Do you wander what is the formula for 13th month pay computation? Here’s the Department of Labor and Employment (DOLE) Labor Advisory entitled Payment of Thirteen Month Pay. Let us defined first what is 13 month pay and basic salary.
What is 13th Month Pay?
Thirteen month pay shall mean one twelfth (1/12) of the basic salary of an employee within the calendar year.
What is Basic Salary?
Basic Salary shall include all remunerations or earnings paid by an employer to an employee for services rendered but may not include cost-of-living allowances, profit-sharing payments, cash equivalent of unused vacation and sick leave credits, overtime pay, premium pay, night shift differential, holiday pay, and all allowances and monetary benefits which are not considered, or integrated as part of the regular or basic salary of the employee.
Rank-and-file employees in the private sector shall be entitled to 13th month pay regardless of their position, designation, or employment status, and irrespective of the method by which their wages are paid, provided that they have worked for at least one month during the calendar year.
Time of Payment
The 13th month pay shall be paid not later than December 24 of every year. An employer, however, may give to his or her employees one-half (1/2) of the 13th month pay before the opening of the regular school year and the remaining half on or before December 24 of every year.
13th Month Pay Computation
This is how to compute for your 13th month pay:
Post from National Wages and Productivity Commission (NWPC)