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Friday, August 17, 2012

DOLE pay rules on August 20, 21, and 27, 2012

The Department of Labor and Employment (DOLE) released an advisory on proper pay rules for August holidays.


Secretary Rosalinda Dimapilis-Baldoz yesterday urged private sector employers to observe the proper pay rules for their workers on August 20, 21, and 27, which were declared holidays, pursuant to Proclamation Nos. 295 and 455 issued by President Benigno S. Aquino III on November 24, 2011 and August 13, 2012, respectively.


August 20 - regular holiday in view of the celebration of Eid'l Fitr or Feast of Ramadhan

August 21 - special non-working day in commemoration of Ninoy Aquino Day

August 27 - regular holiday in commemoration of National Heroes Day


Employers should abide by the following guidelines on holiday pay (pursuant to Pursuant to the Labor Advisory No. 2):


(1) Regular Holidays, Mondays, August 20 and 27:

  • If the employee did not render work during the regular holiday, he/she shall be entitled to 100 percent of his/her salary for that day [(Daily Rate + COLA) x 100%];
  • If the employee reported for work on such day, he/she shall be entitled to 200 percent of his/her regular salary for that day for the first eight (8) hours [(Daily Rate + COLA) x 200%];
  • For overtime work rendered during this regular holiday, he/she shall be entitled to an additional 30 percent of his/her hourly rate on said day (Hourly Rate x 200% x 130% x Number of Hours Worked);
  • If the employee worked during a regular holiday that also falls on his/her rest day, he/she shall be entitled to an additional 30 percent of his/her daily rate of 200 percent [(Daily Rate + COLA x 200%) + 30% (Daily Rate x 200%)]; and
  • For overtime work rendered during the regular holiday that falls on his/her rest day, he/she shall be entitled to an additional 30 percent of his/her hourly rate on said day (Hourly Rate x 200% x 130% x 130% x Number of Hours Worked).


(2) Special (Non-Working) Day, Tuesday, August 21, 2012:

  • If the day is unworked, the “no work, no pay” principle shall apply, unless there is a favorable company policy, practice or collective bargaining agreement (CBA) granting payment on a special day;
  • If worked, the employee shall be entitled to an additional 30 percent of his/her daily rate on the first eight hours of work (Daily rate x 130%);
  • If the employee worked during a special day, he/she shall be entitled to an additional 30 percent of his/her hourly rate on such special day (Hourly rate x 130% x Number of Hours Worked);
  • If the employee worked during the special day that also fall on his/her rest day, he/she shall be entitled to an additional 50 percent of his/her daily rate on first eight (8) hours of work (Daily Rate x 150%); and
  • In excess of eight hours, he/she shall be entitled to an additional 30 percent of his/her hourly rate on such special day (Hourly Rate x 130% x 150% x Number of Hours Worked).

Examples

  1. Q: How is the holiday pay computed when an employee is suffered or required to work during a regular holiday (August 20, 2012, Eid’l Fitr, Feast of Ramadan)?

    A: An additional 100% holiday pay is added to the employee’s minimum wage (Basic wage + COLA), or a total of 200%, which is computed as follows:

    a. For normal eight-hour work, usually rendered from 8:00 a.m. to 5:00 p.m. (with one hour non-compensable meal break), an employee should be entitled to a total amount of P892.00.
    Sample computation using National Capital Region (NCR) minimum wage rate of P426 + P20 COLA. This formula can also be applied to all regions using their applicable daily rates.

    Applicable daily rate = (Basic wage + COLA) × 200%
    = (P426 + P20 COLA) × 200%
    = P446 × 2
    = P892.00

    b. For shift work rendered from 10:00 p.m. of August 19, an ordinary day, to 7:00 a.m. of August 20, 2012, a regular holiday:

    For the said work schedule, an employee should be entitled to a total amount of P844.40 (P122.15 + P610.75 + P111.50), derived from the following computations:

    b.1. For work rendered from 10 p.m. to 12:00 m.n. of 19 August 2012, an ordinary day:


    10:00 p.m. to 12:00 m.n. = (Hourly rate × night shift pay × number of hours) + COLA (proportionate)
    = P426/8 × 110% × 2 hours + P5.00 COLA
    = P53.25 × 1.1 × 2 hours + P5.00
    = P122.15

    b.2. For work rendered from 12:01 a.m. to 6:00 a.m. of 20 August 2012, a regular holiday:

