Holiday Pay for Work Performed on a Local Special Holiday Outside the LGU

Philippine private-sector rules, computations, edge cases, and compliance tips

Executive summary

Local special (non-working) holidays apply only within the locality (LGU) expressly covered by the proclamation or law.
If you work outside the covered LGU on that very day, it is an ordinary working day—no special-day premium or “no work, no pay” rule applies, unless the employer voluntarily extends the benefit.
If you work inside the covered LGU on that day, special (non-working) day rules and pay premiums apply.
For remote/hybrid staff, the applicable “situs of work” is the employee’s agreed work location (often their residence on WFH days).
Always distinguish between a true special (non-working) holiday (which affects private employers) and local work/class suspensions (which generally bind government offices and schools, not private employers).

Legal foundations and concepts (plain-English)

Holiday categories.
- Regular holidays (e.g., New Year’s Day): “double pay” when worked; paid even if unworked (with coverage exceptions).
- Special (non-working) days (e.g., certain local anniversaries): “no work, no pay” if unworked; premium pay if worked.
- Special working days: treated as ordinary working days (no premium unless company policy/CBA says otherwise).
Who declares a local special day?
- Congress (by law) or the President (by proclamation) may declare special (non-working) days for a specific locality (city/province). These bind the private sector within the named locality.
- LGUs may issue suspensions (e.g., for classes or local government work due to weather/events). Those suspensions do not automatically impose private-sector holiday pay rules.
Situs (place) of work governs. The “where” of the actual work on the date controls:
- If the covered locality is where the employee works that day, special-day rules apply.
- If the employee works outside the covered locality, that day is regular for them.

Core rule for the scenario

If an employee performs work on a date that is a Local Special (Non-Working) Holiday for LGU “A,” but the employee actually works in LGU “B,” the day is treated as an ordinary working day for that employee. No special-day premium is legally required, and the “no work, no pay” rule for special days does not apply—unless a CBA, employment contract, or company policy provides otherwise.

Pay computations you’ll actually use

The figures below are the standard private-sector formulas commonly used by payroll practitioners for special (non-working) days (not regular holidays).

If the employee works inside the covered LGU on a special (non-working) day:

Worked, first 8 hours: 130% of the basic hourly/daily rate
Worked, falls on the employee’s rest day: 150% of the basic hourly/daily rate
Overtime on a special day: additional 30% of the hourly rate computed on the special-day rate
Overtime on a special day that is also a rest day: additional 30% of the hourly rate computed on the 150% rate
Night shift differential (10 p.m.–6 a.m.): add 10% of the hourly rate computed on the applicable special-day rate
Unworked special day: No pay (“no work, no pay”), unless there’s a company policy/CBA granting pay

If the employee works outside the covered LGU on that same date:

Treat as ordinary working day (i.e., 100% of basic rate), unless company policy/CBA grants a premium.

Small service/retail establishments regularly employing fewer than 10 workers have special rules for holiday pay on unworked regular holidays. Those exemptions do not typically affect the special (non-working) day computations above (which are “no work, no pay” by default anyway).

Practical examples

1) Resident vs. worksite in different LGUs

Facts: Employee lives in City A (with a local special day), but reports to the office in City B (no special day).
Rule: It’s an ordinary working day. If the employee reports to City B, they get 100% (no special premium). Absence may be treated as leave/unpaid per policy.

2) Temporary assignment outside the holiday LGU

Facts: Employee is usually assigned in City A (local special day), but is officially deployed to City B for that date.
Rule: Ordinary working day (100%)—the employee did not work within the covered locality.

3) Remote work from home inside the holiday LGU

Facts: WFH employee’s agreed work location is their residence in City A, which has a local special day. They perform work from home that day.
Rule: That’s work performed inside the covered LGU; pay 130% (or 150% if it’s also their scheduled rest day), with applicable OT/NSD add-ons.

4) Company voluntarily honors a local holiday nationwide

Facts: Head office in City A has a local special day; company chooses to suspend operations and pay everyone across all sites.
Rule: This is contractual/company-policy generosity. It’s enforceable once granted by practice/CBA/contract, but not mandated by law for other LGUs.

5) Local work/class suspension vs. special (non-working) holiday

Facts: The city mayor suspends classes and government work due to a festival or weather; no national proclamation for private employers.
Rule: For private firms, this is not automatically a “special (non-working) day.” Operations may continue; pay is 100% unless the employer decides otherwise.

