Types of Holidays in the Philippines and How They Affect Payroll

Not all holidays in the Philippines are treated the same when computing payroll. Whether an employee should be paid for an unworked holiday, how much an employee should receive for working, and how overtime should be computed depend on the type of holiday.

For employers, HR personnel, and payroll processors, correctly identifying the holiday type is therefore the first step in computing an employee’s pay.

For payroll purposes, holidays and special days in the Philippines generally fall under these classifications:

• Regular Holiday
• Special Non-Working Day
• Special Working Day

Each has different payroll rules.

Regular Holiday vs. Special Non-Working Day vs. Special Working Day

Here is a quick comparison of how the different types of holidays generally affect payroll:

Additional rates may apply when the holiday falls on the employee’s scheduled rest day or when the employee works overtime.

Regular Holidays

A regular holiday provides employees covered by the holiday pay provisions of the Labor Code with greater protection than a special non-working day.

An employee who does not work on a regular holiday is generally entitled to 100% of the employee’s daily wage, subject to the rules on holiday pay eligibility.

If the employee works during the regular holiday, the employee is generally entitled to 200% of the daily wage for the first eight hours of work.

This is why work performed on a regular holiday is commonly referred to as receiving “double pay.”

Regular Holiday Pay When the Employee Does Not Work

For an unworked regular holiday, the general computation is:

Daily Rate × 100%

For example, if an employee has a daily rate of ₱1,000:

₱1,000 × 100% = ₱1,000

The employee receives ₱1,000 even though no work was performed, provided the employee is entitled to holiday pay.

Absence Before a Regular Holiday

Holiday pay for an unworked regular holiday is subject to an important condition.

An employee is generally entitled to holiday pay if the employee worked or was on leave of absence with pay on the workday immediately preceding the regular holiday.

If the immediately preceding day is a non-working day in the establishment or the employee’s scheduled rest day, eligibility is determined based on whether the employee worked or was on leave with pay on the workday immediately preceding that non-working day or rest day.

This distinction is important in payroll. Simply checking whether the employee was present on the calendar day immediately before the holiday may produce an incorrect result.

Regular Holiday Pay When the Employee Works

When an employee works during a regular holiday, the employee should generally receive 200% of the basic wage for the first eight hours.

The computation is:

Daily Rate × 200%

For an employee earning ₱1,000 per day:

₱1,000 × 200% = ₱2,000

The employee receives ₱2,000 for working eight hours during the regular holiday.

Regular Holiday That Falls on a Rest Day

The computation changes when a regular holiday also falls on the employee’s scheduled rest day.

If the employee works during a regular holiday that falls on the employee’s rest day, an additional 30% applies to the 200% holiday rate.

The computation is:

Daily Rate × 200% × 130%

Using a ₱1,000 daily rate:

₱1,000 × 200% × 130% = ₱2,600

The employee would therefore receive ₱2,600 for the first eight hours of work.

The employee’s actual scheduled rest day matters. A holiday falling on a Sunday does not automatically mean that every employee who works on that date is entitled to the holiday-plus-rest-day rate.

Under the Labor Code, work performed on Sunday is entitled to the additional rest-day compensation only when Sunday is the employee’s established rest day.

Special Non-Working Days

A special non-working day follows different payroll rules from a regular holiday.

The general principle is “no work, no pay.”

If an employee does not work during a special non-working day, the employer is generally not required to pay the employee for that day unless a favorable company policy, established practice, or collective bargaining agreement provides otherwise.

Special Non-Working Day When the Employee Does Not Work

Under the general rule:

No work = No pay

This is one of the biggest differences between a regular holiday and a special non-working day.

A covered employee may be entitled to pay for an unworked regular holiday, while an unworked special non-working day is generally unpaid.

Special Non-Working Day When the Employee Works

If an employee works during a special non-working day, the employee is generally entitled to an additional 30% of the basic wage for the first eight hours.

The computation is:

Daily Rate × 130%

For an employee earning ₱1,000 per day:

₱1,000 × 130% = ₱1,300

The employee would receive ₱1,300 for the first eight hours of work.

Special Non-Working Day That Falls on a Rest Day

If the special non-working day also falls on the employee’s scheduled rest day and the employee works, the employee is generally entitled to 150% of the basic wage for the first eight hours.

The computation is:

Daily Rate × 150%

Using a ₱1,000 daily rate:

₱1,000 × 150% = ₱1,500

Special Working Days

A special working day is different from a special non-working day.

