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How to Compute Daily Rate from a Monthly Salary (Philippines)

Scope: Private-sector payroll under the Labor Code/DOLE rules. Focus: converting a monthly salary to an equivalent daily rate (EDR) you can use for overtime, leave conversions, back pay, wage order compliance checks, etc. This is general information, not legal advice.

1) Start with the right “type” of pay: monthly-paid vs daily-paid

Monthly-paid employees are paid for all days of the month including rest days, special days, and regular holidays (whether worked or not). A monthly salary already “covers” the whole calendar.
Daily-paid employees are paid on the days they actually work and for certain days only if worked or if specific legal conditions are met (e.g., some holidays). Their “month” is really a sum of payable days.

Why this matters: The calendar divisor you use to go from monthly → daily is different for monthly-paid vs daily-paid setups.

2) Standard legal/HR divisors you’ll see in practice

These are the long-standing factors used in payroll and DOLE computations to reconcile “months” and “days” across common work schedules:

Pay setup / schedule	Annual days commonly used	Monthly → Daily (EDR)
Monthly-paid (covers all 365 days)	365	Daily = Monthly × 12 ÷ 365
Daily-paid, 6-day workweek	313	Daily = Monthly × 12 ÷ 313
Daily-paid, 5.5-day workweek	287	Daily = Monthly × 12 ÷ 287
Daily-paid, 5-day workweek	261	Daily = Monthly × 12 ÷ 261

What do those “annual days” mean? They reflect typical payable days per year under each schedule:

365 → all calendar days (fits monthly-paid).
313 / 287 / 261 → approximate payable working days (ordinary working days plus certain paid days) under 6-day / 5.5-day / 5-day arrangements for daily-paid employees.

Tip: Your company policy, CBA, or past practice might deviate (e.g., paying special days even if unworked). If so, adjust the divisor to match what’s genuinely “paid” in your setup.

3) Step-by-step: convert monthly → daily (then to hourly)

Identify the setup: monthly-paid or daily-paid? What weekly schedule (5, 5.5, 6 days)?
Pick the divisor from the table above.
Compute EDR (Equivalent Daily Rate):
- Monthly-paid: Daily = Monthly × 12 ÷ 365
- Daily-paid, 6-day: Daily = Monthly × 12 ÷ 313
- Daily-paid, 5.5-day: Daily = Monthly × 12 ÷ 287
- Daily-paid, 5-day: Daily = Monthly × 12 ÷ 261
Compute hourly, if needed: Hourly = Daily ÷ 8 (standard 8-hour workday).

4) Quick illustrations

Assume ₱30,000 monthly salary.

Monthly-paid: Daily = 30,000 × 12 ÷ 365 ≈ ₱986.30 Hourly ≈ 986.30 ÷ 8 = ₱123.29
Daily-paid, 6-day: Daily = 30,000 × 12 ÷ 313 ≈ ₱1,149.52 Hourly ≈ 1,149.52 ÷ 8 = ₱143.69
Daily-paid, 5.5-day: Daily = 30,000 × 12 ÷ 287 ≈ ₱1,254.36 Hourly ≈ 1,254.36 ÷ 8 = ₱156.80
Daily-paid, 5-day: Daily = 30,000 × 12 ÷ 261 ≈ ₱1,379.70 Hourly ≈ 1,379.70 ÷ 8 = ₱172.46

Notice how the fewer payable days, the higher the equivalent daily rate you derive from the same monthly salary. That’s expected.

5) How this interacts with statutory premiums & pay rules

Once you have the EDR, you can apply legal premiums:

Overtime (OT, ordinary day): at least +25% of hourly rate for hours beyond 8; +30% if OT falls on a rest day/special day/holiday (rates stack with the underlying day’s premium).
Night shift differential: +10% of hourly rate for work from 10:00 p.m. to 6:00 a.m.
Special (non-working) day:
- Not worked: generally no pay for daily-paid (unless company policy/CBA says otherwise); monthly-paid is already covered.
- Worked: at least +30% of the daily rate for the first 8 hours; OT rules apply beyond 8.
Regular holiday:
- Not worked: daily-paid are entitled to 100% of the daily rate if present (or on paid leave) on the workday immediately preceding the holiday; monthly-paid are covered.
- Worked: at least 200% of the daily rate for the first 8 hours; higher if it coincides with a rest day or OT.

The base for these computations is your EDR (and hourly rate for OT/NSD). Company policy/CBA may provide something better (never worse) than statutory minimums.

6) Common edge cases & how to handle them

Different workday length: If your normal day is not 8 hours, replace 8 with your standard hours to get the hourly equivalent.
Fixed “company divisors”: Some employers hard-code 30 days/month for some allowances or leave conversions. That’s allowed if it’s more favorable and consistent—but for legal premiums/holiday pay checks, stick to the statutory logic above.
Part-month pay (new hires, separations, unpaid leaves): Pick a proration base your policy states (e.g., Monthly-paid commonly uses 30 days for easier pro-rating; others use actual calendar days). Use it consistently and ensure it doesn’t undercut legal minimums.
Leap years: Keep using 365 for monthly-paid EDR unless your policy expressly adjusts (most do not).
COLA/allowances: Include in EDR only if your policy treats them as part of the basic wage for the purpose you’re computing (e.g., some CBAs fold COLA into “basic” for OT/13th-month; the law’s default excludes certain allowances from 13th-month).
Minimum wage compliance checks: Compare the EDR you derived (or the underlying daily basic wage) against your region’s current wage order for the applicable sector/establishment size. If your policy uses a smaller divisor than appropriate, you might understate daily pay—avoid that risk.
Compressed workweeks/flexitime: Compute hourly from the EDR and then apply OT/NSD rules against the agreed daily/weekly limits approved by DOLE, ensuring total weekly hours and premium triggers are respected.

7) Reverse direction (if you ever need it): Daily → Monthly

Sometimes you get hired on a daily rate and need the equivalent monthly:

Monthly-paid equivalent: Monthly = Daily × 365 ÷ 12
Daily-paid equivalents:
- 6-day: Monthly = Daily × 313 ÷ 12
- 5.5-day: Monthly = Daily × 287 ÷ 12
- 5-day: Monthly = Daily × 261 ÷ 12

Use the track that matches how you’ll actually be paid.

8) Practical checklist for HR & employees

Confirm pay classification (monthly-paid vs daily-paid) and work schedule (5/5.5/6 days).
Pick the correct annual day factor.
Compute EDR and, if needed, hourly.
Apply premiums (OT, NSD, special/holiday) correctly.
Ensure consistency with company policy/CBA and that outcomes are at least as favorable as legal minimums.
Document the divisors and formulas in the handbook or payroll notes for audit/readability.

Final notes

The 365/313/287/261 framework has been the standard reference set in Philippine payroll practice for years and aligns with how the Labor Code distinguishes monthly- vs daily-paid compensation.
Slight company-specific tweaks are common; what’s critical is internal consistency and non-diminution of benefits.
If you want, give me your exact monthly salary, pay classification, and weekly schedule, and I’ll compute the EDR/hourly you should use and walk you through holiday/OT scenarios with your numbers.