Guide to Holiday Wages in the Philippines | 2026 Update

Holidays are a significant aspect of Philippine culture; employers have a particular responsibility to uphold the rules enforced by the Labor Code of the Philippines, specifically on how to issue holiday pay to their employees in the Philippines. 

Laws in the Philippines require employers to compensate employees during specific dates despite not reporting to work. This article presents a guide on correctly calculating your employee’s wages for proper payment during holidays. 

Importance of Holiday pay 

Adhering to the country’s holiday pay rules is an essential aspect of the corporate environment, and employers are duty-bound to pay employees properly, lest you get penalised for violating the holiday rules enforced by the country’s laws. Avoid incurring salary disputes with your workers. In contrast, as an employee, it is your right to be correctly compensated if you have been asked to work during a holiday. 

To better ensure accurate and timely holiday wage payment, companies can work with a payroll outsourcing service company like Forvis Mazars. These firms also occasionally provide updates reporting on upcoming holiday wages or taxes. This short guide aims to help employers correctly issue holiday wage pay to their employees affected by Philippine holidays. 

What is a Holiday Pay in the Philippines? 

Holiday pay is defined as paying employees a regular daily average wage during an unworked regular holiday. 

It is a legislated benefit enacted as part of the state’s constitutional imperative toward protecting Filipino labour. “It is also intended to enable the worker to participate in the national celebrations held during the days identified with great historical and cultural significance,“ as mentioned by the Asian Transmission Corporation v. CA (Commonwealth Act), G.R. No. 144664, 15 March 2004). 

In the Philippines, holiday pay is a legally mandated benefit that all employers must pay to covered employees during holidays. 

What is Premium Pay in the Philippines?

Pay for special (non-working) days fall under Premium Pay. Premium pay refers to the additional compensation for work performed within eight hours on rest days and special days. 

Who are not covered by holiday pay in the Philippines?

There are certain employees exempt from holiday pay; this benefit does not apply to the following employees: 

• Government employees;
• Retail and service establishments regularly employing less than ten workers;
• Kasambahays and persons in the personal service of another;
• Managerial Employees (conditions apply)
• Officers and staff members of a managerial staff. (conditions apply)
• Field personnel and other employees whose work time and performance are not supervised by the employer, including those paid on a task, contract, commission, or fixed-amount basis, regardless of the time spent.

Computing the Holiday Pay and Premium Pay in the Philippines 

Below is a guide on the computation for the holiday wage rates as required by the Labor Code of the Philippines and summarized by the Department of Labor and Employment (DOLE) Bureau of Working Conditions in its publication, "Workers' Statutory Monetary Benefits 2024 Handbook" (2024).

A. Employee wage payment for regular holidays 

Generally, covered employees who did not report for work during a regular holiday are still entitled to receiving at least 100% salary for that day, provided that the employee was present or on paid leave on the workday immediately preceding the holiday. To illustrate, here are some sample scenarios:

• If the employee was on paid leave before the holiday, he is entitled to holiday pay
• If the employee was absent or on leave without pay on the work day before the holiday, he may not be paid for the holiday if he did not work on the holiday.
• If the day before the holiday is the employee's rest day/s, the employee must have been present or on paid leave on the work day immediately preceding the said rest day/s 

Covered employees who reported for work on a regular holiday must be paid at least double their daily wage. 

Regular holiday pay guide

 The computation for the pay wage is further explained in these examples: 

Consider an employee with a daily basic pay of PHP 2,000 and an hourly basic pay of PHP 250. If the employee reported full day to work on the regular holiday:

Regular holiday, normal hour

The employee is entitled to PHP 4,000 basic pay for the day.

If the same employee worked overtime for 2 hours on the regular holiday, the multiplier will be 260% (or 200% x 130%) times the hourly rate and the number of overtime hours worked on said day. 

Regular holiday, overtime

This means that the employee would be paid a total of PHP 5,300 (or PHP 4,000 + PHP1,300)

B. Special (non-working) day Pay Computation 

Employees (paid on a daily basis) who did not report for work during a special non-working holiday are subject to the “no work, no pay rule”, unless a policy or collective bargaining agreement (CBA) favorable for the employee is in place. 

Employees who report for work on a special holiday are entitled to an additional pay of at least 30% of their daily basic wage or a total of 130%.

Special (non-working) day

Holiday wage pay Rules 

A. Holiday Absences 

Covered employees are entitled to holiday pay if they are on paid leave on the workday immediately before a regular holiday. Employees who are on unpaid leave on the workday immediately before a regular holiday are not entitled to holiday pay if they do not work on the holiday.

If employees are not reporting for work while receiving leave benefits, employers shall grant holiday pay equivalent to the higher of the percentage provided under employee compensation or social security benefits, as determined by the competent authority.

If the day immediately before the holiday falls on a non-workday of the establishment or the employee’s scheduled rest day, the employee is not considered to be on leave on that day. In such cases, the employee is entitled to holiday pay if they worked on the last working day immediately before the non-workday or rest day.

When there are two consecutive regular holidays, such as Maundy Thursday and Good Friday, an employee is not entitled to holiday pay for both days if he or she is absent from work on the day immediately preceding the first holiday. However, if the employee works on the first holiday, he or she shall be entitled to holiday pay for the second holiday.

B. Temporary Periodic Shutdown during Holidays 

In cases of temporary or periodic shutdown or temporary cessation of work—such as for annual inventory, repairs, or cleaning of machinery and equipment—any regular holidays that fall within the shutdown period shall be paid in accordance with the Rules Implementing the Labor Code, as amended.

Forvis Mazars payroll services in the Philippines  

Keeping up with changes to payroll regulations while ensuring precise computations and timely releasing can be challenging.  Our payroll services are designed to meet the requirements of companies that are seeking accurate, on-time, and secure payroll outsourcing services. Whether your headcount in the Philippines is one or one thousand, our team can provide tailored solutions that maintain confidentiality and protect employee data. We are present in over 100 countries, enabling you to scale with efficiency internationally. 

To contact us, you can click the link HERE or click on the box below this page.