Dear Atty. Angela,

I resigned from the company I worked with for eight years and I never converted my service incentive leaves to monetary pay since I know I am entitled to this when I leave. When I spoke to my former boss, he refused to give me the whole converted amount and said he will only provide the SIL equivalent of the last three years. He claimed he was advised that money claims under labor law prescribe after three years. Is this correct? Please help.

Tommy

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Dear Tommy,

Your boss is wrong and the whole amount of SIL for your eight years of service should be given to you. While it is true that there is a three-year prescriptive period for money claims, this does not apply to SIL claims.

In the case of Auto Bus Transport System Inc. v. Bautista (497 Phil. 863, 2005), the Supreme Court clarified the correct reckoning of the prescriptive period for service incentive leave pay where it said that the SIL is a curious animal in relation to other benefits granted by the law to every employee. In the case of SIL, the employee may choose to either use his leave credits or commute them to their monetary equivalent if not exhausted at the end of the year. Furthermore, if the employee entitled to service incentive leave does not use or commute the same, he is entitled upon his resignation or separation from work to the commutation of his accrued SIL.

The case of Rodriguez v. Park N Ride Inc., G.R. 222980 (2017) likewise reinforced the earlier ruling where it expressed that applying Article 291 of the Labor Code in light of this peculiarity of the SIL, it can be concluded that the three-year prescriptive period commences, not at the end of the year when the employee becomes entitled to the commutation of his SIL, but from the time when the employer refuses to pay its monetary equivalent after the demand of commutation or upon the termination of the employee's services, as the case may be.

Thus, your claim to SIL accrues from the moment your employer refused to pay the monetary equivalent since you did not make use of said leave credits but instead chose to avail of its commutation. Your claim is not bound by the three-year prescriptive period pertained to in the Labor Code.