Being left out of a salary increase can feel unfair, embarrassing, and financially stressful—especially when coworkers with similar roles received an adjustment and you did not. In the Philippines, the key question is not simply “Is this unfair?” but “Was the increase legally required, contractually promised, part of company policy, required by a wage order, or denied for an unlawful reason?” This article explains how to check your rights, what evidence to gather, how to approach HR, and when to go to DOLE, the NLRC, or voluntary arbitration.

Is an Employer Required to Give Everyone a Salary Increase?

Not always.

In Philippine labor law, a private employer generally has the right to decide salary levels, merit increases, performance ratings, promotions, and compensation structures as part of management prerogative. The Supreme Court has recognized that salary increases may fall within management prerogative, especially when they are discretionary, performance-based, or tied to business judgment. (Lawphil)

But management prerogative is not unlimited. An employer may be legally required to give you an increase if the increase is based on:

A minimum wage order issued by the Regional Tripartite Wages and Productivity Board;
A collective bargaining agreement or CBA;
Your employment contract;
A written company policy or salary administration rule;
A consistent and deliberate company practice that has become a benefit;
A promotion, regularization, or salary-grade rule that applies to you;
A correction of wage distortion caused by a mandated wage increase;
Protection against discrimination, retaliation, or bad faith.

The practical point is this: being excluded from a raise is not automatically illegal, but it can become illegal or actionable depending on why you were excluded and what documents or practices support your claim.

First, Identify What Kind of Salary Increase You Were Excluded From

Before filing a complaint, identify the type of increase involved. Different rules apply.

Type of increase	Is it automatically required for everyone?	What to check
Minimum wage increase under a wage order	Yes, if you are covered by the order	Region, sector, establishment size, effectivity date, wage order exemptions
Merit or performance increase	Usually no	Performance criteria, ratings, consistency, discrimination, bad faith
Across-the-board company increase	Possibly	Memo, policy, announcement, payroll implementation
CBA wage increase	Yes, if you are covered by the bargaining unit or CBA terms	CBA coverage, union membership rules, wage schedule
Regularization increase	Possibly	Contract, HR policy, offer letter, company practice
Promotion increase	Possibly	Promotion letter, new job grade, salary matrix
Adjustment to correct wage distortion	Possibly	Whether a legal wage order compressed salary gaps
Bonus or incentive increase	Usually discretionary unless promised or practiced	Bonus policy, past payments, performance conditions

This distinction matters because DOLE, the NLRC, or a voluntary arbitrator will ask what legal or contractual basis makes the increase demandable.

Legal Basis: When Exclusion from a Salary Increase May Be Illegal

1. You were excluded from a legally mandated minimum wage increase

Minimum wage rates in the Philippines are set by region. The National Wages and Productivity Commission lists current daily minimum wage rates and wage orders by region, including different rates depending on sector, area, and sometimes establishment size. For example, the NWPC’s NCR page shows rates under Wage Order No. NCR-26 effective July 18, 2025, with different rates for non-agriculture and other covered sectors. (Wages and Productivity Commission)

If you are paid below the applicable minimum wage after a wage order takes effect, the issue is not merely “salary increase exclusion.” It becomes a labor standards violation.

Check:

Your workplace region, not your residence;
Your sector or industry classification;
Whether you are daily paid, monthly paid, piece-rate, or commission-based;
Whether your employer claims exemption or deferment;
Whether the increase should be included in your basic wage;
Whether your 13th month pay, overtime, night shift differential, holiday pay, and service incentive leave pay were computed using the corrected wage.

You can check the official National Wages and Productivity Commission minimum wage rates for the applicable regional wage order.

2. A wage order created wage distortion

A wage distortion happens when a mandatory wage increase eliminates or severely reduces intentional salary differences between employees or groups, such as differences based on skill, length of service, rank, or other logical bases.

Article 124 of the Labor Code, as amended by Republic Act No. 6727 or the Wage Rationalization Act of 1989, defines wage distortion in connection with prescribed wage increases and provides mechanisms for correction. (Lawphil)

Example:

Before the wage order:
- Junior employee: ₱610/day
- Senior employee: ₱650/day
After a ₱50 wage order increase applies only to the junior employee:
- Junior employee: ₱660/day
- Senior employee: ₱650/day

The senior employee may now have a wage distortion concern because the previous wage gap based on seniority or skill was erased.

