Dear Sir,
Based on the chatter on local chat groups, there is much confusion about the payment of the aguinaldo (end-of-year bonus). I think your recent article about the history is very interesting, but it adds to the confusion. (Some people think giving the employee a gift is adequate, which, obviously, it is not.) Unfortunately, your article repeated a common misconception about how to calculate the aguinaldo. Aguinaldo is not 15 times the daily salary.
Aguinaldo is based on base salary and not daily salary. The total salary divided by the number of days in the time period [in the case of aguinaldo, that would be a year (365, or 366 in leap years)] gives you the average per day income for the year. Just as federal income taxes are based on one’s annual income, aguinaldo is based on annual income. Therefore, to calculate an employee’s aguinaldo divide the employee’s total salary for the year by the number of days in the year. This gives you the base salary. Multiply the base salary by 15 to get the aguinaldo. This is different from 15 days of salary.
Someone on the internet wrote that to calculate aguinaldo divide the monthly salary by 30 and then multiply by 15. This is accurate only for 30-day months and not for the other eight months. Also, it would be accurate only if the employee makes the same amount each month. Using the total annual salary eliminates any variations.
Total salary for the year divided by the number of days in the year equals the base salary. Multiplying this base salary by 15 gives you the correct amount for the aguinaldo. It’s that easy!
We are very lucky to live in such a wonderful country. I’m sure most of us would want to do the right thing, rather than shortchange these valuable workers.
Susan B. Eubanks
Editor’s note: Thank you Susan for your well-researched input. It should be noted that, regardless of the rights and wrongs of aguinaldo calculation, the bonus must be paid, by law, by December 20