Philippines Overview: Working Hours, Overtime, and Coverage of Other Mandatory Labor Rights
Under the provisions of Article 82 of the Labor Code of the Philippines, working hours apply to employees in all establishments and undertakings whether for profit or not, EXCLUDING the following:
- government employees;
- managerial employees;
- field personnel;
- family members of the employer who depend on him for support;
- domestic helpers;
- persons who provide personal service to other people; and
- workers who are paid by results as determined by the Secretary of Labor in appropriate regulations.
Working Hours in the Philippines
Normal Working Hours
The normal hours of work an employee has to render must not exceed eight (8) hours a day and should be exclusive of the one (1) hour daily lunch break. Philippine laws, however, do not prohibit work done for less than eight hours.
Working hours shall include:
- all time during which an employee is required to be on duty and/or to be at a prescribed workplace;
- all time during which an employee is permitted to work; and
- rest periods of short duration during working hours.
Every employer is mandated by the Labor Code to give their employees not less than sixty (60) minutes’ time-off for their regular meals. During day shifts, this time-off is usually during 12:00 PM.
Night Shift Differential Pay
Every employee shall be paid a night shift premium of not less than 10% of their regular wage for each hour of work performed between 10:00 PM and 6:00 AM.
Work may be performed beyond eight hours a day provided that the employee is paid for the overtime work, which consists of an additional compensation equivalent to his regular wage plus at least 25% thereof.
Work performed beyond eight hours on a holiday or rest day shall be paid an additional compensation equivalent to the rate of the first eight hours plus at least 30% thereof.
Undertime Not Offset by Overtime
Article 88 of the Labor Code enunciates that undertime work on a business day shall not be offset by overtime work on any other day. The law discourages the offset because the hourly rate of overtime is higher than the hours missed when an employee works for less than eight hours.
Permission given to the employee to go on leave for a day in a regular work week shall not exempt the employer from paying the additional compensation required for the overtime work done.
Emergency Overtime Work
An employee may be required to perform overtime work in any of the following cases:
- When the country is at war or when any other national or local emergency has been declared by the National Assembly or the Chief Executive;
- When it is necessary to prevent loss of life or property in cases of imminent danger to public safety due to actual or impending emergencies in the locality caused by serious accidents, fire, flood, typhoon, earthquake, epidemic or any other disaster;
- When there is urgent work to be performed on machines, installations, or equipment, in order to avoid serious loss or damage to the employer or some other cause of similar nature;
- When the work is necessary to prevent loss or damage to perishable goods; and
- Where the completion or continuation of the work started before the eighth hour is necessary to prevent serious obstruction or prejudice to the business or operations of the employer.
When employer may require work on a rest day
The employer may require his employees to work on any day:
- In case of actual or impending emergencies caused by serious accident, fire, flood, typhoon, earthquake, epidemic or other disaster or calamity to prevent loss of life and property, or imminent danger to public safety;
- In cases of urgent work to be performed on the machinery, equipment, or installation, to avoid serious loss which the employer would otherwise suffer;
- In the event of abnormal pressure of work due to special circumstances, where the employer cannot ordinarily be expected to resort to other measures;
- To prevent loss or damage to perishable goods;
- Where the nature of the work requires continuous operations and the stoppage of work may result in irreparable injury or loss to the employer; and
- Under other circumstances analogous or similar to the foregoing as determined by the Secretary of Labor and Employment.
Employee Right to Weekly Rest Day, Holiday Pay, and Service Incentive Leave
Right to Weekly Rest Day
It shall be the duty of every employer to provide each of his employees a rest period of not less than twenty-four (24) consecutive hours after every six (6) consecutive normal work days.
The employer shall determine and schedule the weekly rest day of his employees to be subject to collective bargaining agreement and to such rules and regulations as the Secretary of Labor and Employment may provide. However, the employer shall respect the preference of employees as to their weekly rest day when such preference is based on religious grounds.
Right to holiday pay
- Every worker shall be paid his regular daily wage during regular holidays, except in retail and service establishments regularly employing less than 10 workers;
- The employer may require an employee to work on any holiday but such employee shall be paid a compensation equivalent to twice his regular rate; and
- As used in this Article, “holiday” includes: New Year’s Day, Maundy Thursday, Good Friday, the ninth of April, the first of May, the twelfth of June, the fourth of July, the thirtieth of November, the twenty-fifth and thirtieth of December, and the day designated by law for holding a general election.
Right to service incentive leave
- Every employee who has rendered at least one year of service shall be entitled to a yearly service incentive leave of five days with pay.
- This provision shall not apply to those who are already enjoying the benefit herein provided, those enjoying vacation leave with pay of at least five days and those employed in establishments regularly employing less than ten employees or in establishments exempted from granting this benefit by the Secretary of Labor and Employment in the Philippines after considering the viability or financial condition of such establishment.
- The grant of benefit in excess of that provided herein shall not be made a subject of arbitration or any court or administrative action.
Mandatory Compensation for Rest Day, Sunday, or Holiday Work
Article 93 of the Labor Code stipulates that:
- When an employee is made or permitted to work on their scheduled rest day, they shall be paid an additional compensation of at least thirty percent (30%) of their regular wage. They shall be entitled to such additional compensation for work performed on Sunday only when it is their established rest day.
- When the nature of the work of the employee is such that they have no regular work days and no regular rest days can be scheduled, they shall be paid an additional compensation of at least thirty percent (30%) of their regular wage for work performed on Sundays and holidays.
- Work performed on any special holiday shall be paid an additional compensation of at least thirty percent (30%) of the employee’s regular wage. When such holiday work falls on an employee’s scheduled rest day, they shall be entitled to an additional compensation of at least fifty percent (50%) of their regular wage.
- When the collective bargaining agreement or other applicable employment contract stipulates the payment of a higher premium pay than prescribed by the Labor Code, the employer shall pay such higher rate.
All service charges collected by hotels, restaurants, and similar establishments shall be distributed at the rate of 85% for all covered employees and 15% for management. The share of the employees shall be equally distributed among them. In case the service charge is abolished, the share of the covered employees shall be considered integrated in their wages.
For more consultation on working hours in the Philippines please contact one of our HR Consultants or Labor Lawyers.