Employer of Record (EOR) in Philippines
Employer of Record (EOR) in Philippines provides a compliant way for companies to hire local professionals without establishing a legal entity. The Philippines has a workforce of over 45 million people, with strong expertise in IT, business process outsourcing (BPO), finance, and healthcare. The country is well-known for its English-speaking talent, cultural adaptability, and cost-effective labor market. However, employers face complex labor codes, mandatory benefits, and multiple statutory contributions. Partnering with an EOR in the Philippines helps businesses streamline payroll, contracts, compliance, and HR administration, ensuring efficient and lawful hiring across industries.
About Philippines
The Philippines, located in Southeast Asia, is an archipelago with a dynamic economy and one of the largest English-speaking workforces in the world. Over the last two decades, it has become a global hub for IT, business process outsourcing (BPO), customer support, and finance services. Major cities like Manila, Cebu, and Davao serve as leading centers for multinational companies.
The country’s labor force is young, skilled, and highly adaptable, making it attractive for roles in software development, digital marketing, accounting, healthcare, and creative industries. Wages are competitive compared to other Asian countries, which has contributed to the country’s rapid growth as an outsourcing destination.
At the same time, employment regulations are strict, requiring compliance with mandatory benefits such as the Social Security System (SSS), PhilHealth, and Pag-IBIG Fund. Employers must also provide 13th-month pay, paid leave, and severance benefits. Navigating these rules can be complex for foreign businesses. An Employer of Record (EOR) in the Philippines helps companies simplify hiring, manage payroll accurately, and ensure compliance with all labor laws while enabling faster entry into the local market.
Employment Terms and Regulations
Types of Contracts
Regular (Permanent) Contracts:
Standard employment with full benefits
Fixed-Term Contracts:
Project-based or time-bound roles
Probationary Contracts:
Up to 6 months before regularization
Project or Seasonal Contracts:
Industry-specific (e.g., construction, agriculture)
Working Hours
Standard: 8 hours per day, 40–48 hours per week
Overtime: Must be compensated at higher rates
Minimum Wage
Varies by region, approx. PHP 570/day in Metro Manila (2025)
Probation Period
Maximum of 6 months
Taxation and Contributions
Income tax:
Progressive, 0%–35% based on income brackets
Employee contributions:
SSS, PhilHealth, Pag-IBIG
Employer contributions:
Equivalent payments for SSS, PhilHealth, Pag-IBIG plus other mandatory benefits
EOR manages filings, deductions, and remittances
Types of Leave
Annual Leave:
Varies, generally 5 days after one year of service
Sick Leave:
Mandatory sick leave provisions for employees
Maternity Leave:
105 days (additional 15 days for solo mothers)
Paternity Leave:
7 days
Special Leave Benefits:
For women, up to 60 days under certain conditions
Public Holidays:
18 official holidays annually
Employee Benefits
- Mandatory 13th-month pay
- Social Security System (SSS) coverage
- PhilHealth healthcare benefits
- Pag-IBIG housing fund contributions
- Paid annual leave, maternity, and paternity leave
- Optional benefits: private health insurance, allowances, bonuses
Termination Process
- Must be based on just cause (misconduct, redundancy, etc.)
- Employer must provide notice and valid documentation
- Separation pay required for redundancy or retrenchment
- Termination procedures are strictly regulated to protect employees
Employer Taxes
- Employer contributions: SSS (~8.5% of salary), PhilHealth, Pag-IBIG (2%)
- Total employer costs typically 10%–12% of gross salary
- EOR ensures accurate and timely remittance
EMPLOYER TAXES
10%–12% (Estimated)
FAQ's
How an Employer of Record Manages Employment in the Philippines
Establishing a legal entity in the Philippines can be costly and time-consuming. We simplify the process by employing and paying your Filipino talent on your behalf. We handle employment contracts, SSS/PhilHealth/Pag-IBIG registrations, and payroll in compliance with Philippine labor law. You can conveniently approve invoices through our platform. By partnering with an Employer of Record (EOR), you can efficiently and compliantly hire top talent in the Philippines without setting up a local subsidiary.
Payment Processes for Employees in the Philippines
We manage payroll for your Philippines-based workforce. Employee hours, leave, holidays, bonuses, and statutory contributions are calculated in accordance with Philippine requirements. Invoicing is handled monthly in your preferred currency, including Euros (EUR), US Dollars (USD), or British Pounds (GBP), ensuring your employees receive their salaries promptly in Philippine Pesos (PHP).
Full-time Employees vs. Independent Contractors in the Philippines
Independent contractors in the Philippines engage with multiple companies and are self-employed, while full-time employees work exclusively for one employer and receive statutory benefits such as SSS/PhilHealth coverage, paid leave, and separation pay protections. Misclassifying employees as contractors carries legal and financial risk under Philippine labor law. Partnering with an EOR for compliant hiring and payment removes that risk.
Reliable Employee Support in the Philippines
Our platform offers accessible support for employers and employees with inquiries about benefits, contracts, and employment in the Philippines. Every client is assigned a dedicated account manager who serves as the primary contact for HR and compliance assistance throughout the employment relationship.