  2. 12:01 a.m. to 6:00 a.m. = (Hourly rate × holiday pay) + [night shift pay × (hourly rate × holiday pay)] × number of hours
    = [(P446/8 × 200%) + [10%(426/8 × 200%) × 5 hours
    = [(P55.75 × 2.0) + [0.1 (P53.25 × 2.0)] × 5 hours
    = [P111.50 + 10.65] × 5 hours
    = P610.75
    b.3. For work rendered from 6:01 a.m. to 7:00 a.m. on 20 August 2012, a regular holiday:
    6:01 a.m. to 7:00 a.m. = [(Hourly rate × holiday pay) × number of hours
    = [P446/8 × 200%] × 1 hour
    = P111.50

    c. For shift work rendered from 10:00 p.m. of 20 August, a regular holiday to 7:00 a.m. of 21 August 2012, a special day:
    For the said work schedule, an employee should be entitled to a total amount of P709.27 (P244.30 + P393.74 + P71.73), derived from the following computations:
    c.1. For work rendered from 10 p.m. to 12 m.n. of August 20, 2012, a regular holiday:
    10:00 p.m. to 12:00 m.n. = (Hourly rate × holiday pay) + [night shift pay × hourly × holiday pay)] × number of hours
    = (P446/8 × 200%) + [10%(426/8 × 200%)] × 2 hours
    = [(P55.75 × 2.0) + [0.1 (P53.25 × 2.0)] × 2 hours
    = [P111.50 + 10.65] × 2 hours
    = 244.30
    c.2. For work rendered from 12:01 a.m. to 6:00 a.m. of 21 August 2012, a special day:
    12:01 a.m. to 6:00 a.m = (Hourly rate × night shift pay × premium pay × number of hours work) + COLA (proportionate)
    = P426/8 × 110% × 130% × 5 hours + 12.5
    = P426/8 × 1.1 × 1.3 × 5 hours + P12.50
    = P393.24
    c.3. For work rendered from 6:01 a.m. to 7:00 a.m. on 21 August 2012, a special day:

    6:01 a.m. to 7:00 a.m. = (Hourly rate × premium pay × Number of hours) + COLA (proportionate)
    = P426/8 × 130% × 1 hour + P2.50
    = P71.73

    Q:
    If the employer requires his employee to work in excess of eight (8) hours on 20 August 2012, how much should the employer pay his employee?

    A:
    The employer should pay the 30% overtime premium pay in addition to the 200% of the regular wage. Assuming that an employee is working in the NCR, he/she should be entitled to P138.45 per hour overtime rate for work on a regular holiday.
    Hourly rate × 200% × 130% × number of hours = overtime rate on regular holiday
    = P426/8 × 200% × 130% × number of hours
    = 426/8 × 2.0 × 1.3 × 1 hour
    = P138.45 overtime rate/hour for work on a regular holiday

    Q:
    What is the compensation of an employee whose work schedule is from 8:00 a.m. to 5:00 p.m. and was required to report for work on 20 August 2012 which is a regular holiday falling on his/her scheduled rest day?

    A:
    For work rendered on the said work schedule, an employee is entitled to a total amount of P1,147.60.
    8:00 a.m. to 5:00 p.m. = [(P426 + P20.00 COLA) × 200%] + [30% (426 × 200%)]
    = [P446 × 2] + [0.3 (852)]
    = P892 + 255.60
    = P1,147.60 

    Q:
    If the employer requires his employee to work in excess of eight (8) hours on August 20, 2012, a regular holiday falling on his/her scheduled rest day, how much should the employer pay his employee?

