Professional Documents
Culture Documents
Sil Separation Pay
Sil Separation Pay
6 SERVICE INCENTIVE
LEAVE AND SEPARATION
PAY
SERVICE INCENTIVE LEAVE
Article 95 of Presidential Decree No. 442 or the Labor
Code of the Philippines, every employee who has
rendered at least one year of service is entitled to a
yearly incentive leave of five (5) days with pay.
COMPUTATION OF SERVICE INCENTIVE LEAVE
CREDIT AND CASH CONVERSION
The unused service incentive leave is commutable to its
money equivalent at the end of the year. In computing, the
basis shall be the salary rate at the date of conversion. The
use and conversion of this benefit may be on a pro-rata
basis.
Cash Conversion
Formula: Daily Pay x No. of Unused Days
EXAMPLE:
Jon is a minimum wage earner who To compute his cash conversion
lives in Rizal City but is currently
working at NCR, specifically in Quezon Daily Pay x No. of Days
City, which pays him at his daily rate.
He was officially hired last January 1, PHP 610 x 5
2019. On January 1, 2020, he is entitled
to 5 days of SIL as of December 31,
= 3,050
2020, he did not consume any of his SIL.
Thus, 5 of his SIL will be convertible to
cash. How much would it be?
EXAMPLE: The formula is as follows:
Thus, only two (2) days shall be Cash Conversion = Daily Pay x No. of Days
converted to cash. To compute
for the conversion: PhP657.53 x 2 days
= PhP 1,315.06
SEPERATION PAY
The amount given to an employee who has been terminated
from service for authorized causes wherein the employees
are not at fault since their employment was ended due to
business reasons.
Authorized causes for termination under the Labor Code:
Installation of labor-saving devices
Redundancy
Retrenchment to prevent losses
Closing or cessation of operation of the establishment
Health risks
SEPERATION PAY
Terminated due to just causes:
Neglection of duties
Willful disobedience
Serious misconduct
If the employee has committed fraud or a willful breach of
the trust given to him or her by a duly authorized
representative
Commission of crime against the employer
Commission of crime against any duly authorized personnel
TERMINATION DUE TO REDUNDANCY OR THE INSTALLMENT OF THE
LABOR-SAVING DEVICES
Formula:
One Month Salary × Years Served = Seperation Pay
Formula:
One Month Salary × Years Served = Seperation Pay