Overview

When employees resign, a common question is whether they can still claim “unpaid leave benefits.” In Philippine practice, this phrase usually refers to one (or more) of these situations:

Unpaid but legally payable leave (e.g., you took a statutory paid leave, but the employer treated it as unpaid or did not release the benefit).
Cash conversion of unused leave credits upon separation (e.g., you resigned with remaining leave credits and want them monetized).
Final pay items connected to leave (e.g., service incentive leave conversion, prorated benefits, or corrections for leave deductions).
Benefits administered by government agencies (e.g., maternity benefit through SSS) that may still be claimable even after separation.

The key point: Resignation does not automatically erase money claims that accrued during employment. If the benefit was earned before separation and remained unpaid, it can generally still be pursued—subject to legal rules, company policy (for non-statutory leaves), and prescription periods.

The Legal Foundation: What the Law Guarantees vs. What Policy Controls

A. Statutory (Legal) Leaves

Some leaves are created by law and are paid (by the employer, by SSS, or by a mix). If you qualified and the leave occurred (or the entitlement accrued) while employed, you may claim unpaid amounts even after resignation.

B. Company-Provided Leaves (VL/SL and Similar)

Vacation leave (VL), sick leave (SL), and other leave credits beyond the statutory minimum are usually management policy/CBA benefits. Whether unused VL/SL is convertible to cash depends on:

written company policy,
employment contract,
collective bargaining agreement (CBA),
established company practice.

C. Service Incentive Leave (SIL) Under the Labor Code

The Labor Code provides a minimum Service Incentive Leave (SIL) benefit for covered employees. Unused SIL is generally commutable to cash, and disputes about it commonly appear in resignation/final pay issues.

What “Unpaid Leave Benefits” Can Mean (and How Each Is Treated)

1) You Took Leave Without Pay, but It Should Have Been Paid

This happens when a leave is legally payable but the employer tagged it as LWOP (leave without pay) or failed to release the pay/benefit.

Common examples:

Paternity Leave (paid by employer, if qualified)
Solo Parent Leave (paid by employer, if qualified)
Violence Against Women and Their Children (VAWC) Leave (paid by employer, if qualified)
Special Leave for Women (paid, if qualified under the law)
SIL days used but not paid correctly

After resignation: You can still claim these as unpaid monetary benefits that accrued during employment.

What you’ll need to show:

you met eligibility requirements,
you filed/requested the leave properly (or the employer had notice),
the leave dates and payroll treatment (payslips/time records),
the employer failed to pay.

2) You Resigned With Unused Leave Credits and Want Cash Conversion

This is the most common “leave benefit after resignation” issue.

A. Service Incentive Leave (SIL)

SIL is a statutory minimum benefit for covered employees.
Many employers “credit” VL that already meets or exceeds SIL; in such cases, the employer may treat the VL as compliance with SIL.
Unused SIL is generally convertible to cash.

Practical note: Employers often maintain a single leave bank (e.g., VL) and say it covers SIL. If so, cash conversion may still be claimable to the extent the law/policy treats unused statutory leave as monetizable, and depending on how the employer structured the benefit.

B. VL/SL (Company Policy Leave)

Unlike SIL, VL/SL conversion is not automatically required by law in the private sector unless:

your contract/policy/CBA says unused leaves are convertible to cash, or
there is a long-standing practice of cash conversion that has become enforceable, or
the leave is effectively the SIL compliance and the employer recognizes commutation.

Some employers have policies like:

“Unused VL converts to cash at year-end or upon separation.”
“Unused SL is not convertible.”
“Leaves expire/forfeit if not used by a cutoff date.”
“Leaves are convertible only if you have no pending accountabilities.”

Whether those conditions are enforceable depends heavily on clarity, consistency, and fairness, and whether the benefit is statutory (SIL) or purely discretionary.

3) Payroll Errors Connected to Leave (Underpayment, Wrong Deductions)

Examples:

Your salary was deducted for a leave that was approved as paid.
Leave pay was computed using the wrong daily rate.
You were docked even though you had leave credits.
Holidays/rest days were mishandled around approved leave (fact-specific).

These are still money claims after resignation, provided you can document the error.

4) SSS-Administered Benefits (Especially Maternity)

Some benefits are primarily under SSS rules (e.g., maternity benefit). In many cases, you may still claim even if you resigned, depending on qualification and timing (for instance, if you are already separated at the time of contingency, the claim process may shift to direct filing with SSS rather than via employer). If the employer should have advanced/processed the claim while you were employed and did not, you may have a claim pathway—but the correct route depends on timing and compliance steps.

Final Pay and Leave: How Leave Benefits Usually Show Up

Upon resignation, “final pay” commonly includes:

unpaid salary/wages up to last day,
prorated 13th month pay,
cash conversion of unused SIL (and sometimes VL, if convertible),
tax adjustments/refunds (if any),
other due benefits under contract/CBA/policy.

A frequent friction point is the employer’s “clearance” process. Clearance may justify reasonable verification of accountabilities, but it is not supposed to be used as a blanket excuse to withhold wages/benefits that are already determinable, especially when delays are excessive.

Eligibility and Coverage Notes (Why Some Employees Have Different Rules)

Service Incentive Leave (SIL) Coverage

SIL under the Labor Code applies broadly, but there are statutory exclusions and special categories. Also, if the employer already provides at least the equivalent benefit, it may be treated as compliance. The details can be technical and fact-driven.

Public Sector vs. Private Sector

Government employees generally follow Civil Service rules on leave credits and monetization that differ from private sector practice. This article focuses mainly on the private sector framework.

