13th-month pay, leave, and public holidays across SEA — a founder's cheat sheet
A founder cheat sheet for 13th-month pay, annual leave and public holidays across the Philippines, Vietnam, Indonesia, Malaysia, Thailand and India.
The short answer: mandatory 13th-month pay exists in the Philippines (statutory) and Indonesia (THR, a religious holiday allowance), while Vietnam’s Tet bonus is a near-universal market expectation rather than a legal requirement. Malaysia, Thailand, Singapore and India have no general statutory thirteenth month, though bonuses are common and India has a separate statutory bonus scheme for lower-paid employees. Statutory annual leave across the region typically starts between 6 and 15 days, and every market adds a long list of public holidays.
Treat everything below as a planning-level orientation. Entitlements depend on tenure, salary level, industry, and sometimes province — confirm the current position for the specific role before you contract.
Thirteenth-month and bonus norms
| Country | 13th month | How it works |
|---|---|---|
| Philippines | Mandatory | One twelfth of basic salary earned in the calendar year, paid on or before 24 December, pro-rated for partial years |
| Indonesia | Mandatory (THR) | Religious holiday allowance, typically one month’s pay after 12 months of service, pro-rated below that, paid before the relevant religious holiday |
| Vietnam | Customary | Tet bonus, commonly around one month’s salary; not legally required but expected, and its absence drives resignations |
| Malaysia | Customary | No statutory requirement; annual or performance bonuses are common in professional roles |
| Thailand | Customary | No statutory requirement; year-end bonuses are widespread |
| India | Partly statutory | The Payment of Bonus Act mandates an annual bonus for employees under a salary threshold; above it, bonuses are contractual or discretionary |
| Singapore | Customary | No statutory requirement; the “annual wage supplement” is a common convention |
Annual leave, sick leave and public holidays
| Country | Statutory annual leave (typical minimum) | Public holidays | Notes |
|---|---|---|---|
| Philippines | 5 days service incentive leave | Long list of regular and special days | Statutory floor is far below market; competitive employers offer 15+ days plus separate sick leave |
| Vietnam | 12 days, rising with tenure | Around 11 days, dominated by Tet | Sick leave is funded through social insurance |
| Indonesia | 12 days after 12 months | Numerous national holidays plus collective leave days | Joint leave days can be centrally mandated |
| Malaysia | 8–16 days depending on tenure | Federal plus state holidays | Holiday lists vary by state |
| Thailand | 6 days after 12 months | Substantial national list | Paid sick leave is separately mandated |
| India | Varies by state, commonly ~15 days earned leave | National plus state holidays | Leave rules are state-legislated and differ significantly |
The pattern to notice: statutory minimums are low almost everywhere, and market practice is well above them. Budgeting to the legal floor is technically compliant and commercially self-defeating — see our retention playbook.
What this means for your budget
- Add the thirteenth month before you compare markets. A Philippine salary is effectively thirteen payments a year, not twelve.
- Fund statutory contributions separately. Social security, health, and housing schemes sit on top of salary and vary widely.
- Accrue leave as a liability. Unused leave is often payable on exit.
- Plan the calendar. Tet, Lunar New Year, Eid, and Christmas produce predictable multi-day gaps in coverage. Schedule releases and support rosters around them.
- Write it into the contract. State the leave allowance, the bonus treatment, and the holiday calendar explicitly so there is no argument in December.
Building the annual cost picture
The cleanest way to compare markets is to build one number per role: total annual employer cost. Work through it in this order and you will not be surprised in December.
- Base salary in local currency, benchmarked against current market data for the seniority you actually need.
- Statutory payments — multiply by 13 where a thirteenth month is mandatory, or add the customary bonus where it is expected in practice.
- Employer contributions — social security, health, and housing or provident schemes, calculated on the applicable base rather than assumed as a flat percentage.
- Leave and holiday exposure — accrued annual leave, statutory sick leave, and any premium payable for work on public holidays.
- Employment and administration — payroll, HR support, and compliance, whether provided internally or by a partner.
- Currency — FX spread and transfer costs on twelve or thirteen payments a year are small individually and material annually.
Planning the calendar, not just the budget
Entitlements have a timing dimension that catches teams out. Tet in Vietnam and Lunar New Year across the region produce a genuine multi-day pause, not a quiet week. Eid affects availability in Indonesia and Malaysia. Philippine December is crowded with both statutory holidays and the thirteenth-month deadline. Put every relevant local holiday in a shared calendar at the start of the year, then set release dates, month-end close, and support rosters around them. A team that plans for these gaps looks well run; a team that discovers them looks chaotic to its own employees.
Write the entitlements into the contract
Whatever you decide — leave above the statutory floor, a thirteenth month for a contractor, a defined holiday calendar — put it in writing before the person starts. Almost every entitlement dispute we see traces back to a verbal understanding that two parties remembered differently eleven months later.
Common questions
Is 13th-month pay mandatory for contractors?
Statutory thirteenth-month obligations attach to employees. Genuine independent contractors are outside them — but in the Philippines especially, the expectation is so strong that many companies include an equivalent payment in the contract or fold it into the rate. If your contractor is working full-time under your direction, the bigger question is whether they should be an employee at all; see managed employment, explained.
Is 13th-month pay the same as a bonus?
No. Where it is statutory, it is a defined entitlement calculated from basic salary and payable on a deadline, regardless of performance. A bonus is discretionary or performance-linked. Conflating them is a common source of disputes.
Do I have to observe local public holidays?
For employees in-country, yes — and premium pay rules often apply if someone works on a public holiday. In practice you should also plan for reduced availability around major holidays even if your own market is working normally.
How do I handle leave when the employee works for my Australian or US company?
Leave follows the law of the country where the person works, not where your company is registered. An employee in Manila accrues Philippine entitlements even if every colleague is in Sydney. Set your global leave policy at or above the highest local floor to keep it simple.
Who tracks all of this?
If you employ through a managed staffing partner or EOR, they should administer statutory leave, holidays, and mandatory bonuses, and give you visibility of balances. If you employ directly, you need local payroll and HR support — this is not a spreadsheet problem for long.
What this means for your team
Build your offshore budget on fully loaded annual cost: salary times the number of statutory payments, plus contributions, plus realistic leave. If you want the current numbers for a specific role and country, ask us and we will put a fully costed figure in front of you.
Hiring in Asia? We'll do it for you.
Sprint Labs is a managed staffing firm. We recruit, vet, employ and retain senior talent across the Philippines, Vietnam, Malaysia, Indonesia and India — you direct the work, we handle everything else.
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