Extrajudicial settlement of estate not necessary to claim deceased employee's last pay

Dear PAO,

Is it really necessary to have an extrajudicial settlement of estate before my father's last pay can be released to us, his heirs? My father worked for a call center company, and he passed away because of an accident. We are left with debts from his hospitalization expenses, and his last pay from the company will really help us in settling some of these debts. However, the company has been giving us one excuse after another and now claims we must complete an extrajudicial settlement first. Is that correct?

Biancaxx

Dear Biancaxx,

Generally, the property, rights, and obligations of a deceased person are transmitted to his or her heirs, through his or her death, by virtue of a will or by operation of law, in line with Article 774 of the New Civil Code of the Philippines. One of the ways to proceed with such transmission is through the settlement of the estate of the decedent.

However, it is expressly provided under Article 105 of the Labor Code of the Philippines that the wages of a deceased employee may be paid to his or her heirs without the need to go through intestate proceedings; rather, upon submission of the appropriate affidavit. To be precise, the law states:

«ART. 105. Direct payment of wages. — Wages shall be paid directly to the workers to whom they are due, except:

»(a) x x x

"(b) Where the worker has died, in which case, the employer may pay the wages of the deceased worker to the heirs of the latter without the necessity of intestate proceedings. The claimants, if they are all of age, shall execute an affidavit attesting to their relationship to the deceased and the fact that they are his heirs, to the exclusion of all other persons. If any of the heirs is a minor, the affidavit shall be executed on his behalf by his natural guardian or next-of-kin. The affidavit shall be presented to the employer who shall make payment through the Secretary of Labor and Employment or his representative. The representative of the Secretary of Labor and Employment shall act as referee in dividing the amount paid among the heirs. The payment of wages under this Article shall absolve the employer of any further liability with respect to the amount