Leave pay is the peso result of a leave day or a leftover credit. It is not one formula. A used vacation day, unused SIL, an unpaid absence, and maternity salary differential are different payroll events. TimeBoxHR is designed to support leave types, approved dates in DTR, and configurable payroll rules so those events do not share a single “leave” earning code by accident.
Last reviewed: September 2026.
Government rules and contribution schedules may change. This article is provided for general information and should be verified against the latest official government issuance before payroll processing.
Read this beside how to calculate leave credits and the employee leave overview. Credits answer “how many days.” This article answers “what those days do to net pay.”
Paid days, unpaid days, and converted days
Every leave date falls into one of three peso treatments.
Paid leave day: the employee is not at work and still receives the pay the rule requires for that type. Company VL/SL with remaining credits, used SIL, paternity, solo-parent, VAWC, and special leave for women are typically in this family, each with its own legal or policy base.
Unpaid leave day: no basic pay for that day. Leave without pay, exhausted company banks with no other paid type, and the optional 30-day unpaid maternity extension belong here.
Converted credit: days not taken as time off become cash. Unused SIL for covered employees is the statutory example. Company VL/SL conversion is optional unless you bound yourself.
Do not run all three through one earning named “LEAVE.” The register will not explain itself, and payroll computation will hide errors.
Daily-paid and monthly-paid employees
Daily-paid staff are paid for days they worked plus paid leave days you recognized. An unpaid leave day drops out of the count.
Monthly-paid staff receive a monthly basic that already assumes a work-month. A paid leave day usually means you do not deduct. An unpaid leave day means you deduct a documented daily equivalent.
Whatever factor you use for ordinary unpaid absences should be the factor you use for unpaid leave, unless a CBA says otherwise. Common practice uses a monthly divisor such as 22, 26, or another documented figure. This article does not bless one unofficial factor. Publish the method you use and keep it stable.
Example, monthly basic ₱22,000, documented divisor 26, two unpaid days:
Deduction = ₱22,000 / 26 × 2 = ₱1,692.31
The same employee with two paid VL days: deduction ₱0.00 for those days; VL balance minus 2.00.
Night differential and overtime do not attach to a day the employee did not work. Premiums follow hours actually worked and day type, as in the rest of your payroll system rules.
Used SIL versus used company VL or SL
A used SIL day for a covered employee is a paid statutory day. Decrement SIL. Pay it like a regular paid leave day under your daily method.
A used company VL or SL day is a paid policy day if credits remain. Decrement that type. Do not decrement SIL unless your charging order says SIL is the bank for that absence.
If VL of at least five days is the vehicle that satisfies SIL, a used VL day may be reducing the bank that also represents the statutory floor. That is acceptable if the bank still meets the legal design. It is not acceptable to forfeit the remainder of that bank at year-end if the remainder is still statutory SIL value.
Sick leave pay is company pay unless another statute applies. Do not treat SL conversion as mandatory because SIL converts.
Conversion: unused credits to cash
SIL commutation, as restated in the handbook, uses the salary rate at the date of commutation times remaining accrued SIL. Use and conversion may be pro rata. The 2024 handbook illustration (hire 1 January 2023, resign 1 March 2024, daily rate ₱610.00) reached 5.833 days and ₱3,558.13. Recompute for live cases. Do not paste ₱610.00.
Company VL conversion example, policy converts unused VL at separation only, remaining 3.00 days, same ₱610.00 daily method for illustration:
3.00 × ₱610.00 = ₱1,830.00
If policy forfeits unused VL, that line is ₱0.00 even if SIL in another type still converts.
Company SL conversion example: many employers pay ₱0.00 for unused SL. If a CBA converts SL at 50% of daily rate, write that fraction. Do not “match SIL” out of habit.
Paternity, solo-parent parental leave, and VAWC unused days generally convert at ₱0.00. Special leave for women is generally non-convertible unless a CBA says otherwise. Maternity is not a leftover-credit conversion problem; it is a period of pay plus SSS.
Maternity, SSS, and salary differential
Maternity leave under RA 11210 is 105 paid days for live birth (120 if a qualified solo parent; 60 for miscarriage or emergency termination). SSS pays a maternity benefit under SSS rules. The employer generally pays the difference so the worker receives full pay for the statutory paid period, subject to current DOLE guidance and any lawful exemption.
