1) The governing law and basic framework

For household workers (“kasambahay”), the main law is Republic Act No. 10361 (Domestic Workers Act) and its Implementing Rules and Regulations (IRR). A kasambahay includes a person engaged in domestic work such as general househelp, yaya, cook, gardener, laundry person, driver of the household, and similar roles, working in or for a household.

When a kasambahay resigns (voluntary termination), the employment relationship ends, but certain obligations remain—most importantly, final pay items that have already been earned or accrued. One of those items is the 13th month pay, which is earned over time and therefore is typically due on a prorated basis if the kasambahay leaves before the customary pay-out date.

2) Is a kasambahay entitled to 13th month pay?

Yes—coverage and entitlement

Kasambahays are entitled to 13th month pay. The Domestic Workers Act expressly provides it as a mandatory benefit. This means:

The employer must pay 13th month pay even if the kasambahay resigned, as long as the kasambahay rendered service during the relevant period.
The entitlement is not a bonus or a “company policy” benefit; it is statutory.

Not dependent on length of service beyond at least one month of work

As a rule of thumb for labor benefits like 13th month, anyone who has worked at least one month during the calendar year is typically entitled to a proportionate share. In household employment, the same practical principle applies: once the kasambahay has rendered service, the 13th month pay accrues.

3) When resignation happens: what must be included in final pay?

Upon resignation, the kasambahay’s final pay commonly consists of:

Unpaid salary/wages up to the last day of work (including any agreed wage adjustments).
Prorated 13th month pay for the portion of the year worked since the last 13th month payment (or since employment began if none yet paid).
Other earned amounts (if applicable):
- Unpaid premium pay or rest-day pay if such arrangements exist by agreement or practice.
- Reimbursement of employer-authorized expenses advanced by the kasambahay.
Deductions permitted by law (strictly limited; see Section 9).

Service incentive leave (SIL) under the Labor Code is not automatically the kasambahay’s statutory benefit (kasambahays are generally outside the Labor Code’s SIL system). However, the Kasambahay Law provides leave benefits under its own rules (notably a 5-day service incentive leave after a certain period of service). Whether unused leave is convertible to cash depends on the law/IRR and the parties’ agreement or household policy; in practice, many household arrangements treat unused leave as non-convertible unless agreed.

4) What “prorated 13th month pay” means

The concept

13th month pay is a statutory benefit equivalent to one-twelfth (1/12) of the total basic salary earned by the employee within a calendar year (or within the portion of the year covered by employment).

When the kasambahay resigns before year-end (or before the employer’s customary payment date), the kasambahay must be paid the proportionate part corresponding to the months actually worked in the year.

The standard formula

Prorated 13th month pay = (Total basic salary earned during the covered period ÷ 12)

Where:

“Total basic salary earned” means the total of the kasambahay’s basic wages paid/earned for actual work performed during the period.
The covered period is typically from January 1 of the year to the last day of work, or from the date of hire (if hired mid-year), or from the day after the last 13th month pay was paid (if the employer already paid 13th month earlier in the year).

A commonly used shortcut when the wage is constant and the kasambahay worked complete months: Prorated 13th month pay = (Monthly basic wage × number of months worked) ÷ 12

If employment includes partial months, use actual basic wage earned in that partial month.

5) Defining “basic salary” for kasambahays (what counts, what doesn’t)

Included in the computation (generally)

Basic wage agreed upon (daily, weekly, or monthly), corresponding to work actually performed.
Wage increases during the year are included by counting the actual basic wages earned at each rate.

Generally excluded

In-kind benefits like food and lodging (common in kasambahay arrangements) are not typically counted as “basic salary” for 13th month pay computation.
Allowances that are not part of basic pay (e.g., transportation allowance, cellphone allowance) are generally excluded unless they are integrated into the wage by agreement in a way that effectively makes them part of basic salary.
Cash advances are not earnings and therefore not part of the base.
Employer contributions (SSS, PhilHealth, Pag-IBIG) are not part of basic wage for 13th month computation.

