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ADD THE BASIC SALARY EARNED, THEN DIVIDE BY TWELVE
The minimum amount is one-twelfth of the total basic salary earned during the calendar year. It is not automatically the employee’s latest monthly salary, especially when the person joined midway through the year or received a pay increase.
For a simple hypothetical example, someone who earns exactly ₱20,000 in basic salary for each of twelve months has ₱240,000 in annual basic earnings. Dividing that by twelve gives ₱20,000. If the same person earns exactly ₱20,000 for only six months, the total is ₱120,000 and the corresponding amount is ₱10,000.
Those examples assume the stated basic salary was actually earned for every month counted. Where pay changes or unpaid periods affect the annual total, use the payroll records rather than multiplying the latest rate by twelve.
WHAT TO WATCH
The months included, the basic earnings credited for each period and the total used in the calculation. Ask for the breakdown if the final figure does not match those records.