EOR Service in Philippines

Hire, Onboard and Pay Employees in Philippines Quickly and Efficiently

Hiring in Philippines at a glance

CURRENCY
Philippine peso (PHP)
working hours
8 hours per week; 40 hours per week
public/bank holidays
13
capital
Manila
language
Filipino & English
date format
YYYY-MM-DD
remote workers
1.2M
tax year
January 1st to December 31st
minimum hourly salary
No minimum wage
CURRENCY
Philippine peso (PHP)
working hours
8 hours per week; 40 hours per week
public/bank holidays
13
capital
Manila
language
Filipino & English
date format
YYYY-MM-DD
tax year
January 1st to December 31st
payroll frequency
Monthly
GDP
USD 425 billion

Employer of Record in Philippines

The Philippines has emerged as a vibrant hub for tech talent, offering a diverse and skilled workforce for companies seeking to expand their operations. Many employers are turning to Employer of Record (EOR) services to tap into this talent pool efficiently and cost-effectively. The Philippines boasts a strong educational system, English proficiency, and a cultural affinity for Western business practices. By partnering with an EOR in the Philippines, employers can access this vast talent pool without needing to establish their own legal entity or navigate complex local employment regulations.

Why use Philippines EOR?

Firstly, establishing an entity to hire talent in the Philippines is time-consuming and expensive. Employers have to deposit a paid up capital of PHP 5,000,000 to register their entity. The entire process - opening bank accounts, registering with tax authorities, obtaining clearance - can take up to 2 months. By engaging with an EOR, you can overcome these obstacles and start hiring talent in days.

Next, The Philippines is  a pro-labor employment market. For employers looking to hire from the Philippines, this means that they have to carefully tread the island’s hiring grounds. For employers where laws exist at the national level, Philippines’ labor laws can be daunting. For example, minimum wages vary with each region.

By employing talent via an Philippines EOR, employers can rest assured that their employees are compliant with these laws, ensuring that all contracts, and tax obligations are met, reducing the potential for legal complications.

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EOR Costs in Philippines

EORs typically charge a service fee covering payroll management, benefits administration, compliance, and other HR-related tasks.

While costs may vary, engaging an EOR is generally a cost-effective solution compared to setting up your own legal entity in the Philippines. The expenses associated with entity formation, legal compliance, payroll management, and benefits administration can be substantial. By outsourcing these functions to an EOR, employers can reduce administrative overheads and focus on their core business operations.

Key Metrics For Foreign Employers in Philippines

In recent years, the Philippines has gained global recognition for its robust economic growth and increased GDP. The country's expertise in healthcare, technology, and services is expanding, and it ranks favorably in skilled labor and talent appeal.

These factors, combined with improved business conditions and rising foreign investment, position the Philippines as an attractive destination for establishing a business presence.

Factors Global Ranking Interpretation
Rule of law 98 Indicates effectiveness of law enforcement
Labour-employer cooperation 27 Indicates positive labor-employee relationships
Reading Maths, and Science 77 Indicates average scores in OECD's survey of 15-year old students
University Ranking 54 Indicates average QS rankings
Labour productivity per employee 86 Indicates total output by the total labor input used to produce that output
Ease of finding skilled employees 15 Indicates findability of skilled talent
Workforce with tertiary education 56 Indicates % of workforce with PG degrees
Digital Skills 76 Indicates prevalence of advanced digital skills in the population

Benefit from a skilled workforce, competitive costs, and supportive policies in the Philippines. Gloroots' Recrew platform enables you to connect with exceptional talent and enhance your team effectively.

Why work in Philippines?

What’s a Rich Text element?

The rich text element allows you to create and format headings, paragraphs, blockquotes, images, and video all in one place instead of having to add and format them individually. Just double-click and easily create content.

Static and dynamic content editing

A rich text element can be used with static or dynamic content. For static content, just drop it into any page and begin editing. For dynamic content, add a rich text field to any collection and then connect a rich text element to that field in the settings panel. Voila!

How to customize formatting for each rich text

Headings, paragraphs, blockquotes, figures, images, and figure captions can all be styled after a class is added to the rich text element using the "When inside of" nested selector system.