Practical guidance

Because household arrangements can be informal, the safest approach is:

Use the cash wage actually paid as basic wage as the base.
Treat benefits in kind separately unless the parties clearly integrated them into cash wage (which is uncommon and can create compliance issues).

6) Resignation timing issues: “months worked” and partial months

A) If the kasambahay worked full months only

Example: Worked January to April, resigned April 30, monthly wage ₱8,000 Prorated 13th month = ₱8,000 × 4 ÷ 12 = ₱2,666.67

B) If the kasambahay resigned mid-month

When resignation happens mid-month, the cleanest method is to compute based on total basic salary earned, not “months.”

Example: Monthly wage ₱10,000. Resigned March 15. Assume daily rate is derived from household pay practice (e.g., monthly ÷ 30 for household payroll conventions) and the kasambahay earned ₱5,000 for March 1–15. Total basic salary earned from Jan 1 to Mar 15 = ₱10,000 (Jan) + ₱10,000 (Feb) + ₱5,000 (Mar 1–15) = ₱25,000 Prorated 13th month = ₱25,000 ÷ 12 = ₱2,083.33

Key point: Use the actual paid/earned basic wages for the partial month.

C) If there were unpaid absences

13th month pay is based on basic salary earned. If an absence is unpaid, that portion typically does not form part of the “earned” basic salary. If an absence is paid (e.g., paid leave by law/contract), it is generally treated as part of wage earned for the period.

7) Multiple 13th month payments in a year and avoiding double payment

Some employers pay 13th month in two installments (e.g., June and November/December). If the kasambahay resigns after receiving an earlier installment:

The kasambahay is still entitled to the balance, computed for the period after the installment covered months.
The employer should compute 13th month for the whole year up to resignation, then subtract any 13th month already paid.

Balance due = (Total basic salary earned from Jan 1 to last day of work ÷ 12) − (13th month already paid this year)

8) Resignation vs. termination: does it affect 13th month entitlement?

Resignation

Resignation does not forfeit 13th month pay. The kasambahay is entitled to prorated 13th month pay based on wages earned.

Termination for just cause

Even if employment ended due to just cause, 13th month pay is generally considered a benefit tied to work actually performed, so the employee is still usually entitled to the proportionate amount already earned, unless a specific rule provides otherwise. For kasambahays, the safer compliance stance is to pay the accrued prorated 13th month to avoid disputes.

9) Deductions and offsets: what an employer can (and can’t) subtract

Household employers sometimes try to deduct from final pay (including 13th month) for reasons like broken items, unreturned uniforms, or recruitment costs. In the kasambahay setting, deductions are strictly limited:

Generally permissible deductions

SSS/PhilHealth/Pag-IBIG employee share (if applicable and properly documented), consistent with the kasambahay’s coverage and contribution scheme.
Cash advances/loans clearly proven and acknowledged, and not in violation of rules on wage deductions.
Other deductions expressly authorized by law.

Risky or generally impermissible deductions

Unilateral deductions for alleged “damages” or “losses” without clear proof and due process.
Deductions that effectively push the wage below minimum standards or defeat statutory benefits.
“Training fees” or “placement fees” charged to the kasambahay.

Best practice: If the employer believes there is a valid claim (e.g., proven cash advance), document it and offset only the clearly supported amount. Otherwise, handle claims separately rather than self-help deductions against statutory benefits.

10) Documentation: payslips, proof, and the importance of records

The Kasambahay Law framework emphasizes documentation despite the household setting. For a clean resignation and final pay settlement:

Keep a simple pay record (dates paid, amounts, and what they represent).
Provide a final pay computation sheet listing:
- unpaid wages,
- prorated 13th month,
- deductions (if any) with basis.

If a dispute arises, the outcome often turns on records: the party with clearer documentation is at a big advantage.

