Guidelines on Leave With Pay (LWP) and Leave Without Pay (LWOP) under Philippine Labor Law
Updated as of 3 July 2025
1. Conceptual Framework
| Leave With Pay (LWP) | Leave Without Pay (LWOP) | |
|---|---|---|
| Definition | Authorized absence for which the employee continues to receive his or her regular compensation (basic pay and, where applicable, allowances). | Authorized (or tolerated) absence for which no compensation is due. |
| Sources | Statutory law (Labor Code, special statutes), collective bargaining agreements (CBAs), company policies. | Primarily company policy; a few statutes expressly grant LWOP extensions (e.g., 30-day maternity extension). |
| Effect on tenure | Considered continuous service; counts toward length-of-service benefits (e.g., SIL accrual, retirement). | Does not break tenure but days are excluded from “actual days worked” computations (e.g., SIL, 13th-month pay, SSS/PhilHealth contributions unless remitted voluntarily). |
| Discipline | Denial of LWP is a management prerogative but must not be exercised in bad faith or with discrimination. | Unapproved absences become “AWOL” and may ground disciplinary action; approved LWOP avoids AWOL. |
2. Statutory Leave With Pay in the Private Sector
| Statute / Code Provision | Coverage & Conditions | Duration / Compensation | Key Notes |
|---|---|---|---|
| Service Incentive Leave (SIL) — Labor Code, Art. 95 | Rank-and-file employees who have rendered ≥ 1 year and are not already enjoying vacation/sick leave of ≥ 5 days | 5 working days yearly, convertible to cash if unused | Prorated for fraction of year; may be commuted at year-end or upon separation. |
| Regular Holiday Pay — Labor Code, Arts. 94, 93 | All employees, regardless of status | 100 % of daily wage even if work is not required; 200 % if worked | 12 regular holidays listed under R.A. 9492, R.A. 9849, proclamations. |
| Expanded Maternity Leave Law (EMLL) — R.A. 11210 & IRR (D.O. 01-19) | All female workers (private, public, informal, voluntary SSS members) regardless of civil status or employment type | 105 calendar days with full pay based on average daily salary credit (ADSC); +15 days if solo parent; optional allocation of up to 7 days to child’s father/alternate caregiver (with pay shouldered by employer) | May extend 30 days LWOP; must apply within 60 days of delivery; SSS reimburses up to applicable ceiling. |
| Paternity Leave Act — R.A. 8187 + DOLE D.O. 147-15 | Married male employee cohabiting with wife at time of delivery/miscarriage | 7 calendar days with full pay for first 4 deliveries/miscarriages | Non-cumulative; applies even to caesarian, ectopic pregnancy. |
| Parental Leave for Solo Parents — R.A. 8972 & IRR (D.O. 65-12) | Legally defined solo parents who have rendered ≥ 1 year service | 7 working days annually with pay | Requires Solo Parent ID; non-cumulative; may be used intermittently. |
| Special Leave Benefit for Women — Magna Carta of Women, R.A. 9710 §18 & D.O. 112-11 | Women employees undergoing surgery for gynecological disorders certified by competent physician | Up to 60 calendar days per year with full pay | Non-cumulative; can be less than 60 days if medically certified. |
| VAWC Leave — R.A. 9262 §43 & DSWD/DOLE Guidelines | Female employees who are victims of violence covered by R.A. 9262 | 10 working days with full pay; extendible by court order | Requires Barangay Protection Order (BPO) or court-issued protection order. |
| Adoption Leave — R.A. 8552 §41; superseded in 2022 by R.A. 11642 §37 | Adoptive parent employee | 60 calendar days with pay (R.A. 11642)** | R.A. 11642 expanded the previous 7-day leave to 60 days; applies from receipt of child-placement order. |
| Other sector-specific paid leaves | e.g., Seafarers’ shore leave under POEA Standard Contract, Teachers’ vacation under DepEd rules | Varies | Check industry-specific regulations or CBA. |
* Implementation awaiting DOLE clarificatory circulars for private employers; many employers still grant 7-day adoption leave pending full rules.
3. Common Company-Granted Paid Leaves
These are not legally mandated but have become best practice or are bargained for in CBAs:
- Vacation Leave (VL) and Sick Leave (SL) beyond the 5-day SIL (often 10-15 days each).
- Emergency/Calamity Leave (e.g., during typhoons, earthquakes).
- Bereavement Leave (3-5 days).
- Birthday Leave, Wellness Day, Mental-Health Day.
Once granted, they form part of company policy and may not be withdrawn unilaterally if they have ripened into practice (Art. 100, “non-diminution of benefits”).
4. Leave Without Pay (LWOP)
4.1. Statutory LWOP Scenarios
| Statute | LWOP Provision |
|---|---|
| EMLL – R.A. 11210 | Optional 30-day extension contiguous to the 105-day paid period. |
| Labor Code, Art. 301 [formerly 286] | Bona fide suspension of business operations of ≤ 6 months places employees on LWOP; after 6 months they must be recalled or separated with authorized-cause benefits. |
| Workers’ Compensation | Periods when EC/SSS disability benefit exceeds company sick-leave credits are effectively LWOP, though income is replaced by EC/SSS. |
4.2. Employer-Policy LWOP
Exhaustion Rule: Employees must first deplete paid leave credits before LWOP may be approved for illness, personal reasons, study, travel, etc.
