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Vacation and Holiday Leave in the Philippines

Vacation and holiday leave are important to employees for spending time with family and friends, or to just relax with a day off.  This is especially true in the Philippines where family life is at the center of the culture, and the shared time is highly valued.

But the statutory leave entitlements are not that generous in the Philippines compared to other countries, and as an employer you will want to take that into account when offering leave.  Many local employers will develop their own expanded leave policies. This guide will outline the minimum entitlements, and some employer practices to expand leave for employees.

How much vacation leave are employees entitled to in the Philippines?

Vacation leave in the Philippines is only five days per year, and is known as Service Incentive Leave (SIL).  It is only available after 1 year of service, so no leave is mandated in the first year.  However, many employers will offer vacation leave of 12-15 days a year as a company policy, or in the individual employment contract.  This is so common that many believe that the statutory minimum is more than five days.  

If you offer company vacation leave of more than five days, the employee cannot also claim the SIL days.  It is notable that there is no paid sick leave in the Philippines, so employees may end up using their vacation leave to avoid losing pay when ill.

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What happens to unused vacation time?

Unused vacation leave can be converted to cash at the end of the year, based on the daily salary rate.

How much holiday leave are employees entitled to in the Philippines?

While the vacation leave entitlement is simple and minimal, holiday leave is the exact opposite.  There are public holidays, non-working holidays and special working days, which vary each year, and may be specific to just one region due to religious or cultural distinctions.

In the current year the President will issue a proclamation on what the exact holidays are to be in the following year, and of what category.  Here is the breakdown of holiday types and pay calculation:

  • 10 public holidays – Fully paid holidays
  • Special Non-working holidays – If an employee does not report for work, there is no pay for that day. If they do report, they receive full pay + 30%
  • Special working days (Christmas Eve, New Year’s Eve) – Full pay if they report

Client Case: Which dates are public holidays in the Philippines?

Context: Our client with employees in the Philippines reached out to us and wanted to know the paid public holidays in 2021.

Solution:  We sent them a list of the public holidays, some of which will change each year:

January 1 – New Years’ Day

April 1 – Maundy Thursday

April 2 – Good Friday

April 9 – Day of Valor

May 1 – Labor Day

June 12 – Independence Day

August 30 – National Heroes’ Day

November 30 – Bonifacio Day

December 25 – Christmas Day

December 30 – Rizal Day

Do you need more information about the Philippines?

If you are new to hiring in the Philippines, you may have other questions such as:

If an employer offers more than the statutory vacation leave, would the extra days also be eligible for cash conversion at year end?

What if a holiday falls on a normal ‘rest day’ e.g. Saturday or Sunday?

Can an employee take both Maundy Thursday and Good Friday as paid holidays, or just one?

If the vacation and holiday pay entitlements seem confusing you are not alone, and our clients often turn to us to make sure they offer the correct leave days.  We make international employment simple.

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Looking to hire an employee in the Philippines? Get in touch.

 

The information in this article is subject to changes in local legislation.

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