But there is an important nuance. The Supreme Court has distinguished legal wage distortion under Article 124 from “factual” salary differences arising from voluntary employer policies. Article 124 applies to distortions caused by law or wage order, not every perceived unfair difference in salaries. (Lawphil)

For unionized workplaces, wage distortion disputes are usually addressed through the CBA grievance machinery and voluntary arbitration. For non-unionized establishments, the dispute may go through the NCMB or NLRC process depending on the circumstances.

3. The salary increase was promised in your employment contract

Your employment contract may give you a stronger claim than general labor law.

Look for clauses such as:

“Salary shall be reviewed after six months”;
“Upon regularization, employee shall receive ₱___”;
“Employee shall be placed at salary grade ___”;
“Annual increase of ___% subject to satisfactory performance”;
“Compensation shall follow the company salary matrix.”

A “salary review” is different from a guaranteed increase. A review only requires the employer to evaluate your salary in good faith. But language like “shall receive,” “shall be adjusted,” or “shall be raised” may create a demandable obligation.

The Supreme Court has held that once company salary policies are officially issued and become part of the employment relationship, implementation may no longer be treated as pure management prerogative. In a case involving regularization salary rates, the Court upheld the enforcement of a company policy where the policy used mandatory language requiring the employee’s salary to be raised to the minimum level upon regularization. (Lawphil)

4. The increase is required by a CBA

If your workplace is unionized, check the collective bargaining agreement. A CBA commonly provides:

Across-the-board annual wage increases;
Salary scale adjustments;
Longevity pay;
Rice allowance, transportation allowance, or other economic benefits;
Regularization or promotion rules;
Grievance procedure and voluntary arbitration.

If the CBA covers you, the employer generally cannot exclude you unless the CBA itself allows the exclusion. Common issues include whether probationary employees, confidential employees, managerial employees, or newly hired employees are included.

If you are covered by the bargaining unit, start with the union grievance procedure before going to external agencies.

5. Exclusion was based on sex, age, disability, union activity, or retaliation

A discretionary salary increase can still be challenged if the exclusion was discriminatory, retaliatory, or made in bad faith.

Philippine law prohibits several forms of employment discrimination:

The Labor Code, as amended by RA 6725, prohibits discrimination against women with respect to terms and conditions of employment, including paying lesser compensation for work of equal value. (Lawphil)
RA 10911, the Anti-Age Discrimination in Employment Act of 2016, promotes equal employment opportunities regardless of age and prohibits arbitrary age-based discrimination. (Lawphil)
RA 7277, the Magna Carta for Disabled Persons, provides that qualified disabled employees are entitled to the same terms and conditions of employment as qualified able-bodied employees. (Lawphil)
RA 9710, the Magna Carta of Women of 2009, requires the State to protect women against discrimination and promote substantive equality. (Lawphil)
RA 11058, the Occupational Safety and Health Standards Law of 2018, prohibits retaliatory measures such as reducing wages or benefits against workers who provide information in relation to OSH inspections. (Lawphil)

Possible red flags include:

Only pregnant employees or mothers were excluded;
Older workers were skipped because management wants “younger energy”;
An employee with disability was excluded despite meeting the same performance criteria;
Union officers or employees who joined a labor complaint were denied increases;
The exclusion happened soon after you reported unpaid wages, unsafe working conditions, harassment, or illegal deductions.

What to Do If You Were Excluded from a Salary Increase

1. Do not rely only on verbal information

Many salary disputes start with hallway talk: “Everyone got an increase except you.” That may be true, but you need evidence.

Gather:

Your payslips before and after the increase period;
Employment contract and job offer;
Regularization letter;
Promotion letter;
HR salary adjustment memo;
CBA, if applicable;
Employee handbook;
Performance evaluation forms;
Emails or chat messages announcing the increase;
Payroll screenshots, if lawfully obtained;
DOLE wage order for your region;
List of affected employees, if available without violating privacy rules.

