Manila: An official of the Bureau of Working Conditions (BWC) on Tuesday reminded employers that 13th month pay is mandatory and cannot be substituted by other allowances. BWC Director Alvin Curada emphasized that the 13th month pay is prescribed under a law, mandating employers to provide this benefit to their workers on or before December 24.

According to Philippines News Agency, Curada stated that under Presidential Decree No. 851 and subsequent Department of Labor and Employment (DOLE) issuances, the 13th month pay is mandatory and cannot be replaced by other bonuses, such as Christmas bonuses or grocery allowances. Companies are allowed to provide additional benefits, but these must be separate from the 13th month pay.

Curada further noted that while employers may offer other bonuses voluntarily, these cannot serve as a substitute for the mandatory 13th month pay. He clarified that the law requires full payment of the 13th month pay by the deadline, and splitting the payment does not comply with legal requirements.

He mentioned that employers may choose to advance part of the 13th month pay earlier in the year, such as mid-year or in quarterly installments. However, the remaining balance must be fully paid on or before December 24. The 13th month pay is applicable to rank-and-file workers regardless of their position, designation, or employment status, as long as they have worked for at least one month during the calendar year.

The minimum 13th month pay must not be less than 1/12 of the total basic salary earned by an employee within a calendar year.