The Philippine Labor Code Art.
83 states that the normal hours of work where an employee is required to do
his/her work or to be in a prescribed workplace is eight (8) hours a day. However, the Labor Code does not apply to
government employees, managerial employees, field personnel, employer’s family members, domestic helpers, and
personal service providers. Also, a child below 15 years of age cannot work for more than 4 hours and those that
are 15 to 18 years cannot work for more than 8 hours a day and 5 days a week. The household helpers are required
to work for 10 hours a day excluded an hour of break time for their meals every day.
There are times that the employee will be required to work for more than their prescribed hours; (1) first if the
country is at war or under a national or local emergency like the Covid-19 Pandemic; (2) second if overtime work
can help save lives; (3) third if there is urgent work to be performed on machines, installation or equipment; (4)
fourth to avoid damage or loss to the perishable good or if the work requires a certain weather condition to finish it;
and (5) lastly the overtime work will avoid company losses. In these cases, the company is required to pay the
overtime pay as stipulated in the law.
OVERTIME PAY is the additional compensation given to the employee who rendered an overtime work. The following
are different kinds of overtime work and ways to compute its payment:
I. OVERTIME PAY ON REGULAR WORKDAY
The employer must provide six continuous working day and one rest day. The overtime pay during this working
days shall be computed as:
Overtime Pay = OT hours x 125% of normal hourly wage rate.
Example: An employee was required to work additional 3 hours overtime to meet the deadline for their output. The
daily wage rate is Php440.00. Compute for the overtime pay.
8 = 55 x 1.25 = Php68.75
Note: To get the hourly rate divide the daily wage to 8 hours.
II. OVERTIME PAY ON SCHEDULED REST DAY
Usually Sunday is the scheduled rest day of various companies, but it may vary depending on the kind of business.
Others call it Sunday rate.
a. First 8 Hours = Daily wage rate x 130%
Example: Renato a technician had to work on Sunday/Rest Day to repair the conveyor equipment. How much will
he be paid if his rate is Php600 daily.
Computation: Sunday/Rest Day Pay = 600 x 1.30 = Php780
b. Sunday Overtime Pay = OT hours x 169% x hourly rate
Example: Renato wasn’t able to finish his repair job for 8 hours so he worked for another 3 hours. What will be his
total compensation?
Computation: Sunday/Rest Day OT Pay = 3(H) x 1.69 x 600.00 8 = Php380.25
Thus, Renato earned Php1,160.25 that Sunday.
III. OVERTIME PAY ON HOLIDAY
The list of regular holidays on 2020 are January 1, April 9, April 10, May 1, June 12, August 31, November 30,
December 25, December 30, Eid al Fitr (Feast of Breaking the Fast)) and Eid al Adha (Festival of Sacrifice). On these
dates the first 8 hours will be paid double or 200% and 260% in excess of 8 hours.
a. Holiday First 8 hours = Daily Wage Rate X 200%
Example: Arnold a guard was required to work on December 25. His daily rate is Php500.00. What will be his
earnings for the first eight hours?
Computation: Special Day First 8 hours = 500 x 2.0 = Php1,000.00
b. Regular Holiday Overtime Pay = Hours of Overtime x 260% x hourly rate
Example: Arnold’s reliever didn’t come on time. He had to work for another 4 hours that day. Compute for his total
earnings that day.
Computation: Special Day Overtime = 4(H) x 2.6 x 500/8 = Php650.00
Thus, Arnold earned Php1,650.00 that day.
IV. OVERTIME PAY FOR HOLIDAY THAT FALLS ON RESTDAY
Other employees like health care workers, police, soldiers, guards, and other vital employees of a company are
always required to work even during holidays and sometimes it falls on their rest day as well.
a. First 8 hours = Daily rate x 260 %
Example: Roland, a guard was required to work on November 1, a holiday and Sunday, which is also his rest day.
His daily wage is Php570.00. Compute for his compensation that day.
Computation: Sunday Holiday Pay = 570 x 2.6 = Php1,482.00
b. Regular Holiday/Rest Day OT Pay = Hours of OT x 260% x 130% x hourly rate
Example: There was a thief incident that day that he has to stay for another 3 hours as overtime work. What will be
his overtime pay after 8 hours on Holiday and Sunday?
Thus, his total earning for that day is Php2,204.75
V. OVERTIME PAY FOR SPECIAL (NON-WORKING HOLIDAY) THAT FALLS ON RESTDAY
The overtime rate is 195% of the normal hourly wage rate if the overtime work is done on a special day which falls
on a scheduled rest day (100 (assumed normal hourly wage) * 130% * 150%).
a. First 8 hours = Daily rate x 150 %
Example: Andy worked for 10 hours on February 25, a special non-working holiday and also his rest day. What will
be his total income for the day if his daily wage is Php520.00?
Computation: Special NWH Rest day Pay = 520 x 1.5 = Php780.00 (for the first 8 hours)
b. SPNW Holiday/Rest Day OT Pay = Hours of OT X 130% x 150% x hourly rate
Thus, his total earning for that day is Php1,033.50
VI. NIGHT SHIFT DIFFERENTIAL
This refers to the 10% added amount to the hourly rate if the employee works from 10:00 PM to 6:00 AM.
Example: Mr. Deinla worked from 8:30 AM to 11:30 PM, if his daily rate is Php500.00 what will be his total earning
for the day?
Thus, his total earnings for the day is Php978.12
