When we encounter number 13, at times, we kind of gasp because of the historical and cultural belief in some regions around the world about it being unlucky. However, during the holiday season in the Philippines, all fear is gone and 13 somehow becomes everyone’s favorite number!
Aside from the celebration of the Christ’s birthday and meaningful family gatherings, Filipinos are also looking forward to receiving their 13th month pay. Under Presidential Decree (P.D.) no. 851, the 13th month pay was created to help workers enjoy the Christmas and New Year’s Day festivities. With this, all employers are required to pay their rank-and-file employees, who have rendered service at least one month in a calendar year, one twelfth (1/12) of their basic salary not later than December 24 of every year.
To help you understand your benefits better, here’s what you need to know about your 13th month pay:
#1: Regardless of your employment status, your employer’s method of wage payment, and your employer size, you are entitled to 13th month pay.
#2: Managerial employees whose responsibilities include laying down and executing management policies are not entitled to 13th month pay. This includes expatriate managerial employees in PEZA zones unless their contract grants it.
#3: If you have multiple employers, for example, you are working for a private organisation and a private educational institution, you are still entitled to the pay regardless of your total earnings.
#4: Whether you have resigned, retired, or been terminated in your work, you will still receive your pro-rated 13th month pay which will be released together with your final pay.
#5: Government employees under Job Order status are not eligible to receive 13th month pay.
#6: Your 13th month pay is tax-exempt until P90,000. If it is more than that, only the excess will be subject to tax.
#7: Government-mandated contributions such as SSS, PhilHealth, and HDMF are not deductible from the 13th month pay.
#8: Employers may opt to give your 13th month pay in two ways. One, give the first half just before the school year begins, and the second on or before December 24 of the year. Two, give the full amount of the monetary benefit on or before December 24.
#9: To compute your 13th month pay, follow this formula:
Total basic salary earned during the year/12 months = 13th month pay
Basic salary is the regular wage for work rendered, excluding allowances, overtime, unused leave cash conversions, and other benefits.
#10: Employers who failed to pay or underpaid their employees are subject to fines and/or imprisonment for up to three years.
#11: Your employer may file for an exemption from providing 13th month pay to its employees on two grounds: If the employer is distressed (accumulating losses and/or negative retained earnings) and if they are already paying equivalent or better benefit.
However, it is important to note that applications are subject to approval, and prior grants are not guaranteed for renewal.
#12: If you have domestic workers or “kasambahays” employed, they are now entitled to 13th month pay under the Domestic Workers Act (R.A. 10361).
#13: If you fail to receive your 13th month pay, you may file a complaint in the Department of Labor and Employment (DOLE) or the National Labor Relations Commission (NLRC).
Now you know the basics and what to expect from your highly anticipated 13th month pay, here are some ways you can maximise it. After all, nowadays, it has become increasingly essential to be wiser and more practical about our hard-earned money.
Learn to distinguish wants from needs
TransUnion's Consumer Pulse Study in Q2 2025 revealed that while 73% of Filipino consumers expect an increase in their incomes over the next year, 42% of consumers intended to limit discretionary spending and 43% intended to scale down major purchases, given the economic headwinds the country is facing.
There may be times when the lines along “needs” and “wants” are blurred. To help you see clearly, list all the things in your “To Buy” and categorise everything depending on its priority. You can also ask yourself: “Do I own similar things that serve the same purpose as the one I want to buy?” or “Am I able to pay for this without hurting my daily budget?”. Understanding what a necessity is for you will help you decide better on your next purchase.
Explore options in growing your money
TransUnion’s study also showed 45% of Filipino households have saved more in their emergency funds in the past three months, signaling a positive shift that can benefit consumers, financial institutions, and the economy.
Growing your money has become more accessible now with the rise of digital banking and on-demand financial literacy programs. Several BSP-licensed digital banks offer high interest rates, attracting more customers to save. Some have also included investment options such as trading stocks, bonds, mutual funds, and crypto in their apps for easy management both for beginners and experienced traders.
Turn your spending into something meaningful
Every time we spend, we make a choice. And this time, why not make it count? Consider supporting a cause that matters to you—whether it’s helping a charity close to your heart, buying from local small businesses, or investing in products that champion sustainability. Spending something that contributes to a positive, lasting impact gives you purpose and fulfillment in creating a better future.
So, while the number 13 might frighten people elsewhere, in the Philippines, it brings joy especially during the holiday season through 13th month pay. However, let us all remember that Christmas is about giving and spreading kindness and hope with our families, friends, and communities.
As published in The Manila Times, 17 December 2025
