Dear PAO,
I have been working as a dressmaker in a tailoring shop for more than three (3) years now. However, since my employment in January 2022, I never enjoyed any vacation leave or sick leave. During one of the meetings I attended, I learned that the law grants a service incentive leave (SIL) benefit of five (5) days every year to employees in the private sector. When I inquired from my supervisor if I am entitled to any paid leave, he answered in the negative as I am employed on a “pakyawan,” or piece rate, basis. May I know if this is correct?
Aesop
Dear Aesop,
The answer to your query can be found in Article 95 of the Labor Code of the Philippines which reads:
“ART. 95. Right to Service Incentive Leave. 80 – (a) Every employee who has rendered at least one year of service shall be entitled to a yearly service incentive leave of five days with pay.
“(b) This provision shall not apply to those who are already enjoying the benefit herein provided, those enjoying vacation leave with pay of at least five days and those employed in establishments regularly employing less than ten (10) employees or in establishments exempted from granting this benefit by the Secretary of Labor and Employment after considering the viability or financial condition of such establishment.
“(c) The grant of benefit in excess of that provided herein shall not be made a subject of arbitration or any court or administrative action.”
From the foregoing provision, the law is clear that in order to avail of the service incentive leave (SIL) benefit, an employee must satisfy the following conditions:
1. An employee has rendered at least one year of service with the company.
2. The same employee does not enjoy any paid vacation leave of at least five days from his/her company.
3. His/her employer currently employs 10 or more workers.
4. The employer was not granted any exemption by the Department of Labor and Employment for payment of the service incentive leave.
In Ariel David v. John Macasio (GR 195466, 02 July 2014), the Supreme Court, through Associate Justice Arturo Brion, clarified that workers engaged on “pakyaw,” or task basis, are entitled to service incentive leave pay, provided that they are not field personnel. In the said ruling, the high court ratiocinated in this wise:
“In short, in determining whether workers engaged on ‘pakyaw,’ or task basis,” is entitled to holiday and SIL pay, the presence (or absence) of employer supervision as regards the worker’s time and performance is the key: if the worker is simply engaged on “pakyaw,” or task basis, then the general rule is that he is entitled to a holiday pay and SIL pay unless exempted from the exceptions specifically provided under Article 94 (holiday pay) and Article 95 (SIL pay) of the Labor Code. However, if the worker engaged on pakyaw, or task basis, also falls within the meaning of “field personnel” under the law, then he is not entitled to these monetary benefits. xxx
In Serrano, the Court, applying the rule on ejusdem generis, declared that “employees engaged on task or contract basis xxx are not automatically exempted from the grant of service incentive leave, unless, they fall under the classification of field personnel.” The Court explained that the phrase “including those who are engaged on task or contract basis, purely commission basis” found in Section 1(d), Rule V of Book III of the IRR should not be understood as a separate classification of employees to which SIL shall not be granted. Rather, as with its preceding phrase — “other employees whose performance is unsupervised by the employer” — the phrase “including those who are engaged on task or contract basis” serves to amplify the interpretation of the Labor Code definition of “field personnel” as those “whose actual hours of work in the field cannot be determined with reasonable certainty.”
Hence, the fact that an employee was engaged on a “pakyaw,” or piece rate basis, does not disqualify him/her from entitlement to SIL. What the law excludes from receiving the same benefit are “field personnel” or workers whose actual work hours cannot be determined with reasonable certainty.
Therefore, if you are not a field personnel and have met all the prerequisites provided under Article 95 of the Labor Code, and your employer is not exempted from providing such benefit, then you are entitled to SIL.
We hope that we were able to answer your queries. Please be reminded that this advice is based solely on the facts you have narrated and our appreciation of the same. Our opinion may vary when other facts are changed or elaborated.
We appreciate your trust and support
Editor’s note: Dear PAO is a daily column of the Public Attorney’s Office. Questions for Chief Acosta may be sent to dearpao@manilatimes.net.
