate plus 30% thereof.cralaw
SECTION 6. Absences. — (a) All covered employees shall be entitled to the benefit provided herein when
they are on leave of absence with pay. Employees who are on leave of absence without pay on the day
immediately preceding a regular holiday may not be paid the required holiday pay if he has not worked
on such regular holiday.cralaw

(b) Employees shall grant the same percentage of the holiday pay as the benefit granted by competent
authority in the form of employee's compensation or social security payment, whichever is higher, if
they are not reporting for work while on such benefits.cralaw

(c) Where the day immediately preceding the holiday is a non-working day in the establishment or the
scheduled rest day of the employee, he shall not be deemed to be on leave of absence on that day, in
which case he shall be entitled to the holiday pay if he worked on the day immediately preceding the
non-working day or rest day.cralaw

SECTION 7. Temporary or periodic shutdown and temporary cessation of work. — (a) In cases of
temporary or periodic shutdown and temporary cessation of work of an establishment, as when a yearly
inventory or when the repair or cleaning of machineries and equipment is undertaken, the regular
holidays falling within the period shall be compensated in accordance with this Rule.cralaw

(b) The regular holiday during the cessation of operation of an enterprise due to business reverses as
authorized by the Secretary of Labor and Employment may not be paid by the employer.cralaw

SECTION 8. Holiday pay of certain employees. — (a) Private school teachers, including faculty members
of colleges and universities, may not be paid for the regular holidays during semestral vacations. They
shall, however, be paid for the regular holidays during Christmas vacation;

(b) Where a covered employee, is paid by results or output, such as payment on piece work, his holiday
pay shall not be less than his average daily earnings for the last seven (7) actual working days preceding
the regular holiday; Provided, However, that in no case shall the holiday pay be less than the applicable
statutory minimum wage rate.cralaw

(c) Seasonal workers may not be paid the required holiday pay during off-season when they are not at
work.cralaw

(d) Workers who have no regular working days shall be entitled to the benefits provided in this
Rule.cralaw

SECTION 9. Regular holiday falling on rest days or Sundays. — (a) A regular holiday falling on the
employee's rest day shall be compensated accordingly.cralaw

(b) Where a regular holiday falls on a Sunday, the following day shall be considered a special holiday for
purposes of the Labor Code, unless said day is also a regular holiday.cralaw

SECTION 10. Successive regular holidays. — Where there are two (2) successive regular holidays, like
Holy Thursday and Good Friday, an employee may not be paid for both holidays if he absents himself
from work on the day immediately preceding the first holiday, unless he works on the first holiday, in
which case he is entitled to his holiday pay on the second holiday.cralaw
SECTION 11. Relation to agreements. — Nothing in this Rule shall justify an employer in withdrawing or
reducing any benefits, supplements or payments for unworked holidays as provided in existing
individual or collective agreement or employer practice or policy.

RULE V
Service Incentive Leave

SECTION 1. Coverage. — This rule shall apply to all employees except:

(a) Those of the government and any of its political subdivisions, including government-owned and
controlled corporations;

(b) Domestic helpers and persons in the personal service of another;

(c) Managerial employees as defined in Book Three of this Code;

(d) Field personnel and other employees whose performance is unsupervised by the employer including
those who are engaged on task or contract basis, purely commission basis, or those who are paid a fixed
amount for performing work irrespective of the time consumed in the performance thereof;

(e) Those who are already enjoying the benefit herein provided;

(f) Those enjoying vacation leave with pay of at least five days; and

(g) Those employed in establishments regularly employing less than ten employees.cralaw

SECTION 2. Right to service incentive leave. — 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.cralaw

SECTION 3. Definition of certain terms. — The term "at least one-year service" shall mean 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.cralaw

SECTION 4. Accrual of benefit. — Entitlement to the benefit provided in this Rule shall start December
16, 1975, the date the amendatory provision of the Code took effect.cralaw

SECTION 5. Treatment of benefit. — The service incentive leave shall be commutable to its money
equivalent if not used or exhausted at the end of the year.cralaw

SECTION 6. Relation to agreements. — Nothing in the Rule shall justify an employer from withdrawing or
reducing any benefits, supplements or payments as provided in existing individual or collective
agreements or employer's practices or policies.