13th Month Pay and Christmas bonus are two different things — DOLE-7 chief

Salome Siaton, Labor regional director in Central Visayas, cites the difference between 13th month pay and Christmas bonus. | CDN Digital file photo — Irene Sino Cruz

CEBU CITY, Philippines — “The Thirteenth Month Pay should not be confused with Christmas Bonus.”

Regional Director Salome Siaton of the Department of Labor and Employment in Central Visayas said this amid the celebration of the Christmas season where benefits like the 13th Month Pay and Christmas Bonus would be enjoyed by employees.

While the two have similarities, in that, both of them come in monetary form and are given out by employers, the Thirteenth-Month Pay is the one that is mandatory as provided for under P.D. 851 and failure to comply with it is a violation.

“Christmas bonus or company bonus as others may refer it, is optional and voluntary in nature, which is actually up to management’s discretion whether to give it out or not,” said Director Siaton.

On the other hand, workers, who have rendered work in a certain company for at least one (1) month during the calendar year, are entitled to a Thirteenth Month Pay and it should be paid to workers on or before 24 December of every year.

Unlike the Thirteenth-Month Pay, Christmas Bonus may or may not be given out to workers and the provision of which is most of the time credited to management’s generosity or its intention to motivate workers.

“The same could be actually given out to workers throughout the year but is typically handed to the workers every December. Thus, the name,” added the DOLE-7 head.

“We want to make things clearer to our customers that the Thirteenth-Month Pay and Christmas Bonus are two different things. And that, it is the former that is mandated by law,” the Regional Director said further.

Thirteenth-Month Pay should be paid to all rank-and-file employees regardless of the nature of their employment and irrespective of the methods by which their wages are paid. Workers holding managerial positions are not entitled to it.

“A managerial employee is one who has the power to lay down and execute management policies and to hire, transfer, suspend, layoff, recall, discharge, assign or discipline employees or even to effectively recommend such managerial actions,” Director Siaton explained. 

The Thirteenth-Month Pay shall not be less than one-twelfth of the total basic salary earned by the employee within a calendar year.

Also covered by the payment of the Thirteenth-Month Pay are household helpers or Kasambahay./dbs