Holiday Premium Pay for Working on Public Holidays in the Philippines
(A comprehensive legal‑practice guide, updated to July 2025)
1. What “Holiday Premium Pay” Means
Holiday premium pay is the additional compensation owed to rank‑and‑file employees who actually perform work on a day the State has formally declared a holiday. It is separate from “holiday pay,” which refers to pay granted even when the employee does not work on a regular holiday. The premium is intended to discourage management from requiring work on days of national rest and, when work is unavoidable, to compensate labor for the sacrifice.
2. Core Legal Sources
| Instrument | Key Section(s) | Essence |
|---|---|---|
| Labor Code of the Philippines (Pres. Decree No. 442, renumbered) | Art. 94 (old) → Art. 87 (new numbering) | Establishes right to holiday pay and premium rates. |
| Omnibus Rules Implementing the Labor Code | Book III, Rule IV | Operationalizes Art. 94/87; exemptions; computation methods. |
| Wage Rationalization Act (RA 6727) + Regional Wage Orders | Wage boards may reiterate or clarify premium obligations. | |
| Annual Proclamations by the President (under Adm. Code, Book I) | List specific holidays each calendar year. | |
| DOLE Labor Advisories / Department Orders (e.g., Advisories #22‑2023; #17‑2024) | Issue handy “pay rules” tables for each holiday date. | |
| Jurisprudence (e.g., Auto Bus Transport v. Bautista, G.R. 156367; De Gumbia v. CA, G.R. 94566) | Clarify coverage, exemptions, and sample computations. |
Note: Collective Bargaining Agreements (CBAs) and long‑standing company practice may grant better‑than‑statutory premiums; those prevail under the non‑diminution rule.
3. Types of Philippine Holidays & Their Payroll Consequences
| Holiday Category | Legal Effect if No Work | Premium if Work Performed (first 8 hrs) | If Also a Rest Day |
|---|---|---|---|
| Regular Holiday (e.g., New Year, Araw ng Kagitingan, Independence Day, Eid al‑Fitr)* |
100 % of daily wage | 200 % of daily wage | 260 % (200 % × 1.3) |
| Special Non‑Working Day (e.g., Ninoy Aquino Day, Black Saturday, Chinese New Year) |
“No work, no pay” (unless prevailing policy/CBA grants otherwise) | 130 % of daily wage | 150 % |
| Special Working Day (declared occasionally to offset long weekends) | Treated as ordinary working day—no additional pay | 100 % (no premium) | 100 % |
| Double Regular Holiday (two regular holidays fall on same date, e.g., Maundy Thursday + Araw ng Kagitingan as in 2026) | 200 % (even if not worked) | 300 % | 390 % |
| Local or Sector‑Specific Holiday | Follow proclamations or ordinances; often treated like special non‑working | Apply DOLE advisory or relevant CBA | Same ratio shown above |
* The exact list changes annually via presidential proclamations; consult the current year’s list to determine category.
Overtime on a holiday: add 30 % of the hourly holiday rate for work beyond eight hours. Night‑shift differential: apply the 10 % night‑shift premium on top of the holiday rate for hours between 10 p.m. – 6 a.m.
4. Who Is—and Is Not—Entitled
Covered:
- All rank‑and‑file employees, whether paid by day, hour, piece‑rate, or commission, regardless of tenure, provided they are present or on paid leave the workday immediately preceding the holiday.
- Kasambahay (household workers) under RA 10361.
- Workers under flexible work arrangements (FWAs) or telework (RA 11165) when schedules fall on the holiday.
Exempt:
- Government employees (civil‑service rules apply, not the Labor Code).
- Managerial staff, officers or members of managerial group (Art. 82/71), though many companies grant them equal benefits voluntarily.
- Field personnel with unsupervised hours, family drivers, and workers paid a fixed salary covering all days, provided an agreement so states.
- Retail/service establishments regularly employing fewer than 10 workers may be exempt from holiday pay (not the premium) under Art. 94(b), but once they do require work on a holiday, the premium applies.
5. Conditions for Entitlement
| Situation | Result |
|---|---|
| Absent without pay on the day immediately before a regular holiday | No holiday pay for the unworked portion, but if the employee actually works on the holiday, premium still applies. |
| On approved leave with pay (vacation, sick, parental) preceding the holiday | Entitled to both holiday pay (if unworked) and premium (if worked). |
| Successive holidays (e.g., Maundy Thursday + Good Friday) and the worker absents on Wednesday | Absent worker loses Thursday holiday pay but not Friday’s—so long as present on Thursday (or on leave with pay). |
| Suspension of work due to calamity and employee cannot report | If the President/DOLE declares temporary closure, daily‑paid workers lose the day’s wage and holiday pay unless company/CBA grants otherwise. |
6. Computation Step‑by‑Step
Let BW = ₱610.00 (basic daily wage in NCR as of July 2025, example only).
