Holiday Pay in the Philippines: Rules and Formulas

TL;DR: Philippine law pays regular holidays and special non-working days differently. A regular holiday guarantees 100% of the daily wage even if the employee does not work, and 200% if they do. A special non-working day is no-work-no-pay by default, but jumps to at least 130% if the employee works, and 150% if that work also falls on their rest day. President Marcos signed Proclamation No. 1006 on 3 September 2025, setting the 2026 list, and DOLE restates the exact pay formulas in Labor Advisory No. 12-25.

The 2026 holiday calendar

Every year, the Office of the President issues a proclamation naming the regular holidays and special non-working days for the following year, under Republic Act No. 9492. For 2026, that is Proclamation No. 1006, signed by President Ferdinand R. Marcos Jr. through Executive Secretary Lucas P. Bersamin on 3 September 2025. The list below is what that proclamation sets out.

Two things in that table trip up foreign founders who assume the list is fixed on day one.

First, 25 February is a special working day, not a day off, despite marking a major national anniversary. Treat it as an ordinary Wednesday for payroll purposes unless your own company calendar says otherwise.

Second, the proclamation does not include Eid’l Fitr or Eid’l Adha. Section 2 of Proclamation No. 1006 explicitly holds those two dates back: they are still regular holidays under Republic Act No. 9177 and Republic Act No. 9849, but the actual calendar dates depend on the Islamic lunar calendar, so the National Commission on Muslim Filipinos recommends the dates to the Office of the President closer to the time, and a separate proclamation follows. Expect at least two more regular holidays to appear on your calendar mid-year that are not in the table above.

On top of that, Malacañang and DOLE add special non-working days through the year for events the September proclamation could not anticipate. In January 2026, the Palace separately declared 11 local special non-working days covering city and municipal festivals and founding anniversaries, from the Coconut Festival in San Pablo City to Bacolor Day in Pampanga. These apply only within the named locality, so a Manila-based company with a Cebu branch cannot assume the two offices share a calendar. Build a habit of checking the DOLE and Official Gazette sites monthly rather than locking your payroll calendar in January and forgetting it.

Regular holiday or special non-working day: why the label matters

The label is not cosmetic. It decides whether an employee gets paid for a day they never worked, and it decides the multiplier if they did work. Get the label wrong and you either underpay, which exposes you to a DOLE money claim and back-pay with legal interest, or overpay every year without knowing it.

The Labor Code’s default position is that a regular holiday is a paid day off. The employer owes 100% of the daily wage whether or not the person works, subject to one condition described below. A special non-working day carries no such guarantee. The Labor Code treats it under the general no-work-no-pay principle that governs any day the business is open but the employee chooses, or is told, not to come in.

How regular holiday pay is computed

The baseline rule, confirmed in DOLE Labor Advisory No. 12-25 and consistent with Article 94 of the Labor Code, breaks into three scenarios.

1. Employee does not work. They receive 100% of their daily wage, but only if they reported for work, or were on leave with pay, on the workday immediately before the holiday. An employee who was absent without pay the day before a regular holiday is not automatically entitled to be paid for the holiday itself. This is the single most common compliance trap in Philippine payroll: an employee takes an unpaid day off right before a long weekend, and the employer pays the holiday anyway out of habit.
2. Employee works. They receive 200% of their daily wage for the first eight hours, regardless of whether the holiday falls on a normal workday or not.
3. Employee works and the holiday falls on their rest day. The rate rises to 260% of the daily wage for the first eight hours. That is the 200% holiday rate plus an additional 30% of that 200%, which is the standard rest-day premium the Labor Code applies whenever work happens on a scheduled day off.

A worked example

Assume an employee earns 700 pesos a day (a figure chosen only to make the arithmetic clear; check the applicable regional minimum wage before using this as a real payroll input).

• Absent employee, holiday not worked, present the day before: 700 pesos, no work required.
• Employee called in to work the holiday, first 8 hours: 700 x 200% = 1,400 pesos.
• Same employee, but the holiday also happens to be their weekly rest day: 700 x 260% = 1,820 pesos.

Multiply that gap across a payroll of even a dozen staff working two or three regular holidays a year, and the difference between applying 200% correctly versus paying a flat day rate is real money, both as underpayment risk and as a line item you should be forecasting rather than discovering after the fact.

How special non-working day pay is computed

Special non-working days use a different starting point. The default is no work, no pay, and DOLE’s advisory is explicit that this default only changes if a favorable company policy, an established practice, or a collective bargaining agreement provides for payment anyway. Absent one of those, an employee who does not report on a special non-working day simply is not paid for it, and that is lawful.

If the employee does work, the rates step up:

1. Worked, first 8 hours: at least 130% of the daily wage.
2. Worked, and the day also falls on the employee’s rest day: at least 150% of the daily wage for the first 8 hours.

