Big picture
In Philippine labor law, holiday pay and rest-day premium are two separate entitlements that can stack. When a regular holiday or a special (non-working) day falls on an employee’s scheduled rest day, the pay rules combine the applicable holiday multiplier and the rest-day premium (typically +30% for work performed on a scheduled rest day). This article explains who is covered, the exact rates (worked vs. unworked), how to compute overtime and night shift differential on such days, and the common pitfalls in payroll and HR compliance.
Key definitions
- Regular holiday: Work is ordinarily suspended and qualified employees are paid even if unworked. Common examples: New Year’s Day, Maundy Thursday, Good Friday, Araw ng Kagitingan, Labor Day, Independence Day, National Heroes Day, Bonifacio Day, Christmas Day, Rizal Day, plus other regular holidays set by law.
- Special (non-working) day: The default rule is “no work, no pay” unless company policy, practice, CBA, or employment status provides otherwise. Examples typically include Chinese New Year, EDSA anniversary (when declared), Black Saturday, All Saints’ Day, Feast of the Immaculate Conception, Ninoy Aquino Day, and special dates proclaimed by the President.
- Rest day: The 24-hour consecutive period after six consecutive workdays or as scheduled by the employer. Work done on a scheduled rest day triggers rest-day premium rules.
Coverage note. Holiday pay rules generally protect rank-and-file employees. Managerial employees, certain field personnel, family members dependent on the employer, and others excluded by law or regulation may not be covered by statutory holiday pay—unless a company policy or CBA grants it.
Eligibility conditions (unworked regular holiday)
To receive the unworked regular holiday pay, the employee must be:
- Present or on leave with pay on the workday immediately preceding the holiday; and
- Otherwise not disqualified by lawful exclusions.
If absent without pay on the workday immediately preceding the regular holiday, the unworked holiday pay may be forfeited under the standard rule (unless a more generous policy applies).
Rate matrix at a glance
Below are the standard statutory baselines. Employers or CBAs may grant better terms, but not worse.
A. Regular holiday
| Scenario | Pay for first 8 hours |
|---|---|
| Unworked (whether or not it falls on a rest day) | 100% of the basic daily wage |
| Worked (holiday but not a rest day) | 200% of the basic daily wage |
| Worked and falls on a scheduled rest day | 260% (that is, 200% × 1.30 rest-day premium) |
Overtime on a regular holiday
- Worked, not a rest day: Hour 9+ = 260% per hour (200% × 1.30 overtime premium).
- Worked, and it’s a rest day: Hour 9+ = 338% per hour (260% × 1.30 overtime premium).
Night shift differential (NSD)
- Add 10% of the hourly rate on that day for hours worked between 10:00 p.m. and 6:00 a.m. (Example: If the base for the hour is 260%, NSD is 10% of that 260% rate.)
B. Special (non-working) day
| Scenario | Pay for first 8 hours |
|---|---|
| Unworked | No pay by default (“no work, no pay”), unless a favorable policy/CBA applies |
| Worked (special day but not a rest day) | 130% of the basic daily wage |
| Worked and falls on a scheduled rest day | 169% (that is, 130% × 1.30 rest-day premium) |
Overtime on a special (non-working) day
- Worked, not a rest day: Hour 9+ = 169% per hour (130% × 1.30 overtime premium).
- Worked, and it’s a rest day: Hour 9+ = ~219.7% per hour (169% × 1.30 overtime premium).
Night shift differential (NSD)
- Add 10% of the hourly rate on that day (e.g., 10% of 169% if it’s a special day on a rest day).
Why these numbers? The law treats the holiday premium and rest-day premium as separate multipliers that can apply together. For worked hours, you start with the correct holiday rate (regular: 200%; special: 130%), then apply the rest-day premium (+30% of the rate on that day) if it is a scheduled rest day, and apply overtime (+30% of the rate on that day) for hours beyond eight. NSD is computed on the rate in effect for that hour.
Sample computations
Assume:
- Basic daily wage = ₱600 for an 8-hour day (₱75/hour).
- Scheduled rest day falls on a holiday. Employee actually worked 10 hours, with 2 night hours (10:00 p.m.–12:00 a.m.).
