Service Incentive Leave Coverage for Personal Drivers Under Philippine Labor Law

Overview

“Service Incentive Leave” (SIL) is a statutory benefit that grants at least five (5) days of paid leave per year to qualified employees who have rendered at least one (1) year of service, whether continuous or broken. For personal drivers, coverage depends on who the employer is and the legal regime that applies:

Household/family (personal) drivers employed by natural persons are governed by the Kasambahay Law (Republic Act No. 10361), not the Labor Code’s SIL rule.
Company/corporate drivers (even if assigned to drive for an officer or family members) are generally governed by the Labor Code SIL rule.

Below is the complete, practitioner-style guide.

Legal Bases at a Glance

Labor Code (as amended) — Service Incentive Leave (SIL) provision and its Implementing Rules.
Republic Act No. 10361 (Kasambahay Law) — Governs domestic workers, expressly including family/personal drivers.
Implementing Rules and Regulations (IRR) — Clarify coverage, exclusions, computation, commutation, and record-keeping.
General jurisprudence — Establishes evidentiary rules (e.g., employer’s burden to prove payment of SIL), prescriptive periods, and treatment of ambiguous classifications.

Who Is Covered?

A. Personal/Family Drivers (Kasambahay Law)

Covered: A driver employed by a natural person to render services primarily for household or family use (e.g., bringing family members to school or appointments, doing household errands).

Entitlement: At least five (5) days of Service Incentive Leave with pay per year after one (1) year of service.
Distinct Features vs. Labor Code SIL:
- By default, unused SIL for kasambahay is not automatically commutable to cash at year-end (unless a better benefit or agreement says otherwise).
- The relationship and standards (wages, rest periods, social security coverage, etc.) follow the Kasambahay Law and its IRR.

Not covered by the Labor Code SIL: The Labor Code expressly excludes “domestic/helpers and persons in the personal service of another.” Household drivers fall squarely here; hence, their SIL comes from the Kasambahay Law, not the Labor Code.

B. Company/Corporate Drivers (Labor Code)

Covered: A driver employed by a company or organization (the employer is a juridical person), including those assigned to a particular executive or to shuttle family members as part of company duties.

Entitlement: Five (5) days of SIL with pay per year after one (1) year of service (continuous or broken).
Convertible to cash: Unused SIL is generally commutable to cash at year-end, and any unused balance must be paid upon separation.
Typical non-coverage scenarios under the Labor Code:
- Already enjoying at least five (5) days of paid vacation leave or an equivalent or better benefit (no double counting).
- Government employees (covered by civil service rules).
- Field personnel and those whose work is unsupervised, including certain “task/contract/commission basis” arrangements if they meet the IRR definition of field personnel (see “Field Personnel” note below).
- Domestic workers/persons in the personal service of another (these are under the Kasambahay Law instead).

Field Personnel Note (for company drivers): Many company drivers are not considered field personnel because their time or performance is measurable/supervised (fixed routes, time logs, dispatch sheets, GPS/telemetry, check-in procedures). If the employer can and does supervise their work or measure their hours, the “field personnel” exclusion usually does not apply.

The One-Year-of-Service Rule

Threshold: The employee (household or company driver) must have rendered at least one (1) year of service.
Counting: One year may be continuous or broken (e.g., a series of seasonal or project engagements that total one year of service for the same employer).
Probationary and fixed-term drivers: Time during probation or a fixed term counts toward the one-year threshold if they remain with the same employer.

Amount, Use, and Scheduling

Minimum benefit: Five (5) working days with full pay per year after qualifying service. Employers may grant more by policy or contract.
Purpose: SIL is versatile—it may be used for vacation or sick (personal) reasons, subject to reasonable scheduling rules.
Scheduling: Employer may adopt a reasonable notice/approval system (e.g., advance notice for vacation leave, except for emergencies/illness). Policies should be clear, written, and applied uniformly.
No offsetting: As a rule, SIL should not be used to “offset” tardiness/absences unless the policy expressly allows conversion of absences into SIL upon the employee’s request.

Commutation and Carry-Over

Company Drivers (Labor Code)

Year-end commutation: Unused SIL is convertible to cash based on the employee’s current daily wage at the time of commutation.
Separation: All unused SIL must be paid upon resignation, termination, or end of contract.
Carry-over: The law ensures payment; employers may allow carry-over in addition to commutation, but cannot diminish the benefit.