For payroll purposes, a special working day is generally treated like an ordinary working day. There is no special holiday premium simply because the date has been declared a special working day.

If the employee works, the normal compensation applicable to an ordinary working day applies.

If the employee does not work, the usual rules applicable to an ordinary working day apply.

This distinction is important because the words “special holiday” alone do not tell an employer how payroll should be computed. Employers should determine whether the official proclamation declares the date a special non-working day or a special working day.

Holiday Pay Rates at a Glance

The following table summarizes the basic rates:

*Subject to applicable holiday pay rules and any more favorable company policy, practice, employment agreement, or collective bargaining agreement.

Overtime Work During a Holiday

Holiday pay becomes more complicated when an employee works beyond eight hours.

The overtime rate is based on the applicable rate for the type of day.

Overtime on a Regular Holiday

For overtime performed during a regular holiday:

Hourly Rate × 200% × 130% × Overtime Hours

For example, assume an employee has an hourly rate of ₱125 and works two overtime hours:

₱125 × 200% × 130% × 2 = ₱650

The ₱650 represents compensation for the two overtime hours and is in addition to compensation for the first eight hours.

Overtime on a Regular Holiday That Is Also a Rest Day

If a regular holiday also falls on the employee’s scheduled rest day:

Hourly Rate × 200% × 130% × 130% × Overtime Hours

Overtime on a Special Non-Working Day

For overtime during a special non-working day:

Hourly Rate × 130% × 130% × Overtime Hours

Overtime on a Special Non-Working Day That Is Also a Rest Day

If the special non-working day also falls on the employee’s scheduled rest day:

Hourly Rate × 150% × 130% × Overtime Hours

These combinations are one reason holiday payroll errors can occur when payroll is computed manually.

How Do Holidays Apply to Shifts That Cross Midnight?

A less straightforward situation occurs when an employee’s shift begins on one calendar date and ends on another.

For example, suppose June 12 is a regular holiday and an employee is scheduled to work:

June 11, 10:00 PM to June 12, 6:00 AM

Which date should determine the holiday treatment?

There are two ways employers and payroll systems may encounter this situation.

Calendar-Date Method

Under a calendar-date approach, the hours are classified according to the actual calendar date on which they were worked.

Using the example above:

• June 11, 10:00 PM to 12:00 midnight – June 11
• June 12, 12:00 midnight to 6:00 AM – June 12 holiday hours

This can result in a single shift being divided between an ordinary day and a holiday.

Shift-Based Method

Under a shift-based approach, the entire shift may be associated with the employee’s scheduled workday based on when the shift begins.

Using the same example, the shift beginning at 10:00 PM on June 11 may be treated as the employee’s June 11 shift even though some of the hours extend into June 12.

This approach is commonly useful in businesses with night shifts because attendance, schedules, absences, rest days, and payroll are often managed by work shift rather than strictly by calendar date.

Which Method Is Required?

Philippine labor rules clearly prescribe the rates for work performed during a holiday and provide specific rules when a holiday also falls on an employee’s scheduled rest day.

However, the Labor Code, its implementing rules, and the DOLE holiday-pay guidance we reviewed do not appear to expressly prescribe whether an overnight shift crossing midnight must always be classified using the calendar date or the shift’s assigned workday.

Because of this, employers should be careful about treating either method as a universal rule required by DOLE.

Employers with overnight operations should establish a clear and consistently applied policy for determining the workday of a cross-midnight shift, while ensuring that employees receive at least the compensation required by applicable labor standards.

This is particularly important for businesses such as:

• BPO and call center operations
• Hotels and restaurants
• Hospitals and healthcare facilities
• Manufacturing operations
• Security services
• Logistics and warehousing
• Other businesses operating night or 24-hour shifts

Payroll and attendance systems should also be configured consistently with the employer’s adopted policy. MPM Payroll can be configured to determine holidays either by calendar date or by the employee’s work shift, allowing employers to apply the method appropriate to their work schedules and company policy.

What Happens When Two Regular Holidays Fall on the Same Day?

Occasionally, two regular holidays may fall on the same date. This is commonly referred to as a double holiday.

Double holidays have their own payroll rules and should not be treated as an ordinary regular holiday.

For covered employees who do not work on a double regular holiday, the applicable holiday pay is generally 200% of the employee’s daily wage, subject to the applicable holiday pay eligibility rules.

