Payslip Requirements & Government-Contribution Compliance in the Philippines
(Comprehensive legal overview as of 8 July 2025)
1. Governing Laws & Issuances
| Area | Principal Authority | Key Statutes / Regulations |
|---|---|---|
| Payslip issuance | Labor Code (Art. 103), DOLE Dept. Order (DO) No. 11-92 §6, DO No. 20-93; reiterated in Labor Advisory No. 11-2014 & Labor Advisory 11-2020 (electronic payslips) | |
| Mandatory deductions & remittances | Republic Acts: RA 11199 (SSS Act of 2018), RA 11210 & RA 1161 (Social Security Act), RA 7875 & RA 11223 (PhilHealth), RA 9679 (Pag-IBIG Fund), NIRC 1997 (withholding tax) | |
| Record-keeping | Art. 109 Labor Code; BIR RR No. 2-2015 (books retention); Data Privacy Act of 2012 | |
| Administrative sanctions | DOLE’s Visitorial & Enforcement Power (Art. 128 Labor Code); SSS & PhilHealth charter penalties; Pag-IBIG Circulars; BIR penalties |
Note: Local ordinances (e.g., Manila City Ordinance No. 7857) may add clerical rules but cannot diminish national minimum standards.
2. Payslip Content: Minimum Mandatory Fields
DOLE expects payslips to be understandable, itemized, and issued every pay period (weekly/semi-monthly/monthly). The template (paper or electronic) must show at least:
Employee Identifiers
- Full name & signature / acknowledgment field
- Employee or payroll number
Work & Pay Details
- Pay period covered (start–end date)
- Basic rate (hourly/daily/monthly) & employment status
- Actual days/hours worked, overtime, night-shift, rest-day or holiday premiums
- Leave with pay (type and days)
Earnings Itemization
- Basic wage
- COLA / wage distortion adjustments
- 13th-month accrual or pro-rated amounts (if advanced)
- Incentives, allowances, commissions, service charges (for hotels & restaurants, RA 11360)
Mandatory Statutory Deductions
Scheme Employee Share (typical) Employer Share Remittance Due* SSS (regular) 4.5 % to 5 % 8.5 % to 9.5 % on or before
15th, 31st of month following applicable monthWISP/WISP Plus fixed ₱650 (if applicable) ₱650 bundled with SSS submissions PhilHealth 2.25 % (year 2025 ceiling ₱90,000 salary base) 2.25 % 11th–15th of the month following Pag-IBIG 1 % (≤₱1,500) or 2 % (>₱1,500) 2 % 10th day of the following month Withholding Tax based on BIR table (TRAIN Law) — 10th/15th or last day of following month; quarterly & annual Alphalists Deadlines reflect SSS Circular 2022-033, PhilHealth Circular 2020-0005, Pag-IBIG Circular 448, and BIR RR 11-2018.
Other Deductions (must have written employee authorization & comply with Art. 113 Labor Code): loans, salary advances, union dues, canteen charges, cooperative contributions, etc.
Net Pay & Mode of Payment (cash, check, or payroll credit)
Employer Details
- Registered business name, address, TIN
- SSS/PhilHealth/Pag-IBIG employer numbers
3. Electronic Payslips & Data Privacy
- Legality. DOLE Labor Advisory 11-2020 allows soft copies (PDF/email/web portal) as long as employees can easily access, download, print, and dispute within a reasonable time.
- Consent & Access Control. Employers must comply with the Data Privacy Act: secure transmission (TLS/SSL), password protection, role-based access.
- Retention. Art. 109 Labor Code: at least three (3) years; BIR requires ten (10) years for payroll registers if used for tax audit.
4. Compliance Workflow & Reporting Obligations
| Step | Action | Primary Tool / Form |
|---|---|---|
| 1 | Enroll new hires in SSS, PhilHealth, Pag-IBIG | SSS R-1A / R1-E, PhilHealth ER2, Pag-IBIG MCRF |
| 2 | Compute contributions per payroll | Latest brackets (updated January of each year) |
| 3 | Generate Electronic Contribution Report | SSS R-3 / Electronic Contribution Collection List (E-CCC), PhilHealth ERV, Pag-IBIG RF-1 |
| 4 | Pay & upload | Bank partner or eGov PH System |
| 5 | File tax withholding | BIR Forms 1601C (compensation), 1604C, Alphalist DAT files |
| 6 | Year-end Annualization & 2316 issuance | Provide signed BIR Form 2316 to each employee before 31 Jan |
| 7 | Annual contribution confirmation | SSS MSS summary, PhilHealth Member Data Record (MDR) updates, Pag-IBIG POP (Proof of Payment) |
Failure to follow any step exposes the employer to fines, surcharges, interest, plus possible criminal prosecution for “failure or refusal to pay.”
