13th Month Pay Calculator
Understanding Your 13th Month Pay
The 13th-month pay is a mandatory monetary benefit in several countries, most notably the Philippines, usually paid out before the end of the year. It is distinct from a Christmas bonus, which is typically discretionary. The core concept is that an employee receives an additional amount equivalent to one-twelfth (1/12) of their total basic salary earned within a calendar year.
How It Is Calculated
The standard formula used by the calculator above is straightforward. It determines the total basic salary earned during the year and divides it by 12.
Formula: (Monthly Basic Salary × Number of Months Worked) ÷ 12
Typically Excluded Items
Crucially, the computation for the 13th-month pay generally only involves the basic salary. Unless stated otherwise by company policy or collective bargaining agreements, the following are usually excluded from the calculation:
- Overtime pay
- Night differential pay
- Holiday pay
- Cost of Living Allowances (COLA)
- Profit-sharing payments
- Cash equivalents of unused leave credits
Calculation Example
Let's assume an employee has a fixed monthly basic salary of 30,000. They started working in March and completed the year, meaning they worked for 10 months.
- First, calculate the total basic salary earned: 30,000/month × 10 months = 300,000.
- Next, divide the total by 12: 300,000 ÷ 12 = 25,000.
In this scenario, the employee's 13th-month pay would be 25,000. If they had worked the full 12 months, the amount would exactly equal one month's salary (30,000).