The Department of Labor and Employment has ruled that workers are entitled to a yearly five-day service incentive leave with pay.
“Service Incentive Leave Pay is an employee benefit that enables them to take or avail of leave with pay for five days provided the worker has rendered service for at least one year,” Labor Secretary Rosalinda Baldoz said.
“Article 95 of the Labor Code mandates employers to give their employees a yearly service incentive leave of five days with pay. The SIL shall be granted to a worker who has been in service within 12 months, whether continuous or broken, reckoned from the date the employee started working, including authorized absences and paid regular holidays,” Baldoz said.
“Notwithstanding this provision, our laws do not preclude employers from giving similar or more, beneficial leave benefits to their employees. The common practice nowadays is that employees in the private sector are given monthly sick and vacation leave credits which they may use as the need arises,” the Labor chief said.
She said that service Incentive Leave is commutable, and it is convertible to cash if not used or exhausted at the end of the year.
“The cash equivalent is aimed primarily at encouraging workers to work continuously and with dedication to the company,” Baldoz said.
However, she said the Labor Code provides that the rule on service incentive leave does not apply to those of the government and any of its political subdivisions, including government-owned and-controlled corporations; domestic helpers and persons in the personal service of another; managerial employees as defined in Book 3 of the Labor Code; field personnel and other employees whose time and performance are not supervised by the employer; those who are already enjoying the benefit; those enjoying vacation leave with pay for at least five days; and those employed in establishments regularly employing less than 10 employees.