Cecily Zamora
The 13th-month pay law, also known as Presidential Decree No. 851, was created by then-President Ferdinand Marcos in the Philippines in December 1975. The law was intended to give low-paid employees additional income to combat the effects of worldwide inflation and the lack of an increase in the minimum wage. While Marcos signed the decree, the concept and writing of the law have been attributed to labor leader and former representative Zoilo de la Cruz, also known as the Father of 13th Month Pay.
| Characteristics | Values |
|---|---|
| Country | Philippines |
| Creator | Zoilo de la Cruz |
| Signed by | Ferdinand Marcos |
| Date | December 16, 1975 |
| Decree number | 851 |
| Decree name | Presidential Decree No. 851 |
| Decree type | Requiring all employers to pay their employees a 13th-month pay |
| Payment amount | One twelfth (1/12) of an employee's basic annual salary |
| Payment date | Not later than December 24 every year |
| Payment status | Mandatory |
| Payment exemption | Exempt from taxation |
| Payment limit | Prescribed limit provided under Section 32 (B)(7)(e) of the National Internal Revenue Code (NIRC) |
| Payment exemption limit | P90,000 |
| Payment eligibility | All rank-and-file employees |
| Payment frequency | One-half before the opening of the regular school year and the other half on or before December 24 |
| Payment conditions | Employees must have worked for at least one month during the calendar year |
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What You'll Learn
- Presidential Decree No. 851 was signed by Ferdinand Marcos on December 16, 1975
- The law was intended to give low-paid employees additional income
- Marcos's successor, Corazon Aquino, removed the Php 1000 salary ceiling
- Zoilo de la Cruz, a labour leader, is considered the 'Father of 13th Month Pay'
- Marcos loyalists claim that those against him should refuse the holiday benefit
Presidential Decree No. 851 was signed by Ferdinand Marcos on December 16, 1975
On December 16, 1975, Ferdinand Marcos signed Presidential Decree No. 851, also known as the 13th Month Pay Law. This law requires employers to pay their employees an additional month's salary, known as the 13th-month pay, by December 24 each year. The 13th-month pay is equivalent to one-twelfth (1/12) of an employee's basic annual salary.
The 13th-month pay law was created to address the issue of low wages and the lack of an increase in the minimum wage for several years. It aimed to protect the purchasing power of wages from the effects of worldwide inflation, ensuring that employees could meet their daily subsistence needs. The law also recognised the Christmas season as an opportunity for society to show concern for low-paid workers, allowing them to properly celebrate the holidays.
The 13th-month pay was initially applicable to employees earning up to PHP 1,000 per month. However, Marcos's successor, Corazon Aquino, removed this income limit in 1986, extending the benefit to all employee categories in the private sector. Aquino further modified the law in 1988 to include government employees.
While Marcos signed the decree, the concept and drafting of the 13th-month pay law are attributed to labour leader and lawyer Zoilo de la Cruz, also known as the "Father of 13th Month Pay." De la Cruz was the president of the National Congress of Unions in the Sugar Industry in the Philippines (NACUSIP) in 1975 and played a crucial role in advocating for the rights and benefits of sugar workers.
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The law was intended to give low-paid employees additional income
The 13th-month pay law, also known as Presidential Decree No. 851, was created in the Philippines in December 1975 by then-President Ferdinand Marcos. It requires employers to pay their employees an additional month's salary, equivalent to one-twelfth of an employee's basic annual salary, by December 24 each year. This payment is separate from any Christmas bonuses that may be given at the employer's discretion.
Initially, the law applied only to employees earning less than 1,000 pesos per month. However, in 1986, Corazon Aquino, Marcos's successor, removed this income limit and extended the benefit to all employee categories in the private sector. Two years later, in 1988, Aquino further modified the law to include government employees, ensuring that a broader segment of the workforce could benefit from the additional income.
The concept of the 13th-month pay law has been attributed to Negrense lawyer and legislator Zoilo de la Cruz Jr., who was president of the National Congress of Unions in the Sugar Industry in the Philippines (NACUSIP) in 1975. De la Cruz is often referred to as the "Father of 13th Month Pay" and is credited with drafting the proposal for the law. However, it was President Marcos who ultimately signed and enacted the decree, making the 13th-month pay a legal requirement in the Philippines.
The implementation of the 13th-month pay law has had a significant impact on the Filipino workforce, providing much-needed financial relief to low-wage earners and setting a precedent for similar regulations in other countries. It is an example of how legislation can be used to address income disparities and improve the economic well-being of vulnerable workers.