If the employee works on the double regular holiday, the applicable rate for the first eight hours is generally 300% of the employee’s daily wage.

For example, with a ₱1,000 daily rate:

₱1,000 × 300% = ₱3,000

Because double holidays are uncommon, they can easily be overlooked when payroll rules are configured manually.

What About Consecutive Regular Holidays?

Another situation employers should watch for is when two regular holidays occur consecutively.

This commonly becomes relevant during Holy Week.

When there are two successive regular holidays, an employee who is absent without pay on the workday immediately preceding the first holiday may not be entitled to holiday pay for both holidays.

However, if the employee works on the first regular holiday, the employee may become entitled to holiday pay for the second holiday.

This is another reason payroll processors should not evaluate each holiday solely as an isolated calendar date.

National and Local Holidays

Not every holiday applies to the entire Philippines.

Aside from nationwide holidays, certain dates may be declared holidays only in a particular:

• Province
• City
• Municipality
• Region or other locality

For payroll purposes, employers should determine whether the holiday declaration applies to the employee’s workplace.

This is particularly important for businesses operating in multiple branches or locations. One branch may be affected by a local holiday while employees working in another location may have an ordinary working day.

The Employee’s Scheduled Rest Day Matters

The employee’s work schedule is particularly important when determining whether a holiday also falls on a rest day.

For example, suppose a regular holiday falls on Sunday.

For Employee A, Sunday is the scheduled rest day. If Employee A works on that holiday, the regular-holiday-plus-rest-day rate may apply.

Employee B, however, normally works on Sunday and has Wednesday as the scheduled rest day. Employee B should not automatically receive a rest-day premium merely because the holiday happened to fall on Sunday.

The Labor Code specifically provides that the additional compensation for Sunday work applies when Sunday is the employee’s established rest day.

Payroll processing should therefore consider both:

1. The classification of the day – regular holiday, special non-working day, special working day, or ordinary day; and
2. The employee’s work schedule – including the employee’s scheduled rest day.

Why Correct Holiday Classification Matters in Payroll

Incorrect holiday classification can result in either underpayment or overpayment of employees.

For example, treating a special non-working day as a regular holiday may result in paying employees who did not work even when the “no work, no pay” rule should apply.

On the other hand, treating a regular holiday as an ordinary working day may result in an employee receiving less than the required holiday pay.

Holiday classification can affect:

• Basic pay
• Holiday pay
• Premium pay
• Overtime pay
• Rest-day premiums
• Attendance and timesheet processing
• Payroll reports

This is why holiday configuration should be part of the payroll process rather than simply being used to mark dates when the office is closed.

Holiday Dates and Classifications Can Change

While many Philippine holidays occur on familiar dates, employers should not assume that the classification and date will always remain the same every year.

The Philippine government issues proclamations identifying the official regular holidays and special days for a particular year. Additional national or local holidays may also be declared during the year.

Employers should therefore verify the applicable official proclamations and issuances when configuring their payroll calendar.

For the current schedule, see our 2026 Philippine Holidays guide.

Automating Holiday Pay Computation

Holiday payroll becomes increasingly difficult to manage manually when employees have different schedules, rest days, overtime, and work locations.

For example, the same holiday could result in different payroll computations for employees who:

• Did not work
• Worked for eight hours
• Worked overtime
• Had the holiday fall on their scheduled rest day
• Work in a location covered by a local holiday
• Were absent before a regular holiday
• Worked an overnight shift crossing into or out of the holiday

A payroll system can automate many of these rules by combining the employee’s attendance, work schedule, holiday calendar, and payroll settings.

MPM Payroll allows businesses to configure holiday processing according to their attendance and payroll policies, including determining holidays based on the calendar date or the employee’s work shift. This is particularly useful for businesses with overnight shifts where a single shift may cross two calendar dates.

Frequently Asked Questions

Making Holiday Payroll Easier

Philippine holiday pay involves more than simply identifying whether a date is a holiday. Employers may need to consider the type of holiday, whether the employee worked, the employee’s scheduled rest day, overtime hours, attendance before the holiday, work location, and the treatment of shifts crossing midnight.

Understanding these differences helps employers compute payroll correctly and helps employees understand how their holiday pay is determined.

For businesses that want to reduce manual payroll computations, MPM Payroll can automate attendance, holidays, rest days, overtime, and payroll calculations using configured Philippine payroll rules.