Release Schedule for Final Pay and 13th-Month Pay After Resignation in the Philippines

A practitioner-oriented guide as of May 2025

1. Introduction

When an employee voluntarily resigns, the employment relationship ends—but the employer’s monetary obligations do not. Two of the most pressing questions for departing workers are “When will I receive my final pay?” and “How soon will my prorated 13th-month pay be released?” Philippine labor standards law lays down clear—though often misunderstood—rules. This article gathers and explains all authoritative sources, deadlines, computations, and enforcement mechanisms relevant to the timely payment of (a) final pay and (b) the prorated 13th-month pay upon resignation.

2. Governing Legal Sources

Instrument	Key Provisions for Resigned Employees
Labor Code of the Philippines (PD 442, as amended)	Art. 103 (Time of payment of wages); Arts. 113-115 (lawful deductions); Art. 116 (withholding of wages); Art. 118 (retaliation).
Presidential Decree 851 (13th-Month Pay Law, 1975) & its Implementing Rules	Requires 13th-month pay for rank-and-file employees; allows proration for those who resign before the year-end cut-off.
DOLE Labor Advisory No. 06-20 (4 Feb 2020) “Guidelines on the Payment of Final Pay and Issuance of Certificate of Employment”	Imposes a 30-calendar-day release period after separation (including resignation) for “final pay,” and a 3-day period for the Certificate of Employment (COE).
RA 10963 (TRAIN Law) & Rev. Regs. 13-2018	Increase the tax-exempt ceiling for 13th-month pay/other benefits to ₱90,000 per year.
Company policy / CBA / Employment contract	May be more favorable to the worker (e.g., release within 15 days). By Art. 100 (Non-diminution) such benefits cannot be reduced once granted.
Relevant jurisprudence	Intercontinental Broadcasting Corp. v. Ithamar (G.R. 204998, 13 Jan 2021) re: final pay; Canlubang Sugar Estate line of cases on prorated 13th-month pay; NLRC and CA decisions on interest for delayed payment.

3. What Counts as “Final Pay”?

DOLE defines final pay (a.k.a. “last pay” or “back pay”) as the aggregate of all monetary benefits due to the employee regardless of the cause of separation. For a voluntary resignation the typical components are:

Unpaid basic salary up to the last day worked.
Prorated 13th-month pay (see § 4).
Cash conversion of unused Service Incentive Leave (SIL)—5 days per year under Art. 95—or any company-granted leave credits.
Separation or retirement benefits only if provided by law (e.g., Art. 298 for redundancy) or by company policy/CBA. Resignation per se does not entitle one to statutory separation pay.
Pro-rated bonuses or deferred incentives, if contractually guaranteed.
Deductions/offsets (e.g., SSS/PhilHealth/Pag-IBIG arrears, unreturned company property) that are (a) authorized by the employee in writing or (b) allowed by law/CCBA.

4. 13th-Month Pay Upon Resignation

Item	Rule
Entitlement	All rank-and-file employees who have worked ≥ 1 month in a calendar year earn 13th-month pay pro rata.
Formula	Total basic salary earned during the year ÷ 12. Months need not be whole; use actual earnings.
Release timing	There is no special statute on when the prorated amount must be paid to a resignee, so DOLE treats it as part of final pay—hence the 30-day rule in Labor Advisory 06-20.
Tax treatment	Aggregate 13th-month pay (whether full or prorated) plus other benefits up to ₱90,000 in a calendar year is tax-exempt; any excess is subject to withholding tax.

Quick Illustration An employee resigns effective 15 June 2025 with a ₱30,000 monthly basic salary.

Basic salary earned Jan – 15 Jun = ₱150,000.
Prorated 13th-month pay = ₱150,000 ÷ 12 = ₱12,500. This ₱12,500 is part of the final pay and, assuming no other 13th-month amounts, is fully within the ₱90,000 exemption.

