Resigning from a job is never an easy decision, whether for career growth, personal reasons, or a better opportunity. However, before you move forward, it’s vital to understand the benefits you’re entitled to when you leave the company.
Many employees mistakenly believe that resigning means losing all benefits, but Philippine labor laws provide certain protections to ensure you receive what you’ve rightfully earned. Knowing your rights—from your final paycheck to unused leave credits—can help you transition more smoothly.
This article breaks down the key benefits that resigned employees in the Philippines should expect to receive, so that when you do, you can more confidently start the next chapter of your career.
9 Benefits of Resigned Employees in the Philippines
Resignation doesn’t mean walking away empty-handed. Philippine labor laws ensure that employees who leave their jobs still receive applicable entitlements. Below are the key benefits you should expect when you resign from your job in the Philippines.
1. Final pay (Back pay)
Your final pay, often called “back pay,” consists of all earnings and benefits due to you upon resignation. This amount typically includes unpaid salary, pro-rated benefits, and other compensation outlined in your employment contract, as well as the following circumstances:
- Constructive dismissal: If you resign due to unfair treatment or unsafe working conditions, DOLE may rule that you are entitled to separation pay.
- Closure or retrenchment: If your employment is affected by company closures or retrenchment, you may be entitled to separation pay, even if you did not resign voluntarily. Consult your employment contract or DOLE regulations if you qualify for separation pay.
Employers must release the final pay within 30 days of resignation, though timelines may vary depending on company policies. If you haven’t received your final pay within this period, you have the right to inquire with HR or escalate the matter to the Department of Labor and Employment (DOLE).
2. Pro-rated 13th month pay
The 13th-month pay is a mandatory benefit for employees in the Philippines. Even if you resign before the year ends, you are still entitled to a pro-rated portion of this benefit. You will receive a fraction of your 13th-month pay based on the number of months you worked within the calendar year.
Your employer must provide this along with your final pay, so be sure to check that it’s in your back pay computation.
3. Unused vacation and sick leave conversions
If your company offers convertible leave credits, you may be entitled to a cash equivalent of your unused vacation leave upon resignation. Not all employers offer this, as it depends on company policy.
However, if your contract states that unused leave is convertible to cash, your employer must compensate you accordingly. If you are unsure about your leave conversion policy, clarify with HR.
4. Tax refunds
Depending on your tax situation, you may receive a tax refund upon resignation. This event typically occurs when:
- Your employer over-withheld taxes due to incorrect computations.
- You resigned in the first half of the year, and your total earnings do not meet the annual tax threshold.
- If your tax contributions exceed what you owe, you should receive a tax refund when your final pay is processed. Check your pay slip or request a tax computation from HR to ensure accuracy.
5. Government-mandated benefits
Even after you resign, your Social Security System (SSS), PhilHealth, and Home Development Mutual Fund (Pag-IBIG) contributions remain in your account. You can continue making voluntary contributions to maintain eligibility for benefits such as:
- SSS: Loan eligibility, retirement, disability, and maternity benefits.
- PhilHealth: Continued access to healthcare coverage.
- Pag-IBIG: Housing loan eligibility and savings accumulation.
Before leaving your job, request a copy of your latest contributions to see if your records are updated.
Additionally, some companies provide de minimis benefits—small, non-taxable perks such as rice subsidies, meal allowances, or uniform allowances. If you receive these benefits, check whether you are entitled to a pro-rated portion upon resignation.
6. Certificate of Employment (COE)
A Certificate of Employment (COE) confirms your employment period and position. While it is not a clearance document, many future employers require it as proof of previous employment.
Under Philippine labor laws, employers must issue a COE upon an employee’s request. If you need one, formally request it from your HR department.
7. Separation pay (if applicable)
Resigning does not generally entitle you to separation pay unless your contract states it or your resignation falls under special circumstances, such as company-initiated resignation packages where you’re offered separation pay as part of voluntary resignation programs.
8. Clearance and release of final pay
Most companies require resigned employees to undergo a clearance process before releasing their final pay. This step ensures that all matters regarding company assets, outstanding obligations, and employee-employer responsibilities are settled before the exit.
9. Endorsement for government unemployment benefits (if applicable)
While unemployment benefits from SSS are typically for employees who were involuntarily separated, there may be situations where an employer may endorse resigned employees for these benefits.
For instance, if you resigned due to health issues or company downsizing, your employer may provide documentation that allows you to apply for SSS unemployment benefits. Check with your HR department regarding this possibility.
Leaving Right: Know Your Rights!
You’ve worked hard and dedicated time and effort to your company—it’s only fair that you receive what you’ve rightfully earned.
A comprehensive understanding of your resigned employee benefits in the Philippines ensures a smooth transition and helps avoid unnecessary delays in receiving your benefits. Always check with HR regarding pending payments, and don’t hesitate to escalate concerns when necessary. You deserve it.
Employers and employees in the Philippines highly consider Manila Recruitment for hiring and employment. Our Philippine offshore agency connects businesses with skilled industry professionals. Contact our team today to get started!
DISCLAIMER: The information in this webpage/blog/article/infographic we have published and the associated commentary are presented as general information and are not a substitute for obtaining legal advice in this area. Manila Recruitment does not accept liability for any action taken based on the information presented or for any loss suffered as a result of reliance on the information provided.
Passionate about promoting the ingenuity of Filipino talent, Arvin is a sought-after resource person in the field of career development. He regularly delivers keynote speeches and conducts workshops throughout the Philippines, sharing his insights and strategies for improving employability and promotability.
- How to Hire Top Filipino Computer Programmers: 8 Tips - March 12, 2025
- Employer Branding: Why It Matters and How to Improve It - March 12, 2025
- Exit Interviews and How Much They Impact Your Recruitment Process - March 11, 2025