A worked example

Using the same 700-peso daily wage:

• Employee stays home on a special non-working day, no applicable company policy: 0 pesos, no violation.
• Employee comes in and works the special non-working day, first 8 hours: 700 x 130% = 910 pesos.
• Same day happens to be the employee’s rest day: 700 x 150% = 1,050 pesos.

Notice the practical effect: a special non-working day is far cheaper for an employer than a regular holiday if nobody works it, and materially cheaper than a regular holiday even if someone does work it. This is exactly why the label on each date in the proclamation matters more than most founders assume when they first budget for payroll.

Overtime on a holiday

Work beyond the first 8 hours on either kind of holiday still earns the standard overtime premium on top of the holiday rate, not instead of it. Following the formulas DOLE restates in Labor Advisory No. 12-25:

• Regular holiday, overtime hours: hourly rate x 200% x 130% x hours worked.
• Regular holiday plus rest day, overtime hours: hourly rate x 200% x 130% x 130% x hours worked.
• Special non-working day, overtime hours: hourly rate x 130% x 130% x hours worked.
• Special non-working day plus rest day, overtime hours: hourly rate x 150% x 130% x hours worked.

The 130% multiplier for overtime hours is the same 30% overtime premium the Labor Code applies to any overtime worked on a rest day or a special or regular holiday, layered on top of whichever holiday rate already applies to that day.

The pay-multiplier table

Who is exempt from holiday pay

The Labor Code does not apply holiday pay to every worker equally. Article 82 excludes several categories from the entire chapter on working conditions, holiday pay included:

• Government employees, who are covered instead by civil service rules.
• Managerial employees, meaning staff whose primary duty is managing the establishment, or a department of it, and who direct the work of other employees.
• Field personnel, non-agricultural staff who regularly work away from the principal place of business and whose actual hours cannot be determined with reasonable certainty. A field sales representative who sets their own daily schedule is the classic example; a delivery rider whose route and hours are tracked by the company generally is not.
• Members of the employer’s family who depend on the employer for support.
• Domestic helpers and persons in the personal service of another, covered instead under the separate kasambahay law.
• Workers paid by results, such as pakyaw or piece-rate arrangements, where output rather than time worked sets the pay.

There is a second, narrower exemption that catches many small foreign-owned businesses off guard: Article 94 itself exempts retail and service establishments that regularly employ fewer than 10 workers from the regular holiday pay obligation. A small consultancy, boutique, or cafe run by a foreign founder with eight or nine staff can sit entirely outside the regular holiday pay requirement, while an identical business with 11 staff cannot. Cross the threshold, even briefly, and the safer approach is to start paying holiday rates and keep the exemption as a documented fallback position rather than a default assumption, since headcount fluctuates and DOLE looks at what a business regularly employs, not a single payroll cycle.

None of these exemptions apply automatically just because a job title sounds senior. DOLE and the courts look at actual duties, not the label on the employment contract, when a managerial exemption is disputed. A “store manager” who spends most shifts ringing up sales alongside rank-and-file staff, with no real authority to hire, discipline, or set schedules, is unlikely to hold up as a managerial employee if the exemption is challenged.

Holiday pay and the minimum wage floor

Holiday pay is computed on the employee’s actual basic daily wage, not on a separate holiday-specific rate. That basic daily wage has to sit at or above the applicable regional minimum wage for the region and sector the business operates in. Wage boards set different minimum rates across regions, and some set separate rates for agriculture versus non-agriculture or for establishment size, so the 700-peso figure used in the examples above is illustrative only. Confirm your region’s current wage order before running payroll, because paying holiday premiums correctly on a daily wage that is already below the legal floor does not fix the underlying minimum wage violation.

Getting holiday pay right in your payroll

Three habits keep this from becoming a recurring problem:

1. Track attendance the day before every regular holiday. That single data point, not attendance on the holiday itself, decides whether the 100% obligation exists at all.
2. Confirm each date’s official label before the pay period closes, since the type, not the date, decides the rate, and DOLE issues local and supplementary special non-working days through the year that a January calendar will not show.
3. Keep your holiday and overtime formulas in one place your payroll process actually enforces, rather than a rule someone remembers to apply manually. If your payroll processing already handles statutory contributions and withholding correctly, holiday pay is one more rule set that belongs inside the same system rather than a manual override every proclamation season.

Get the label wrong on even a handful of pay periods a year and the exposure compounds: DOLE inspections look specifically at holiday pay computation, and underpayment claims carry legal interest from the date each amount fell due, not from the date the employee complains.

This guide is general information, not legal advice on your specific facts. Book a consultation if you want a fixed-scope review of your holiday pay setup before your next long weekend.