I. Basic Rule: What Are You Entitled to When You Resign?

When an employee voluntarily resigns in the Philippines (properly and in good faith), the general rule is:

You are entitled to receive everything you have already earned up to your last day of work, including:
- Unpaid basic salary
- Overtime pay
- Night shift differential
- Premium pay for holidays/rest days actually worked
- Statutory monetary benefits (e.g., proportionate 13th month pay)
- Monetized unused leaves, if they are convertible to cash by law, company policy, CBA, or long-standing practice
- Commissions and incentives already earned under your compensation scheme
You are generally not entitled to separation pay just because you resigned, unless:
- Your employment contract,
- Company policy or handbook,
- Collective Bargaining Agreement (CBA), or
- A special agreement explicitly grants separation pay to resigning employees.

Resignation does not, by itself, create a right to separation pay.

II. Valid Resignation and the 30-Day Notice

1. Legal Basis for Resignation

Under the Labor Code, an employee may terminate the employment relationship by resigning. To be valid and voluntary, resignation should be:

A written notice addressed to the employer
Usually given at least 30 days in advance (unless a shorter or longer period is agreed upon or allowed by company policy)
Free from force, intimidation, threat, or deception

The 30-day notice allows the employer to find a replacement and arrange the turnover of work.

2. Resignation Without 30-Day Notice

If you resign without observing the 30-day notice:

The resignation can still be valid (especially if the employer accepts it), but:
- The employer may refuse to pay salary corresponding to the unserved portion of the notice period (no “pay for days not worked”).
- The employer may, in some cases, claim damages or set-offs if the lack of notice caused demonstrable loss (though this is less common in practice and usually requires specific proof and/or contractual basis).

If the employer accepts an immediate resignation (e.g., “effective today” and they countersign/accept), the employer generally cannot later demand the 30 days, but they also don’t have to pay for days you did not work.

3. Just Cause Resignation (Without Notice)

The Labor Code recognizes situations where an employee can resign without the 30-day notice because of the employer’s wrongful acts, e.g.:

Serious insult to the employee’s person or family
Inhuman and unbearable treatment
Commission of a crime or offense by the employer or its representatives against the employee or their family
Other analogous causes

In these cases, the employee may stop working at once—and may even have grounds for claims or complaints (sometimes even illegal dismissal claims if the resignation is actually a forced exit).

III. Final Pay (“Last Pay”) – What It Typically Includes

When you resign, your final pay usually includes:

Unpaid salary
- Salary from the last cutoff up to your final actual day of work.
13th month pay (pro-rated)
- Based on your basic salary actually earned from January 1 up to your separation date.
- Even resigning employees are entitled to the pro-rated amount, provided they worked for at least one month during the calendar year.
Unused leaves convertible to cash
- Vacation/sick leaves, if:
  - The law requires it (e.g., some service incentive leave situations), or
  - The company policy or CBA says unused leaves are convertible to cash.
- Many companies have a policy like “unused vacation leave at year end or upon separation is convertible to cash,” but this is policy-based, not automatic.
Overtime, holiday pay, night differential, and other wage differentials
- For work actually rendered but not yet paid as of the date of resignation.
Earned commissions and incentives
- Depending on your contract:
  - Commissions may be paid if the qualifying sale, collection, or milestone has been completed before your last day, even if encashment happens later.
  - Employers sometimes try to withhold or prorate; validity depends on the actual commission scheme.
Other company-based benefits, if applicable
- Pro-rated performance bonuses, profit sharing, or 14th month pay if the policy/CBA provides for them even upon resignation.
- This is not a legal requirement; it depends on the company’s rules and actual practice.
Tax refund or adjustments (if any)
- Sometimes, year-to-date withholding taxes exceed what should have been withheld as of separation; in such cases, a small refund may appear in the final pay.

IV. Separation Pay and Other Lump-Sum Benefits

1. When Resigning Employees Get Separation Pay

By default, a resigning employee does not get separation pay.