How to Compute Leave Conversion (Practical Guidance)

A. Basic Formula

Leave cash conversion is typically:

Daily Rate × Number of Convertible Leave Days

The dispute is usually not the formula—it’s:

what counts as “convertible,”
what daily rate/divisor applies,
whether allowances are included,
whether the leave is statutory or policy-based.

B. Daily Rate (Common Payroll Practice)

Employers often compute a daily rate using the payroll divisor applicable to the employee’s pay scheme (e.g., monthly-paid employees often use a standard divisor used by the company for daily conversion). Because practices vary and errors are common, your best evidence is:

employment contract,
company handbook,
payslips showing daily rate deductions/additions,
HR/payroll policy.

Deadlines: Prescription Period for Money Claims

Claims for unpaid monetary benefits arising from employment are generally subject to prescription periods. As a practical rule in labor money claims, act quickly and do not sit on claims for years. Your safest approach is to assert your claim in writing as soon as possible after separation and keep proof of receipt.

(Exact prescription analysis can be technical depending on the type of claim; if the amount is significant, a labor lawyer consult is worth it.)

Step-by-Step: How to Claim Unpaid Leave Benefits After You Resign

Step 1: Gather Documents (You’ll Win or Lose on Records)

Collect and keep copies of:

resignation letter and employer acceptance/acknowledgment,
employment contract,
company handbook/CBA provisions on leave conversion,
leave applications/approvals,
leave ledger/leave credits screenshot or HR printout,
payslips (especially around leave dates),
time records/DTR summaries,
final pay computation (if provided),
clearance communications.

Step 2: Ask for a Written Final Pay Breakdown

Request a breakdown that itemizes:

unused leave credits (by type: SIL, VL, SL),
number of days credited and number monetized,
the daily rate used,
deductions (with explanation and basis),
release date.

Step 3: Send a Formal Demand (Calm, Specific, Documented)

Your letter/email should state:

the exact benefit you’re claiming (e.g., unpaid SIL commutation of X days; unpaid paternity leave pay for dates; VL conversion under policy),
your computation (with assumptions),
supporting attachments,
a clear request for payment within a reasonable period.

Step 4: Use the DOLE/SEnA Route if Unresolved

If the employer ignores or denies without basis, employees commonly pursue a labor dispute mechanism (often starting with mandatory/assisted conciliation/mediation through DOLE mechanisms) before escalating to adjudication. The correct venue can depend on claim nature, amount, and circumstances.

Step 5: Escalate to Formal Adjudication if Needed

If conciliation fails, money claims may proceed to the appropriate labor forum. This is where well-organized documentation matters most.

Common Employer Defenses (and How to Evaluate Them)

“VL/SL Is Not Convertible.”

If VL/SL is purely discretionary and policy clearly says “not convertible,” that can be enforceable.
If the employer has a consistent history of paying conversion or the policy promises conversion, denial may be challengeable.

“Your Leave Credits Expired/Forfeited.”

Expiry rules must be clear, communicated, and consistently enforced.
Statutory benefits (like SIL) are treated differently from purely discretionary leaves.

“We’re Holding Your Pay Because of Clearance.”

Clearance can justify verification of liabilities, but unreasonable withholding can be contested—especially when the amount due is clear.

“You Didn’t File It Properly.”

For statutory leaves, employers often require notice/documentation. If you have approvals, emails, or other proof of notice, that helps.
If the employer prevented filing or ignored a request, document the attempts.

Special Situations

A. Immediate Resignation / AWOL

Even if separation is messy, earned monetary benefits don’t automatically disappear, though disputes may arise over accountabilities, offsetting, and documentation.

B. Probationary Employees

Probationary status does not, by itself, remove statutory entitlements that apply based on law and eligibility. But leave credit accrual under company policy may differ.

C. “Unlimited Leave” Policies

If a company advertises “unlimited leave,” disputes can arise because there may be no accrued bank to monetize. However, statutory SIL obligations still need to be met in a compliant structure.

D. Offsetting and Deductions

Employers sometimes offset final pay with:

unreturned equipment,
cash advances/loans,
company property/accountabilities.

Offsets must be legitimate, documented, and properly computed.

Practical Tips to Maximize Your Chances

Request your leave ledger before your last day (or immediately upon resignation).
Keep payslips that show leave deductions or leave pay.
Confirm in writing what leave types are convertible (HR email is useful).
Be precise: specify “SIL commutation” vs “VL conversion” vs “unpaid paternity leave pay.”
Don’t rely on verbal assurances. Get a breakdown.

Simple Claim Checklist

You likely have a strong claim if:

the leave is statutory and you were qualified, and it wasn’t paid; or
the leave is SIL (or clearly treated as SIL compliance) and you have unused days; or
company policy/CBA/practice clearly allows cash conversion and you have unused credits.

Your claim is more difficult (but not always impossible) if:

the leave is purely discretionary VL/SL and policy clearly prohibits conversion; and
there’s no consistent practice of conversion; and
you lack documentation of credits or approvals.

Sample Outline for a Demand Email (You Can Copy the Structure)

Subject: Request for Payment of Unpaid Leave Benefits and Final Pay Breakdown
Facts: employment dates, position, last day, resignation details
Claim: specify the leave benefit(s) unpaid (type, dates, days)
Computation: daily rate assumption + amount claimed
Attachments: payslips, approvals, leave ledger, policy excerpts
Request: release payment and provide written breakdown by a specific date
Closing: contact details

Closing Note

In the Philippines, resignation is not a waiver of earned benefits. The decisive questions are:

Was the benefit legally required or contractually promised?
Did it accrue while you were employed?
Can you prove it with records?

If you want, paste (remove personal identifiers if you prefer) your company’s leave conversion policy text and the leave balances shown in your HR ledger, and I can help you map which parts are enforceable, which are discretionary, and how to word a tight demand.