    A:
    The employer should pay the 30% overtime pay in addition to the 260% premium pay of his/her regular wage. Thus, an employee should be entitled to P179.99 per hour overtime rate for work, in excess of eight (8) hours on a regular holiday falling on the employee’s scheduled rest day.
    Hourly rate × 130% × 260% × number of hours = overtime rate on a regular holiday falling on the employee’s scheduled rest day
    = P426/8 × 130% × 260% × number of hours
    = 426/8 × 1.3 × 2.6 × 1 hour
    = P179.99 overtime rate/hour for work on a regular holiday falling on a rest day
    B. 21 August 2012, Ninoy Aquino Day, a Special Day pursuant to Proclamation No. 295

    Q:
    What is Proclamation No. 295?
    A: Proclamation No. 295 was issued by President Benigno S. Aquino III on November 24, 2011, declaring  August 21, 2012, as a special day.
    Q: If an employee does not report for work on 21 August 2012, is he or she entitled to be paid his/her daily wage?
    A: In the case of a daily-paid employee, the principle of “no work, no pay” applies. If the employee does not report for work, the same is not entitled to his/her daily wage. However, an employee can be covered by a favorable company policy and practice, or by collective bargaining agreement granting payment of wages during special days.
    For a monthly-paid employee, no deduction should be made as he/she is considered paid all the days of the year, using the factor of 365 days a year. In case he/she rendered work on that day, he/she is only entitled to additional premium pay of 30%.
    Q: For work on a special day, such as 21 August 2012, Ninoy Aquino Day, how is the premium pay computed when an employee is suffered or required to work on such day?
    A: An additional 30% premium pay is added to the employee’s basic pay, which is computed as follows:
    a. For normal eight-hour work, usually rendered from 8:00 a.m. to 5:00 p.m. (with one (1) hour non-compensable meal break) an employee should be entitled to a total amount of P573.80:
    (Sample computation using NCR minimum wage rate of P426 + 20.00 COLA):
    Applicable daily rate = (Basic Pay × 130%) + COLA, if applicable
    = (P426 × 1.3) + P20
    = P553.80 + P20
    = P573.80

    b. For shift work rendered from 10:00 p.m. of 20 August 2012, a regular holiday, to 7:00 a.m. of August 21, 2012, a special day:
    For the said work schedule, an employee should be entitled to a total amount of P709.27 (P244.30 + P393.24 + P71.73), derived from the following computations:
    b.1. For work rendered from 10:00 p.m. to 12:00 m.n. of 20 August 2012, a regular holiday:
    10:00 p.m. to 12:00 m.n. = [Hourly rate × 200% + night shift (hourly rate × 200%)] × 2 hours[(P446/8× 200%) + (10% (426/8 × 200%)] × 2 hours
    = [(P55.75 × 2.0) + (0.1 (P53.25 × 2.0)] × 2 hours
    = [P111.50 + 10.65] × 2 hours
    = P244.30
    b.2. For work rendered from 12:01 a.m. to 6:00 a.m. of 21 August 2012, a special day:

    12:01 a.m. to 6:00 a.m. = (Hourly rate × night shift pay × premium pay × number of hours) + COLA (proportionate)
    = (P426/8 × 1.1 × 1.3 × 5 hours) + P12.5
    = P393.24
    b.3. For work rendered from 6:00 a.m. to 7:00 a.m. of 21 August 2012, a special day:

    6:01 a.m. to 7:00 a.m. = (Hourly rate × premium pay × number of hours) + COLA (proportionate)
    = P426/8 × 130% × 1 hour + 2.5
    = P71.73

    c. For shift work rendered from 10:00 p.m. of 21 August 2012, a special day to 7:00 a.m. of 22 August 2012, an ordinary day:
    For the said work schedule, an employee should be entitled to a total amount of P518.43 (P152.30 + P292.88 + P53.25 + P20.00 COLA), derived from the following computations:
    c.1. For work rendered from 10:00 p.m. to 12:00 m.n. of 21 August 2012, a special day:
    10:00 p.m. to 12:00 m.n. = Hourly rate × night shift pay × premium pay × number of hours
    = P426/8 × 110% × 130% × 2 hours
    = P426/8 × 1.1 × 1.3 × 2 hours
    = P152.30
    c.2. For work rendered from 12:01 a.m. to 6:00 a.m. of 22 August 2012, an ordinary day:

    12:01 a.m. to 6:00 a.m. = Hourly rate × night shift pay × number of hours
    = P426/8 × 110% × 5 hours
    = P426/8 × 1.1 × 5 hours
    = P292.88
    c.3. For work rendered from 6:01 A.M to 7:00 a.m. of 22 August 2012, an ordinary day:

