Managing employee compensation can be challenging, especially when handling rest day pay in the Philippines. Employers must ensure compliance with DOLE regulations while fairly compensating employees who work on their scheduled rest days. Understanding the correct rest day pay computations, including overtime rates, can help businesses avoid disputes and payroll errors.

How Rest Day Pay Works

The Department of Labor and Employment (DOLE) mandates that employees working on their designated rest days receive additional compensation. Here’s a breakdown:

• Basic Rest Day Pay: Employees must receive an extra 30% of their daily rate for work performed on their rest day.
• Overtime Pay: If work exceeds eight hours, an additional 30% on top of the overtime rate applies.
• Rest Day Holiday Pay: If a holiday coincides with an employee’s rest day and they report to work, higher compensation rates apply based on DOLE’s guidelines.

Rest Day Overtime Pay: Sample Computation

To illustrate, let’s say an employee earns ₱1,000 per day and works 10 hours on their rest day:

• Rest Day Compensation: ₱1,000 + (₱1,000 × 30%) = ₱1,300
• Overtime Pay for 2 Extra Hours: [(₱1,000 ÷ 8) × 1.25] × 30% × 2 = ₱406.25
• Total Earnings for the Day: ₱1,300 + ₱406.25 = ₱1,706.25

Ensuring Accurate Payroll with PAYDAY

Calculating rest day overtime pay and holiday compensation manually can be time-consuming and prone to errors. PAYDAY.PH simplifies payroll management with automated computations, ensuring compliance with DOLE regulations while reducing administrative workload.

With PAYDAY.PH, businesses can:

• automate rest day and overtime pay calculations.
• ensure accurate and timely payroll processing.
• minimize errors in compensation and compliance reporting.
• streamline payroll operations for efficiency.

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