Personal/Family Drivers (Kasambahay Law)

Default rule: Unused SIL is generally not automatically convertible to cash at year-end (unless a more favorable agreement or practice exists).
Best practice: Put the rule in writing (employment contract or household policy). More generous arrangements are allowed.

Wage Basis for SIL Pay

Daily rate: Use the basic daily wage (excluding OT premiums, holiday premiums, and most allowances) prevailing when the SIL is commuted/used.
Hourly-rated drivers: Convert hours to an equivalent day under the employer’s policy (e.g., 8 hours = 1 day), then pay the day-equivalent.
If pay varies (e.g., with trip allowances): Compute SIL based on the basic wage component; allowances/premiums are generally excluded unless your policy says otherwise.

Documentation and Employer Burden

Record-keeping: Employers must keep records of SIL accrual, usage, and commutation.
Burden of proof: In disputes over unpaid SIL, employers carry the burden to show they granted or paid SIL (through payrolls, ledgers, payslips, leave forms). Lack of records typically weighs against the employer.

Interaction With Other Benefits

No double benefits: If a driver already enjoys ≥5 days of paid leave under policy or contract, this satisfies SIL (unless the other leave is narrowly restricted and not reasonably available for personal use; employers should label and define benefits clearly).
Sick/Vacation Leave banks: Employers may integrate SIL into a combined leave bank, provided the total remains at least 5 paid days per year after one year of service.
13th month pay: Separate from SIL and still required if the driver is an employee (including kasambahay).

Special Classifications and Common Scenarios

Household driver paid via an agency
- Still a kasambahay if the work is for a household and day-to-day control rests with the homeowner. The agency arrangement does not remove Kasambahay Law coverage.
Company hires a driver dedicated to the CEO’s family
- If the employer on paper and in fact is the corporation, Labor Code SIL applies (not kasambahay). Labeling someone “family driver” does not convert a corporate employment relationship into household employment.
“Field” company driver (e.g., route driver with minimal supervision)
- Exclusion as “field personnel” applies only if performance is unsupervised and hours cannot be determined with reasonable certainty. Most company drivers have dispatch controls that defeat the exclusion.
Project- or fixed-term driver hired repeatedly across the year
- If total service reaches one year, the driver qualifies for SIL under the applicable regime (Labor Code or Kasambahay Law).

Enforcement, Claims, and Prescriptive Period

Where to file:
- Company drivers: DOLE Regional/Field Office (labor standards complaint) or NLRC (money claims accompanying illegal dismissal, etc.).
- Kasambahay (household drivers): Barangay-based mechanisms under the Kasambahay Law may be tapped first, then DOLE/NLRC as appropriate for money claims.
Prescription: Monetary claims such as unpaid SIL generally prescribe in three (3) years from when the cause of action accrued (e.g., from year-end when commutation should have been paid, or from separation if SIL remained unpaid).

Practical Compliance Checklist

For Household/Personal Drivers (Kasambahay Law)

Issue a written employment contract (required under RA 10361).
Track start date to identify one-year entitlement point.
Grant ≥5 paid days of SIL per year thereafter; clarify in writing whether cash commutation is provided (by default, not required).
Maintain payroll and leave records.

For Company/Corporate Drivers (Labor Code)

Keep clear policy stating that after one year of service, drivers receive 5 paid SIL days/year; clarify commutation at year-end and payment upon separation.
Ensure timekeeping/dispatch systems show supervision, defeating any improper “field personnel” classification.
Keep payslips/ledgers reflecting accrual, usage, and commutation.

Quick Answers to Frequent Questions

Do personal/household drivers get SIL? Yes, under the Kasambahay Law: at least 5 paid days per year after one year of service (default: not cash-commutable unless agreed).
Do company drivers get SIL? Yes, under the Labor Code: 5 paid days/year after one year, cash-commutable if unused (and payable upon separation).
If a company already gives 10 days of vacation leave, do drivers still get SIL? Not in addition—the existing ≥5 paid days generally satisfy SIL, provided the leave is truly available for personal use.
Can an employer classify a company driver as “field personnel” to avoid SIL? Only if the driver’s work is unsupervised and hours cannot be determined with reasonable certainty—a high bar rarely met for drivers with dispatch/time logs.

Bottom Line

Household/personal drivers are governed by the Kasambahay Law and receive ≥5 days paid leave after one year (default non-commutable).
Company/corporate drivers are governed by the Labor Code SIL rule and receive 5 days paid leave after one year (commutable and payable upon separation).
Correct classification, clear written policies, and meticulous records are the keys to compliance and risk management.