Application & Approval: Written request specifying dates and reason; employer’s written approval to avoid AWOL.
Effect on Benefits:
- 13th-Month Pay – Computed on basic wage earned; LWOP days reduce basic wage component.
- SSS, PhilHealth, Pag-IBIG – Employer must still remit minimum contributions; some employers pass employee share via salary deduction upon return.
- Holiday Pay & SIL Accrual – No accrual during LWOP days because not “actual workdays”.
Maximum Cumulative LWOP: Many handbooks cap at 6 months; longer LWOP may be treated as separation.
5. Procedural Standards
Advance Notice: Except in emergencies, employee must file leave form at least 3-5 working days before intended date (company policy may set longer notice for SIL conversions or extended LWOP).
Supporting Documents:
- Medical certificate (sick leave, Magna Carta, maternity).
- Birth or medical certificates (maternity/paternity).
- Protection order (VAWC leave).
- Solo Parent ID.
- Child Placement Order (adoption leave).
Leave Ledger: Employers must keep payroll records showing leave accrual and usage (Labor Code, Art. 109).
Denial & Appeals: Denial must be in writing with reason; employee may elevate to HR or grievance machinery; labor inspection may review for statutory leaves.
6. Interaction with Social Insurance
| Benefit | Who Pays | Notes |
|---|---|---|
| SSS Maternity Benefit | SSS reimburses employer (who advanced the benefit). | Employer shoulders salary-differential if actual salary > SSS ceiling (usually applicable to higher-paid workers). |
| SSS Sickness Benefit | SSS pays daily allowance after employer advances first 120 days; employer may offset sick-leave pay. | Requires at least 3 days confinement/illness and sufficient contributions. |
| EC Disability Benefit | ECC through SSS/GSIS pays compensation for work-related injury/illness; separate from leave. | Employee on EC may also exhaust company sick leave. |
7. Jurisprudential Highlights
| Case | G.R. No. | Doctrine |
|---|---|---|
| Cargill Phils. vs. NLRC | 167247 (2010) | Repeated AWOL after denial of leave justifies dismissal; proper notice of denial is critical. |
| Honda Phils. vs. Bongcaras | 190065 (2014) | Conversion of unused SIL to cash is demandable money claim recoverable within 3 years from accrual. |
| De La Salle Araneta vs. Bernardo | 190809 (2017) | Employer may discipline employee for abuse of sick leave (e.g., falsified medical certificate). |
| Rodriguez vs. Sintron Systems | 240254 (2023) | Failure to recall employees after 6-month bona fide suspension (Art. 301) results in illegal dismissal; LWOP period beyond 6 months converts to separation pay liability. |
8. Drafting Company Policy / CBAs
A compliant leave policy should:
- Enumerate statutory leaves verbatim, citing legal bases.
- Define eligibility, accrual, and conversion mechanics for company-granted leaves.
- Set procedures for filing, documentation, approval hierarchy, and timelines.
- Clarify treatment of LWOP: impact on pay, bonuses, 13th month, and benefits.
- Conform with non-diminution and equal-protection rules: benefits once granted cannot be reduced; leaves cannot discriminate (e.g., against unmarried mothers).
- Provide for grievance and appeals consistent with Article 260 of the Labor Code.
9. Enforcement & Penalties
| Violation | Agency | Consequence |
|---|---|---|
| Non-grant or improper reduction of statutory paid leave | DOLE Regional Office (labor standards inspection) | Compliance order + payment of leave plus legal interest; potential closure for repeated violations. |
| Non-remittance of SSS maternity reimbursements to employee | SSS | Criminal liability under SSS Law (R.A. 11199). |
| Discrimination due to leave-taking (e.g., dismissal during maternity leave) | NLRC | Illegal dismissal; full backwages; moral/exemplary damages. |
10. Key Take-Aways for Employers & HR Practitioners
- Map all paid leaves in a single matrix with eligibility, documents, and payroll treatment.
- Automate leave ledgers to avoid conversion disputes; reconcile with 13th-month and SSS monthly remittances.
- Train supervisors on lawful approval/denial; a denied leave must be communicated promptly to prevent inadvertent AWOL.
- Review CBAs annually to ensure consistency with new statutes (e.g., adoption leave under R.A. 11642).
- Update the employee handbook whenever DOLE issues new department orders or implementing rules.
Final Word
Philippine labor law offers one of the most progressive sets of paid leave entitlements in Southeast Asia, but compliance hinges on clear policy drafting, accurate payroll systems, and proactive education of both managers and employees. Understanding when a day off is with or without pay—and why—prevents costly disputes and fosters a healthy, rights-respecting workplace.