    6:00 a.m. to 7:00 a.m. = P426/8 × 1 hour
    = P53.25

    Q:
    What is the compensation of an employee whose work schedule is from 8:00 a.m. to 5:00 p.m., and was required to report for work on 21 August 2012, which is a special day falling on his/her scheduled rest day?
    A: For work rendered on the said work schedule, an employee is entitled to a total amount of P659.00.
    8:00 a.m. to 5:00 p.m. =( Daily rate × premium pay) + COLA
    = (P426 × 150%) + P20.00 COLA
    = (P426 × 1.5) + P20.00 COLA
    = P639.00 + P20.00 COLA
    = P659.00

    Q:
    If the employer requires his employee to work in excess of eight hours on 21 August 2012, how much should the employer pay his employee?
    A: The employer should pay the 30% overtime pay, in addition to the 30% premium pay of his/her regular wage. Thus, an employee should be entitled to P90.00 per hour overtime rate for work rendered in excess of eight hours on a special day.
    Hourly rate × 130% × 130% × number of hours = overtime rate on a special day
    = P426/8 × 130% × 130% × number of hours
    = 426/8 × 1.3 × 1.3 × 1 hour
    = P90.00 overtime rate/hour for work on a special day

    Q:
    If the employer requires his employee to work in excess of eight hours on 21 August 2012, a special day falling on his/her scheduled rest day, how much should the employer pay his employee?
    A: The employer should pay the 30% overtime pay, in addition to the 50% premium pay of his/her regular wage. Thus, an employee should be entitled to P103.84 per hour overtime rate for work in excess of eight hours on a special day falling on the employee’s scheduled rest day.
    Hourly rate × 130% × 150% × number of hours = overtime rate on a special day falling on the employee’s scheduled rest day
    = P426/8 × 130% × 150% × number of hours
    = 426/8 × 1.3 × 1.5 × 1 hour
    = P103.84 overtime rate/hour for work on a special day falling on a rest day

    Q:
    Who are covered by the premium pay?

    A:
    The premium pay benefit applies to all employees, except managerial employees, officers, or members of a managerial staff, house helpers, workers who are paid by results, and field personnel.

    C. 27 August 2012, National Heroes’ Day, a Regular Holiday pursuant to Proclamation No. 295

    Q:
    How is the holiday pay computed when an employee is suffered or required to work during a regular holiday, such as 27 August 2012, National Heroes’ Day?

    A:
    An additional 100% holiday pay is added to the employee’s minimum wage (Basic wage + COLA) or a total of 200%, which is computed as follows:

    a. For normal eight-hour work, usually rendered from 8:00 a.m. to 5:00 p.m. (with one hour non-compensable meal break), an employee should be entitled to a total amount of P892.00:

    Sample computation (using NCR minimum wage rate of P426 + P20 COLA): This formula can also be applied to all regions using their applicable daily rates.

    Applicable daily rate = (Basic wage + COLA) × 200%
    = (P426 + P20 COLA) × 200%
    = P446 × 2
    = P892.00

    b. For shift work rendered from 10:00 p.m. of 26 August 2012, rest day, to 7:00 a.m. of 27 August 2012, a regular holiday:
    For the said work schedule, an employee should be entitled to a total amount of P927.50 (P157.30 + P626.75 + P143.45), derived from the following computations:
    b.1. For work rendered from 10 PM to 12:00 m.n. of 26 August 2012, rest day (Sunday)
    10:00 p.m. to 12:00 m.n. = (Hourly rate ÷ 8 hours × night shift pay × premium pay × number of hours) + COLA (proportionate)
    = P426/8 × 110% × 130% × 2 hours+ P5.00 COLA
    = P157.30
    b.2. For work rendered from 12:01 a.m. to 6:00 a.m. of 27 August 2012, a regular holiday falling on a rest day:

    12:01 a.m. to 6:00 a.m. = (Hourly rate × holiday pay) + [night shift pay × (hourly rate/premium pay × number of hours
    = [(P446/8 × 200%) + [10%(426/8 × 260%)] × 5 hours
    = [(P55.75 × 2.0) + [0.1 (P53.25 × 2.6)] × 5 hours
    = [P111.50 + 13.85] × 5 hours
    = P626.75
    b.3. For work rendered from 6:01 a.m. to 7:00 a.m. on 27 August 2012, a regular holiday falling on a rest day:

