Are there employers exempted from paying 13th-month pay?

Last Updated on 04/28/2020 by FilipiKnow

Yes, certain employers are exempted from paying 13th-month pay.

Under P.D. 8511 and its Revised IRR2, the following employers are exempt from paying the 13th-month pay:

  • The Government and any of its political subdivisions, including government-owned and controlled corporations (except those operating essentially as private subsidiaries of the government). The salary and benefits of government employees are governed by a different law;
  • Employers already paying their employees a 13th-month pay or more in a calendar year or equivalent. For example, if an employer is already giving employees Christmas bonus, mid-year bonus, cash bonuses, and other payment amounting to not less than /12 of the basic salary, then the employer is no longer required to pay the 13th-month pay;
  • Employers of those who are paid purely on commission, boundary, or task basis, and those who are paid a fixed amount for performing specific work, irrespective of the time consumed in the performance of the task.

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

  1. Official Gazette of the Republic of the Philippines. Presidential Decree No. 851, s. 1975 (1975).
  2. Revised Guidelines on the Implementation of the 13th Month Pay Law (1986).