5. Mandatory Release Schedule

Obligation	Standard Deadline	Source	Notes
Final pay (inclusive of prorated 13th-month)	Within 30 calendar days from date of separation	DOLE Labor Advisory 06-20 § 2	“Unless a more favorable company policy, CBA, or individual contract exists.”
Certificate of Employment (COE)	Within 3 working days from employee’s request	Labor Advisory 06-20 § 3	COE must specify dates of employment and position/s.
13th-month pay for ongoing employees	Not later than 24 December annually	PD 851, D.O. 217-22	Separate from resignation cases.

Important: The 30-day clock runs even if the employer’s clearance process is unfinished. DOLE, however, allows lawful, documented deductions for unreturned property or unsettled cash advances, which can be offset against the amounts due.

6. Lawful and Unlawful Deductions

Lawful (Arts. 113-115):

Government contributions, taxes.
Union dues (with CBA).
Employee-authorized deductions (e.g., company-administered loans).
Cost of unreturned assets if demanded in writing and supported by inventory or receipt.

Unlawful:

Blanket forfeiture of benefits “pending clearance.”
Penalties not previously stipulated in policy/contract.
Amounts exceeding the provable loss (Art. 118 & jurisprudence).

7. Remedies for Late or Non-Payment

SEnA (Single-Entry Approach) Request for Assistance at the DOLE Regional/Provincial Office—mandatory 30-day conciliation-mediation.
Complaint before the NLRC for money claims + 10 % legal interest per annum (currently 6 % p.a. under Nacar v. Gallery Frames, G.R. 189871).
Criminal liability (Art. 303) for repeated or willful refusal.
BIR assessment for failure to withhold/remit taxes (if any).

8. Best-Practice Checklist for Employers

When	Action
Upon receipt of resignation	Acknowledge in writing; outline clearance steps.
Within 5 days	Compute estimated final pay subject to deductions; initiate property retrieval.
On/near last working day	Issue quitclaim template (not mandatory but advisable); collect company IDs, assets.
< 30 days from exit	Release net final pay via cash, payroll account, or check; issue BIR Form 2316 for the year.
≤ 3 working days from COE request	Provide COE (digital or hard copy).
Record-keeping (retain 3 years)	Payroll, quitclaim, clearance, email trail.

9. Best-Practice Tips for Employees

Submit a formal resignation letter giving the required notice (Art. 300: 30 days, unless just cause).
Complete clearance steps swiftly and keep copies of turnover receipts.
Request COE and final pay status in writing to start the statutory clocks.
Monitor that 30-day period; politely remind HR before Day 30 lapses.
If delayed, file a SEnA request (free, no lawyer needed).

10. Frequently Asked Questions

Can my employer delay payment until the next regular payroll cut-off? No. The 30-day rule is an outer limit, not tied to pay cycles.
Is separation pay mandatory when I resign? Generally no, unless (a) your CBA/company handbook grants it or (b) you qualify under a special program (e.g., voluntary redundancy).
What if I resigned mid-January—do I still get 13th-month pay? Yes, for the days actually worked that year. Even one day earns a fraction.
Does signing a quitclaim bar me from later claims? Not automatically. Courts void quitclaims if executed under duress or for unconscionably low consideration.
Can I insist on interest for delayed payment? Yes. NLRC routinely grants 6 % annual interest from the date of demand or formal filing.

11. Conclusion

The Philippine labor framework strikes a deliberate balance: it lets employers conduct clearance and asset reconciliation, yet categorically fixes a 30-day deadline to release everything the worker has already earned—including the prorated 13th-month pay. Familiarity with Labor Advisory 06-20, PD 851, and the Labor Code provisions on wage payment and deductions equips both parties to meet their obligations, avoid disputes, and—where needed—seek speedy redress.

This article is for general information only and is not a substitute for formal legal advice. For specific situations, consult the Department of Labor and Employment or a qualified labor practitioner.