As the working world becomes more dispersed and the technology that keeps us connected advances, a growing number of employers are building a remote workforce and looking overseas to meet their talent needs. The Philippines has become a particularly popular destination for finding top tech talent. The nation is rich with software developers, engineers, programmers, and other in-demand tech professionals.
Yet, as with most countries, deciding to hire in the Philippines can present certain challenges. To simplify hiring across borders, many companies turn to using an employer of record (EOR).
EORs in the Philippines
An EOR is an organization that acts as an employer for legal and tax purposes. EORs perform human resources and legal functions, managing tasks like payroll, taxes, compliance, and benefits for your remote employees. These third-party organizations take responsibility for all formal employment tasks, allowing you to quickly hire workers in global markets..
Simply put, there are many benefits that can come from partnering with an EOR. Talent based in the Philippines becomes much more accessible once you have one of these organizations on your side, which can also eliminate the typical stressors of global employment. For example, Oyster handles all aspects of overseas employment on your behalf, including:
- Benefits
- Compliance with local laws
- Onboarding
- Offboarding
- Payroll
- Time off management
Talk to one of our advisors today to find out how our global employment platform can help onboard team members in the Philippines without the usual headaches.
A few things to know about hiring in the Philippines
While sourcing talent from the Philippines can grant you access to talented tech professionals and many other skilled workers, there are important differences from U.S. hiring practices to keep in mind. Here are a few considerations for hiring talent in the Philippines..
Paid time off
In the Philippines, employers have no legal obligation to provide paid sick time. However,, employees are entitled to “service incentive leave” after 12 months of service. They are legally entitled to a minimum of five days of paid time off, which can also be used for vacation.
Female employees may receive up to 105 days of fully paid maternity leave for each pregnancy when they are employed. Female employees are also entitled to 60 days of paid leave for miscarriage and emergency termination of pregnancy. For their first four children, married men are eligible for up to seven days of paid leave.
13th month salary
In the Philippines, employees receive a 13th month salary, which amounts to 1/12th of their annual pay. The payment must be made no later thanDecember 24th. It is typically paid in one lump sum in December, however, employers can pay it in two installments in June and December. The 13th month salary is not the same as a Christmas bonus, however, which is an optional incentive some employers provide.
Working hours and overtime
The normal work week for Philippines employees spans 48 hours. Employees are expected to work eight hours a day, six days a week. Hours worked beyond this period should be the exception rather than the rule, and are to be paid at overtime rates, which are compensated with an additional 25% of the regular basic rate. On special holidays, overtime hours are eligible for a special rate of an additional 30%. Managerial employees are not entitled to overtime pay.
Probationary and notice periods
The probationary period in the Philippines is six months. Employees must provide a minimum of 30 days’ notice for resignations, while businesses are required to provide the same amount of notice for dismissals for authorized causes. Dismissals for just causes, such as habitual neglect of duty or employee misconduct, do not require a notice period, however, a specific process must be followed before employment can be terminated. Employees are entitled to severance pay, but only if they were terminated for authorized causes. This could amount to up to one month’s salary for each year of service.
Find out more about hiring in the Philippines in our complete guide.
Whether you’d like to hire in the Philippines or elsewhere, Oyster simplifies the process with our contractor management and global hiring tools. We eliminate the hassle of onboarding, payments, and paperwork.
How much does it cost to hire in the Philippines?
Check out our cost of hiring in the Philippines tool to work out how much tax you and your employee might have to pay on top of salary payments.
About Oyster
Oyster is a global employment platform designed to enable visionary HR leaders to find, engage, pay, manage, develop, and take care of a thriving distributed workforce. Oyster lets growing companies give valued international team members the experience they deserve, without the usual headaches and expense.
Oyster enables hiring anywhere in the world—with reliable, compliant payroll, and great local benefits and perks.
