Kabayan Party-list Representative Ron Salo has proposed a measure that, if passed, would require public and private companies to provide their employees with 14th month pay regardless of the beneficiary’s employment status.
The proposal is in addition to the mandated 13th month pay for employees.
House Bill 540, also known as the 14th Month Pay Law, was filed on 30 June but had been pending with the House Committee on Civil Service and Professional Regulation since 26 July.
“Despite the existence of 13th month pay, many Filipino families still struggle to sufficiently provide for their families because of meager salaries, among others. With the continuously rising cost of living in the Philippines, it is incumbent upon the State to address the plight of its workers in both the government and private sectors,” the explanatory note read.
Under Salo’s bill, the mandatory 13th month pay would be paid to employees “on or before 31 May of each year in anticipation of the school enrollment of the employees’ dependents.”
Meanwhile, in preparation for the holiday season, the 14th month pay would be distributed on or before 30 November of each year, and it would be excluded from an employee’s gross income calculation.
Employees who have been with the company for less than a year will have their 14th month pay prorated based on the number of months served.
According to the bill, the 14th month pay should not be less than the employee’s monthly basic salary.
The lawmaker cited Presidential Decree 851 in his explanatory note.
“Presidential Decree No. 851 institutionalized the 13th month pay in recognition of the continuing struggle of the labor force in providing for the needs of their families, as well as in incentivizing them to work harder for the betterment of the economy and the society, in general, and for the good of their respective employers. However, many Filipino families still struggle to sufficiently provide for their families because of meager salaries, among others.”
“With the continuously rising cost of living in the Philippines, it is incumbent upon the State to address the plight of its workers in both the government and private sectors,” the solon added.
According to Salo, the 14th-month pay also intends to incentivize and motivate all employees to work harder and increase productivity.
The bill also directs the Department of Labor to enact for the private sector. It taps the Department of Finance, the Department of Budget and Management, and the Civil Service Commission to enact the bill’s provisions for government employees, the Social Security System, and the Government Service Insurance System for its members.