Payroll Cycle
Minumum Wage
Overtime Pay
Visa Immigration
9(g) Pre-Arranged Employee Commercial Visa Requisite: Alien Employment Permit (AEP)

Validity: Depends on contract or Bureau of Immigration

Entitled to multiple entries in and out of the country.

Eligible to legitimately work and stay in the country approved by the Bureau of Immigration corresponding to the employment contract.

Special Non-Immigrant Visa or 47(A)(2) Validity: Contract or Term of Office or one (1) year whichever is shorter

Company-specific visa that has less than 5% foreign national workforce.

Must be sponsored / petitioned by the employer.

Talent Wiki - Philippines

Your quick guide on talent and labor compliance norms in Philippines
Talk to our experts
Capital
Manila
Currency
Philippine Peso (PHP)
Languages
Filipino, English
Payroll Frequency
Bi-Monthly
GDP per Capita
$3,298
Employer Tax
4% and Php 265 - Php 2155

Supplementary Guide for Employment and Expansion in Philippines

Talent Overview

The Philippines’ dynamic economy is rooted in the country’s labor market. The majority of the Philippine population comprises the young, attracting more foreign investors to venture into the country’s talent pool. Moreover, the Philippines’ archipelagic structure bears a lot of tourist spots for travelers and has contributed to the success of the country’s tourism industry.

Major Economic Hubs:

Manila, Cebu, Davao, Zamboanga, Cagayan de Oro, Baguio, and Vigan

Skills in Demand:

ICT professionals, Marketing, creative and Design professionals, Customer Service Professionals, Sales and Retail Professionals, Logistics and Delivery Professionals

Local Universities

The top local universities in Philippines include:

University of the Philippines

RANKING

Philippines : 1

World : 1434

Ateneo de Manila University

RANKING

Philippines : 2

World : 1617

University of Sto. Tomas

RANKING

Philippines : 3

World : 1990

De La Salle University

RANKING

Philippines : 4

World : 2192

University of the Philippines System

RANKING

Philippines : 5

World : 2837

Salary Data

No. Job Title Salary Range (in PHP) Salary Range (in USD)
1 Accounting Manager 83,333 – 166,666 1,735 – 3,470
2 Web/Mobile App Developer 108,333 – 250,000 2,275 – 5,250
3 Data Scientist 125,000 – 208,333 2,625 – 4,375
4 Test Analyst 83,333 – 158,333 1,750 – 3,325
5 Project Manager 166,667 – 333,333 3,500 – 7,000
6 Sales Manager 108,333 – 425,000 2,275 – 8,925

Talent Sourcing Tips

Top Local Job Boards

Jobstreet, Kalibrr, Indeed, Boss Job, LinkedIn

Number of LinkedIn Users

11,000,000

Top Recruitment Agencies

Robert Walters, Manila Recruitment, Alliance Recruitment Agency

Employing in Philippines

Hiring in the Philippines requires you to be aware of the local employment laws, benefits, payroll, and taxes. Below, are everything you need to know on how to successfully onboard talents from the Philippines.

Employee Contract

As a general rule, employment in the Philippines does not require a formal or written contract. A consensual contract may be agreed upon by both parties with the exception of contractors and subcontractors which written contracts are required. Written contracts are generally written in English, however, the employer must provide a Filipino contract if the employee is a Filipino Citizen. This is to clarify points and agreements for the employee under the contract.

All contracts, consensual or written, must adhere to The Labor Code of the Philippines.

Probation Period

The probationary period for employees ranges from 1 - 6 months. The notice period before termination ranges from 14 - 30 days.

