Leave Policy in the Philippines: What Foreign Employers Must Provide

Part of your responsibility as a foreign employer is to provide the right amount of leaves to your Filipino staff. Leave policy in the Philippines is a key component to safeguarding employee rights and ensuring compliance with labor regulations under the Labor Code of the Philippines. In this guide, we’ll break down what are mandatory leave entitlements for Filipino staff. 

Who is Entitled to Statutory Leaves in the Philippines?

Before implementing these policies, you must understand the legal definition of who is covered by these leaves under the Philippine Labor Code.

• All Private Sector Employees: These mandates apply to all employees in the private sector, regardless of their status (probationary, regular, or fixed-term).
• Remote & Office-Based Staff: Whether your team works from a physical office in Manila or remotely from their homes, they are entitled to these benefits if they are legally employed within the Philippines.
• Excluded Categories: The Labor Code generally excludes certain groups from mandatory SIL (though they may still be eligible for other statutory leaves like Maternity/Paternity).

Mandatory Leaves for Filipino Staff

Filipino culture is deeply rooted in family and community and it reflects within the Labor Code of the Philippines (Presidential Decree No. 442). Under specific Republic Acts (RAs), there are specific laws passed by the Philippine Congress that expand upon the Labor Code. 

Here is a quick summary of mandatory leaves for your Filipino staff:

1. Service Incentive Leave (SIL)

The most fundamental leave in the Philippines is the Service Incentive Leave (SIL). Under Article 95 of the Labor Code, every employee who has rendered at least one year of service is entitled to a yearly service incentive leave of five (5) days with pay.

Here are key details you should know about SIL as a foreign employer:

• Qualifying Period: "One year of service" means service within 12 months, whether continuous or broken, from the date the employee started working.
• The "Monetization" Rule: If an employee does not use their SIL by the end of the year, you must convert the unused days into cash. This is often referred to as "leave credits commutation."
• Market Reality vs. Legal Minimum: The legal minimum for SIL is 5 days. However, it’s conventional for companies to offer 12 to 15 days of Vacation Leave (VL) and 12 to 15 days of Sick Leave (SL).  

2. The Expanded Maternity Leave (RA 11210)

In 2019, the Philippines significantly updated its maternity benefits with a 105-Day Expanded Maternity Leave Law. This was a massive shift from the previous 60-78 day allowance, bringing the Philippines in line with international labor standards.

With this change, you need to provide the following to your Filipino staff: 

• Duration: 105 days of fully paid leave for female employees, regardless of the mode of delivery (caesarean or normal).
• Solo Parents: If the mother qualifies as a "solo parent" under the law, she is entitled to an additional 15 days, totaling 120 days of paid leave.
• Optional Extension: The employee has the option to extend the leave for an additional 30 days, but this extension is usually unpaid, provided she notifies the employer 45 days in advance.
• The "Salary Differential": While the

For an international company, managing the paperwork for SSS reimbursements can be a headache. This is often where Emerhub’s Employer of Record (EOR) becomes invaluable, handling the local bureaucracy while you focus on the work.

3. Paternity Leave (RA 8187)

The Philippines recognizes the importance of fathers during the early days of a child's life. The Paternity Leave Act of 1996 grants 7 days of leave with full pay to all married male employees.

This benefit is available for the first four (4) deliveries of the legitimate spouse with whom he is cohabiting. Under the Expanded Maternity Leave Law, a mother can choose to "allocate" up to 7 days of her 105-day leave to the father/spouse, effectively giving him a total of 14 days of paid leave.

Currently, the law specifically applies to married male employees living with their legitimate spouse. Even if your remote employee is not legally married, many modern international companies choose to offer "Parental Leave" regardless of marital status to promote inclusivity and equity within their global teams.

4. Solo Parent Leave (RA 8972 & RA 11861)

The Philippines has one of the most progressive laws for single parents in the region. Under the Solo Parents' Welfare Act, employees who are left with the responsibility of parenthood alone are entitled to additional benefits. To qualify, your employee must have rendered at least six months of service.

Solo parents are entitled to 7 working days of leave with pay every year. Under the 2022 amendment (RA 11861), it is now fully paid (previously, it was only paid if the employer chose so, though most did). Additionally, the definition of a "solo parent" has been expanded to include those whose spouses are incarcerated or working abroad (OFWs) for long periods.

5. VAWC Leave (RA 9262)

The Anti-Violence Against Women and Their Children Act (VAWC) grants up to 10 days with full pay for women and children who are victims of violence (physical, sexual, psychological, or economic).

The leave can be used continuously or intermittently. It is intended to allow the employee to attend to medical needs, legal proceedings, or relocation for safety. To qualify, the employee typically needs to provide a certification from the Barangay (local village council), a police report, or a court document. 

Due to the sensitive nature of such cases, you are legally and ethically bound to maintain strict confidentiality regarding reasons for this leave. Handling VAWC leave requires a high degree of empathy and sensitivity. It’s a situation where your HR policies truly meet your corporate values.

6. Special Leave for Women (Magna Carta of Women)

Under RA 9710, female employees are entitled to a special leave benefit of up to two (2) months with full pay following surgery caused by gynecological disorders. The employee must have rendered at least six months of continuous aggregate service in the last 12 months. This covers surgeries for cysts, fibroids, and other gynecological conditions as certified by a competent physician.

Working During Leave: Calculating Overtime and Compensation

In some cases, an employee might be asked to work during a period they had originally scheduled as leave (e.g., Vacation Leave). As a foreign employer, you must ensure that compensation is handled according to the Labor Code.

Most employees would simply ask their leave credits to be restored to their balance. The day is then treated as a regular working day for payroll purposes. 

Overtime Calculations

If the employee works beyond the standard 8-hour shift on that day, standard overtime (OT) rates apply:

• Regular Day OT: 125% of the hourly rate.
• Rest Day/Special Holiday OT: 169% of the hourly rate (130% premium for work on a rest day, then 130% for the OT hours).

Intersection with Regular Holidays

If an employee is on leave during a Regular Holiday (e.g., Christmas Day or Independence Day), they are entitled to 100% of their daily wage without deducting a leave credit from their balance. 

If they are required to work on that holiday:

• First 8 hours: 200% of their daily wage.
• Overtime (beyond 8 hours): 260% of the hourly rate (200% holiday rate × 130% OT rate).

To help you manage payroll and HR administration, Emerhub’s Employer of Record service acts as the legal employer for your staff. Our team of recruitment specialists can help you ensure compliance for your operations with local leave policies. 

RecruitGo specializes in helping foreign employers navigate the complexities of Philippine labor law. Contact us to learn more about how we can help.