1) Regular holiday on a scheduled rest day (worked 10 hours; last 2 hours are night OT)
- First 8 hours: 260% × ₱600 = ₱1,560
- Hours 9–10 (OT): 338% × ₱75 × 2 = ₱507
- NSD on hours 9–10: 10% of 338% × ₱75 × 2 = 0.10 × 3.38 × 75 × 2 = ₱50.7
- Total = ₱1,560 + ₱507 + ₱50.7 = ₱2,117.70
2) Special (non-working) day on a scheduled rest day (worked 10 hours; last 2 hours are night OT)
- First 8 hours: 169% × ₱600 = ₱1,014
- Hours 9–10 (OT): 219.7% × ₱75 × 2 ≈ ₱329.55
- NSD on hours 9–10: 10% of 219.7% × ₱75 × 2 = 0.10 × 2.197 × 75 × 2 ≈ ₱32.96
- Total ≈ ₱1,014 + ₱329.55 + ₱32.96 = ₱1,376.51
3) Regular holiday (unworked) that happens to fall on a rest day
- ₱600 (100% of daily wage), assuming eligibility (present or on leave with pay on the workday immediately before the holiday).
Monthly-paid vs. daily-paid employees
- Daily-paid employees are paid only for days actually worked, plus statutory holiday pay when applicable (e.g., unworked regular holidays if eligible; worked special days at special rates).
- Monthly-paid employees generally receive pay for all days of the month, including regular holidays, under common payroll factors (e.g., 313-day or 314-day factor). Verify your company’s factor and policy; some CBAs or policies also extend pay for special days.
Scheduling, substitution, and “rest day” identification
- The employer sets the weekly rest day, subject to business exigencies and certain protections for religious observance.
- If schedules change, what matters is whether the holiday coincides with the employee’s scheduled rest day. The premium computations hinge on that scheduling fact—not on labels after the fact.
- “Substituted” rest days (e.g., swapping Sunday with another weekday) should be clearly documented to avoid disputes over whether the holiday actually fell on the employee’s rest day.
Overtime and NSD layering rules (quick rules of thumb)
- Determine the base rate for the day (regular holiday 200%, special day 130%, ordinary day 100%).
- If it’s the scheduled rest day, multiply the base by 1.30 for the first 8 hours.
- For overtime, multiply the applicable hourly rate on that day by 1.30 for hours beyond eight.
- For NSD, add 10% of the hourly rate on that day for hours between 10:00 p.m. and 6:00 a.m.
- If multiple premiums apply (holiday + rest day + OT + NSD), compute sequentially as above; do not replace one with another.
Frequently asked questions
Q1: If I didn’t work and the regular holiday fell on my rest day, do I still get paid? Yes—if you qualify (e.g., you were present or on leave with pay on the workday immediately before the holiday). The fact that it’s your rest day does not cancel regular holiday pay.
Q2: Do I get holiday pay for a special (non-working) day that I didn’t work and that fell on my rest day? By default, no (“no work, no pay”), unless a company policy, CBA, or practice grants it.
Q3: We follow a compressed workweek or rotating shifts. Do the same multipliers apply? Yes. The multipliers apply irrespective of the scheduling scheme; just ensure your rest day is properly identified in the rota.
Q4: Are managerial employees entitled to these rates? Statutory holiday pay rules primarily protect rank-and-file employees. Managerial/executive employees are often excluded by statute from certain premium pay rules; however, company policy or CBA may voluntarily extend them.
Q5: How do we treat undertime or tardiness around the holiday? Undertime on the workday immediately preceding a regular holiday can, under conservative practice, lead to non-entitlement to the unworked holiday pay—unless a favorable policy says otherwise. Many employers adopt consistent, written rules for clarity.
Compliance pitfalls (and how to avoid them)
- Not layering premiums correctly. Holiday, rest-day, OT, and NSD are stackable in sequence; skipping a layer underpays.
- Mislabeling the day as a rest day post hoc. Rest-day status is about schedule, not later labels. Keep schedules on record.
- Inconsistent policy across sites or payroll vendors. Publish a pay matrix and lock it in with HR, payroll, and operations.
- Ignoring eligibility rules for unworked regular holidays. Track attendance and leave status the day before the holiday.
- Forgetting NSD on top of already-elevated hourly rates. NSD is 10% of the actual hourly rate on that day, not of the basic rate.
Practical checklist for HR & Payroll
- Map schedules weekly and freeze the rest-day tag for each employee.
- Calendar holidays (regular vs. special) and communicate early.
- Adopt a written matrix of rates (regular, special, rest day, OT, NSD).
- Automate the sequence: base → rest-day → OT → NSD.
- Document eligibility for unworked regular holidays (attendance on the preceding workday).
- Audit payslips after each holiday run.
Bottom line
- If a holiday falls on a rest day, the rules do not cancel each other—they stack.
- On regular holidays, qualified employees get 100% when unworked; if worked, it’s 200%, and 260% when it’s also a rest day (with higher rates for OT and NSD).
- On special (non-working) days, no work, no pay by default; if worked, it’s 130%, and 169% when it’s also a rest day (again, higher for OT and NSD).
- Put everything in a clear pay matrix and compute sequentially to stay compliant.