Philippines labour officials issue '13th month' pay guidelines

Concerns are mounting on how small businesses can pay for them

Philippines labour officials issue '13th month' pay guidelines

The Philippine Department of Labour and Employment (DOLE) has issued its guidelines for the issuance of 13th month pay for workers in the private sector. According to DOLE's labour advisory, rank-and-file employees in the private sector, regardless of their position, designation, or employment status, are covered by the pay.

Workers are also entitled to the pay regardless of the method by which their wages are paid as long as they have worked for the company for at least one month during the calendar year.

"The minimum 13th month pay required by law shall not be less than one-twelfth (1/12) of the total basic salary earned by an employee within a calendar year," the department explained in its advisory.

DOLE said the minimum amount shall be given "without prejudice to existing company practice or policy, employment contract, or collective bargaining agreement."

Employers are mandated to provide the 13th month pay on or before December 24, and no exemptions will be granted to businesses.

However, concerns are growing on how businesses can pay for their workers' 13th-month pay given that operations were shuttered in some parts of the year because of the pandemic.

Presidential Adviser for Entrepreneurship Joey Concepcion on Monday told a television interview that the government should offer "credit access" to businesses to pay for what he described as a "financial challenge."

"I think the government should provide credit access to those business establishments that need money to pay these obligations like the 13th month pay," he said.

According to Concepcion, the Department of Trade and Industry (DTI) is already looking into lending to business owners to help them pay the 13th month pay.

The DTI, through its financing arm the Small Business Corporation, will be launching a lending facility to assist micro, small, and medium enterprises that have been hit hard by the pandemic in issuing their workers' 13th month pay.

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