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Guidelines in the Availment of Compensatory Time Off & Overtime Credit

What is Compensatory Time-Off (CTO)?

Refers to the number of hours or days an employee in excused from reporting for work with full pay and benefits. It is a non-monetary benefit provided to an employee in lieu of overtime pay.

What is Compensatory Overtime Credit (COC)?

Refers to the accrued number of hours an employee earns as a result of services rendered beyond regular working hours, and/or those rendered on Saturdays, Sundays, Holidays or scheduled days off without the benefit of overtime pay.

TeacherPH REMINDS all concerned of the guidelines in the availment of Compensatory Time Off (CTO) in lieu of overtime pay in accordance to Civil Service Commission and Department of Budget and Management Joint Circular No. 2, s 2004 – “Non-Monetary Remuneration for Overtime Services Rendered” (copy attached).

Everyone is encouraged to run through the guidelines for a thorough understanding, particularly on the following sections of the above-cited Joint Circular.

  • Section 5.2 – Issuance/ Approval of CTO
  • Section 5.3 – Authorized Activities to Qualify for Overtime Services
  • Section 5.5 – Accrual and Use of COC’s
  • Section 5.6 – Limitation on the Use of COC’s
  • Section 5.8 – Issuance of Certificate of COC Earned
  • Section 5.9 – Availment of CTO
  • Section 7.2 – Duties and Responsibilities of Employees

CSC & DBM Joint Circular No. 2 s. 2004. “Non-monetary Remuneration for Overtime Services Rendered”

Attached for information and guidance, is a copy of the CSC & DBM Joint Circular No. 2, s. 2004 dated October 4, 2004 entitled “Non-monetary Renumeration for Overtime Services Rendered” which prescribes guidelines on the availment of compensatory time-off in lieu of overtime pay, pursuant to adoption of austerity measures in the government.


To provide a uniform policy on the availment of compensatory time-off, in lieu of overtime pay, pursuant to Section 1 (d) of Administrative Order No. 103, “Directing the Continued Adoption of Austerity Measures in the Government.”


This Circular shall cover incumbents of positions of chief of division and below under permanent, temporary or casual status, and contractual personnel whose employment is in the nature of a regular employee.


This Circular does not cover the following government personnel:

  • Those occupying positions whose ranks are higher than chiefs of division;
  • Those appointed to positions in the Career Executive Services (CES);
  • Elective officials; and
  • Military and uniformed personnel.


Employees are required to render forty (40) hours of work in a week, subject to the work schedule adopted by the agency. In the exigency of the service, employees may be required to render services beyond working hours.

The Head of Office shall determine the need for overtime services. In this regard, the Office concerned shall issue an office order specifying the date and time for rendition of overtime, and its purpose.

Overtime services may be authorized for the following activities:

  1. Completion of infrastructure and other projects with set deadlines when due to unforeseen events the deadline cannot be met without resorting to overtime work;
  2. Relief, rehabilitation, reconstruction and other related work or services during calamities and disasters;
  3. Work related to school graduation/registration where the additional work cannot be handled by existing personnel during regular working hours;
  4. Work involving the preparation for and administration of government examinations, including the prompt correction and release of results thereof where existing personnel are not adequate to handle such work during regular working hours;
  5. Seasonal work such as budget preparation and rendition of annual reports to meet scheduled deadlines;
  6. Preparation of special/financial/accountability reports required occasionally by central monitoring agencies like the Congress of the Philippines, Office of the president, Commission on Audit, Department of Budget and Management, and National Economic and Development Authority;
  7. The provision of essential public services during emergency situations, such as power and energy, water, distribution and control of basic staples, communication and transportation, medical and health services, peace and order, and security;
  8. Implementation of special programs/projects embodied in Presidential directives and authorizations and with specific dates to complete, which are in addition to the regular duties of the employees;
  9. Legal services to facilitate the dissolution of cases/resolutions/decisions;
  10. Services rendered by drivers and other immediate staff of officials when required to keep the same working hours as their superiors; and
  11. Such other activities as may be determined by the head of agency.

Computation of Compensatory Overtime Credits (COCs)

The COC is expressed in number of hours, computed as follows:

For overtime services rendered on weekdays or scheduled work days:

COC = number of hours of overtime services x 1.0

For overtime services rendered on weekends, holidays or scheduled days off:

COC = number of hours of overtime services x 1.5

Accrual and Use of Compensatory Overtime Credits (COCs)

Each employee may accrue not more than forty (40) hours of COCs in a month. In no instance, however, shall the unexpended balance exceed one hundred twenty hours (120) hours.

The COCs should be used as time-off which the year these are earned. The unutilized COC should not be carried over in the ensuing year, hence, are non-cumulative.

The COCs shall be considered as official time for the following purposes.

Compliance with compensation rules relative to the entitlement to PERA, Additional Compensation, year-end benefits, and other benefits received on a regular basis, and

Computation of service hours for entitlement to sick and vacation leave credits, and step increment due to length of service.

Limitation on the Use of Compensatory Overtime Credits (COCs)

The COCs cannot be sued to offset undertime/s or tardiness incurred by the employee during regular working days.

The COCs earned cannot be converted to cash, hence, are non-commulative.

The COCs will not be added to the regular leave credits of the employee. Hence, it is not part of the accumulated leave credits that is paid out to the employee.

Effect on Personnel Movement

In cases of resignation, retirement, or separation from the service, the unutilized COCs are deemed forfeited.

In case of detail, secondment or transfer to another agency, the COCs earned in one agency cannot be transferred to another agency, nor could the employee receive the monetary equivalent thereof.

In case of promotion, except when promoted to a position not qualified to receive overtime pay under previous issuances, the employee will retain his or her accrued COC.

Issuance of Certificate of Compensatory Overtime Credits (COCs) Earned

An employee who has earned COC shall be granted Certificate of COC Earned (Annex A) duly approved and signed by the Head of Office. The certificate indicates the number of hours of earned COC by the employee in a month. The certificate would be issued at the end of each month.

Availment of Compensatory Overtime Credits (COCs)

The CTO may be availed of in blocks of four (4) or eight (8) hours. Agencies adopting alternative work schedules should make parallel adjustments in the availment blocks, tantamount to either a half or full day leave from work.

The employee may use the CTO continuously up to a maximum of five (5) consecutive days per single availment, or on staggered basis within the year.

The employee must first obtain approval from the head of the agency/authorized official regarding the schedule of availment of CTO. The management shall accommodate, to the extent practicable all applications for availment of CTO at the time requested by the employee. In the exigency of the service, however, the schedule may be recalled and subsequently rescheduled by the Head of the Office/authorized official within the year.

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Mark Anthony Llego

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2 thoughts on “Guidelines in the Availment of Compensatory Time Off & Overtime Credit”

  1. Paanu Naman po Yung mga regular security guard Ng DepEd na pumapasok Ng Saturdays, Sundays and holidays po..are they entitled to avail compensatory time off or compensatory overtime credit.salamat po sa pagtugon..

  2. What if kadedeclare lang nila na holiday pala eh hindi nasama ung holiday na un noong gawaan ng schedule. Tapos ung duty is shifting and ung unit na un eh 24/7. Pwede ba may file ng CTO ung nakaduty at naka off?


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