11) Step-by-step computation guide (usable template)

Step 1: Identify the covered period

If no 13th month was paid yet this year: Jan 1 to last day of work, or date of hire to last day of work if hired mid-year.
If 13th month was partially paid: Jan 1 to last day of work, then subtract amount already paid, or compute only from the period after the last installment (either method works if consistent and documented).

Step 2: Determine total basic salary earned in that period

Add all basic wage payments actually earned.
Account for wage increases by using actual amounts paid at each rate.
Exclude non-basic items unless truly integrated into basic pay.

Step 3: Compute prorated 13th month

Divide the total by 12.
Round reasonably to centavos.

Step 4: Subtract any 13th month already paid

If applicable.

Step 5: Prepare final pay statement

Add unpaid wages and other earned amounts.
Apply lawful deductions only.

12) Worked examples (common household scenarios)

Example 1: Fixed monthly wage, resigned after 7 full months

Monthly wage: ₱7,500
Worked: Jan–Jul (7 months), resigned Jul 31
Total basic salary earned: ₱7,500 × 7 = ₱52,500
Prorated 13th month: ₱52,500 ÷ 12 = ₱4,375.00

Example 2: Hired mid-year, resigned before December

Hired: May 10
Monthly wage: ₱9,000
Resigned: Oct 10 Assume basic wages earned:
May 10–31 earned: ₱6,600 (illustrative; depends on payroll convention)
Jun: ₱9,000
Jul: ₱9,000
Aug: ₱9,000
Sep: ₱9,000
Oct 1–10 earned: ₱3,000 (illustrative)

Total basic salary earned = 6,600 + 9,000 + 9,000 + 9,000 + 9,000 + 3,000 = ₱45,600 Prorated 13th month = ₱45,600 ÷ 12 = ₱3,800.00

Example 3: Wage increase during the year

Jan–Jun wage: ₱8,000
Jul–Sep wage: ₱9,000
Resigned: Sep 30 Total basic salary earned = (₱8,000 × 6) + (₱9,000 × 3) = ₱48,000 + ₱27,000 = ₱75,000 Prorated 13th month = ₱75,000 ÷ 12 = ₱6,250.00

Example 4: Paid 13th month installment in June

Monthly wage: ₱10,000
Received June 13th month installment: ₱5,000 (representing Jan–Jun)
Resigned: Oct 31 Compute total earned Jan–Oct: ₱10,000 × 10 = ₱100,000 Total 13th month earned to Oct: ₱100,000 ÷ 12 = ₱8,333.33 Less paid: ₱5,000 Balance due on resignation: ₱3,333.33

13) Timing of payment and dispute handling

In practice, final pay is commonly settled shortly after separation. For household employment, prompt settlement is strongly advisable because delays often trigger disputes. If there is a disagreement:

Attempt a written reconciliation of wages paid vs. wages owed.
For unresolved claims, the dispute may be brought to the appropriate labor dispute mechanisms (often with DOLE assistance depending on the issue and local processes).

14) Common misconceptions and correct rules

“If the kasambahay resigns, they lose the 13th month.” Not correct. 13th month pay is earned proportionately and remains due.
“Food and lodging should be counted in the 13th month computation.” Typically not; 13th month is based on basic salary (cash wage), not in-kind benefits.
“I can deduct damages from the 13th month automatically.” Deductions must be lawful and properly supported; self-help deductions are risky.
“Only regular employees get 13th month.” Kasambahays are statutorily entitled regardless of “regularization” concepts.

15) Practical compliance checklist (employer and kasambahay)

For employers

Keep wage records and dates of payment.
Compute prorated 13th month using total basic salary earned ÷ 12.
Avoid questionable deductions; document any lawful offsets.
Provide a written computation with the final pay.

For kasambahays

Keep notes of wage payments received (dates and amounts).
Ask for a simple written final pay breakdown.
If the employer paid an installment earlier, confirm what months it covered to avoid underpayment.

16) Summary rule you can rely on

A resigning kasambahay is entitled to prorated 13th month pay, computed as:

(Total basic wage earned during the relevant period ÷ 12) minus any 13th month pay already received for the same period.