Withholding 13th-month pay benefit

Dear PAO,

I started working for ABC Company as a probationary employee in September 2007. On my sixth month, an opportunity to work as an IT technician in the same company came, so I filed my intention to apply for the position. The management advised me to resign first then apply for the said position. That was what I did and I was hired for the job. I was regularized after a year. However, I was not given my 13th-month pay because, according to the company, I was only regularized last March 28, 2009. Is the company correct in not giving me that benefit? 

Roland

Dear Roland, 

The 13th month pay is an additional compensation and an employee benefit granted by law. Presidential Decree No. 851, as amended by Memorandum Order No. 28, requires employers to pay their employees a 13th month pay, which is equivalent to 1/12 of the employee’s basic salary earned within a calendar year. 

However, not all employers are required to give this benefit. As provided for under the Revised Guidelines on the Implementation of the 13th Month Pay Law the following employers are exempted from the provisions of the 13th Month Pay Law, to wit: (1) the government or any of its political subdivisions, including government-owned and controlled corporations, except those corporations operating essentially as private subsidiaries of the government; (2) Employers already paying their employees a 13th month pay or more in a calendar year or its equivalent; (3) Employers of household helpers and persons in the personal service of another in relation to such workers; (4) Employers who are paid purely on commission, boundary or task basis, and those who are paid a fixed amount for performing specific work, except where the workers are paid on piece-rate basis. In the situation you have presented before us, there is no showing that your employer is one of those listed above as exempted from the 13th-Month Pay Law. Thus, we are of the opinion that your employer should give a 13th month pay to those employees governed by them and who are entitled thereto. 

Accordingly, the revised guidelines also states that among those entitled to 13th month pay are rank-and-file employees, regardless of their designation or employment status, and irrespective of the method by which their wages are paid, provided that they would have worked for at least one month during a calendar year. Since you have worked with the company for more than a year, you are entitled to receive 13th month pay, provided that you can establish that your position as an IT technician is one that is of rank-and-file’s. If your job title is that of an IT technician but the nature of your position is that of a supervisor or a manager, you may be denied such benefit because those holding supervisory or managerial positions are not entitled to this benefit. Furthermore, the fact that you have only been regularized last March 28, 2009 should not be an obstacle in order for you to get hold of this benefit. According to the revised guidelines, if the employee, whether on a probationary or regular status, worked for the entire calendar year, he or she is entitled to 1/12 of his or her basic salary earned within that calendar year. If he or she worked for only a portion of the year, the 13th month pay shall be computed pro rata. 

We hope that we were able to answer your queries. Please be advised that this opinion is based solely on the facts you have narrated and our appreciation of the same. Our opinion may vary when other facts are changed or elaborated.

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