Glossary

13th-month pay: what it is and what it means for you as a buyer

Also called: Thirteenth-month pay, Thirteenth salary, 13th month. Last reviewed .

13th-month pay is a yearly payment Philippine employers must give rank-and-file employees, worth at least one-twelfth of the basic salary earned in the calendar year and paid by December 24. It comes from Presidential Decree 851 of 1975.

What it means for you as a buyer

13th-month pay is a real cost of employing someone in the Philippines that most US, UK and Australian payrolls do not have, so check where each quote puts it. In the model on this site it sits inside the hourly rate, with no separate charge in December. A freelancer hired from a job board gets none, because a freelancer is not an employee; the comparison of a managed office team, OnlineJobs.ph and a local hire shows what else that changes. When you compare quotes, ask whether 13th-month pay is in the rate or a surprise line at year end.

A worked example with numbers

On an example basic salary of PHP 24,000 a month, 13th-month pay is PHP 24,000, so the employer pays 13 monthly salaries a year, not 12. The salary is a round example, not any agent's pay.

Example: 13th-month pay on a PHP 24,000 monthly basic salary
Line Sum Amount
Basic salary for a full year 24,000 × 12 PHP 288,000
13th-month pay 288,000 ÷ 12 PHP 24,000
Total paid for the year 288,000 + 24,000 PHP 312,000
Agent who started in July (6 months) 24,000 × 6 ÷ 12 PHP 12,000

That is one-twelfth, about 8.3%, on top of the 12-month salary total. Only basic salary counts: overtime pay and the night shift differential are left out unless the contract or company practice treats them as basic salary.

Where this appears in our pricing or process

13th-month pay is inside the hourly rate (USD 10.50–12): the included and not-included table on the pricing page lists it with the agent's salary and the employer's government contributions, so the cost calculator adds nothing for it. The provider, as employer, owes it to the agent by December 24; you see only the usual monthly invoice.

I am paid a commission by the provider for clients I introduce. The provider bills you at the rate shown on this site. How I'm paid

Questions buyers ask

Is 13th-month pay a bonus?

No. The law requires it for rank-and-file employees who worked at least one month in the year. An employer can pay a bonus on top, but a bonus does not replace it.

  • Night shift differential (Philippines)
    Philippine law adds at least 10% to an employee's wage for each hour worked from 10pm to 6am. What that means for a US-hours agent, with a worked example.
  • Regularization and probation (Philippines)
    Philippine probation may not run past six months; after that the employee is regular. What it means for your agent's first months, with an example.
  • Employer of record (EOR)
    An employer of record legally employs a worker for you and runs payroll while you direct the work. When it fits and what it leaves to you, with an example.

What a dedicated agent costs, and what the rate includes

Sources

  1. Presidential Decree No. 851 (13th-month pay) and its implementing rules, The LawPhil Project, signed 16 December 1975; text checked 7 November 2026.
  2. Labor Advisory No. 16, Series of 2025: Guidelines on the payment of the 13th-month pay (PMAP circular), Department of Labor and Employment, via PMAP, 2025.
  3. Thirteenth salary, Wikipedia, checked 7 November 2026.

We publish what the provider has confirmed in writing. If a figure is not here, we have not been able to confirm it.