Dear PAO,
It is Christmas season again and I am just apprehensive that our 13th month pay will be given to us again after the season ends. I am just curious if there is a law that mandates when and how 13th month pay is to be paid?
Apple

Dear Apple,
The law that prescribes the payment of 13th month pay to employees by their employers is Presidential Decree (P.D.) No. 851. Under this law, all employers covered shall pay to all their employees receiving a basic salary of not more than P1,000.00 a month a 13th month pay not later than December 24 of every year (Section 1, P. D. No. 851). However, this was amended by Memorandum Order No. 28, dated August 13, 1986, by requiring all employers to pay all their rank-and-file employees 13th-month pay.

As defined, 13th month pay is an additional benefit received by rank-and-file employees which is equivalent to one twelfth (1/12) of their basic salary within a calendar year (Section 2 (a), Presidential Decree No. 851).

Under the Labor Code, “a managerial employee is one who is vested with powers or prerogatives to lay down and execute management policies and/or to hire, transfer, suspend, lay-off, recall, discharge, assign or discipline employees. Supervisory employees are those who, in the interest of the employer, effectively recommend such managerial actions if the exercise of such authority is not merely routinary or clerical in nature but requires the use of independent judgment. All employees not falling within any of the above definitions are considered rank-and-file employees for purposes of this Book” (Article 212 (m), Labor Code of the Philippines).

The above-quoted provision is the basis in determining employees entitled to receive the 13th-month pay (Revised Guidelines on the Implementation of the 13th-month Pay Law).

It is clear that the payment of the 13th month pay shall not be later than December 24 of the year you are entitled to receive the same. If your employer fails to give this benefit, you may file a complaint before the Department of Labor and Employment (DOLE) or the National Labor Relations Commission (NLRC).

Again, we find it necessary to mention that this opinion is solely based on the facts you have narrated and our appreciation of the same. The opinion may vary when the facts are changed or elaborated.

We hope that we were able to guide you with our opinion on the matter.