5. Penalties & Enforcement Snapshot
| Agency | Fine / Imprisonment | Administrative Remedies |
|---|---|---|
| DOLE | ₱5,000–₱100,000 per affected worker &/or closure (Art. 303) | Compliance Order; Show-Cause; Writ of Execution |
| SSS | 3 % per month penalty & prison (6 yrs-1 day → 12 yrs) | Issuance of Warrant of Distraint/Levy |
| PhilHealth | 3 % per month + ₱5,000–₱10,000 per violated employee | Compromise agreement; suspension of accreditation |
| Pag-IBIG | 2 % per month + surcharge + 6-yr jail | Employer counterpart delinquency program |
| BIR | 25 %–50 % surcharge + 12 % interest + compromise penalties; prison 2-4 yrs | Tax assessment; garnishment |
6. Common Compliance Pitfalls
- Consolidated payslips (bi-monthly salary but single payslip) → violates requirement to issue every payout.
- Using old SSS/PhilHealth tables after annual adjustments.
- Multiplying daily wage by 30 instead of 26/313 divisor, causing under-remittance.
- Un-itemized “Other deductions” without written authority.
- Delayed final pay (>30 days after separation) without explaining pro-rated contributions.
- One-time year-end adjustment for under-withheld tax instead of monthly withholding.
7. Best-Practice Checklist
| ✔️ | Task |
|---|---|
| ⬜ | Maintain a master payroll ledger mapping each payslip line item to the GL account and statutory return. |
| ⬜ | Subscribe to Gov.ph email circulars; refresh deduction tables every January or upon special issuance (e.g., PhilHealth premium moratoriums). |
| ⬜ | Integrate e-Gov PH or SSS R4-File Generator into payroll software to eliminate manual encoding. |
| ⬜ | Capture digital acknowledgments (e-signature or portal click-wrap) to prove payslip receipt. |
| ⬜ | Archive encrypted PDF payslips in separate storage from HRIS to meet retention and privacy rules. |
| ⬜ | Conduct an annual payroll compliance audit (internal or external) covering: payslip content, posting of Labor Law Poster, remittance deadlines, and variance between BIR 2316 vs. SSS/PhilHealth totals. |
8. Employee Remedies & Employer Defenses
- Workers may lodge complaints at the DOLE Regional Office, NLRC, or via SINGLE-ENTRY Approach (SEnA).
- Burden of proof on employer: submit payslips, payroll registers, proof of remittances, and government receipts (OR).
- Employers who can show good-faith error (e.g., system migration) may seek waiver of surcharges but not of principal liability.
9. Emerging Trends & 2025 Outlook
- Unified Multi-Agency eContribution System (eGov PH Service Portal) – phased rollout aiming to consolidate SSS, PhilHealth, Pag-IBIG, and BIR obligations into one payment file; expect mandatory adoption by Q4 2026.
- Greater digital wage payment – Bangko Sentral’s Paleng-QR and InstaPay fees reduced to drive e-payslips with QR-code validation.
- AI-assisted payroll validation – DOLE exploring API links for real-time payslip compliance checks during routine inspections.
- Data Privacy audits – National Privacy Commission (NPC) focusing on payroll vendors handling biometric time-keeping data.
10. Practical Takeaways
- Issue itemized payslips each pay day; electronic is fine if employees can print.
- Embed statutory contribution formulas into payroll systems and update tables promptly.
- Remit and file on time to avoid hefty interest and criminal sanctions.
- Retain payroll records for at least 10 years; secure them under DPA guidelines.
- Audit annually and educate HR/payroll staff on latest DOLE, SSS, PhilHealth, Pag-IBIG, and BIR circulars.
Disclaimer: This article provides general legal information as of July 8 2025 and is not a substitute for individualized legal advice. Consult labor-law counsel or certified payroll professionals for specific cases.