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Retirement pay
Retirement pay is minimum retirement pay under RA 7641 for employees who qualify by age and service when the company has no better plan: typically one-half month salary for every year of service, with a fraction of.
How it works
This is a long-horizon rule. Most 701am seats will not hit it. Still know it exists so you do not write a contract that pretends retirement is zero after twenty years. A company plan can exceed the floor. SSS retirement benefits are separate. Do not tell a 28-year-old EA that RA 7641 is their 401(k). For a U.S. company hiring one Filipino teammate, write this into the brief, the employment contract, and the peso payroll file before the start date. Slack habits do not override the Labor Code, BIR, or NPC. If the local employer of record holds the paper, they run the statutory step; you still owe a clean operating definition so the seat does not fail in week three. Put a number on the example when you budget loaded cost, because a nameless allowance always returns as a December surprise or a missed SLA.
Example: age and service tests met after 22 years at ₱80,000. Half-month per year is a large check. Budget it in the entity, not as a surprise.
How it differs
SSS retirement is a social-security benefit. Separation pay is for authorized-cause exits. WISP is provident inside SSS.
Common errors
Waiving RA 7641 in an offer letter for a junior hire as if that were the point.