How to Claim Unpaid Final Pay and Cash Bond from Your Employer in the Philippines

(A comprehensive, practice-oriented legal guide as of 24 July 2025)

1. Why This Matters

Under Philippine labor law, an employee who is separated from work—whether by resignation, termination, end-of-contract, retrenchment, or closure—is entitled to receive final pay (sometimes called “last pay”) and the return of any cash bond or deposit that the employer has required. Delay or refusal to release these sums is a common workplace dispute; understanding the legal rules, timelines, and enforcement mechanisms can spare you months of frustration and help you recover what is rightfully yours.

2. Legal Foundations

Source	Key Provisions	Practical Effect
Labor Code of the Philippines (PD 442, as amended) • Art. 94 + 116 (wages; withholding) • Art. 118 (unauthorized deductions)	• No employer may withhold wages or make deductions not expressly allowed by law. • Cash bonds are lawful only if expressly authorized in writing and used for a legitimate purpose.
Labor Advisory No. 06-20 (DOLE, 2020)	Employers must release final pay within 30 calendar days from the date of separation, unless a shorter period is provided in the CBA, company policy, or individual contract.
Department Order No. 174-17 (for contractors & sub-contractors)	Any cash bond or security deposit collected from workers must be returned within two (2) weeks after separation or completion of project.
Rule VIII-A, Book III, Omnibus Rules	Enumerates valid wage deductions (e.g., insurance premiums, union dues) and implicitly bars others.
Republic Act 10361 (Domestic Workers or “Batas Kasambahay”)	Mandates release of final pay and return of deposits within 15 days of severance for domestic workers.
Civil Code (Arts. 1159, 1170)	General principles on performance of obligations and liability for damages in case of delay or abuse.

Note: No government clearance (e.g., “Accountability Clearance”) can lawfully postpone the 30-day rule unless the employee willfully delays completion of clearance requirements.

3. What Exactly Is Included in “Final Pay”?

Unpaid basic salary up to last day worked.
Pro-rated 13th-month pay (Art. VII, PD 851).
Cash equivalent of unused Service Incentive Leave (Art. 95).
Separation pay if required (Art. 298-299; redundancy, retrenchment, closure, etc.).
Retirement benefits under Art. 302 or company plan, if qualified.
Tax refund or deduction of tax due, per BIR Regulations.
Cash bond / security deposit (see Section 4).
Other company-granted benefits that are convertible to cash (e.g., unused vacation beyond the statutory SIL, commissions already earned, monetized credits) if so agreed or established by practice/CBA.

4. Cash Bonds: Rules & Pitfalls

4.1 When Is a Cash Bond Valid?

Must be agreed in writing (e.g., employment contract or separate acknowledgment).
Purpose must be lawful and specific (e.g., loss or damage liability, uniforms, equipment).
Amount must be reasonable and not exceed the employee’s actual accountability.
Company must keep separate records and issue receipts.

4.2 When Must It Be Returned?

General rule: Upon separation, simultaneously with final pay “within 30 days.”
Special rule for contractors (DO 174-17): within 14 days from termination or completion of project.
Domestic workers: within 15 days (RA 10361).

4.3 Common Issues

Issue	Employer’s Excuse	Legal Response
“We’re still auditing shortages”	Burden is on employer to prove loss or damage and give employee due process. Without proof, withholding is illegal.
“Policy says bond returned after next audit cycle”	Any policy that delays beyond 30 days (or the DO174/RA10361 shorter deadlines) is void.
“No more funds”	Insolvency is not a defense; officer-in-charge may incur personal liability under Art. 118, Art. 288, and even estafa (Art. 315, RPC).

5. Timelines at a Glance

| Day 0 | Last day of employment (or effectivity of termination/resignation). | | Within 30 days
(14 days for DO 174 contractors, 15 days Kasambahay) | Employer must release all final pay & cash bond. | | Day 31-60 | You may begin informal demand (e.g., e-mail, HR follow-up). | | Day 61 onward | Legal remedies available (see Section 6). | | 3 years from cause of action | Prescriptive period to file money claims with NLRC/DOLE (Art. 306). |

6. Step-by-Step Enforcement Guide

6.1 Internal & Written Demand

Send a demand letter to HR / finance stating:
- Facts of employment and last day worked.
- Amounts due (attach computation).
- Cite Labor Advisory 06-20 & relevant articles.
- Give a reasonable deadline (e.g., 5-10 days).
Keep copies and proof of receipt (e-mail read receipts, messenger acknowledgment).

