Philippines Announces 2nd Tranche Salary Increase for Civilian Workers in 2025 – In a major financial boost for public servants, the Philippines has announced the 2nd tranche salary increase for civilian workers in 2025, as part of its continuing commitment to reward government employees fairly. The adjustment comes under Executive Order No. 64, signed by President Ferdinand Marcos Jr. in 2024, and it officially took effect in January 2025.
This move is designed to help public servants keep up with inflation, support their families better, and encourage excellence in public service. If you’re a government employee or aspiring to be one, here’s everything you need to know about the new pay hike — from who qualifies to how much you can expect.
Philippines Announces 2nd Tranche Salary Increase for Civilian Workers in 2025
| Key Details | Information |
|---|---|
| Policy Name | Executive Order No. 64 (2nd Tranche of Salary Standardization Law V) |
| Effective Date | January 2025 |
| Applies To | Civilian government workers in national government agencies, SUCs, GOCCs not covered by RA 10149 |
| Excludes | Military, uniformed personnel, job order and contract of service workers |
| Covered Positions | Full-time, part-time, casual, contractual, elective, and appointive employees |
| Purpose | To adjust salaries in line with inflation and improve government service quality |
| Official Source | Philippine News Agency |
The 2025 salary increase for civilian government workers in the Philippines is a much-needed step toward better compensation and recognition of their role in nation-building. With this second tranche now in effect, eligible employees should take the time to understand their new pay scale, plan their finances, and prepare for future tranches.
Understanding the 2nd Tranche Salary Increase
The 2nd tranche salary increase is part of the Salary Standardization Law V (SSL V). Under this law, the government commits to increasing the salaries of civilian government workers over a four-year period starting from 2024 until 2027.
The first tranche was implemented in 2024, and the second tranche now comes into effect in 2025, with subsequent increases planned in 2026 and 2027.
Why Is This Increase Important?
Public sector workers have long argued for salary adjustments to meet the rising cost of living. This second tranche is an effort to:
- Make government compensation competitive with the private sector
- Retain talent in the civil service
- Help employees cope with inflation
Who Is Eligible to Get the Increase?
Included:
According to the Department of Budget and Management (DBM), the salary increase applies to:
- Civilian government personnel in the Executive, Legislative, and Judicial branches
- Employees of Constitutional Commissions
- Workers in State Universities and Colleges (SUCs)
- Personnel in Government-Owned and -Controlled Corporations (GOCCs) not covered by RA No. 10149
- Civilian personnel in local government units (LGUs), depending on their financial capability
It includes workers regardless of:
- Status of appointment (regular, contractual, casual)
- Whether full-time or part-time
- Whether elective or appointive
Excluded:
Not everyone in public service is covered by this tranche. The following are not eligible:
- Military and uniformed personnel (they have a separate salary adjustment)
- GOCCs covered under Republic Act No. 10149 and Executive Order No. 150
- Consultants, laborers on a piecework basis, student workers, apprentices
- Individuals hired under job orders or contracts of service
How Much Is the Salary Increase?
The exact amount varies by Salary Grade (SG) and step under the government’s standardized salary scale. Here are a few examples:
- SG 1 (lowest rank): From PHP 13,000 in 2024 to around PHP 13,780 in 2025
- SG 11 (e.g., teachers, mid-level staff): From PHP 27,000 to about PHP 28,600
- SG 24 (e.g., directors): From PHP 88,410 to about PHP 93,512
For full tables and step-by-step breakdowns by grade, visit the DBM official website.
How This Impacts Pension and Benefits
An increase in base salary can positively impact retirement benefits, as GSIS pension computations are partially based on the average monthly compensation. A higher salary also means higher PhilHealth, Pag-IBIG, and GSIS contributions, potentially improving future benefits.
How the Adjustment Is Funded?
The funding for the 2025 salary hike has already been included in the General Appropriations Act (GAA) 2025. Agencies are instructed to allocate the required amounts internally and submit reports to DBM for transparency.
For local government units (LGUs), implementation depends on their financial standing and compliance with local budget guidelines.
What Should Employees Do Now?
Here’s how you can make the most of this increase:
1. Check Your Payslip
Ensure that your January 2025 payslip reflects the new rates. If not, talk to your HR or accounting department.
2. Review the DBM Salary Schedule
Visit the DBM website to review your updated salary grade.
3. Plan Your Budget
Use the increase wisely. Consider boosting your emergency fund or contributing more to your Government Service Insurance System (GSIS) savings.
4. Adjust Your Tax Planning
Higher salaries may place some employees in higher tax brackets. Consult with a tax advisor or visit the Bureau of Internal Revenue (BIR) website for updated withholding tax tables.
5. Stay Updated
Follow DBM and Civil Service Commission (CSC) updates for upcoming tranches in 2026 and 2027.
Why This Matters for the Filipino Workforce?
Government workers are the backbone of public service delivery. This pay hike:
- Helps maintain morale and productivity
- Improves the quality of service to the public
- Promotes retention and reduces turnover
- Encourages professionals to choose public service over private employment
It’s not just about higher pay—it’s about valuing public servants who keep the country running.
FAQs
1. How do I know what Salary Grade I belong to?
Check with your HR department or view the salary standardization law charts on the DBM website.
2. Will uniformed personnel get a similar increase?
Uniformed personnel are covered under a separate salary scheme. Updates are announced by the Department of National Defense (DND) or Department of the Interior and Local Government (DILG).
3. Do LGU employees automatically get this raise?
No. LGU salary adjustments depend on their financial capacity and must align with the Department of Budget and Management guidelines.
4. Will there be another increase after this?
Yes. This is the second of four tranches, with additional increases planned for 2026 and 2027.
5. Where can I find the official list of salary adjustments?
You can view or download the latest salary schedules at the DBM official site.
6. How does this affect my GSIS contributions and pension?
Higher salaries mean higher GSIS contributions, which can translate to better retirement and loan benefits. Consult your GSIS servicing office for personalized advice.
7. Will this affect income tax deductions?
Yes, a higher salary could result in slightly higher monthly income tax deductions. You can refer to the updated tax withholding tables from BIR.