However, separation pay may still be due if:

Company policy explicitly grants separation pay for resignations after a certain length of service or under specific circumstances.
A Collective Bargaining Agreement provides for resignation benefits.
The employment contract itself stipulates a separation package upon voluntary separation.
The employer, as an act of management prerogative or compassion, grants financial assistance or a negotiated package (often through a written agreement).

In those cases, the amount and conditions depend on:

What the policy states,
What the CBA provides, or
What the parties mutually agree upon (e.g., ½ month per year of service, or a fixed amount).

2. When Separation Pay Is Not Due

Separation pay provided in the Labor Code is mainly for authorized causes (e.g., redundancy, retrenchment, closure of business, disease). That is different from voluntary resignation. So:

If you resign voluntarily without any such authorized cause on the employer’s side,
And there is no special policy, contract, or CBA granting separation pay,

then there is no legal right to separation pay.

V. Clearance, Company Property, and Deductions

1. Clearance Process

Most employers require resigning employees to undergo a clearance process, which usually covers:

Return of laptops, phones, tools, IDs, uniforms, documents, etc.
Settlement of cash advances, company loans, accountable forms, and similar obligations
Turnover of work, passwords, project documents, and company data

Employers often withhold release of final pay until clearance is completed, provided this is reasonable and not abused.

2. Deductions From Final Pay

Your final pay can be subject to lawful deductions, including:

Statutory contributions and taxes (SSS, PhilHealth, Pag-IBIG, withholding tax)
Company loans or cash advances with your written consent/authorization
Amounts representing unreturned company property or losses caused by your fault, where:
- Liability is clear,
- Proper investigation or agreement exists, and
- Deductions do not violate minimum wage rules (for ongoing employees; for final pay, it usually counts as set-off).

Employers cannot arbitrarily deduct unknown or unjustified amounts. Large deductions must have a clear basis in:

A contract or written authorization, or
A documented loss/liability properly established.

VI. Timing of Release of Final Pay and Certificate of Employment

While exact timelines can be affected by company policies and regulatory advisories:

The general expectation is that final pay should be released within a reasonable period after separation (often around 30 days is used as a standard in practice).
The Certificate of Employment (COE), when requested, should be issued within a short period (commonly referenced as within a few working days from request).
- A COE only states the date of hire, date of separation, and nature of work/position; it should not normally contain negative remarks.

Delaying final pay for an unjustifiably long period can expose the employer to:

Labor complaints for unpaid wages or benefits, and
Possible moral and exemplary damages in appropriate cases.

VII. Resignation vs. Constructive Dismissal

There are situations where an employee is forced to resign, e.g.:

Threats of termination without lawful cause unless the employee “resigns”
Harassment, discriminatory treatment, or untenable working conditions intended to make the employee quit
Sudden demotion or reduction in pay/benefits without valid basis, leading the employee to resign

If the resignation is coerced or involuntary, it may be treated as constructive dismissal, meaning:

In law, it is as if the employee was illegally dismissed.
The employee may then claim:
- Backwages
- Reinstatement, or if no longer feasible, separation pay in lieu of reinstatement
- Possible damages and attorney’s fees

In such cases, the question is not just about final pay, but about illegal dismissal, which is a separate and more serious labor dispute.

VIII. Money Claims After Resignation: Where and When to File

1. Venue for Claims

If an employer fails or refuses to pay lawful entitlements upon resignation, the employee can:

Go through DOLE’s Single Entry Approach (SEnA) – a mandatory conciliation-mediation step for labor disputes involving money claims.
File a complaint with the National Labor Relations Commission (NLRC) for:
- Unpaid wages, 13th month, overtime, etc.
- Monetary claims arising from employer-employee relationship.
Approach the Public Attorney’s Office (PAO) (if financially qualified) or private counsel for representation.

2. Prescriptive Period

Money claims arising from employer-employee relations (like unpaid salary, 13th month, final pay components) generally prescribe in three (3) years from the time the cause of action accrued (usually from the time you should have been paid but were not).

