6727, and vary depending on the sales of the company as well as the number of employees. Art. Weekends–Saturday and Sunday–are usually allotted as rest days. However, suppose the employee also earns a shift differential for working weekends or the night shift, or a performance bonus, or a commission. Every employee shall be paid a night shift differential of not less than ten percent (10%) of his regular wage for each hour of work performed between ten o’clock in the evening and six o’clock in the morning. Under Philippine labor laws, an employee who works between 10 p.m to 6:00 a.m. should be paid a night shift differential of not less than ten percent (10%) of his regular wage. Employers must also take note of the night shift differential rate. 87. Gross salary is how much the employee earned, including overtime, night shift differential and other additional compensation, based on actual number hours of work. If the day factor is 365, rest day is paid even when no work is done. A child below 15 years cannot work for more than 4 hours a day, while adolescents (15 and 18 years) cannot work for more than 8 hours a day. Further, the daily hours’ limit in the Labour Code does not apply to government employees, managerial employees, field personnel, employer’s family members, domestic helpers, and personal service providers. For example, the employee is paid $10.00 per hour plus a $2.00 per hour shift differential for the night shift. Processing of Payroll This website does not show any ads or advertising materials for an ad-free reading experience of the readers. When the work is necessary to avail of favorable weather or environmental conditions where performance or quality of work is dependent thereon. 442 of 1974), Special Protection of Children against Child Abuse, Exploitation and Discrimination Act, Department Advisory No. Basic Labor Code of the Philippines - Night Shift Differential (NSD) Night Shift Differential For work performed from 10:00 p.m. to 6:00 a.m. the following day, the employee is entitled to a night shift differential pay of not less than 10% of his regular wage for each hour of work rendered. 2. Industry sectors are segmented as follows: 1. *same monthly rate applied in the computation, Regular holiday (200% x basic pay)10,000 x 2 = Php 20,000Holiday pay (i.e., 20 working days/month): 1.1 x (20,000/20) = Php 1,100/day, Regular holiday that coincided on a scheduled rest day (260% x basic pay)10,000 x 2.6 = Php 26,000Premium pay (i.e., 20 working days/a month): 1.1 x (26,000/20) = Php 1,430/day, How a PEZA-Accreditation Can Benefit Your Business, 15-Minute Team Building Activities You Can Apply in the Workplace, The Pros and Cons of Working in a Call Center in Manila, Overtime Pay Computations And Policies In The Philippines, , you must know the policies regarding overtime pay computation, or, . Under R.A. 9504 overtime pay, night shift differential pay and hazard pay received by such minimum wage earners are exempt from income tax (Section 2, R.A. 9504). Night shift overtime hourly rate: 1.1 x (1.30 x 112.5)= Php 89.375/hour. How many hours are allowed for overtime work?Employees can render up to eight (8) hours of overtime work. Labour Code (Presidential decree No. Overtime pay rates depend upon the the day the work is performed, whether it is ordinary working day, special day, regular holiday or rest day. As far as the rate of night work is concerned, night shift employees must be paid a differential of at least 10% of the regular wage for each hour of work performed between 10:00 p.m. and 6:00 a.m. OVERTIME PAY • An employee is entitled to overtime pay for each hour of work done beyond normal working hours • The overtime rate on normal day is 25% • The overtime rate on rest day and holiday is 30%. Employees are required by law to have at least one day (a full 24 hours) off every week. However, the following employees are NOT entitled to … Category My PayrollHero Account, Payroll, Philippine Payroll Regulations and Information Every employee is entitled to a Night Differential or Night shift pay of not less than 10% of his regular wage for each hour of work performed between 10pm and 6am. Every employee shall be paid a night shift differential of not less than ten percent (10%) of his regular wage for each hour of work performed between ten o’clock in the evening and six o’clock in the morning. The worker should be paid overtime pay, equivalent to 125% of his usual rate per hour. Under R.A. 9504 overtime pay, night shift differential pay and hazard pay received by such minimum wage earners are exempt from income tax (Section 2, R.A. 9504). Can an employee demand overtime work from the employer?The employee cannot urge or oblige the employer to let him or her to render overtime work if it is not required by the circumstance or there is no extra work to be done. Night Shift Differential (NSD) refers to the additional compensation of ten percent (10%) of an employee’s regular wage for each hour of work performed between 10 p.m. and 6 a.m. Women and young persons are prohibited from night work. An employee is entitled to night pay for those hours that must be worked between 6 p.m. and 6 a.m. to complete an 8-hour daily tour of duty. Night-shift differential pay may be granted to government personnel at a rate not exceeding 20% of the hourly basic rate of the employee.