Here’s a complete, practice-oriented guide—Philippine context—on delayed separation pay: when it’s due, how to compute it, what to do when employers delay, the forums to go to, timelines, evidence, remedies (interest, damages, attorney’s fees), and practical templates. No external search used.

1) Separation pay 101: when it’s legally due

Separation pay is not a universal benefit. It’s due when the law or a valid policy/CBA says so.

A. Authorized causes (Labor Code) — separation pay required

Redundancy or installation of labor-saving devices (LSD) → at least 1 month pay or 1 month pay per year of service, whichever is higher.
Retrenchment to prevent losses, closure/cessation not due to serious losses, and disease (employee unfit to work per DOH-accredited physician and no suitable work available) → at least ½ month pay per year of service, or 1 month pay, whichever is higher.

B. Illegal dismissal cases — separation pay “in lieu of reinstatement” When reinstatement is no longer viable (e.g., strained relations, closure), labor tribunals/courts award separation pay in lieu—commonly 1 month pay per year of service (a judicial remedy, distinct from the statutory schedules above).

C. Contract/CBA/company policy If your contract, handbook, or CBA promises separation pay (even beyond minimums), that binds the employer.

D. What’s not separation pay

Retirement pay (under RA 7641/company plan).
Final pay components (last salary, pro-rated 13th-month, SIL conversion, tax refund, commissions)—these are due whether or not separation pay applies.

2) Timing: when must employers release separation pay/final pay?

Final pay (including any separation pay due) should be released within 30 calendar days from separation, unless a shorter company/CBA timeline applies.
Authorized-cause terminations also require 30-day written notice to both the employee and DOLE before effectivity (the notice period does not substitute payment).

Practical rule: If you’re separated effective Day 0, expect the separation pay and all final pay items no later than Day 30—absent a valid, documented reason (e.g., bank processing of a large check that’s already approved).

3) Amount & computation: getting the numbers right

A. Base rate. Use the employee’s latest daily/monthly rate at separation. Regular wage-integrated allowances that are part of “basic pay” per company practice/CBA are typically included; purely discretionary or occasional allowances usually aren’t.

B. Fractional years. A fraction of at least six (6) months counts as one (1) whole year.

C. Quick guide

Redundancy/LSD → max of (1 month) and (1 month × years).
Retrenchment/closure (no serious losses)/disease → max of (1 month) and (½ month × years).
In lieu of reinstatement (illegal dismissal) → commonly 1 month × years (tribunal’s call).

D. Examples

4 years 7 months, redundancy, ₱25,000/month → years = 5 → ₱125,000 (5 × ₱25,000).
2 years 5 months, retrenchment, ₱20,000/month → years = 2 (fraction < 6 months) → max(₱20,000, ₱20,000) = ₱20,000 (½ mo × 2 = 1 mo).
10 years, disease, ₱30,000/month → ½ mo × 10 = 5 months = ₱150,000 (greater than ₱30,000 minimum).

4) What else is part of “final pay” (separate from separation pay)

Unpaid salary up to last day worked
Pro-rated 13th-month pay (all rank-and-file; managers often covered by policy)
Conversion of unused SIL (if covered establishment; after 1 year of service)
Earned but unpaid commissions/incentives (per plan)
Tax refund (over-withheld income tax) where applicable
Government contributions are remitted as usual; COE must be issued within 3 working days upon request.

5) When employers delay: typical excuses vs. the law

“Clearance pending.” Employers may complete reasonable clearance steps, but they can’t use clearance to delay beyond the 30-day norm without a concrete, documented basis. Deductions for accountabilities actually due (e.g., unreturned company asset with cost) must be specific and provable.
“Financial difficulty.” Not a legal excuse; authorized-cause separation creates an immediate monetary obligation.
“Waiting for HQ approval.” Internal bureaucracy does not suspend legal timelines.
“We’ll pay once you sign a quitclaim.” Employees can refuse an unfair quitclaim. A valid quitclaim requires reasonable consideration, voluntariness, and clear terms.

6) Your legal remedies (laddered approach)

Step 1 — Demand letter (7–10 days to comply). Send a formal demand with your computation, asking payment within 7–10 days and stating you’ll escalate (SEnA/NLRC) and claim legal interest and attorney’s fees if unpaid.

Step 2 — SEnA (Single-Entry Approach) at DOLE. File a Request for Assistance (RFA) at the DOLE Regional/Field Office where you worked. It’s a mandatory conciliation step (typically a quick setting). Bring: ID, contract, payslips, termination notice, your computation, and the demand letter.

Step 3 — NLRC (Labor Arbiter) money claim / illegal dismissal, as applicable. If no settlement at SEnA, file a Complaint with the NLRC for:

Money claim (separation pay + final pay + interest + attorney’s fees); and/or
Illegal dismissal (if the authorized cause is doubtful), praying for reinstatement with backwages or separation pay in lieu plus damages.

