Philippines Night Differential

Philippines Night Differential Calculation

The majority of BPO (Business Process Outsourcing) and call center businesses in the Philippines operate on a shifting schedule. In some industries, such as manufacturing and healthcare, real-time contact with clients, investors, and consumers is possible.

Even if working nights is advantageous for the company, it may be detrimental to your health because you will not get enough sleep at night. Employees who report to work between 10 p.m. and 6 a.m. should be paid a night shift differential. This cannot be less than 10% of your hourly wage, according to Department of Labor and Employment guidelines.

How much is Night Differential in the Philippines

Employees who work between 10 p.m. and 6 a.m. receive a night difference bonus. According to DOLE regulations, it cannot be less than 10% of your hourly wage. Several companies offer night differential pay of up to 20% to attract and retain employees.

By Article 86 of Book III – Conditions of Employment of the Labor Code of the Philippines, which President Ferdinand Marcos passed into law in 1974, employers are required to give night differential pay. In the meanwhile, Republic Act 117012 was approved by President Rodrigo Duterte in April 2022 and grants government employees night differential pay (permanent, contractual, temporary, and casual staff).

Who Gets Nighttime Differential Pay?

All employees are subject to the night differential pay, with the following exceptions:

  • Public servants are not protected under RA 11701
  • Employees of businesses with less than five employees in retail and services
  • Homemakers, also known as kasambahays
  • Managers’ personnel
  • Unsupervised field workers doing their job tasks away from the office
  • Employees of businesses with proper Barangay Micro Business Enterprise registration (BMBEs)

The details of your remuneration package, which includes your hours worked, regular wage, overtime pay, night differential pay, holiday pay, and other allowances, must be outlined in your employment agreement or contract.

As pay packages vary from business to firm, you can explain your eligibility to HR if you are unclear about your employment grade or level.

To elaborate on the first exclusion on the list above, RA 11701 details the exclusions in the public sector as follows:

  • Government workers whose services are required around-the-clock
  • Uniformed members of the Philippine National Police and Armed Forces of the Philippines
  • Employees decided by the Department of Budget and Management (DBM) and the Civil Service Commission (CSC) are not eligible for this benefit.

Who May Receive Nighttime Differential Pay?

 

How to Compute Night Differential in the Philippines

1. What is the Night Differential Pay Formula?

(Hourly Rate x Night Differential Rate per Hour x Number of Hours) = Nighttime Bonus Pay

It should be noted that private groups may give a greater rate than the minimum 10% set by the government for the night differential rate. To find out your night differential rate, first, check your job contract.

The term “Number of Hours” denotes the time period from 10 PM to 6 AM.

2. How can I Find Out the Daily and Hourly Rates?

(Monthly Basic Pay x 12 Months) / Total working days in a year = Daily Rate

See the examples below:

1. (20,000 x 12 months) / 313 (if working 6 days a week)

Amount per day: 766.78

2. (20,000 x 12 months) / 216 (if working 5 days a week)

Amount per day: 1,111.11

 

3. Night Differential Computation Example

Monthly SalaryP20,0000
Work Schedule5x/week (10pm to 6am)
Night Difference8 hours
Night Difference Rate10%
Daily RateP1,111.11
Hourly RateP138.89
Philippines Night Differential