DOLE eyeing to allow delay in payout of 13th-month bonus by ‘distressed’ firms

by Gabriel Pabico Lalu, Philippine Daily Inquirer, 8 Oct 2020

MANILA, Philippines — The Department of Labor and Employment (DOLE) is considering to let companies and businesses “distressed” by the COVID-19 pandemic to defer its payout of the 13th-month bonus of their workers.

Labor Secretary Silvestre Bello III on Thursday said they are considering several options to find the balance between the welfare of workers and companies and businesses as the economy has just started to move again after months of lockdown.

Bello said that while one option is to totally excuse some companies from giving their employees the 13th-month pay, he prefers a deferment instead which means that companies would still have to give the bonus to their workers but only on a later date.

“‘Pagka ‘yong business establishment is characterized as distressed, kaya we have to come up with an advisory to determine what is the meaning of a distressed company or distressed business establishment. Para ma-exempt sila from the payment,” he said in an online briefing.

(If the business establishment is characterized as distressed — that’s why we have to come up with a meaning of what is a distressed company or distressed business establishment. So that they could be exempted from payment.)

“Pero sabi ko nga instead of going through that, why don’t we consult both labor and management, pag-usapan na lang nila na medyo mahirap ngayon ang panahon, ‘di kami kumikita […] baka naman pwedeng i-defer. To me that might be the more acceptable formula to address the issue,” he added.

(But as I have said, instead of going through that, why don’t we consult both labor and management, have them talk about it, that times are hard, the company may not be having much profit… maybe it’s possible to defer. To me that might be the more acceptable formula to address the issue.)

Under Presidential Decree No. 851, companies are required to give workers a 13th-month pay, which is basically a twelfth of a person’s annual earnings. This bonus is given before the end of each year, separate from other year-end bonuses.

However, the new coronavirus pandemic has forced a lot of companies to either suspend or totally cease operations amid limited number of customers since the government has imposed health regulations such as lockdowns and travel restrictions that require the general public to stay indoors.

Among the most affected industries are tourism, transportation, leisure activities, and some food and beverage outlets.

Bello further said that DOLE is also looking at other options like totally exempting Micro, Small and Medium Enterprises from granting the 13th-month pay, or excluding companies with a capital of more than P1 million from delaying or passing up on the payout of 13th-month bonus to workers.

“Baka hindi namin kaya ngayon, baka pwedeng next year or next month, gano’n. Pero that’s an option. The other option is, kaming business, we are excused gano’n […] So ito pinag-aralan na naman namin, on how we can address the issue of the non-payment of the 13th month pay,” he explained.

(Maybe they cannot do it this year, maybe they can do it next month or next year. But that’s an option. The other option is for businesses to be excused. So that’s what we are studying, on how we can address the issue of the non-payment of the 13th-month pay.)

“Baka naman kako when it comes to the 13th-month pay, baka pwede nating i-exempt ‘yong mga MSMEs, ‘yong mga micro, small, and medium. And then ‘yong mga with a capitalization of P1 million above, baka pwede nating i-require. So ito, pinag-aaralan pa, then it will be subject to a tripartite consultation,” he added.

(I suggested that maybe when it comes to the 13th-month pay, we can exempt MSMEs, the micro, small, and medium. And then those with a capitalization of P1 million above, maybe we can require them to pay. That is being studied, then it will be subject to a tripartite consultation.)

KGA