SmartDeer Global Workforce Policy Watch | Philippines April 2026 Holiday Pay Rules Update

The Philippine Department of Labor and Employment has recently issued Labor Advisory No. 05-2026, clarifying the pay rules for Regular Holidays and Special Non-Working Days in April 2026.

The advisory covers the following dates:

• April 2 – Maundy Thursday
• April 3 – Good Friday
• April 4 – Black Saturday
• April 9 – Araw ng Kagitingan (Day of Valor)

For companies employing staff in the Philippines, holiday pay rules not only affect payroll calculations but also have direct implications for labor compliance and employee communication.

SmartDeer has summarized the key policy points and practical considerations for employers.

I. April 2, April 3, April 9: Regular Holiday Pay Rules

According to the advisory, the following dates are classified as Regular Holidays:

• April 2 – Maundy Thursday
• April 3 – Good Friday
• April 9 – Araw ng Kagitingan

1. If Employees Do Not Work

If an employee does not work on these Regular Holidays, the employer must still pay 100% of the daily wage, provided that the employee:

• Was present on the workday immediately preceding the holiday, or
• Was on approved paid leave on that day

This means employees are entitled to full pay even if they do not work, as long as the condition is met.

2. If Employees Work

If an employee works on a Regular Holiday, the first 8 hours must be compensated at:

200% of the daily wage

This reflects a significantly higher pay rate compared to a regular working day.

II. April 4: Special Non-Working Day Pay Rules

April 4 (Black Saturday) is classified as a Special Non-Working Day, which follows different pay rules.

1. If Employees Do Not Work

If an employee does not work on this day, the general principle applies:

“No work, no pay.”

This means employers are generally not required to pay wages for non-working employees.

However, there are important exceptions:

If any of the following apply, payment may still be required:

• More favorable company policy
• Established company practice
• Collective Bargaining Agreement (CBA)

Therefore, employers should not automatically apply “no work, no pay” without reviewing internal policies and agreements.

2. If Employees Work

If an employee works on a Special Non-Working Day, the first 8 hours must be paid at:

130% of the daily wage (i.e., an additional 30%)

While lower than Regular Holiday pay, this rate is still higher than a normal working day.

III. Key Considerations for Payroll Compliance

Although the advisory appears straightforward, several compliance risks may arise in practice.

1. Distinguishing Holiday Types

Different holiday classifications in the Philippines lead to significantly different pay obligations:

• Regular Holiday:
  • 100% pay if not working
  • 200% pay if working
• Special Non-Working Day:
  • No work, no pay (in principle)
  • 130% pay if working

Failure to correctly classify holidays may result in payroll errors.

2. Verifying Pre-Holiday Attendance or Paid Leave

For Regular Holiday pay eligibility (April 2, 3, and 9), employees must have:

• Reported to work on the preceding day, or
• Been on approved paid leave

Therefore, payroll calculations must consider not only the holiday itself but also attendance records from the previous day.

3. Reviewing Internal Policies and CBAs

For Special Non-Working Days like April 4, if company policies, historical practices, or CBAs provide more favorable benefits, employers must follow those terms.

This means holiday pay compliance is not based solely on government advisories, but also on internal frameworks.

IV. What This Means for Employers

While this advisory focuses on short-term payroll rules, it highlights three broader issues in Philippine labor management:

1. Highly Structured Holiday Classification System

Under Philippine labor law, different holiday types carry distinct pay requirements.

Companies operating across multiple countries may mistakenly apply familiar rules from other jurisdictions.

2. Payroll Systems Must Be Updated Promptly

For companies using centralized or regional payroll systems, it is essential to ensure:

• Accurate identification of holiday types
• Automatic application of correct pay rates

3. Employee Communication Is Critical

Given the differences between Regular Holidays and Special Non-Working Days, employees may misunderstand pay outcomes.

Employers should proactively communicate holiday classifications and pay rules to reduce disputes.

V. Pre-Holiday Compliance Checklist

Companies operating in the Philippines are advised to complete the following before April 2026:

• Verify holiday classifications and corresponding pay rules
• Ensure payroll systems are updated accordingly
• Confirm employee attendance and paid leave records
• Review internal policies and CBAs for special provisions
• Communicate holiday pay rules clearly to employees

Conclusion

Holiday pay compliance in the Philippines is not just a one-time payroll adjustment —
it is an integral part of ongoing local labor compliance management.

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