Firms told: Release worker’s last pay in 30 days

CEBU, Philippines —   Companies are reminded to release the final or last pay of terminated or separated workers within 30 days.

Department of Labor and Employment (DOLE-7) Regional Director Salome Siaton said separated workers, regardless of the cause of their termination, should be given their final pay within 30 days from the date of separation or termination of employment.

“Companies are mandated to release the final or last pay within 30 days from separation or termination of employment, unless there is a more favorable company policy, individual or collective agreement that will allow the release of such at an earlier time,” said Siaton.

The regional director said the failure of companies to release the final pay of workers within a reasonable period of time is among the common complaints lodged before the labor department.

“We repeatedly heard workers saying that their former companies would only release their last pay after two to three months. Some would even last longer than three months ever after workers have been already issued with company clearance,” Siaton said in a statement.

DOLE Labor Advisory No. 6 series of 2020 provides guidelines for the issuance of the final pay, last pay or back pay, which refers to the sum or totality of all wages or monetary benefits due the employee regardless of the cause of the termination of employment.

Siaton said the advisory aims to effectively harmonize the management prerogative of the employer and the right of the employees.   

“Once and for all, we have now an advisory that will serve as a guide for all employers as well as for all workers insofar as their rights are concerned,” said Siaton.

The final pay includes pro-rated 13th month pay; separation pay pursuant to Articles 298-299 of the Labor Code, company policy, or individual or collective agreement, if applicable; income tax claim for the excess of taxes withheld, if applicable; and retirement pay pursuant to Article 302 of the Labor Code, if applicable.

Also, unpaid earned salary of the employee; cash conversion of unused service incentive leave (SIL) pursuant to Article 95 of the Labor Code; cash conversions of remaining unused vacation, sick or other leaves pursuant to a company policy, or individual or collective agreement, if applicable; other types of compensation stipulated in an individual or collective agreement, if applicable; and, cash bond/s or any kind of deposit/s due for return to the employee, if any.

Certificate of Employment

On the other hand, employers are also mandated to release the certificate of employment to workers as stipulated in the Labor Advisory No. 06, which was recently issued by Secretary Silvestre Bello III.

“The employer must issue a certificate of employment within three days from the time of the request by the employee. An employee whose employment is not yet terminated may also ask for a certificate of employment,” said Siaton.

She urged workers to visit the DOLE Regional Office or its Field Offices in the event that they have issues or concerns or claim disputes arising from or relating to the release of their final pay or the issuance of their certificate of employment. KQD (FREEMAN)