GUIDELINES ON THE PAYMENT OF FINAL PAY AND ISSUANCE OF CERTIFICATE OF EMPLOYMENT

Read also: The Tenor of a Voluntary Resignation of an Employee and its Effects

• Certificate of Employment must specify the dates of an employee’s engagement and the termination of his/her employment and the type or types of work in which he/she is employed.

• Employer shall issue a certificate of employment within three (3) days from the time of the request by the employee.

• Final Pay shall be released within thirty (30) days from the date of separation or termination of employment, unless there is a more favorable company policy, individual or collective agreement thereto.

An employee who voluntarily resigns from the company is required to submit a written resignation letter at least thirty (30) days before its effectivity date. On the part of the employer, the Final Pay and the Certificate of Employment must be released to the employee.

Department of Labor and Employment (DOLE) issued Labor Advisory No. 06 Series of 2020 or “Guidelines on the Payment of Final Pay and Issuance of Certificate of Employment” defines “Certificate of Employment” and “Final Pay” as:

“Certificate of Employment” refers to a certificate from the employer specifying the dates of an employee’s engagement and the termination of his/her employment and the type or types of work in which he/she is employed.

An employee whose employment is not yet terminated may also ask for a Certificate of Employment.

“Final Pay”, “Last Pay”, or “Back Pay” refers to the sum or totality of all the wages or monetary benefits due the employee regardless of the cause of the termination of employment, including but not limited to:

1. Unpaid earned salary of the employee;
2. Cash conversion of unused Service Incentive Leave (SIL)
3. Cash conversions of remaining unused vacation, sick or other leaves pursuant to a company policy, or individual or collective agreement, if applicable;
4. Pro-rated 13th month pay;
5. Separation pay pursuant;
6. Retirement pay;
7. Income tax claim for the excess of taxes withheld, if applicable;
8. Other types of compensation stipulated in an individual or collective agreement, if any; and
9. Cash Bond/s or any kind of deposit/s due for return to the employee, if any.

• Time of Payment and/or Release of Final Pay

To effectively harmonize the management prerogative of the employer and the right of the employee, the Final Pay shall be released within thirty (30) days from the date of separation or termination of employment, unless there is a more favorable company policy, individual or collective agreement thereto.

• Issuance of Certificate of Employment

The employer shall issue a certificate of employment within three (3) days from the time of the request by the employee.

Any issue or claim dispute arising out or relating to the payment of final pay, or issuance of certificate of employment, shall be filed before the nearest DOLE Regional/Provincial/Field Office which has jurisdiction over the workplace, for conciliation and subject to DOLE’s existing enforcement mechanism.

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Alburo Alburo and Associates Law Offices specializes in business law and labor law consulting. For inquiries, you may reach us at info@alburolaw.com, or dial us at (02)7745-4391/0917-5772207.

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