Waiting too long may result in losing the right to claim.

IX. Quitclaims and Waivers

Employers often require resigning employees to sign:

A Release, Waiver, and Quitclaim in exchange for:
- Final pay, and/or
- Additional financial assistance or “separation package”

1. General Rule on Quitclaims

Quitclaims are not automatically invalid, but courts will scrutinize them. They are more likely to be respected if:

The employee signed voluntarily, without coercion or deception.
The employee clearly understood the document.
The consideration is reasonable and not unconscionably low compared to what the employee is legally entitled to.
The waiver only covers matters that have been fully paid or settled.

If a quitclaim is shown to be:

Signed under duress, misrepresentation, or intimidation, or
For a grossly inadequate amount relative to clear legal entitlements,

courts may set it aside and still allow the employee to pursue claims.

2. Practical Tip

Before signing a quitclaim:

Check that all items (salary, leaves, 13th month, benefits, etc.) are properly computed.
Make sure you understand what claims you are waiving.
If unsure or you feel pressured, seek advice before signing.

X. Special Situations

1. Probationary Employees Who Resign

Probationary employees who resign are generally entitled to:

Salary up to the last day worked
Pro-rated 13th month pay
Monetized leaves if policy provides

They usually do not get separation pay unless a contract or policy states otherwise.

2. Project, Seasonal, or Fixed-Term Employees

For project-based or seasonal employees:

Entitlement at resignation is similar: all earned wages and benefits up to last day.
Company policies or contracts may govern additional benefits.

For fixed-term contracts:

If the employee resigns before the end of the term, they usually:
- Get pay only up to the last day worked,
- May not claim pay for the remaining term, unless there is some other legal basis (e.g., constructive dismissal).

3. Employees With Bonds or Training Agreements

If an employee signed:

A training agreement with a return-of-service period, or
A fidelity bond or similar undertaking,

early resignation may trigger obligations such as:

Reimbursement of training costs, or
Payment of bond amounts, if:
- The agreement is valid,
- The costs are reasonable and supported, and
- No labor-law violations (like forced labor or unreasonable restraint) are involved.

These obligations are commonly settled or offset against final pay, subject to legal standards on fairness and proper documentation.

XI. Tax and Government Contributions

1. Taxes

Final pay (salary, 13th month, etc.) is subject to withholding tax according to tax rules.
Separation benefits due to voluntary resignation are generally treated as taxable compensation income (unlike some authorized-cause separation benefits, which may be tax-exempt up to certain limits).

2. Government Contributions and Records

Even after resignation:

Your employer should remit your SSS, PhilHealth, and Pag-IBIG contributions up to your last month of employment.
You should receive your BIR Form 2316 for the year (covering your earnings and taxes with that employer), typically after year-end or upon request.

These records matter for:

Future benefits (SSS, etc.), and
Your personal tax compliance.

XII. Practical Takeaways

Resignation does not forfeit your earned pay. You are entitled to all wages and benefits already earned up to your last day.
Separation pay is not automatic. You only get it on resignation if a law, contract, or company rule clearly says so, or if it is granted as part of a negotiated package.
Observe proper notice and clearance. A written resignation with proper notice, plus a complete clearance, helps avoid disputes over final pay.
Check your final pay computation. Make sure salary, 13th month, leaves, and other entitlements are correctly computed before signing any quitclaim.
Act within time limits. Money claims generally prescribe in three years, so don’t sleep on your rights.
Seek legal help for complex or hostile situations. If you suspect constructive dismissal, coerced resignation, or serious underpayment, it’s wise to consult a labor lawyer, union, or appropriate government office.

Disclaimer: This article provides general legal information on salary entitlement after resignation in the Philippine context. It is not legal advice and may not fully cover all special cases or the latest regulations. For actual disputes or detailed assessment of your specific situation, consult a Philippine labor lawyer, the Department of Labor and Employment (DOLE), the NLRC, or the Public Attorney’s Office if you qualify.