Regular holiday worked, ordinary day
- Premium Pay = BW × 200 % = ₱610 × 2 = ₱1 220.00
Regular holiday worked, also a rest day
- Premium Pay = BW × 200 % × 1.3 = ₱610 × 2 × 1.3 = ₱1 586.00
Special non‑working day worked, ordinary day
- Pay = BW × 130 % = ₱610 × 1.3 = ₱793.00
Overtime on a regular holiday (2 hours)
- Hourly holiday rate = (BW × 200 %) ÷ 8 = ₱1 220 ÷ 8 = ₱152.50
- OT premium per hour = Hourly holiday rate × 30 % = ₱152.50 × 0.30 = ₱45.75
- OT total = ₱45.75 × 2 = ₱91.50
7. Enforcement & Penalties
- Labor Inspectors may issue compliance orders; non‑payment constitutes an illegal deduction / underpayment.
- Monetary awards include premium differentials plus legal interest (currently 6 % per annum) until fully satisfied.
- Administrative fines under the DOLE’s Labor Laws Compliance System (LLCS): ₱20 000 per affected worker (adjustable), plus possible criminal liability under Art. 303/288.
8. Frequently Litigated Issues & Case Law Pointers
| Issue | Principle from SC Decisions |
|---|---|
| Whether field personnel enjoy holiday pay | Auto Bus Transport v. Bautista—true field personnel excluded; but bus conductors/drivers with regular routes covered because operations are supervised via dispatch system. |
| Holiday premium for piece‑rate workers | De Gumbia v. CA—compute based on average daily earnings in the week preceding the holiday; same percentage multipliers apply. |
| Effect of incomplete months or probationary status | R.B. Crawford v. Castro—no length‑of‑service requirement; probationary workers covered. |
| Unilateral withdrawal of long‑enjoyed holiday premium higher than statutory | Phimco Industries v. Phimco Workers Union—violates non‑diminution of benefits doctrine. |
9. Interaction with Other Laws
Taxation (NIRC, as amended):
- Holiday premiums form part of compensation income subject to withholding tax, except where total does not exceed BIR’s de minimis thresholds (rare).
RA 11534 (CREATE Act) incentives: additional payroll costs (including holiday premiums) are deductible business expenses.
Expanded Maternity Leave (RA 11210), Paternity Leave (RA 8187), Solo Parent Leave (RA 8972): while on paid leave, employees deemed “present” for holiday‑pay qualifying purposes.
10. Record‑Keeping & Best‑Practice Checklist for Employers
| Action Item | Why It Matters |
|---|---|
| Maintain 3‑year payroll, time‑cards, and leave records (Art. 305/290) | Burden of proof in premium‑pay disputes lies on employer. |
| Post annual DOLE “Pay Rules for Holidays” bulletin at the workplace or intranet | Compliance with Art. 134 onboarding obligation. |
| Issue written notice & secure staff consent when insisting on work during holidays | Aids in defense against unjust labor practice claims. |
| Integrate premium‑pay codes in payroll software | Automates complex multipliers (200 %, 260 %, etc.). |
| Conduct annual audit aligned with DOLE’s Labor Inspection Checklist | Minimizes remedial orders and monetary assessments. |
11. Special‑Sector Notes
- Business‑Process Outsourcing (BPO): where foreign calendars differ, Philippine premium rules still apply if the employee is hired under Philippine law, even when assigned to a foreign account.
- Hospitality & Retail: tip‑credit schemes cannot be used to offset holiday premiums.
- Domestic Workers (Kasambahay): entitled to holiday premium unless on permanent live‑in duty with fixed monthly wage explicitly covering holidays.
- Construction Piece‑Rate: Premium is computed on average daily equivalent of the task rate.
- Platform / Gig Workers: still contested; if engagement is found to be employment, holiday rules apply retroactively.
12. Emerging Developments (2025 Outlook)
- Pending Senate Bill No. 2062 proposes to standardize special working‑day premiums at 115 %, eliminating the “ordinary day” treatment.
- DOLE is pilot‑testing an e‑Holiday Pay Calculator in its Labor Inspectorate Management Application (LIMA).
- Discussions under the Tripartite Industrial Peace Council (TIPC) aim to include a “right to self‑disconnect” on holidays for teleworkers, with penalties for off‑hours messaging.
13. Practical Takeaways
- Employees: Keep your own time records; an employer’s failure to keep documents favors labor in disputes.
- Employers: Apply the most beneficial rule—statute, CBA, or company practice—whichever gives the employee the higher rate.
- HR & Payroll Professionals: Track annual proclamations early (usually issued in Q3 of the prior year) to budget premium accruals.
- Both Parties: Remember that disputes over ₱50/day holiday differentials can escalate into large sums once overtime, interest, and attorney’s fees accrue—preventive compliance is cheaper.
Disclaimer: This material is for general information only and does not constitute legal advice. For specific cases, consult the Department of Labor and Employment or qualified Philippine labor counsel.