Am I entitled to the 13th-month pay if I am paid on a commission basis?

Last Updated on 04/27/2020 by FilipiKnow

Generally, a person paid purely on a commission basis is not entitled to the 13th-month pay. This is expressly stated in Sec. 2 (d) of the Revised Guidelines on the 13th-Month Pay Law1 which says that employers paying their employees on a commission basis are exempted from the coverage of the law.

However, if you are paid a guaranteed fixed salary plus commission, you are entitled to receive a 13th-month pay. In this scenario, should the commission then be considered part of your basic salary, thus, included in computing your 13th-month pay?

In one case2, the Supreme Court ruled that only the guaranteed fixed salary shall be considered as the “basic salary” for purposes of computing the 13th-month pay. The commission, which is given for extra efforts exerted in making sales or other transactions, is considered as additional pay which does not form part of the basic salary.

Go back to the main article: How to Compute 13th Month Pay in the Philippines: An Ultimate Guide

 

References.

  1. Revised Guidelines on the Implementation of the 13th Month Pay Law (1986).
  2. Boie-Takeda Chemicals, Inc. vs. DOLE, G.R. No. 92174 (Supreme Court of the Philippines 1993).