How to compute your 13th month pay

Christmas is coming, all of us are excited to get our 13^th month pay. We plan to allocate this money for foods, gifts or for trips. But do you have an idea on how to compute your 13^th month pay?

13th  month pay is a form of monetary benefit equivalent to the monthly basic compensation received by an employee, computed pro-rata according to the number of months within a year that the employee has rendered service to the employer

All of the employees are entitled to have 13^th month pay even if you are a regular, contractual, direct hired, under a manpower service provider and local recruitment agencies. If you are a contractual employees or under a local recruitment agencies,  it is much better if you have the idea on how to compute your 13^th month pay. Here’s how:

 Another example:

If you started working on April 1

First payslip of the year:

1st month Apr 1-15 cut-off

1^st month Apr 16-30 cut-off

 For the month of April

P3,707.00 + P3,3700 =  P7,077 your basic salary for the 1^st month.

 If you worked for about 6 months(Apr-Sept), compute fot the 2^nd, 3^rd…up to 6^th months, you just add your basic salary then divide by 12 months and then you get your 13^th month pay.

According to DOLE

·        Every employer should give the 13^th month pay of their employees NOT LATER THAN DECEMBER 24.

·        An employee who resign within a year shall be entitled to 13^th month pay, provided he or she has worked at least 1 MONTH.

·        All establishments regardless of the number of employees are required to pay their rank-and-file employees the 13th month pay.

The information shared here is for general knowledge only and maybe subject to change. Consult a legal expert or your accountant for more information.

Source: Department of Labor and Employment