Covid-19: Top 10 FAQ on Compensation and Benefits

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The following Frequently Asked Questions (FAQ) aim to guide employers and employees on the above topic in the time of Covid-19.

The discussions are without prejudice to any stipulation in favor of the employees under an employment contract, Company Policies, Collective Bargaining Agreement (CBA), and other employment agreeements.

1. May employees be paid below minimum wage for a day’s work?

No. Employees should be paid at least the minimum wage for a day’s work. If the employment contract provides for a higher daily rate, it should be followed.

The wage should comply with the Minimum Wage Law.

2. May employees be paid below minimum wage if they work less than the prescribed 8 hours of work (e.g. 4 hours of work)?

Yes. The employees may be paid below the minimum wage if they work less than the prescribed eight (8) hours of work.

The wage shall be based on the hours of work multiplied by their hourly rate.

The hourly rate is the quotient of whichever is the higher of the daily rate or the minimum wage divided by eight (8) hours.

This should be aligned with DOLE Labor Advisory No. 17, Series of 2020, and previous Labor Advisories on adopting flexible working arrangements due to Covid-19.

3. May compensation of monthly-paid employees be reduced resulting from reduced workhours or workweek?

Yes. Compensation of monthly-paid employees may be reduced resulting from reduced workhours or workweek.

There are prescribed computations or formula for determining the hourly or a day’s salary of a monthly-paid employees. Once determined, they maybe paid based on actual workhours.

This should be aligned with DOLE Labor Advisory No. 17, Series of 2020, and previous Labor Advisories on adopting flexible working arrangements due to Covid-19.

4. May employees on work from home be paid only a day’s work if they are engaged to work for several days?

No. Employees on work from home may not be paid only a day’s work if they are engaged to work for several days.

The principle of a day’s wage for a day’s work applies to employees under work from home arrangements.

5. Do employees have the right to demand for more work hours to increase their pay?

No. Employees do not have the right to demand for more work hours to increase their pay.

Due to Covid-19 and quarantine restrictions, employers have the management prerogative to adjust business operations and consequently work hours and work shifts of employees.

This should be aligned with DOLE Labor Advisory No. 17, Series of 2020, and previous Labor Advisories on adopting flexible working arrangements due to Covid-19.

6. Are employees entitled to their holiday pay even if they did not work due to quarantine restrictions?

Yes. Employees are entitled to their holiday pay even if they did not work due to quarantine restrictions.

Per DOLE Advisories, holiday pay is only deferred. This means it is due notwithstanding no work due to quarantine restrictions. Employers only have the option to pay at a later date.

7. Are employees entitled to other legally mandated benefits such as premium pay, maternity/paternity/solo parental leaves?

Yes. Employees are entitled to other legally mandated benefits such as premium pay, maternity/paternity/solo parental leaves.

Similar to holiday pay, these are mandatory and are not affected by quarantine restrictions.

8. Are employees entitled to pay if they are referred to a Covid-19 facility or directed to go home if they tested positive for Covid-19 or show its manifest symptoms?

No. Employees are not entitled to pay if they are referred to a Covid-19 facility or directed to go home if they tested positive for Covid-19 or show manifest symptoms.

In line with management prerogative, the employer has the right and duty to protect the workforce from an employee who has tested positive for Covid-19 or is showing manifest symptoms, such as fever, sore throat, difficulty of breathing, among others.

9. May employees be paid monthly instead of the twice a month due to quarantine restrictions.

No. Employees may not be paid monthly instead of the twice a month due to quarantine restrictions.

The twice a month requirement is mandatory under the Labor Code.

10. May employers pay their employees in kind such as inventory/merchandise or gifts instead of their wage?

No. Employers may not pay their employees in kind such as inventory/merchandise or gifts instead of their wage.

The Labor Code explicitly prohibits paying wages in kind and expressly mandates payment via legal tender or cash.

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Last updated: 28 May 2020

This article is updated regularly.  For feedback: https://www.laborlaw.ph/contact/