    6:01 a.m. to 7:00 a.m. = [(Hourly rate × holiday pay + premium pay (hourly rate × holiday pay) × number of hours
    = [P446/8 × 200%] + [30% (426/8 × 200%)] × 1 hour
    = P111.50 + P31.95 × 1 hour
    = P143.45

    c. For shift work rendered from 10:00 p.m. of  August 27, 2012, a regular holiday, to 7:00 a.m. of  August 28, 2012, an ordinary working day:
    For the said work schedule, an employee should be entitled to a total amount of P605.42 (P244.30 + P305.37 + P55.75), derived from the following computations:
    c.1. For work rendered from 10:00 PM to 12:00 m.n. of August 27, 2012, a regular holiday:
    10:00 p.m. to 12:00 m.n. = (Hourly rate × holiday pay) + [night shift pay × daily rate ÷ 8 hours × holiday pay)] × number of hours
    = [(P446/8 × 200%) + [10%(426/8 × 200%)] × 2 hours
    = [(P55.75 × 2.0) + [0.1 (P53.25 × 2.0)] × 2 hours
    = [P111.50 + 10.65] × 2 hours
    = 244.30
    c.2. For work rendered from 12:01 a.m. to 6:00 a.m. of 28 August 2012, an ordinary working day:

    12:01 a.m. to 6:00 a.m. = Daily rate × night shift pay × number of hours work+ COLA (proportionate)
    = P426/8 × 110% × x 5 hours + 12.5
    = (P426/8 × 1.1 × 5 hours) + 12.5
    = P305.37
    c.3. For work rendered from 6:01 a.m. to 7:00 a.m. on 28 August 2012, an ordinary day:

    6:01 a.m. to 7:00 a.m. = (Hourly rate × number of hours) + COLA (proportionate)
    = P426/8 × 1 hour + P2.50
    = P55.75

    Q:
    If the employer requires his employee to work in excess of eight hours on 27 August 2012, how much should the employer pay his employee?
    A: The employer should pay the 30% overtime premium pay in addition to the 200% of the regular wage. Assuming that an employee is working in the NCR, he/she should be entitled to P138.45 per hour overtime rate for work on a regular holiday.
    Hourly rate × 200% × 130% × number of hours = overtime rate on regular holiday
    = P426/8 × 200% × 130% × number of hours
    = 426/8 × 2.0 × 1.3 × 1 hour
    = P138.45 overtime rate/hour for work on a regular holiday

    Q:
    What is the compensation of an employee whose work schedule is from 8:00 a.m. to 5:00 p.m., and was required to report for work on 27 August 2012, which is a regular holiday falling on his/her scheduled rest day?
    A: For work rendered on the said work schedule, an employee is entitled to a total amount of P1,147.60.
    8:00 a.m. to 5:00 p.m = [(P426 + P20.00 COLA) × 200%] + [30% (426 × 200%)]
    = [P446 × 2] + [0.3 (852)]
    = P892 + 255.60
    = P1,147.60 

    Q:
    If the employer requires his employee to work in excess of eight hours on 27 August 2012, a regular holiday falling on his/her scheduled rest day, how much should the employer pay his employee?
    A: The employer should pay the 30% overtime pay in addition to the 260% premium pay of his/her regular wage. Thus, an employee should be entitled to P179.99 per hour overtime rate for work in excess of eight hours on a regular holiday falling on the employee’s scheduled rest day.
    Hourly rate × 130% × 260% × number of hours = overtime rate on a regular holiday falling on the employee’s scheduled rest day
    = P426/8 × 130% × 260% × number of hours
    = 426/8 × 1.3 × 2.6 × 1 hour
    = P179.99 overtime rate/hour for work on regular holiday falling on a rest day

    Q:
    Who are covered by the holiday pay rule?
    A: The holiday pay benefit applies to all employees, except managerial employees, officers or members of a managerial staff, house helpers, workers who are paid by results, field personnel, and those of retail and service establishments regularly employing less than ten (10) workers.


[Reposted from Official Gazette; Photo: kabisyo.com]







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