How to generate the 13th Month Pay in PayrollHero?

According to the DOLE handbook (Revised 2016), the basic salary of an employee for the purpose of computing the 13th month pay shall include all remunerations or earnings paid by his employer for services rendered. It does not include allowances and monetary benefits which are not considered or integrated as part of the regular or basic salary, such as the cash equivalent of unused vacation and sick leave credits, overtime, premium, night differential and holiday pay, and cost-of-living allowances. However, theses salary related benefits should be included as part of the basic salary in the computation of the 13th month pay if by individual or collective agreement, company practice or policy, the same are treated as part of the basic salary of the employees.

“Total basic salary EARNED during the year” means the actual salary they received. Employees don’t earn from the deductions due to tardiness/undertime.

And thus, PayrollHero have fully released the 13th month feature meaning, it includes the following 13th month computations…

  • Using the employee’s BASE pay only.
  • Using the employee’s GROSS pay only.
  • Using the employee’s BASE pay but LESS the lates and absences.
  • Using the employee’s BASE pay LESS the lates and absences and includes ALL allowances.

The requirements to generate the 13th month are as follows:

  • Payrolls / payslips needs to be finalized.
    • If payrolls are not finalized, you won’t be able to generate the 13th month pay.
  • No need for the 13th month enrollment.
    • Generating the updated 13th month pay options doesn’t need any existing enrollment on the employee profile, this means it will not use the 13th month enrollment or accrued amounts as it automatically computes using the employee’s base pay less lates and absences or including the allowance.
  • The period that the 13th month uses starts to when you’ll generate the 13th month pay.

    • Your company’s pay period starts on October 11-25, 2017 and October 26-November 10, 2017
    • Today is October 24, 2017
    • If you generate the 13th month pay, the period that it will use starts on October 11, 2016 up to October 10, 2017.
      • The reason why it uses October 11, 2016 as the start of the 13th month period as that is the start of the pay period. It uses the base pay and lates/absences (and/or allowance) within the pay period.
    • Another examples are the following:

        • Generated 13th month on October 24, 2017 (OCTOBER 11-25 pay period)
          13th Month covers: October 11, 2016 – October 10, 2017
        • Generated 13th month on October 30, 2017 (OCTOBER 26 – NOVEMBER 10 pay period)
          13th Month covers: October 26, 2016 – October 25, 2017
        • Generated 13th month on October 30 (OCTOBER 1-31 pay period)
          13th month covers: October 1, 2016 – September 30, 2017

How to generate the 13th Month Pay?

  1. Make sure that employee’s payslip / payrolls are FINALIZED.
    There’s 2 ways to finalize a payroll.On the Payrolls page
    – Go to the Payroll tab
    – Click on the Payrolls page
    – Click on a specific pay period
    – On the drop down under the employee’s payroll details, choose “Finalize” and click on Go. (see screenshot below)

    – A pop up should appear, click YES

    – And that should finalize the payslip 
    On the Employee Profile

    • Go to the employee profile.
    • Click on the Payrolls page.
    • Click on the “keylock” unlocked icon to ‘Finalize’ the payroll. See screenshot below
    • It should the show a pop up like this
    • Click OK, and it should then finalize the payslip showing a locked keylock like the screenshot below:
      Here’s how you can finalize a payroll / payslip – Philippine Payroll Guide: Publishing Payslips and Finalizing Payroll
  2. Go to the Employee List
  3. Select the employees you want to generate the 13th month payment.
  4. On the drop down, select “Generate 13th Month Payment”
  5. And click on “Do It”. See screenshot below:
  6. It should then redirect to a page where you can choose how you want the system to compute your 13th month pay:
  7. Click on “Generate” 
  8. It should redirect you to the ‘Job Notification’ page that shows the list of employees it generated and let’s you know once that is done:
  9. If you close the pop up, it will show the employee’s name with the 13th month amount it generated.
  10. Hover your mouse pointer to the employee name, and click on it to open the 13th month payment:
  11. If you’re happy with the amount, click on Update and then generate the payroll to include the 13th month pay on the employee’s salary.

And that’s it! You’ve now generated the employee’s 13th month payment!


If you have any questions, feel free to email

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