TWENTIETH CONGRESS OF THE } 
REPUBLIC OF THE PHILIPPINES } 
First Regular Session 
}
SENA 
S.B. No._
25 JUL-7 Pll'-OS
INTRODUCED BY SENATOR VICENTE C. SOTTO III
AN ACT
REQUIRING EMPLOYERS IN THE PRIVATE SECTOR 
TO PAY 14th MONTH PAY
Presidential Decree No. 851 or the decree requiring all employers to pay 
their employees a IS^^-Month pay was enacted in December 16, 1976. After 
almost five decades, the needs and cost of living of every Filipino worker have 
drastically changed, thus it is high time that employees in the private sector 
receive their 14* month pay.
In that regard, 13* month pay can be given in the middle of the year to 
help our workers to pay the educational expenses of their children. 14* month 
pay on the other hand should be given at the end of the year.
This bill has exemptions for qualified employers as not to burden 
struggling businesses as they are equally important for our economy.
In view thereof, immediate approval of this bill is requested.
VICENTE C. SOTTO III


TWENTIETH CONGRESS OF THE } 
REPUBLIC OF THE PHILIPPINES }
First Regular Session 
}
25 JUL -7 All -08
SENATE
S.B. No. 1 93
INTRODUCED BY SENATOR VICENTE C. SOTTO III
1
2
3
4
5
6
7
8 
9
10
11
12
13
14
15
16
17
18
AN ACT
REQUIRING EMPLOYERS IN THE PRIVATE SECTOR 
TO PAY 14th MONTH PAY
Be it enacted by the Senate and House of Representatives of the 
Philippines in Congress assembled:
SECTION 1: Short Title. - This act shall be known as the 14th Month 
Pay Law".
SECTION 2. Declaration of Policy. - The State affirms labor as a 
primary social economic force. It shall protect the rights of workers and 
promote their welfare.
SECTION 3. Coverage. - This act shall cover all non-government rank 
and file employees regardless of their employment status, designation and 
irrespective of the method by which their wages are paid, workers under the 
Kasambahay Law and other workers who are presently entitled by law to 13th 
month pay, provided that they have worked at least one month during the
calendar year.
SECTION 4. Definition of Terms. - As used in this Act:
a. Rank and File Employees - are those not considered as managerial 
employees. They are not vested with powers or prerogatives to lay 
down and execute management policies and/or to hire, transfer.


1
2
3
4
5
6
7
8 
9
10
11
12
13
14
15
16
17
18
19
20 
21 
22
23
24
25
26
27
28
29
30
31
32
33
suspend, layoff, recall discharge, assign or discipline employees or 
to effectively recommend such managerial actions.
b. Basic Salary - for the purpose of computing the 14th month pay 
shall include all remunerations or earning paid by this employer for 
services rendered but does not include allowances and monetary 
benefits which are not considered or integrated as part of the regular 
or basic salary.
SECTION 5. Mandatory Payment of 14th Month Pay. - All non­
government rank and file employees, qualified workers under the 
Kasambahay Law and other workers who are presently entitled by law to 13th 
month pay, shall be entitled to 14th month pay every year.
SECTION 6. Time of Payment. - The 13 th month pay shall be paid not 
later than June 14th and the 14th month pay shall be paid not later than 
December 24th of every year provided however that the frequency of payment 
of this monetary benefit may be the subject of agreement between employer 
and employee or any recognized/collective bargaining agent of employees.
SECTION 7. Minimum Amount. - The minimum amount of the 14th 
month pay shall not be less than one twelfth (1/ 12) of the total basic salary 
earned by the employee within the calendar year.
SECTION 8. Employers Covered. - The law shall apply to all employers 
except to:
(a) Distressed employers, such as (1) those which are currently incurring 
substantial losses or (2) in the case of non-profit institutions and 
organizations, where their income, whether from donations, 
contributions, grants and other earnings from any source, has 
consistently declined by more than forty (40%) percent of their normal 
income for the last two (2) years, subject to the authorization process of 
the Department of Labor and Employment;


1
2
3
4
5
6
7
8 
9
10
11
12
13
14
15
16
17
18
19
20 
21 
22
23
24
25
26
27
28
29
30
31
32
(b) 
The Government and any of its political subdivisions, including 
government-owned and controlled corporations, except those 
corporations operating essentially as private subsidiaries of the 
Government;
(c) Employers already paying their employees 14-month pay or more in 
a calendar year or its equivalent at the time of this issuance; and
(d) Employers of those who are paid on purely commission, boundary, 
or task basis, and those who are paid a fixed amount for performing a 
specific work, irrespective of the time consumed in the performance 
thereof, except where the workers are paid on piece-rate basis in which 
case the employer shall be covered by this issuance insofar as such 
workers are concerned.
SECTION 9. Implementing Rules. - Within sixty days from the 
enactment of this law, the Secretary of the Department of Labor and 
Employment (DOLE) shall promulgate the implementing rules of this law.
SECTION 10. Separability Clause. - If any provision of this Act is 
declared invalid or unconstitutional, other provisions hereof which are not 
affected thereby shall continue to be in full force and effect.
SECTION 11. Repealing Clause. - Any law, presidential decree or 
issuance, executive order, letter of instruction, administrative order, rule or 
regulation contrary to or inconsistent with any provision of this Act as hereby 
amended or modified accordingly.
SECTION 12. Bffectiirity Clause. - This Act shall take fifteen (15) days 
following its publication in the Official Gazette or in at least two (2) newspaper 
of general circulation.
Approved,