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Marcos's successor, Corazon Aquino, removed the Php 1000 salary ceiling
The 13th-month pay, an additional remuneration or an extra month's salary, was first implemented in the Philippines in December 1975 by then-President Ferdinand Marcos. This was known as Presidential Decree No. 851, which mandated that employers from the private sector pay their rank-and-file employees a 13th-month salary not later than December 24 each year.
By expanding the coverage, Aquino's amended law provided clarity and ensured that all rank-and-file employees, regardless of their salary level, could benefit from this additional remuneration. This amendment demonstrated Aquino's commitment to improving the financial well-being of a broader range of employees in the private sector.
In 1988, Aquino further modified the law to extend the benefits of the 13th-month pay to government employees. This modification resulted in Republic Act 6686, which granted all employees of the national government who had rendered at least four months of service from January 1 to October 31 of each year and remained in service as of October 31 a Christmas bonus equivalent to one month's basic salary, along with an additional cash gift. Aquino's actions ensured that more employees across sectors could benefit from this additional financial support, especially during the festive season.
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Zoilo de la Cruz, a labour leader, is considered the 'Father of 13th Month Pay'
In the Philippines, the 13th-month pay is an additional remuneration, or an extra month’s salary, which is paid to employees in a financial year. This amount is often equal to the employee’s monthly salary and is synonymous with the end-of-year bonus.
The 13th-month pay was first legalized in the Philippines in December 1975 by then-President Ferdinand Marcos, known as Presidential Decree No. 851. This decree mandated that employers from the private sector pay their rank-and-file employees a 13th-month salary not later than December 24 every year.
However, it is important to note that the idea of the 13th-month pay predates this decree. Even before it was issued, some employers in the Philippines were already granting this benefit to their employees. The decree itself acknowledges this by stating that it does not apply to employers who are already providing a 13th-month salary or its equivalent.
In recent years, the most well-known claimant to the title of "Father of the 13th-Month Pay" is Zoilo de la Cruz Jr., a Negrense lawyer, legislator, and labour leader. In 1975, he served as the president of the National Congress of Unions in the Sugar Industry in the Philippines (NACUSIP). De la Cruz played a crucial role in ensuring that the voices of sugar workers were heard in tripartite discussions.
According to his son, Ronaldo de la Cruz, who is also the president of NACUSIP, Zoilo de la Cruz actually drafted the 13th-month pay proposal. In an obituary written by Marchel Espina and published in The Freeman on December 17, 2014, it was stated that De la Cruz "conceptualized the 13th-month pay, the Social Amelioration Program in the sugar industry, and payment of cost-of-living allowance to workers in the private sector." De la Cruz's efforts demonstrate his dedication to securing better benefits and improving the welfare of sugar plantation workers and their communities.
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Marcos loyalists claim that those against him should refuse the holiday benefit
The 13th-month pay is an additional remuneration, or an extra month's salary, paid to employees in a financial year. It was first implemented in the Philippines in 1975 by then-President Ferdinand Marcos, under Presidential Decree No. 851. This decree mandated that employers from the private sector pay their rank-and-file employees a 13th-month salary by December 24 each year. The idea of the 13th-month pay is rooted in Filipino tradition, providing relief to breadwinners during the Christmas season.
While the creation of the 13th-month pay law is attributed to President Marcos, there are claims that Negrense lawyer and legislator Zoilo de la Cruz Jr. conceptualized and drafted the proposal in 1975. De la Cruz was then the president of the National Congress of Unions in the Sugar Industry in the Philippines (NACUSIP), which had a seat in tripartite discussions.
Marcos loyalists have expressed their support for the former president and his regime, even amidst criticisms of the Marcos administration's human rights abuses, corruption, and misuse of funds. Some loyalists have claimed that those who oppose Marcos should refuse the benefits of the 13th-month pay holiday. However, it is important to note that this holiday benefit is a legal entitlement for employees, regardless of their political stance.
The 13th-month pay has become a mandatory benefit in the Philippines, providing financial relief to employees during the holiday season. It is separate from the discretionary Christmas bonus commonly granted by employers. While Marcos may have played a role in its implementation, the law has since been modified to expand its coverage to all employee categories in the private sector and government employees.
The debate around the 13th-month pay law and the role of Marcos in its creation is complex. While Marcos loyalists may have their justifications, it is essential to consider the broader context of the Marcos regime and the contributions of individuals like Zoilo de la Cruz Jr. in shaping this employment benefit.
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Frequently asked questions
Former President Ferdinand Marcos is credited with creating the 13th-month pay law, also known as Presidential Decree No. 851, in the Philippines.
The 13th-month pay law was enacted on December 16, 1975.
The original law stated that employees earning a basic salary of PHP 1,000 or less per month were eligible for the 13th-month pay.
Yes, certain groups were exempted from the law, including government employees, household helpers, and those paid on a commission, boundary, or task basis.