Public and Provincial Holidays

Date Name Type
1 Jan New Year's Day National holiday
1 Feb Chinese New Year National holiday
25 Feb People Power Revolution National holiday
16 Mar Davao City Day Regional holiday
9 Apr Araw ng Kagitingan National holiday
14 Apr Maundy Thursday National holiday
15 Apr Good Friday National holiday
16 Apr Black Saturday National holiday
1 May Labor Day National Holiday
3 May Eid’l Fitr National holiday
12 Jun Independence Day National holiday
24 Jun Manila Day National holiday
10 Jul Eidul Adha National holiday
19 Aug Birthday of Manuel L. Quezon Regional holiday
21 Aug Ninoy Aquino Day National holiday
29 Aug National Heroes Day National holiday
1 Nov All Saint’s Day Local holiday
30 Nov Bonifacio Day National holiday
8 Dec Immaculate Conception Day National holiday
25 Dec Christmas Day National holiday
30 Dec Rizal Day National holiday

Employee Leaves

Type of leave Time period Mandatory
Annual leave/Earned Leave 5 days Yes
Maternity Leave 15 weeks Yes

Allotted sick leaves in the Philippines depends according to the contract between employee and employer.

Payroll

Payroll Cycle

Workers are paid twice a month. Paydays are generally once every two weeks and must not exceed 16 days for the second.

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Minimum Wage

The minimum wage in the Philippines depends on the region. For Metro Manila, the minimum wage is Php 537.00 ($10.24) per day. The average minimum wage for the whole country is Php 343.63.

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Overtime pay

Any hours exceeding the regular 8 working hours per day are considered overtime and should get paid at 25% over their standard rate. The rate jumps to 30% when working overtime on a rest day, special or regular holiday.

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Health Examination Clause

Bonus

13th month salary

All regular employees are entitled to a 13th-month pay provided that they have worked at least one (1) month during the calendar year. The pay must at least be 1/12 of the total basic salary earned for the year. It must be paid by December 24th.

Employee Benefits

Full-time employees in the Philippines are ensured to have insurance benefits such as

  • ~Social Security (SSS),
  • ~Medical (PhilHealth); 
  • ~and Housing benefits (PAG-IBIG). 
Talk to our experts

Taxes

Employer Payroll Tax

Tax Rate Contribution
Social Security (SSS) PHP 265 – PHP 2,155
Health Insurance (PHIC) 2%
Home Development Mutual Fund (HDMF) 2%

Employee Payroll Tax

Tax Rate Contribution
Social Security (SSS) PHP 135 – PHP 1,125
Home Development Mutual Fund (HDMF) 1% (Below PHP 1,500)

2% (Above PHP 1,500)

Health Insurance (PHIC) 2%

Employee Income Tax

Income tax is levied at a progressive rate on all monthly income as follows:

Tax Rate Income Group (in Php)
< 20,833.33 0
20,833.33 – 33,333.33 20% of the excess over P20,833.33
33,333.33 – 66,666.67 P2500 + 25% of the excess over P33,333
66,666.67 – 166,666.67 P10,833.33 + 30% of the excess over P66,666.67
166,666.67 – 666,666.67 P40,833.33 + 32% of the excess over P166,666.67
666,666.67 P40,833.33 + 32% of the excess over P166,666.67

VAT

VAT in the Philippines is 12% in 2021 and is subject to until 2022.

Offboarding & Termination

Termination Process

Letting go of an employee in the Philippines is by no means an easy task. Before you terminate one of your employees, you must follow The Labor Code of the Philippines. You can only dismiss an employee if:

They have behavioral issues such as:

  • ~Incurred serious misconduct;
  • ~Willful disobedience;
  • ~Gross and habitual neglect of duty;
  • ~Fraud or breach of trust;
  • ~Commission of a crime or offense against the employer, his family, or representative;

Or the company is retrenching or expanding with the following reasons:

  • ~Installation of labor-saving devices
  • ~Redundancy
  • ~Retrenchment to prevent losses
  • ~Closure and cessation of business; and
  • ~Disease / illness

Notice Period

The notice period before termination is up to 3 months.

Severance Pay

Terminated employees are entitled to a severance pay package adhering to The Labor Code of the Philippines. The computation of the severance pay depends on the cause of termination except relating to behavioral issues.

  • ~One month pay or at least ½ month pay for every year of service whichever is higher (a fraction of 6 months is considered a whole year) including the available allowances with the position
  • ~Separation pay is exempt from taxation

Visa and Immigration

If you’re looking to work as an expat in the Philippines, there are two primary relevant visas you can acquire. These visas depend on the nature of your contract or dealing with the company. Click on the link below to get more details.

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