Holiday Pay as a Legal Obligation and Deferment Due to COVID-19 Situation
Holiday pay is mandated to be paid as soon as the right has accrued to the employees. There are two kinds of holidays under the Philippine labor laws.
One, regular holiday and two, special day. Currently, there are twelve regular holidays and at least three special days. There are other special days that the Malacañang proclaim from time to time and depending on the occasion.
There are special days also which are declared, covering only a particular local government. The special days are divided into two: 1) Special non-working day, and 2) Special working day.
The special non-working day mandates that the employee may not be required to report for work in observance of the holiday established for the purpose. While the special working day provides otherwise, as the term itself states.
The burden of proof of payment of the holiday pay depends on whether the obligation arises in the course of business. If it does, then the employer has the burden to prove payment. If it does not, the employee has the burden to prove work. If work is not proven, payment is not due.
Regular holidays provide benefits that are in the course of doing business. Thus, the law mandates the payment of these benefits since they are due even if the employee did not work (as to the 100%). Note that
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when the employee works he is entitled to additional 100% of the daily rate thus, giving rise to the term “double pay.”
For the second 100%, the employee has the burden to prove work because work in this case is not in the ordinary course of business. Meaning, the employee is not expected to work on regular holiday. If he claims that he worked, then he should show proof. He has the burden and not the employer.
Work on special days also needs to be proved by the employee. Only when proof of work is established that duty to pay the benefit arises. Hence, employers and HR practitioners should clearly distinguish the difference between burden to prove payment and the burden to prove work as well as their effects on labor liability.
Now, during the COVID-19 pandemic, the Department of Labor and Employment (DOLE) has issued labor advisories advising the deferment of payment of holiday pays on account of the situation. It applies only to certain companies placed under particular situation contemplated by the issuances.
For instance, Labor Advisory 13-A on holiday pay on April 9, 10 and 11, 2020, the was allowed the pay to be deferred until such time that the present emergency situation has been abated and the normal operations of the establishments is in place.
Further, for establishments that have totally closed or ceased operation during the ECQ period they are exempted from the payment of the holiday pay under LA 13, Series of 2020.
Also, Labor Advisory 15, Series of 2020, pertaining to the holiday pay for May 1, 2020, the employers are allowed to defer payment of holiday pay on May 1, 2020, until such time that the present emergency situation has been abated and the normal operations of the establishment is in place. Establishments that have totally closed or ceased operation during the ECQ are exempted from the payment of the holiday pay under this Advisory.
Succeeding advisories were issued stating that employers are allowed to defer payment of holiday pay until such time that the present emergency situation has been abated and the normal operations of the establishment is in place. For establishments that have totally closed or ceased operation during the community quarantine they are exempted from the payment of the holiday pay under said Advisories.
These advisories are Labor Advisory 15, Series of 2020, Holiday pay for May 1, 2020; Labor Advisory 20, Series of 2020, Regular holiday pay for May 25, 2020 in observance of Eid’l Fitr (Feast of Ramadhan); Labor Advisory 22, Series of 2020, Regular Holiday Pay for June 12, 2020; Labor Advisory 25, Series of 2020, Regular holiday pay on July 31, 2020 in Observance of Eid’l Adha (Feast of Sacrifice); and Labor Advisory 27, Series of 2020, Payment of wages for the special non-working day on August 21, 2020 and Regular Holiday on August 31, 2020.
It is expected that the DOLE will continue to issue similar advisories for as long as the effects of the pandemic remain a threat to businesses.
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