As it seems the Republic Act on the Expanded Maternity Leave Law actually comes in three parts – the Republic Act, the Implementing Rules and Regulations and the Computation of Salary Differential.
…and I see why, it isn’t as simple as it initially seemed. It is not as simple as just adding days to the number of maternity leaves. In this article, let me share with you the details of the computation of salary differential.
What You Need To Know
- Full pay includes the basic salary, allowance and government contributions.
- The Company should continue to remit while the employee is on maternity leave. In the scenario below, if the salary differential is negative, the Company shoulders both the employee and employer share. [UPDATE, Sept 9, 2019] Employer does, however, have an option to deduct the amount from the employee’s maternity benefit, provided that there is a written and signed consent from said employee. Employers should not delay any social contribution, though. This is input from DOLE. If the salary differential is positive, the Company deducts employee share from employee and continues to pay employer share.
- Formula goes like this: Salary Differential = Full Pay – Social Welfare Premium Contributions – SSS Maternity Benefit
- Where, Full Pay = Monthly Salary x 3.5 (or 98 days for those allocating 7 days to their husband/partner, although, please note that the Company may always still choose to pay 105 days despite allocation)
- Remember that Monthly Salary, includes basic pay and allowance (just to ensure you didn’t miss it…)
- Salary Differential shall be treated as taxable income.
- Salary Differential shall be included as part of the basic salary computation for the computation of the 13th month pay
Check-out the Calculator – Expanded Maternity Benefit Calculator By Deb
Here’s the Department Advisory:
There, I hope this helps clarify some of your questions.
featured photo from freepik.com