Avoid secretly taking confidential payroll files or accessing HR systems without authority. Use documents you received, official announcements, your own payslips, and lawful communications.

2. Ask HR for the basis of exclusion in writing

Send a calm written inquiry. Do not accuse immediately. Ask for clarification.

A practical message could be:

I would like to respectfully clarify my salary adjustment status for the recent increase implemented effective [date]. Based on the announcement, employees under [department/job level] were covered. May I know whether I am covered, and if not, the basis for my exclusion? I would appreciate a written explanation for my records.

This helps in three ways:

HR may correct an administrative mistake;
You force the company to identify its reason;
You create a paper trail if the explanation is inconsistent or discriminatory.

3. Compare your situation with the actual eligibility rules

Do not compare only based on job title. Compare based on the employer’s stated criteria.

Common criteria include:

Regular vs. probationary status;
Date hired or cut-off date;
Performance rating;
Disciplinary record;
Rank or salary grade;
Department budget;
Promotion cycle;
Billable performance or sales targets;
Attendance or tardiness records;
Client assignment or project status.

An exclusion may be lawful if the rule is clear, consistently applied, and not discriminatory.

But it may be questionable if:

The rule was invented after you complained;
The rule was applied only to you;
The company cannot produce the criteria;
Your performance rating was changed without explanation;
Similarly situated coworkers received the increase despite the same alleged issue;
The exclusion contradicts a written policy.

4. Check whether the issue is a money claim, discrimination issue, CBA grievance, or wage distortion

This affects where you go next.

Situation	Likely first forum
Minimum wage increase not given	DOLE Regional Office / SEnA
Unpaid salary differential based on contract or policy	SEnA, then NLRC if unresolved
CBA wage increase denied	Grievance machinery, then voluntary arbitration
Wage distortion due to wage order	CBA grievance/voluntary arbitration if unionized; appropriate labor dispute mechanism if non-union
Discriminatory exclusion	SEnA, NLRC, DOLE, or other proper agency depending on facts
Retaliation after OSH complaint	DOLE, especially if connected to inspection or OSH reporting
Small monetary claim with no reinstatement claim and within legal threshold	DOLE Regional Director may have summary jurisdiction

For ordinary employees, SEnA is often the practical first step.

5. Use SEnA before filing a full labor case

SEnA means Single Entry Approach. It is a mandatory conciliation-mediation mechanism intended to resolve labor disputes quickly before they become full-blown cases. RA 10396 strengthened conciliation-mediation as a voluntary mode of settlement for labor cases. (Lawphil)

DOLE describes SEnA as a speedy, impartial, inexpensive, and accessible settlement procedure for labor issues. It generally provides a 30-calendar-day conciliation-mediation period handled by a Single Entry Approach Desk Officer or SEADO. (DOLE ARMS)

You can usually file a Request for Assistance through:

The DOLE Regional Office with jurisdiction over your workplace;
DOLE field or provincial office;
DOLE’s online filing channels where available;
The appropriate attached agency, depending on the dispute.

Bring or prepare:

Valid ID;
Employment contract or proof of employment;
Payslips;
Written HR response, if any;
Wage order or company memo;
Computation of unpaid salary differential;
Timeline of events;
Names and positions of company representatives.

SEnA is not a trial. It is a mediated discussion. The goal is settlement. If the employer agrees to pay, the settlement agreement can be made final and immediately executory. DOLE’s SEnA materials state that settlement agreements reached through the process are binding. (Dole NCR)

6. If SEnA fails, consider the correct formal case

If there is no settlement, you may be referred to the appropriate forum.

For many private-sector salary claims, the next step is usually the National Labor Relations Commission or NLRC. The NLRC is a quasi-judicial labor tribunal that resolves employer-employee disputes, including money claims and other labor cases. (www.foi.gov.ph)

Under the 2025 NLRC Rules of Procedure, Labor Arbiters may direct parties to submit verified position papers with supporting documents and affidavits. (National Labor Relations Commission)

A typical NLRC money-claim process involves:

Filing a verified complaint;
Mandatory conference or mediation stage;
Submission of position papers;
Submission of replies, if required;
Decision by the Labor Arbiter;
Appeal to the NLRC, if legally proper;
Further review by the Court of Appeals through Rule 65 certiorari in proper cases.