Step 4 — DOLE visitorial/compliance route (for standards issues). For clear labor standards violations (e.g., non-payment of 13th-month, SIL), DOLE may issue compliance orders after inspection—even as your NLRC case for separation pay proceeds.

Optional — Civil action/attachment. If the employer is dissipating assets, consult counsel on pre-judgment attachment in a civil action. (This is rare but useful with flight-risk respondents.)

7) What can you recover besides the delayed amount

Legal interest: 6% per annum on the unpaid amount, commonly counted from the date of demand (or from filing) until full payment.
Attorney’s fees: Frequently 10% of the award when the employee was compelled to litigate to recover lawful benefits.
Nominal damages: If the employer had a valid authorized cause but botched due process (e.g., no 30-day notice), nominal damages may be awarded.
Moral/exemplary damages: Awarded only if bad faith or malice is proven (e.g., deliberate withholding).

8) Prescriptive periods (don’t sleep on your rights)

Money claims (e.g., separation pay, 13th-month): 3 years from when the claim accrues (usually the separation date or, at the latest, the 30th day when payment should have been made).
Illegal dismissal: 4 years (injury to rights).
Filing SEnA does not stop prescription; it’s wise to file the NLRC case promptly if conciliation fails.

9) Tax treatment (high level)

Statutory separation pay due to authorized causes or disease is generally tax-exempt (beyond the employer’s control).
Separation pay in lieu of reinstatement (illegal dismissal) and ex gratia packages may be taxable unless falling under a tax-exempt category. Coordinate with payroll; dispute erroneous withholding in your demand if needed.

10) Evidence you should gather (checklist)

Employment contract / handbook / CBA provisions
Termination notices (to you; any proof of DOLE notice if available)
Payslips and proof of latest rate; time records (for commissions/allowances)
Company computations, quitclaim drafts, HR emails/chats/texts
Your demand letter and proof of receipt
Any proof of other employees paid earlier (pattern of bad faith)

11) Employer playbook (if you’re the HR/owner)

Decide early on the ground (redundancy/closure/retrenchment/disease) and paper it properly (business case, notices).
Compute and fund the separation package before effectivity.
Release within 30 days (or earlier if policy says so); give a clear, itemized statement.
Keep quitclaims fair and voluntary; never condition the COE on signing a quitclaim.
If you need offsets (e.g., unreturned laptop), itemize and prove before netting.

12) Templates you can copy-paste

A) Demand Letter (Short Form)

Subject: Demand for Release of Separation Pay and Final Pay Date: [____]

Dear [HR/Authorized Officer], I was separated on [date] due to [authorized cause/closure/etc.]. Under the Labor Code and company policy, my separation pay is ₱[amount] (computation attached). My final pay items total ₱[amount] (last salary, 13th-month pro-rata, SIL conversion, tax refund, etc.). These amounts became due no later than [date = separation + 30 days]. Kindly release payment within 7 days from receipt of this letter. Otherwise, I will seek relief via SEnA and the NLRC, including 6% legal interest from default, attorney’s fees, and damages as warranted. Sincerely, [Name | Address | Contact] Attachments: Computation; proof of rate; termination notice.

B) NLRC Complaint — Sample Prayers (for money claim)

Order Respondent to pay separation pay of ₱[__];

Pay final pay balances (salary, 13th-month, SIL, commissions) of ₱[__];

6% legal interest from [date of demand] until full payment;

Attorney’s fees at 10% of total monetary award;

Nominal damages for procedural lapses; and

Other reliefs just and equitable.

13) Quick decision tree (employee’s view)

Were you separated for an authorized cause or by illegal dismissal?
- Authorized cause → compute statutory separation pay.
- Illegal dismissal → seek reinstatement or separation pay in lieu + backwages.
Is payment delayed past Day 30?
- Yes → Demand (7–10 days) → SEnA → NLRC.
Is the amount disputed/lowballed?
- Bring your own computation; challenge exclusions (e.g., integrated allowances).
Company insists on quitclaim for release?
- Don’t sign unfair terms; note that acceptance under protest doesn’t bar you from disputing undervaluation, especially if consideration is unconscionably low.

14) Common pitfalls (and how to avoid them)

Missing the 3-year clock → diary your accrual date.
No written demand → always create a paper trail; it anchors interest.
Vague computations → attach a neat 1-page breakdown.
Assuming tax is always withheld → push back on wrongful taxation of statutory separation pay.

One-page employee action plan

Compute your separation pay using the correct schedule; prepare a clean breakdown.
Send a dated demand letter with a 7–10 day deadline.
File SEnA at DOLE if unpaid; bring docs.
If no settlement, file an NLRC complaint for the amount + 6% interest + 10% attorney’s fees (+ other damages if due).
Track prescription (3 years for money claims; 4 years if you’ll also allege illegal dismissal).

If you want, I can turn your facts (dates, rate, years of service, ground for termination) into: (a) a ready-to-file demand with computation, and (b) a filled-out NLRC complaint tailored to your region.