13th month pay is one of the mandated benefits by law. This is based on P.D. 851, as amended by Memorandum No. 28.
If an employee resigns, what should be the computation?
13th month pay is 1/12 of basic salary earned during the calendar year. Minimum service required is one month. It should be given not later than December 24.
For instance, X, an employee in NCR, was hired on June 1, 2017, receiving minimum wage, who served for six months then resigned on December 1, 2017. Let’s say X works 6 days a week. The factor/divisor is 313. He has no absences.
Minimum wage rate in NCR: P502 basic wage + P10 COLA; Total P512
Since COLA is not included in the basic wage computation for purposes of 13th month, the P10 will be excluded.
Thus, let us determine the basic salary earned by X during the calendar year:
To get the monthly equivalent, P502 x 313 = P157,126
P157,126 / 12 = P13,093.83
To obtain the 1/12 of the monthly equivalent, P13,093.83 / 12 = P1,091.15
To obtain the 13th month for the 6 months of service, P1,091.15 x 6 = P6,546.92
Alternative computation is 1/12 of the total basic salary earned, thus:
P13,093.83 x 6 months = P78,562.98
1/12 of P78,562.98 is P78,562.98 / 12 = P6,546.92 which is the same as the above approach.
Hence, the 13th month pay of X for the six-month period without any unauthorized absences is P6,546.92.
For further discussion about 13th month pay, please check my book on Employee Compensation and Benefits Volume 2, Second Edition.