The process can take months or longer depending on docket congestion, settlement efforts, complexity of evidence, appeals, and execution issues.

How to Compute the Salary Differential

If the increase should have applied to you, compute the unpaid difference carefully.

Basic formula:

Correct salary minus actual salary = salary differential

Then multiply by the covered period.

Example:

Item	Amount
Correct monthly salary after increase	₱35,000
Actual monthly salary paid	₱32,000
Monthly differential	₱3,000
Covered period	8 months
Basic salary differential	₱24,000

Also check whether the corrected salary affects:

13th month pay;
Overtime pay;
Holiday pay;
Rest day premium;
Night shift differential;
Service incentive leave conversion;
Separation pay, if later separated;
Retirement pay, if applicable;
SSS, PhilHealth, and Pag-IBIG contributions.

For minimum wage violations, the corrected daily wage may affect many wage-related benefits. For a contractual salary increase, the effect depends on the wording of the contract or policy.

Important Deadlines

Money claims arising from employer-employee relations generally prescribe in three years under Article 306 of the Labor Code, formerly Article 291. The Supreme Court has repeatedly applied the three-year prescriptive period to labor money claims. (Lawphil)

This means you should not wait too long. If the salary increase should have been paid starting January 2024, the claim for that unpaid amount may start aging from the date it became due.

For continuing underpayment, each unpaid payroll period may have its own reckoning point. Still, it is safer to act early, especially because documents and witnesses become harder to secure over time.

Common Real-Life Scenarios

“Everyone got an increase except me because I was on maternity leave.”

This may raise a serious issue if the exclusion was because of pregnancy, maternity leave, or sex. The Labor Code prohibits discrimination against women in terms and conditions of employment, and the Magna Carta of Women strengthens protection against discrimination. (Lawphil)

The employer may use legitimate performance criteria, but it should not penalize an employee simply for exercising maternity rights.

“I was probationary when the increase was announced, but regular when it took effect.”

Check the exact eligibility language. Some policies cover employees who are regular as of the announcement date; others use the effectivity date or payroll implementation date.

If the policy says “all regular employees as of [date],” the date matters. If it says “employees who successfully complete probation shall be raised to the minimum salary level,” that may create a stronger contractual claim, depending on the wording.

“My coworkers received a market adjustment, but I did not.”

A market adjustment is often discretionary. But ask for the criteria. If the adjustment was tied to salary grade, job family, or compression correction, exclusion may be questionable if you are in the same covered group.

“The company said I had poor performance, but I never received an evaluation.”

This is common. A company can use performance as a basis for merit increases, but it should be able to show a reasonable basis for the rating.

Useful evidence includes:

Performance evaluation forms;
Key performance indicators;
Warning memos;
Coaching records;
Prior commendations;
Sales or productivity reports;
Emails confirming completed deliverables.

A weak or undocumented rating does not automatically win your case, but it may support an argument of arbitrariness or bad faith.

“Foreign employees were excluded from the increase.”

Foreigners lawfully employed in the Philippines generally have labor rights under Philippine law. However, their contract, work permit status, expatriate package, secondment arrangement, and governing-law clauses may complicate the analysis.

A foreign employee should check:

Local employment contract;
Assignment or secondment agreement;
Alien Employment Permit or work visa documents;
Whether salary is paid locally, abroad, or split;
Whether the increase applies only to Philippine payroll employees;
Tax and benefits treatment.

If the foreign employee works in the Philippines under a Philippine employer-employee relationship, Philippine labor standards may apply even if the employee is not Filipino.