-- uno. The maximum working hours on such days cannot exceed 12 hours per day. Accordingly, they are not entitled to holiday pay, overtime pay, premium pay, night shift differential pay, and service incentive leave. Agricultural 3. As far as the rate of night work is concerned, night shift employees must be paid a differential of at least 10% of the regular wage for each hour of work performed between 10:00 p.m. and 6:00 a.m. (When an employee is required to work beyond the normal 8 hours, they are entitled to receive Overtime Pay) If the employee’s overtime reaches overnight or the night differential time frame, the night differential would affect the overtime rate of the employee. Night Shift Differential in the Philippines WHAT IS NIGHT SHIFT DIFFERENTIAL Article 86 of our labor provides that every employee shall be paid a night shift differential of not less than ten percent (10%) of his regular wage for each hour of work performed between ten o’clock in … The main question you have to ask is: what kind of non-working day is this? Calculating for your employees’ overtime, holiday, rest day, and/or night differential premiums is not a walk in the park. However, suppose the employee also earns a shift differential for working weekends or the night shift, or a performance bonus, or a commission. This extra pay needs to be added into the Regular Rate to make the overtime rate bigger. Non-agricultural 2. Knowing the level of compensation your employees should receive if they work the extra hours on regular workdays and holidays helps you establish a reputable image for your business. Hours of worked include all time during which an employee is required to be on duty or to be at a prescribed workplace and all time during which an employee is permitted to work. Ordinary day Overtime. In line with that, you should pay for their rendered service in … *same values used in the computation, First 8 hours = 130%; beyond 8 hours = 169% /hourFirst 8 hours: ((18,000 x 12) / 258) x 1.3 = Php1,088.37Beyond 8 hours: [((18,000 x 12) / 258) x 1.69]/8 = Php176.86/hour, What is the computation for overtime pay on a special day? The Department of Labor and Employment has published advisory guidelines on the adoption of flexible work arrangements which includes compressed workweeks among a range of flexible arrangements which employers may consider implementing in times of economic difficulty or national emergency. The Trade Union Congress of the Philippines (TUCP) has thrown its support behind two House bills seeking to exclude from income taxes all overtime and graveyard shift differential pay received by salaried employees, including the country’s 1.1 million business process outsourcing (BPO) workers who perform jobs all day and all night. Source: §86 of the Labour Code, as amended. Article 86 - Night shift differential; Article 87 - Overtime work; Article 88 - Undertime not offset by overtime; Article 89 - Emergency overtime work; Article 90 - Computation of additional compensation; Article 91 - Right to weekly rest period; Article 92 - When employer may require work on a rest day; – Every employee shall be paid a night shift differential of not less than ten percent (10%) of his regular wage for each hour of work performed between ten oclock in the evening and six oclock in the morning. An employee is entitled to night pay for any nonovertime work performed between 6 p.m. and 6 a.m. during designated core hours. If you are running a business in the Philippines, you must know the policies regarding overtime pay computation, or shift differentials. Powered by the WageIndicator Foundation - Share and compare wages, understand Labour Laws and spot career opportunities. The employer cannot use the offset to keep the company from compensating the employee with required overtime rates. The list includes managers, field personnel, domestic helpers, workers who are hired for personal service of another, members of the employer's family who depend on employees for support, and workers whose compensation is results-based. Overtime Work Work may be performed beyond eight hours a day provided that the employee is paid for the overtime work, which consists of an additional compensation equivalent to his regular wage plus at least 25% thereof. Night work is regulated under the Labour Code which provides for a night shift differential. How to Compute Overtime Pay All employees required to work beyond the normal 8 hours are entitled to overtime. If the employee is late for 1 minute, the deduction must not be based more than 1 minute. 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