Grow your team in Philippines

Growing a team means hiring employees at the right time and for the appropriate positions. Employers in the Philippines must have a local legal organization and use local resources to handle compliance, payroll, tax, and benefits management. The complexity of employment regulations in the Philippines makes compliance with employment laws demanding.

With Gloroots’s Global Employer of Record (EoR) service, you can let Gloroots do the heavy lifting of payroll, tax, benefits, and compliance and concentrate on what matters to you most: your employees and company growth.

Risks of misclassification

The phenomenon of "employee misclassification" pertains to the incorrect categorization of workers by employers. It transpires when an employer labels a worker as an independent contractor to exempt them from employment rights  and benefits endowed upon a permanent employee, despite the worker carrying out duties akin to that of a permanent employee.

Engaging a PEO/EOR in the Philippines can help you make these distinctions correctly and prepare employment agreements to correctly classify workers. These experts ensure compliance with labor laws, accurate classification of employees, precise payroll processing, and provision of comprehensive benefits. This allows businesses to concentrate on core operations while entrusting employment-related obligations to seasoned professionals.

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Employing in Philippines

What’s a Rich Text element?

The rich text element allows you to create and format headings, paragraphs, blockquotes, images, and video all in one place instead of having to add and format them individually. Just double-click and easily create content.

Static and dynamic content editing

A rich text element can be used with static or dynamic content. For static content, just drop it into any page and begin editing. For dynamic content, add a rich text field to any collection and then connect a rich text element to that field in the settings panel. Voila!

How to customize formatting for each rich text

Headings, paragraphs, blockquotes, figures, images, and figure captions can all be styled after a class is added to the rich text element using the "When inside of" nested selector system.

Tax

INCOME TAX

Taxable Income Range (PHP) Income Tax Rate
Up to 250,000 0 %
Over 250,000 up to 400,000
15 %
Over 400,000 up to 800,000 20%
Over 800,000 up to 2 million 25%
Over 2 million up to 8 million 30%
Over 8 million 35%

Other Taxes and Social Security contribution:

Tax Employer Contribution
Corporate Tax 25%
VAT 12% (standard rate)

Contribution Type Employer Rate Employer Contribution Limit
Social Security System (SSS) around 13% Up to PHP 2,850
Philippine Health Corporation (PHIC) 1.75% Up to PHP 1,600
Home Development Mutual Fund (HDMF) 2%    Up to PHP 100

Contribution Type Employee Rate Employee Contribution Limit
Social Security System (SSS) around 7% Up to PHP 1,350
Philippine Health Corporation (PHIC) 1.75% Up to PHP 1,600
Home Development Mutual Fund (HDMF) 1% Up to PHP 100

Separation

Termination Process:

Terminating employment in the Philippines can occur due to either 'justified' or 'authorized' causes, as outlined by labor laws. 'Justified' causes include serious misconduct, neglect of duties, breach of trust, and more, while 'authorized' causes encompass business reasons like redundancy or health issues. 

In cases of 'justified' causes, employees must receive written notices and a chance to be heard before termination. For 'authorized' causes, both the employee and the Department of Labor and Employment need to be notified 30 days in advance.

The BIR 2316 form, which reports withholding tax, is mandatory upon termination before final payment. Other documents like Quitclaim and resignation letters might also be required, based on specific company policies. It's essential to understand that termination during pregnancy or maternity leave is protected under the law. Trust Gloroots to guide you through these processes with expertise and clarity.

Notice Period:

Employees and employers are generally required to give a one-month notice.

Severance Pay:

Termination for just causes does not necessitate severance pay. However, for authorized causes, employees are entitled to receive severance pay equivalent to one month's pay or one half month's pay for every year of service, whichever is greater.

Probation Periods:

Employees serve a probationary period of up to six months.

Start Hiring in Philippines today

Global hiring can be complicated due to various compliance requirements like employment laws, payroll, and data protection. Gloroots simplifies this by offering a centralized solution for hiring in the Philippines. Our experts help manage cross-border employment and payroll compliance. We handle contracts, payments, and benefits, letting you focus on finding the right talent. Our goal is to ensure a smooth global employment experience for you and your employees. Reach out to our experts today to start your global hiring in the Philippines.

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