What is the overtime pay computation for employees working on a night shift during a regular workday? The personal and additional exemptions of employees previously available under R.A. 9504 were also removed. Rest periods of short duration during working hours are regarded as hours worked. Every employee shall be paid a night shift differential of not less than ten percent (10%) of his regular wage for each hour of work performed between ten o’clock in the evening and six o’clock in the morning. Source: §86 of the Labour Code, as amended. 2. To determine the employee Night Differential pay: Special Holiday Night Differential = (Hourly rate × 130% × 10% × 8 hours) Php 59.28 = (Php 57.00 × 1.3 × 0.10 × 8 hours) Special Holiday and at the same time Rest day Night Shift. Ensuring your workspaces are ready for your return and the new norm. Employees are required by law to have at least one day (a full 24 hours) off every week. Night shift differential is from 10pm to 6am the following day. If the employee is late for 1 minute, the deduction must not be based more than 1 minute. Night work is regulated under the Labour Code which provides for a night shift differential. In line with that, you should, If the country is at war or declared to be under national or local emergency, If overtime work can help save lives or properties in face of danger to public safety due to emergencies caused by fire, natural disasters, or serious accidents, If work started before the 8th hour needs to be completed or continued to avoid grave obstruction or to prevent prejudice to the business or operations, If overtime work is needed to achieve good weather or environmental conditions and the quality of work and performance depend on these conditions, If urgent work needs to be done on equipment, installations, and machinery to avoid loss or damage, If work is required to preserve perishable goods or prevent its loss. Under Philippine labor laws, an employee who works between 10 p.m to 6:00 a.m. should be paid a night shift differential of not less than ten percent (10%) of his regular wage. Overtime pay, on the other hand, is additional pay for work performed beyond 8 hours in a day. Accordingly, they are not entitled to holiday pay, overtime pay, premium pay, night shift differential pay, and service incentive leave. Agricultural 3. Overtime work. 87. The main question you have to ask is: what kind of non-working day is this? (When an employee is required to work beyond the normal 8 hours, they are entitled to receive Overtime Pay) If the employee’s overtime reaches overnight or the night differential time frame, the night differential would affect the overtime rate of the employee. Overtime is beyond 8 hours in a single workday, except in flexible work arrangements such as compressed work week. Most businesses will outline how shift differentials work, if they’re offered, in the employee handbook.Usually, however, differential 4 Simple Charts to explain Philippines Premium Pay Rate FIND OUT THE OVERTIME PAY RATE, NIGHT SHIFT DIFFERENTIAL PAY RATE, REST DAY PAY RATE AND HOLIDAY PAY RATE. On an ordinary day, the overtime rate per hour is determined as follows: “This is pursuant to our existing policy to recognize voluntary work arrangements between companies and their employees that is mutually beneficial and does not diminish existing standards and benefits such as overtime pay premium and night shift differential,” Labor Secretary Silvestre H. Bello III said. Women and young persons are prohibited from night work. These guidelines define a compressed workweek as being one where the normal workweek is reduced to less than 6 days but the weekly working hours (48 hours) remain unchanged. No. Can employers/business owners require their employees to render overtime work?The law does not encourage employers/business owners to ask their employees to do overtime work. The worker should be paid overtime pay, equivalent to 125% of his usual rate per hour. *same values used in the computation, First 8 hours = 130%; beyond 8 hours = 169% /hourFirst 8 hours: ((18,000 x 12) / 258) x 1.3 = Php1,088.37Beyond 8 hours: [((18,000 x 12) / 258) x 1.69]/8 = Php176.86/hour, What is the computation for overtime pay on a special day? The employer cannot use the offset to keep the company from compensating the employee with required overtime rates. When they work the evening shift, they are paid a shift differential of $1 an hour. Take note that it can fall into more than one category: it can be both a rest day and a regular holiday, for example. Cottage and handicraft For example, on average, the minimum daily payroll in the Phili… 87. The amount of 13 th month pay shall at least be 1/12 of the total basic salary earned for the year which shall n include all earnings paid by his/her employer for services rendered but does not include allowances and other monetary benefits such as the cash equivalent of unused vacation and sick leave credits, overtime, premium, night shift differential, holiday pay and COLA. Read also: Can Employees Be Compelled To Render Overtime Work? Under certain conditions and circumstances, however, employers may require overtime work: Can an employee offset his or her filed undertime with overtime work?The undertime cannot be offset with overtime. If work is performed on a rest day which is also regular holiday, worker is paid 260% of the normal wage rate. The maximum working hours on such days cannot exceed 12 hours per day. Some employees, however, are exempt to this rule. Source: §91-94 of the Labour Code, as amended, Living and Working during