6.2 DOLE Single-Entry Approach (SENA)

File a Request for Assistance (RFA) at any DOLE field office or online.
Within 5 days, a mandatory conciliation-mediation conference is scheduled.
If settled, parties sign a settlement agreement (Kasunduan)—an executory document.
If not, you receive a Referral to NLRC or Certificate to File Action.

6.3 National Labor Relations Commission (NLRC) Complaint

Prepare NLRC Form-A (Verified Complaint) stating money claims.
Attach computation, proof of employment, and demand letter.
Pay filing fee ≈ ₱500 + ₱10/₱1,000 of claim above ₱5,000 (indigent exempt).
Undergo mandatory conciliation (single hearing).
On failure, case proceeds to labor arbiter for hearings and decision within 30 days after submission for resolution.

6.4 Execution & Enforcement

When decision or settlement becomes final, request a Writ of Execution; sheriff may garnish bank accounts or levy properties.
Corporate officers who knowingly refuse compliance may face subsidiary or solidary liability (Art. 110).

6.5 Criminal Recourse (Rare)

Article 303 (formerly 288) imposes fines/imprisonment for unlawful deductions/kickbacks.
Estafa may lie if employer collected bond with intent to defraud.

7. Evidence Checklist

Employment contract / appointment letter
Payslips (last 3–6 months)
Company policies / CBA on final pay or cash bond
Written authorization for bond deductions
Demand letters & replies
Exit clearance form (if any)
Computation sheet (your own or HR-issued)
Witness affidavits (co-workers, HR staff)
Bank statements showing non-payment

8. Tax Treatment

Final pay is subject to normal withholding tax unless you qualify for the ₱90,000 tax-exempt ceiling on 13th-month pay and other benefits (Sec. 32(B)(7)(e), NIRC).
Cash bond refunds are not taxable; they represent return of your own money.
Any tax refund or deficiency must be settled concurrently with final pay.

9. Frequently Asked Questions

Question	Answer
Can I claim moral damages?	Only if employer’s bad faith is proven; otherwise NLRC awards are limited to money claims plus legal interest (usually 6 % p.a.).
Does resignation waive my right?	No. You remain entitled to all earned benefits.
What if I signed “I have received my pay in full”?	Such quitclaim is invalid if executed under duress, for unconscionably low amount, or without independent legal advice.
Is my 30-day notice a prerequisite for final pay?	Serving notice is separate; employer cannot withhold accumulated earnings even if you failed to give notice (they may deduct an amount equivalent to 30 days’ pay only if stipulated).

10. Practical Tips

Compute your own figures—mistakes in HR computations are common.
Be polite yet firm in follow-ups; most disputes settle at HR/SENA.
Group claims with co-workers if many are unpaid; consolidated NLRC cases save fees and forge stronger evidence.
Preserve e-mails and chats; screenshots matter.
Consult a lawyer or union early if large sums or separation issues (e.g., illegal dismissal) are involved.

11. Sample Demand Letter (Template)

Date: _____ To: HR/Finance Manager, [Company] Subject: Demand for Release of Final Pay and Cash Bond

I was employed as [Position] from [Start-Date] until my separation on [End-Date]. Pursuant to Labor Advisory No. 06-20 and Articles 94, 116, 118 of the Labor Code, please release the following within five (5) days:

Unpaid salary ________

Pro-rated 13th-month ________

SIL conversion ________

Cash bond refund ________ Total: ₱________

Failure to comply will compel me to file a request for assistance with DOLE or a complaint before the NLRC without further notice.

Sincerely, [Name] Contact No. ________

12. Conclusion

The law is emphatic: final pay and cash bonds are employee property, not bargaining chips. Employers must release them promptly—generally within 30 days of separation, or even sooner for specific sectors. Begin with a cordial written demand, escalate to DOLE’s SENA process if needed, and file an NLRC complaint before the three-year prescriptive period lapses. Armed with the statutes, timelines, and practical steps outlined above, you can confidently assert—and enforce—your right to every peso you have earned.

This article is for general guidance only and is not a substitute for individualized legal advice. Where significant amounts or complex facts are involved, consult a Philippine labor-law practitioner.