When employees get accepted for work, one of the first questions they ask is,"How many vacation leaves do I get? What about sick leaves?" Some employees are happy and glad with what their companies give them, while others compare and complain. For the latter, is that complaint valid? Let's see what the law has to say to settle this once and for all.

I got an email from one of my readers which goes:

Hi. When will be the effectivity of a sick leave of an employee.? Kapag po ba na hired sya automatic na na may sick leave na sya.? Thank you!

This question shows that people tend to have different expectations on this benefit. But as with anything else, let's go back to legal basics so everyone is on the same page.

How many Vacation Leaves and Sick Leaves are you entitled to?

Are you sitting down? You might get shocked by what I'm about to teach you.

You are not entitled to any vacation or sick leaves. Nothing.

I can hear you protesting right now. "Attorney, are you serious? I can't believe that's possible! People left and right are enjoying Vacation leaves and Sick Leaves, and yet you're telling me it's not a mandatory benefit?"

Yes, I said what I said. Don't believe me? Bring up the labor code and search for the terms vacation or sick leaves. I guarantee you, you'll find none of those terms in the law.

I know… I know. It's surprising! I was shocked as well when I was studying the labor code as a student. So now that we're clear about there being no vacation or sick leaves, does it provide anything at all with regard to taking time off work?

“The more that you read, the more things you will know. The more that you learn, the more places you’ll go.”― Dr. Seuss
Photographer: Ben White | Source: Unsplash

Let me introduce you to the SIL

Instead of Vacation leaves or Sick leaves, what the law gives is the Service Incentive Leave, or SIL for short.

Every employee who has rendered at least one (1) year of service is entitled to Service Incentive Leave (SIL) of five (5) days with pay (Article 95 of the Labor Code). Simplified further, this means the law gives you 5 paid days off work if you've been with the company for at least a year.

Simplified further, the law gives you 5 paid days off work if you've been with the company for at least a year.

Chapter 12
Photographer: chen zo | Source: Unsplash

"Attorney, is this above and beyond the Vacation leaves and Sick Leaves?"

Again, there is no legal provision that grants Vacation leaves and Sick Leaves. What employees are entitled to is 5 days SIL. Therefore, it isn't correct to say that the SIL is "above and beyond" the Vacation leaves and Sick Leaves. They are different.

Think about it this way. The law wants to ensure that employees get at the very least 5 days paid leaves after a year. If you are already providing that in the form of Vacation leaves and Sick Leaves, then you're already compliant with the minimum. The employer, exercising its right to grant more than what is required under the law, has chosen to grant its employees something beyond the mandatory 5 day SIL.

To reiterate, if the employee has paid Vacation leaves and Sick Leaves more than 5 days, the law considers these leaves as the equivalent of the SIL. The SIL is considered embedded within the Vacation leaves and Sick Leaves and the employer is deemed compliant with the law.

Photographer: Icons8 team | Source: Unsplash

A word about complaining employees

I sometimes go thru forums and I cringe inside when I read employees complaining that their employers have given only 10 Vacation leaves and Sick Leaves in facebook forums or in workshops.

I really wish that these employees had read about their mandatory entitlements before they complained. What they don't realize is that the company has already gone above and beyond what they are required to provide under the law.

This is how it looks like in my head: imagine ordering ramen from a Japanese restaurant, and when they set down the ramen at your table, they give you free gyoza which you didn't order or pay for. You then complain, "Why is this just gyoza? Shouldn't there be sashimi as well? That would make me happier! Why does the other table have sashimi?" Are you seeing the absurdity? Let's recognize a gift when it is offered. That's why to me, some of the complaints are absurd.

Let's recognize a gift when it is offered. That's why to me, some of the complaints are absurd.

Can the benefit get better for employees?

Yes, to the extent that the company can afford giving more than what is due. But the mindsets of these employees should be put in the right context. The way they talk, they really believe that they have been oppressed in some way. This is grossly unfair to employers who have already gone the extra mile.

But when I get questions like these in workshops or I encounter them online, I always give the benefit of the doubt. I attribute the complaints from not knowing what the law actually provides. It can also arise from comparing their leave benefits with employees from other businesses.

A quick message for complaining employees

You can work on improving leave benefits further down the line, but I don't think you would be encouraging your employers to give more if you keep complaining about gifts already given. I would suggest acknowledgment and appreciation instead. Let the employers feel that what has already been given is valued, and you would want to explore expanding it further because you find so much use in it. That approach, from a negotiating standpoint, is infinitely better than complaining about them giving something above and beyond.

When do we start counting the year?

My interpretation of the law falls on the conservative side. I will count it from the date the employee started working, which includes any absences, weekends and holidays. Yes, even the probationary period. I don't count it from the time they become regular.

What if the employee doesn't take leaves?

There are some employees that are so hard core that they don't take time off. If that happens, the law requires that you release the equivalent of the unused 5 day SIL to the employees at the end of the year. You can't keep accumulating these 5 days, you are required to release them. Just have this reflected properly in a policy so everyone has the same expectations.

When is SIL not applicable?

Quick note, SIL isn't required for all employers. This benefit applies to all employees except:

  1. Government employees, whether employed by the National Government or any of its political subdivisions, including those employed in government-owned and/or controlled corporations with original charters or created under special laws;
  2. Persons in the personal service of another;
  3. Managerial employees;
  4. Officers or members of a managerial staff;
  5. Field personnel and those whose time and performance is unsupervised by the employer;
  6. Those already enjoying this benefit;
  7. Those enjoying vacation leave with pay of at least five (5) days; and
  8. Those employed in establishments regularly employing less than ten (10) employees.

Why the exceptions? These people are covered by a different set of rules.

Let's summarize!

So, what did we learn today?

  • There are no vacation or sick leaves under the law.
  • What we have instead is Service Incentive Leaves.
  • That is 5 days per year.
  • If you don't avail of it, it can be converted into cash at the end of the year.

If you're an employer, make sure that you have at least 5 paid days off if you're covered. If you're an employee, be aware of what you are entitled to so that you can help your employer be compliant, or request an increase in leaves within the right context.

Hope we were able to simplify this so you can now make better choices!

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