General information, not legal advice. This answer was written by the PhilippineLaws team from the law it cites and checked for accuracy to the best of our knowledge, last on Sep 21, 2026. It has not been reviewed by a lawyer. Read the cited law yourself, and for your own situation talk to a lawyer or the Public Attorney’s Office (PAO).
Am I entitled to night shift differential, and how is it computed?
Every covered employee is owed at least 10% of their regular wage for each hour worked between 10:00 PM and 6:00 AM, and it is a floor rather than a ceiling. It stacks on top of overtime, rest-day and holiday premiums, so the 10% is computed on the rate applicable to that day and not on your plain ordinary rate.
Illustrated Legal Brief
Full Plate| Situation | Rate |
|---|---|
| Ordinary night hourHourly rate + 10% | 110% |
| Night hour that is also overtime10% on the 125% overtime rate | 137.5% |
| Night hour on a rest day10% on the 130% rest-day rate | 143% |
| Night hour on a regular holiday10% on the 200% holiday rate | 220% |
| Your ordinary hourly rate = 100% | |
The 10% is a floor, not a ceiling, and it is computed per hour rather than as a flat shift allowance. It stacks on every other premium — it never absorbs them.
Why
Article 86 of the Labor Code is one sentence long: every employee shall be paid a night shift differential of not less than 10% of their regular wage for each hour of work performed between ten o'clock in the evening and six o'clock in the morning. Two words carry the weight. 'Each hour' means it is computed hour by hour rather than as a flat allowance for the shift, so an employee whose shift ends at 11:00 PM is owed the differential for that one hour. 'Not less than' means 10% is the statutory floor, and many collective bargaining agreements and company policies in the BPO sector pay considerably more.
The differential is separate from every other premium and does not absorb them. If you work overtime during night hours, you are owed both the overtime premium and the night differential. If those hours fall on a rest day, a special day or a regular holiday, the differential is taken as 10% of the hourly rate applicable on that day, which is already 130%, 130% or 200% respectively. Computing the night differential against your bare ordinary rate is the single most common underpayment in shift work.
A worked example. Take an hourly rate of PHP 100. An ordinary night hour between 10:00 PM and 6:00 AM pays PHP 110. A night hour that is also overtime pays the overtime rate of PHP 125 plus 10% of it, or PHP 137.50. A night hour worked on a regular holiday pays the holiday rate of PHP 200 plus 10% of it, or PHP 220.
Coverage follows the same exclusions as the rest of the working-conditions provisions. Under Article 82, government employees, managerial employees, field personnel, members of the employer's family dependent on them for support, domestic workers, persons in the personal service of another, and workers paid by results are outside it. The implementing rules add one more: employees of retail and service establishments regularly employing not more than five workers. Managerial status is decided by the powers actually exercised, not by the job title, so a team lead in a call centre with no authority to hire, discipline or lay down policy is very unlikely to be a managerial employee in the legal sense.
The right cannot be waived. Like overtime pay, night shift differential is a benefit fixed by statute, so an agreement to work night hours without it, or to fold it into a 'shift allowance' that turns out to be smaller, does not defeat the claim.
Domestic workers are covered by their own law rather than by Article 86. The Batas Kasambahay, RA 10361, sets their conditions of work separately.
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