How to apply the rules (HR/Payroll checklist)

Identify the instrument and coverage.
- Is it a Presidential Proclamation or Republic Act declaring a special (non-working) day?
- What LGU(s) and date are covered?
Map each employee’s situs of work for that date.
- On-site: which LGU is the facility in?
- Field: where were they officially deployed?
- Remote/hybrid: what is the agreed work location under the WFH arrangement for that day?
Classify the day per employee.
- Inside covered LGU → apply special (non-working) day formulas.
- Outside covered LGU → treat as ordinary working day.
Check internal instruments.
- CBA, employment contracts, or company policies may grant better terms (e.g., paying special day even if outside the LGU, or declaring a company-wide holiday).
Compute pay.
- Use the special-day or ordinary-day formulas accordingly, add OT and NSD where applicable.
Document decisions.
- Keep copies of proclamations/laws, deployment orders, WFH schedules, and attendance logs.
- Issue a payroll memo summarizing how each site/role was treated.

Remote and multi-site complications

Hybrid schedules: If Tuesday is your WFH day in City A (with a local special day), but HR asks you to report to City B, the actual work performed ends up in City B → ordinary day (unless the company still chooses to honor the local holiday).
Travel that straddles LGUs: The situs is determined by the place where work is actually performed, not where the timekeeping server or HQ is located.
Cross-midnight shifts: Break the shift into hours that fall on the local special day within the covered LGU; apply the special-day rate to those hours only.

Frequent employer/employee questions

Q: Our plant in City B ran normally, but HQ in City A (with a local special day) was closed. Do we owe special-day premiums in City B? A: No. City B had no local special day; it’s an ordinary working day there.

Q: An employee based in City A (local special day) was sent to City B for urgent repairs that day. Does special-day premium apply? A: No. The work was performed outside the covered LGU.

Q: Our rider spent 3 hours in City A (holiday) and 5 hours in City B (not). How do we pay? A: Ideally, pay special-day rate for hours actually worked inside City A and ordinary rate for the rest, supported by dispatch logs/geo-stamped records.

Q: Can we choose to pay the special-day premium company-wide to avoid confusion? A: Yes. That becomes a contractual/company policy benefit and must be applied consistently and reflected in payroll rules.

Compliance pitfalls to avoid

Confusing “class/work suspensions” with a true special (non-working) holiday. Suspensions usually do not create private-sector holiday pay obligations.
Basing the rule on the employee’s residence instead of the site of work, except in WFH arrangements where the residence is the agreed workplace.
Ignoring CBAs or established practice. If you’ve consistently paid premiums company-wide in prior years, that may have ripened into a benefit you should continue or properly modify with notice/bargaining.
Forgetting OT/NSD layering. Compute OT and NSD on top of the special-day rate, not the basic rate.

Quick reference (special non-working day)

Inside covered LGU
- Unworked: No pay (unless policy/CBA says otherwise)
- Worked (first 8 hrs): 130%
- Worked on rest day: 150%
- OT premium: +30% of hourly rate based on the day’s applicable rate
- NSD: +10% of hourly rate based on the day’s applicable rate
Outside covered LGU (your scenario)
- Treated as ordinary working day: 100% (unless a better company/CBA rule applies)

Implementation template (HR memo)

Subject: Pay Rules for Local Special (Non-Working) Holidays by Location Coverage Date(s): [insert date/s] LGUs Covered by Proclamation/Law: [insert] Rules:

Employees working within the LGUs listed above on the coverage date(s) are entitled to special (non-working) day pay rules (130%/150%, with OT/NSD add-ons).

Employees working outside the LGUs listed above on the coverage date(s) will be paid as on an ordinary working day.

Remote workers: the agreed work location for the day determines applicability.

Where a CBA, contract, or company policy grants a better benefit, that better rule applies.

Timekeeping must capture actual work location (site assignment, travel orders, WFH schedule). Payroll to retain copies of proclamations/laws and internal deployment records.

Bottom line

For private employers and employees alike, location matters. A local special (non-working) holiday binds private sector pay rules only within the locality it covers. If you worked outside that LGU on the date in question, it’s business as usual—unless your company or CBA says you get more.