How Service Incentive Leave works under Article 95
Article 95 of the Philippine Labor Code entitles a covered employee who has rendered at least 1 year of service to Service Incentive Leave…
Article 95 of the Philippine Labor Code entitles a covered employee who has rendered at least 1 year of service to Service Incentive Leave (SIL) of 5 days with pay a year, usable for sick, vacation or other leave purposes. The DOLE Handbook on Workers' Statutory Monetary Benefits explains that "one year of service" means service within 12 months, whether continuous or broken, counted from your start date, and includes authorized absences, unworked weekly rest days, and paid regular holidays.
Unlike some other countries' leave laws, SIL is a flat 5 days once you are eligible; it does not increase with further years of service. Once you have completed a full year and started a new one, the Handbook's own worked example shows unused SIL for the still-incomplete current year being pro-rated: for an employee hired 1 January 2022 who resigned 1 March 2023, the Handbook computes "SIL earned as of 31 December 2022: 5.000 days" plus "proportionate SIL for January and February 2023 (2/12) x 5 days = 0.833 days", for a total of 5.833 days accrued at resignation. This calculator applies the same (months since your last anniversary ÷ 12) × 5 formula to your current service year.
Cash conversion
If you do not use all of your SIL, the law lets you commute the unused balance to its cash equivalent.
If you do not use all of your SIL, the law lets you commute the unused balance to its cash equivalent. The Handbook states this is computed "at the salary rate at the date of conversion", and that "the use and conversion of this benefit may be on a pro rata basis". If you resign or are separated before using or commuting your SIL, you are entitled to be paid its cash value.
| Item | Formula |
|---|---|
| SIL for the current service year | 5 days once eligible; pro-rated if mid-cycle |
| Unused SIL | Current year's SIL minus SIL used |
| Cash value | Unused SIL × daily rate |
Who is excluded
Per the Omnibus Rules Implementing the Labor Code, as reproduced in the DOLE Handbook, SIL does not apply to: government employees…
Per the Omnibus Rules Implementing the Labor Code, as reproduced in the DOLE Handbook, SIL does not apply to: government employees; persons in the personal service of another; managerial employees meeting the legal test for that status; officers or members of a managerial staff meeting the legal test for that status; field personnel and others whose time and performance are unsupervised by the employer; those already enjoying this benefit; those already enjoying vacation leave with pay of at least 5 days; and employees of establishments regularly employing fewer than 10 workers.
Vacation leave is a separate, company-granted benefit
"Vacation leave" above the SIL floor is not a separate statutory entitlement: it is whatever additional paid leave your employer grants as…
"Vacation leave" above the SIL floor is not a separate statutory entitlement: it is whatever additional paid leave your employer grants as a matter of company policy or a collective bargaining agreement. Many employers structure their vacation leave to already exceed and effectively include the SIL requirement, which is one of the exemptions listed above.
FAQ
How many Service Incentive Leave days am I entitled to?
Under Article 95 of the Labor Code, a covered employee who has rendered at least 1 year of service is entitled to 5 days of paid Service Incentive Leave (SIL) a year, which can be used for sick, vacation or other leave purposes.
When do I become eligible for SIL?
You become eligible once you complete at least 1 year of service with the same employer. There is no SIL for the months before you reach the 1-year mark; once you pass it, your SIL for the year you are currently in builds up proportionally to the completed months since your last work anniversary.
What counts toward "one year of service"?
Per the DOLE Handbook, "one year of service" means service within 12 months, whether continuous or broken, counted from the date you started working. It includes authorized absences, unworked weekly rest days, and paid regular holidays.
Can I convert unused SIL to cash?
Yes. If you do not use all of your SIL, you may choose to commute the unused balance to its cash equivalent, generally at year end. If you resign or are separated before using or commuting it, you are entitled to be paid the cash value of your accrued, unused SIL, computed at your salary rate on the date of conversion.
Who is not covered by SIL?
Article 95 and its implementing rules exclude: government employees; persons in the personal service of another; managerial employees who meet the legal test for that status; officers or members of a managerial staff who meet the legal test for that status; field personnel and others whose time and performance are unsupervised by the employer; employees already enjoying this benefit; employees already enjoying vacation leave with pay of at least 5 days; and employees of establishments regularly employing fewer than 10 workers.
If any of these apply to you, this calculator's statutory floor does not apply to you, though your employer may still grant leave as a matter of company policy.
Is vacation leave the same as SIL?
No. Service Incentive Leave is the statutory minimum under the Labor Code. "Vacation leave" is a separate term commonly used for whatever additional paid leave an employer chooses to grant on top of that floor, as a matter of company policy or a collective bargaining agreement, not a legal requirement.
Does SIL replace sick leave?
SIL is a single pool of days that the law allows you to use for sick leave, vacation, or other leave purposes, however your employer's policy describes it. The law does not require separate statutory sick leave on top of SIL for most private-sector employees; some employers choose to grant a separate sick leave allowance as a matter of policy.
Is this calculator legal advice?
No, this tool applies Article 95 of the Labor Code and the DOLE Handbook on Workers' Statutory Monetary Benefits to the details you enter, for general information only. It is not a substitute for your employment contract, your payslip, or guidance from the Department of Labor and Employment (DOLE).
Sources
3 official sources
- DOLE Bureau of Working Conditions: Handbook on Workers' Statutory Monetary Benefits (2024 edition), Chapter 7, Service Incentive Leave (Article 95): coverage, exemptions, meaning of one year of service, conversion formula and worked example, all quoted above.
- Labor Code of the Philippines (Presidential Decree No. 442, as amended), Article 95, Service Incentive Leave.
- DOLE Handbook on Workers' Statutory Monetary Benefits (2023 edition, mirrored copy): same Article 95 text, used to cross-check the 2024 edition above.
Figures checked against the DOLE Bureau of Working Conditions' Handbook on Workers' Statutory Monetary Benefits. Last verified: September 2026.