the Coronavirus Pandemic - Link me to the Covid 19 Survey and Daily Updates, Cite this page © WageIndicator 2021 - Mywage.org/Philippines -, Living and Working during the Coronavirus Pandemic, Survey on Living and Working in Philippines during Coronavirus, Coronavirus Work & Life in Maps and Graphs - updated daily, Daily updated Maps on Living and Working during Coronavirus, Daily updated Graphs on Living and Working during Coronavirus. ARTICLE 87. Source: §82, 83, 84, 87, 88 and 89 of the Labour Code, as amended; §12A of the Special Protection of Children against Child Abuse, Exploitation and Discrimination Act; Department Advisory No. DEPARTMENT OF LABOR AND EMPLOYMENT. Overtime Work Work may be performed beyond eight hours a day provided that the employee is paid for the overtime work, which consists of an additional compensation equivalent to his regular wage plus at least 25% thereof. Under R.A. 9504 overtime pay, night shift differential pay and hazard pay received by such minimum wage earners are exempt from income tax (Section 2, R.A. 9504). Let say the employee hourly rate is Php 57.00/hour and working from 10pm to 6am; To determine the employee Night Differential pay: Special Holiday Rest day Night Differential = (Hourly … Art. For example, the employee is paid $10.00 per hour plus a $2.00 per hour shift differential for the night shift. Shift differentials aren’t required by federal law, but many companies, especially in the manufacturing industry, offer them as a way of encouraging employees to take an “undesirable” shift such as the night shift or a weekend shift. COLA is not included in overtime calculation. When they work the night shift they are paid a shift differential of $2 an hour. OVERTIME PAY • An employee is entitled to overtime pay for each hour of work done beyond normal working hours • The overtime rate on normal day is 25% • The overtime rate on rest day and holiday is 30%. If you find this site useful and want to show your support, feel free to … Overtime pay rates depend upon the the day the work is performed, whether it is ordinary working day, special day, regular holiday or rest day. What is the computation for overtime pay on a regular work day?Here's a sample computation based on the given values (monthly rate: Php18,000; factor rate: 258; 246 total regular days + 12 regular holidays): Daily rate: 18,000 x 12 / 258= Php837.21Hourly rate (8 hours): 837.21 / 8= Php 104.65, Number of hours in excess of 8 hours (125% x hourly rate x number of hours rendered)Overtime hourly rate: 1.25 x 104.65= Php 130.81/hour, What is the computation for overtime pay on a rest day? Knowing the level of compensation your employees should receive if they work the extra hours on regular workdays and holidays helps you establish a reputable image for your business. Notably, the MWE’s earnings from overtime, night shift differential, and hazard pay are not anymore exempt. Where an employee is made or permitted to work on his scheduled rest day or a special day, he is paid an additional compensation of at least 30% of his regular wage (130% of the normal wage rate). Category My PayrollHero Account, Payroll, Philippine Payroll Regulations and Information Every employee is entitled to a Night Differential or Night shift pay of not less than 10% of his regular wage for each hour of work performed between 10pm and 6am. No statutory provisions in law could be identified that stipulate whether the employees are to be given compensatory rest days for working on public holidays or weekly rest days. One of the reasons is the night shift differential pay. Article 86 of Philippine Labor Code states, “Every employee shall be paid a night shift differential of not less than ten percent (10%) of his regular wage for each hour of work performed between ten o’clock in the evening and six o’clock in the morning.” Night shiftdifferential. An employee is entitled to night pay for any nonovertime work performed between 6 p.m. and 6 a.m. during designated core hours. So if he or she worked for less than 8 hours, the compensation will be adjusted accordingly. However, not all employees are entitled to night shift differential. For example, the employee is paid $10.00 per hour plus a $2.00 per hour shift differential for the night shift. 110% x number of hours in excess of 8 hours (130% x hourly rate) Monthly rate: Php10,000 Daily rate (20 working days/month): 10,000/20= Php500 Hourly rate (8 hours): 500/8= Php 62.50 Overtime work. However, kasambahay under the age of 18 years are not allowed to work more than 8 hours a day, 5 days a week, exclusive of 1 hour breaks for each regular meal of the day. NIGHT SHIFT DIFFERENTIAL . Every employee shall be paid a night shift differential of not less than ten percent (10%) of his regular wage for each hour of work performed between ten o'çlock in the evening and six o'clock in the morning. The working hours for kasambhay (domestic helpers) are 10 hours a day, exclusive of one hour breaks for each regular meal of the day. The Labour Code provides that work may be performed beyond 8 hours a day provided that the employee is paid for the overtime work as prescribed. Industry sectors are segmented as follows: 1. If the day factor is 365, rest day is paid even when no work is done. If you are running a business in the Philippines, you must know the policies regarding overtime pay computation, or shift differentials. Women and young persons are prohibited from night work. Working hours in the Philippines cannot exceed eight hours in a day, not including the mandatory one-hour lunch break. Every