AMID challenges of rising costs of basic commodities and services brought about BY RISING INFLATION, THE 13TH MONTH PAY OF WORKERS IN THE PRIVATE SECTOR REMAINS A LEGAL OBLIGATION OF EMPLOYERS, ACCORDING TO THE DEPARTMENT OF LABOR AND EMPLOYMENT (DOLE).

Labor Secretary Bienvenido Laguesma, though, assured employers, particularly hard-up businesses and micro, small and medium enterprises (MSMEs) that were just starting to recover, to dialogue with their employees so that they can meet halfway and come up with a winning solution to the problem.

Laguesma also gave his assurance that the Labor department would not resort to extreme actions of closing companies that failed to pay their employees the mandatory 13th month pay because doing so would be at the disadvantage of the workers also.

“We will not close down companies that cannot afford to pay their workers their 13th month pay. We don’t like to deprive the workers of their opporTUNITIES TO GET THEIR RIGHTFUL BENEfiTS and continue with their jobs,” he said.

The Labor department, Laguesma added, is in consultation with the Department of Trade and Industry and the Small Business Corp. about the 13th month pay loan facility they earlier initiated to help the MSMEs meet their 13th month pay obligation to their workers at zero interest and without collateral.

“We wanted to know if said loan facility is still open. We wanted to know the terms of payment,” he added.

The DoLE secretary said they fully sympathize with the situation of employers at present but, he pointed out, employers could not avoid paying their employees the 13th month pay.

“The problem is this is a statutory legal obligation. It cannot be waived, and it cannot be a subject of an exemption,” Laguesma also said.

At the same time, he warned companies that have no valid reasons for not paying their workers’ 13th month pay on time, saying they might turn out paying their employees double the amount of what they should originally pay.

Under the Thirteenth Month Pay Law or Presidential Decree (PD) 851, RANK-AND-fiLE EMPLOYEES IN THE PRIVATE sector shall be entitled to 13th month pay regardless of their position, designation or employment status, and regardless of the method by which their wages are paid, provided that they have worked for at least one month during the calendar year.

The formula and computation of the 13th month pay is: Total basic salary earned during the year divided by 12 months equals the proportionate 13th month pay.

It shall be paid not later than December 24 of every year.

An employer, however, may give to his or her employees one-half of the 13th month pay before the opening of the regular school year and the remaining half on or before December 24 of every year.

The frequency of payment of this MONETARY BENEfiT MAY BE THE SUBJECT of an agreement between the employer and the recognized collective bargaining agent of the employees.

Exempted from payment of 13th month pay are the government and any of its political subdivisions, including government-owned and -controlled corporations, except those corporations operating essentially as private subsidiaries of the government; employers who are already paying their employees’ 13th month pay or more in a calendar year or its equivalent at the time of the issuance of PD 851; persons in the personal service of another in relation to such workers; employers of those who are paid on purely commission, boundary or task BASIS, AND THOSE WHO ARE PAID A fiXED AMOUNT FOR PERFORMING SPECIfiC WORK, regardless of the time consumed in the performance thereof (except those workers who are paid on piece-rate basis, in which case their employer shall grant them 13th month pay).

An employee who has resigned or whose services are terminated at any time before the time of payment of the 13th month pay is entitled to this BENEfiT IN PROPORTION TO THE LENGTH OF time he or she has worked during the year, reckoned from the time he or she started working during the calendar year up to the time of his or her resignation or termination from the service.

Sen. Mark Villar has filed a bill seeking to grant 13th month pay for contractual and job order personnel in the government service.