Details about the Pay for Resigned and Terminated Employees and the 13th Month Pay Coverage
There might be some curiosities on the eligibility of the resigned and terminated employees to receive the 13th Month Pay in the Philippines.
Employees in the Philippines get different types of pay in a year — the basic daily pay which results to the monthly basic salary at work, the holiday pay during regular holidays and special non-working days, and the 13th Month Pay among others.
Let us talk about the 13th Month Pay. In the country, this is usually given every December thus it is also called as the “holiday pay” in some cases. December is a month filled with holidays including Christmas and New Year.
The 13th Month Pay is mandated by the labor law to be given by companies to all employees who have worked for at least a month in the firm. It should not be less than 1/12 of the total basic salary received by the employee.
With regards to the case of the resigned and terminated employees, they are entitled to receive the 13th Month Pay as long as they have worked in the company for at least a month.
The 13th Month Pay of the resigned and terminated employees must be given as part of their final pay. In the case of those voluntarily left their job, the final pay includes the unpaid salary, the leave conversions if it is allowed by the company, the 13th Month Pay, and the other pays that the employee is entitled to receive.
In the case of employees who lost their job but they did not violate the ground rules of the company, like in the case of reshuffling resulting to the abolition of a department or office, they are entitled not only to the aforementioned pays but as well as a separation pay which is equivalent to one-month salary for every year of service.