Documents to Prepare Before Going to DOLE or the NLRC

Document	Why it matters
Valid ID	Required for filing and identity verification
Employment contract or offer letter	Shows salary promises and job terms
Regularization or promotion letter	May show entitlement to increase
Payslips and payroll records	Proves actual salary paid
HR memo announcing increase	Shows coverage and effectivity
Employee handbook or salary policy	May create enforceable company rules
CBA, if any	Determines negotiated wage increase rights
Performance evaluation	Relevant for merit-based increases
Written HR explanation	Shows employer’s stated basis for exclusion
Wage order	Needed for minimum wage or wage distortion issues
Computation sheet	Helps mediation and case preparation

For employees abroad or foreign documents, notarization, consular acknowledgment, or apostille may be needed if the document will be formally used in Philippine proceedings. For most initial SEnA discussions, scanned copies may help, but formal cases may require clearer authentication depending on how the document is contested.

Practical Tips Before Filing a Complaint

Stay professional in writing. Angry messages may distract from your legal issue.
Ask for the policy, not gossip. The written rule matters more than coworker rumors.
Compute conservatively. Overstated claims can weaken credibility.
Preserve payslips immediately. Some payroll portals cut off access after resignation.
Do not resign impulsively. Resignation can complicate leverage and remedies.
Check whether others are affected. Group concerns may show a pattern.
Use the correct forum. A CBA issue may need grievance machinery, not an immediate NLRC complaint.
Watch the three-year period. Salary differentials are money claims, and delay can reduce recovery.

Frequently Asked Questions

Can my employer legally exclude me from a salary increase in the Philippines?

Yes, if the increase is discretionary, performance-based, or limited by clear eligibility rules that are applied fairly. But exclusion may be illegal if the increase is required by law, contract, CBA, company policy, wage order, or if the exclusion is discriminatory or retaliatory.

Is there a law requiring annual salary increases in the Philippines?

There is no general law requiring private employers to give all employees an annual salary increase. The law requires compliance with minimum wage orders, labor standards, valid CBAs, contracts, and enforceable company policies.

What if my salary is now the same as a newly hired employee?

That may feel unfair, but it is not automatically illegal. It may become a legal issue if a wage order caused a wage distortion, or if a company policy, CBA, or salary grade system requires maintaining certain salary differences.

Can I file a DOLE complaint for being excluded from a raise?

Yes, you may start with SEnA if the issue involves a labor or employment dispute. DOLE conciliation may help clarify the employer’s basis and explore settlement. If unresolved, you may be referred to the proper forum, such as the NLRC or voluntary arbitration.

Can probationary employees be excluded from salary increases?

Sometimes, yes. Employers may limit certain merit or annual increases to regular employees, depending on the policy. But if the increase is a minimum wage increase under a wage order, probationary status does not automatically exclude a covered employee.

What if the company promised an increase after regularization but did not give it?

Check the exact wording of your contract, offer letter, or HR policy. If it says the salary “shall” be increased upon regularization or provides a specific amount, you may have a money claim for salary differential.

Is it legal to deny a salary increase because I joined a union?

Denying benefits because of union activity may raise unfair labor practice or discrimination issues. If the workplace is unionized, coordinate with the union and check the CBA grievance procedure.

Can I ask coworkers how much increase they received?

You can ask, but be careful. Do not access confidential payroll records or pressure coworkers to disclose private salary information. For a legal claim, your own records, HR announcements, policies, and official wage orders are usually safer evidence.

How long do I have to claim unpaid salary increases?

Labor money claims generally prescribe in three years under Article 306 of the Labor Code, formerly Article 291. It is best to act as soon as you confirm that the increase should have applied to you.

What if I already resigned?

You may still pursue unpaid salary differentials if the claim has not prescribed. Keep your payslips, clearance documents, final pay computation, employment contract, and HR communications. Resignation does not automatically waive valid unpaid wage claims.

Key Takeaways

Being excluded from a salary increase is not automatically illegal, but it may be actionable if the increase was legally required, contractually promised, covered by a CBA, part of company policy, or denied for an unlawful reason.
Minimum wage increases under regional wage orders must be followed for covered employees.
Wage distortion applies when a mandated wage increase severely compresses intentional wage gaps.
Merit increases are usually discretionary, but discretion cannot be exercised in a discriminatory, retaliatory, arbitrary, or bad-faith manner.
Start by gathering documents, asking HR for a written explanation, and checking the exact eligibility rules.
SEnA is often the practical first step before a full labor case.
Salary differential claims generally have a three-year prescriptive period, so delay can reduce or defeat recovery.