A workable register shows:
- SSS maternity benefit (from SSS, not from a VL factor)
- Employer salary differential
- Unpaid extension days as deductions or as days without basic pay
- Allocated days on the father’s or caregiver’s payroll if you employ that person
The handbook discusses including the salary differential in the 13th-month base for rank-and-file employees. Confirm current text when you build that annual figure.
Do not deduct 105 days of VL to “fund” maternity. Do not skip the differential because an SSS deposit appeared.
Other statutory paid leaves
Paternity: seven days full pay, employer-paid, not convertible if unused.
Solo-parent: up to seven working days full pay per year if qualified; generally not convertible unless agreed.
VAWC: up to ten days full pay (basic plus mandatory wage-board allowances as the handbook describes); not convertible; not cumulative.
Special leave for women: up to two months full pay based on gross monthly compensation as the handbook defines it (monthly basic plus mandatory wage-board allowances). That pay base may be richer than a VL daily factor. Confirm current guidelines.
These leaves are paid because the statute says they are paid, not because a credit accrual batch created a balance in January.
Final pay
Final pay is where conversion mistakes become money.
Checklist:
- Remaining SIL for covered employees, commuted at the rate on the commutation date, including lawful pro rata.
- Remaining company VL at the policy conversion rule (full, partial, or none).
- Remaining company SL at the policy conversion rule (often none).
- Recovery of VL/SL used beyond what was earned, if policy allowed an advance.
- No cash line for unused paternity, solo-parent, or VAWC days unless a written agreement says otherwise.
- Open maternity: pay through the correct end date; do not commute unused maternity as if it were VL.
- Unpaid days through last day already deducted in the last regular run or in this run, not twice.
Keep the last-pay worksheet reconcilable to the leave ledger. Employees contest a lump sum labeled “leave” that does not match the portal balance they saw the week before.
Holidays and leave pay
A paid leave day that falls on a regular holiday is not automatically holiday work. It is usually one paid concept, not two, unless policy or handbook principles for your facts say otherwise. Write the interaction. Apply it in DTR and payroll together.
A leave day is not overtime. Do not attach 125% to a VL day because the shift calendar still shows a long schedule.
Worked mini-register
Assume a monthly-paid employee, basic ₱26,000, divisor 26, daily equivalent ₱1,000.00 for illustration only.
| Event | Days | Payroll effect (illustrative) |
|---|---|---|
| Paid VL used | 3 | No deduction; VL −3.00 |
| Unpaid LWOP | 1 | −₱1,000.00 |
| SIL used | 1 | No deduction; SIL −1.00 |
| Unused SIL at separation | 2.50 | +₱2,500.00 conversion |
| Unused SL (forfeit policy) | 4.00 | ₱0.00 |
| Paternity unused | 7 | ₱0.00 |
Change any row’s type and the peso result should change. If it does not, the earning code is too coarse.
Records
Keep the daily-rate or divisor method, the leave type on each date, remaining balances, conversion rate and date, SSS maternity figures, differential computation, and the final-pay worksheet. Store sensitive certifications under privacy rules as described in the VAWC and special-leave articles.
How TimeBoxHR Handles This
TimeBoxHR is designed to support leave types, entitlement policies, credit balances, accrual batches, manual adjustments, requests and approval, and employee-portal balances. Approved leave is designed to flow into DTR and payroll. Configurable payroll rules can treat paid leave, unpaid leave, SIL conversion, and other earnings as different inputs. Holiday calendars remain in the same system so a leave day is not paid as holiday work by mistake.
Simplify leave-pay processing with TimeBoxHR
Map each leave type to a payroll treatment: pay through, deduct, convert, or maternity differential after you have SSS figures. Do not map every type to “miscellaneous earnings.” When final pay runs, start from remaining balances the employee can also see, then apply the conversion rules you configured per type.
TimeBoxHR does not replace SSS computation or a legal opinion on an exemption. It is designed to apply the leave dates and payroll rules you set after those figures exist.
Explore TimeBoxHR leave, DTR, and payroll features, or start a 30-day free trial to see approved leave and pay treatment in one cutoff.
