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Payment for Legal Holiday Falling on a Rest Day

This article explains the specific handling of Legal Holiday (LH) pay in Sprout HR when the holiday coincides with an employee's Rest Day (RD), detailing the different payment scenarios based on whether the employee renders work or not.

1. Employee Renders Work on a Legal Holiday Falling on a Rest Day (LH-RD)

When an employee is scheduled to work and successfully renders service on a day that is both a Legal Holiday and their designated Rest Day, special attention is required to ensure accurate payroll computation.

2. Employee Does Not Render Work on a Legal Holiday Falling on a Rest Day (LH-RD)

The payment process for an employee who is not at work on an LH-RD depends heavily on their pay type (salary basis).

a) Semi-Monthly / Monthly Paid Employees

  • Payment Status: The basic pay for the holiday/rest day is already included in the computation of their factor rate.
  • Payroll Action: There is no need to add or upload extra payment during the regular payroll processing period, as this group is already paid for all calendar days, including holidays and rest days.

    Reference: Workers Monetary Benefits

b) Daily Paid Employees

  • +8 Legal Holiday Policy

    If your company has the +8 Legal Holiday Policy enabled in Sprout HR, employees will receive holiday pay even if they do not work on a legal holiday. For daily-paid employees, the system automatically provides 8 hours of basic pay for the holiday.

    If this policy is not yet enabled, please note that it will only work correctly if the employee’s Attendance Compute Type is set to First Shift Basis. This setting ensures that payroll is calculated accurately for legal holidays.

    For more details on how this works, you can refer to:: First-Shift Basis Attendance Computation: How Does This Affect Payroll Types On a Legal Holiday?
Pursuant to Article 94 of the Labor Code of the Philippines and as reflected in DOLE holiday pay guidelines, an employee is entitled to 100% of their daily wage if a Legal Holiday falls on their Rest Day, provided that the employee was present at work or on paid leave on the workday immediately preceding the holiday. This “day-before” requirement is part of the holiday pay computation guidance under DOLE rules for regular holidays in the Philippines. Rolling Stone PH

Reference:📌 DOLE Holiday Pay Rules and Guidelines for 2025 — includes the rule on regular holiday pay (100% if not worked, with day-before attendance requirement) 

However, kindly note that this entitlement also depends on the Holiday Pay Eligibility as set in the Holiday Plan in Sprout HR. For more information, please see this article: How Does Holiday Pay Eligibility Work?

Key Notes for Compliance and Accuracy

  • This holiday pay calculation method in Sprout HR is designed to ensure strict compliance with DOLE guidelines regarding holiday and rest day pay.
  • For accurate processing, always confirm that the Daily Paid Policies such as the +8 Legal Holiday are properly enabled in your company's Sprout HR settings, especially when dealing with daily-paid employees. Feel free to reach out to us at Sprout Experts to help you with this.

Understanding these distinctions is crucial for maintaining DOLE compliance and ensuring accurate payroll. Proper filing by the employee (when working) and confirming system policy settings (when not working) are the two key steps to accurate payment for a Legal Holiday falling on a Rest Day.

If you have any further questions or require assistance in checking your company's specific holiday policy configurations, please do not hesitate to reach out to your Customer Success Manager or us at Sprout Experts.

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