employee shall be paid a night shift differential of not less than ten percent (10%) of his regular wage for each hour of work performed between ten o’clock in the evening and six o’clock in the morning. However health personnel in cities and municipalities with a population of at least one million, or in hospitals and clinics with a bed capacity of at least one hundred may be required to work additional hours where exigencies of the service require. Employees working anytime from 10 o’clock in the evening to 6 o’clock in the morning qualifies for the Night Shift Differential (NSD). Powered by the WageIndicator Foundation - Share and compare wages, understand Labour Laws and spot career opportunities. How many hours are allowed for overtime work?Employees can render up to eight (8) hours of overtime work. Moreover, under time work on a day cannot be offset by overtime work on another day. 22009 Guidelines on the Adoption of Flexible Work Arrangements Part III, point 1. Every employee shall be paid a night shift premium of not less than 10% of their regular wage for each hour of work performed between 10:00 PM and 6:00 AM. Is it a rest day, a regular holiday, or a special non-working day? The Department of Labor and Employment has published advisory guidelines on the adoption of flexible work arrangements which includes compressed workweeks among a range of flexible arrangements which employers may consider implementing in times of economic difficulty or national emergency. This website does not show any ads or advertising materials for an ad-free reading experience of the readers. How to Compute Overtime Pay All employees required to work beyond the normal 8 hours are entitled to overtime. *same monthly rate applied in the computation, Regular holiday (200% x basic pay)10,000 x 2 = Php 20,000Holiday pay (i.e., 20 working days/month): 1.1 x (20,000/20) = Php 1,100/day, Regular holiday that coincided on a scheduled rest day (260% x basic pay)10,000 x 2.6 = Php 26,000Premium pay (i.e., 20 working days/a month): 1.1 x (26,000/20) = Php 1,430/day, How a PEZA-Accreditation Can Benefit Your Business, 15-Minute Team Building Activities You Can Apply in the Workplace, The Pros and Cons of Working in a Call Center in Manila, Overtime Pay Computations And Policies In The Philippines, , you must know the policies regarding overtime pay computation, or, . Employees who work between the hours of 10 p.m. to 6 a.m. are entitled to night shift differential pay also known as Night Shift Pay to compensate them for the hazards and inconvenience of working at odd hours when the body is normally asleep. If your employee works beyond eight hours, you must pay overtime wages. Overtime Pay and Night Shift Differential in the Philippines. Employees who work between 10:00 PM and 6:00 AM are entitled to night shift differential. Gross salary is how much the employee earned, including overtime, night shift differential and other additional compensation, based on actual number hours of work. The Law does not provide a limit on overtime work. The Trade Union Congress of the Philippines (TUCP) has thrown its support behind two House bills seeking to exclude from income taxes all overtime and graveyard shift differential pay received by salaried employees, including the country’s 1.1 million business process outsourcing (BPO) workers who perform jobs all day and all night. Source: Article 86, Labor Code of the Philippines When working overtime, RNs are paid time-and-one-half of their basic hourly rate of $22. Overtime pay rates are covered under the Labour Code. It further provides that any employee may be required by the employer to perform overtime work in any of the following cases: in the case of national emergency or force majeure; urgent work in order to avoid serious loss or damage to the employer; work necessary to prevent loss or damage to perishable goods; and were the completion or continuation of the work is necessary to prevent serious obstruction or prejudice to the business or operations of the employer. However, the following employees are NOT entitled to … Is this in compliance with the FLSA overtime standard? Article 86 - Night shift differential; Article 87 - Overtime work; Article 88 - Undertime not offset by overtime; Article 89 - Emergency overtime work; Article 90 - Computation of additional compensation; Article 91 - Right to weekly rest period; Article 92 - When employer may require work on a rest day; What is the overtime pay computation for employees working on a night shift during a rest day? Night shift differential. Employee would be paid the overtime rate for the excess hours worked. N ight Shift Differential (NSD) refers to the additional compensation of ten percent (10%) of an employee’s regular wage for each hour of work performed between 10 p.m. and 6 a.m. Generally, all employees are entitled to night shift differentials, except the following: *same monthly rate applied in the computation, special day: 110% x (130% x basic pay)10,000 x 1.3 = Php 13,000Special day premium pay, night shift: (i.e., 20 working days/month): 1.1 x (13,000/20)= Php 715/day, Special day that coincided on a scheduled rest day: 110% x (150% x basic pay)10,000 x 1.5 = Php 15,000Special and rest day premium pay (i.e., 20 working days/a month): 1.1 x (15,000/20)= Php 825/day, What is the overtime pay computation for employees working on a night shift during a regular holiday? Work-Life balance from 10pm to 6am the following day against Child Abuse, Exploitation and Discrimination Act, Republic No! 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