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It's easier than ever to hire skilled professionals in the Philippines, with its English-speaking talent pool and strong cultural alignment with Western businesses. The country offers competitive labour costs and a well-established outsourcing industry.
In the Philippines, Employers must follow local rules on minimum wages, employment contracts, and social security contributions.
Learn more about salaries, hiring costs, and legal requirements in the Philippines—get the full hiring guide now!
The law recognises five types of employment contracts: regular, probationary, project-based, fixed-period, and seasonal. Employers must ensure each contract, oral or written, meets the labour code’s essential requirements and minimum standards. If the employee is a Philippine national, employers must provide a bilingual contract including Filipino to ensure clear communication.
Notice periods: 30 days written notice
Termination of employment: Employers may terminate contracts for just causes (employee fault), authorised causes (business/legal reasons), or accept voluntary resignations made for personal reasons.
Want to learn more about employment contracts in the Philippines? Get our full template now!
Employee benefits in the Philippines are governed by comprehensive labour laws designed to protect workers and promote their welfare. These benefits include mandatory statutory provisions as well as additional perks and supplemental benefits.
Want a full breakdown of all the employee benefits available in the Philippines?
The Philippines has a progressive personal income tax system, where tax rates increase as income rises. The employer is responsible for deducting and remitting withholding taxes from employees’ salaries to the Bureau of Internal Revenue (BIR).
Personal income tax rate: Income up to ₱250,000 is exempt from tax; income between ₱250,001 and ₱400,000 is taxed at 15% on the excess over ₱250,000; rates increase progressively up to 35% for income above ₱8,000,000
VAT: 12%
Tax allowances: No particular tax allowances
Additional tax reliefs: Tax holidays for registered businesses under incentive programs, and optional 8% flat tax for self-employed individuals or professionals with gross sales not exceeding ₱3 million who are not VAT-registered.
Curious to learn about the Philippines’ tax allowances and similar tax regulations?
Managing payroll in the Philippines involves complying with clear deadlines for salary payments, tax remittances, and mandatory contributions. Staying on top of these schedules helps ensure smooth operations and compliance with local laws.
Salary payment deadline: Wages must be paid at least twice a month, with intervals not exceeding 16 calendar days between payments
Taxes and contributions payments deadline: Income tax withheld must be remitted on or before the 10th day of the following month; social security and other contributions by the 10th or 15th of the following month
Payroll declarations deadline: on or before the 10th day of the month following the payroll period
Payroll currency: PHP
Want to explore the Philippines’ regulations about payroll, salaries, and contributions in more detail?
The Department of Labour and Employment (DOLE) enforces the labour code and promotes its principles across workplaces. It regulates employment laws, protects workers from unfair practices, and oversees areas like training, work conditions, health and safety, social benefits, and termination.
Total employment cost: Includes gross income, mandated benefits, and the 13th-month pay.
Minimum wage: 645 PHP per day
Probation period: Up to six months
Need a more detailed overview of the Philippines’ regulations about employment types, employer obligations, and work conditions?
Foreign citizens must obtain the proper work permits and visas to work in the Philippines. The process, type of permit, and costs vary based on the applicant’s nationality, job role, and duration of stay.
Types of permits: 9G visa
Process length: three to four months
Process cost: 3500 USD
Want to learn more about obtaining visas and work permits in the Philippines? Get our full country handbook now, or click here to find out more!
Using EOR services in the Philippines enables you to employ individuals legally without establishing a local entity. The EOR handles all legal responsibilities as the official employer, including:
Using PEO services in the Philippines provides HR and administrative support while you remain the legal employer. PEO services suit employers with local entities who need help managing workforce operations, including:
Native Teams offers a payroll calculator tailored to the Philippines’ labour laws, helping you quickly estimate net and gross salaries, employer and employee contributions, and other mandatory deductions.
Note: The information provided above is for general guidance only and should not be considered a substitute for legal advice. We strongly recommend consulting with qualified professionals who specialise in local labour laws before making any hiring decisions. While the data was accurate at the time of writing, labour regulations are subject to change, and it is your responsibility to stay informed about the latest developments.
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Freelancers in the Philippines must register with the Bureau of Internal Revenue (BIR) as self-employed individuals and handle their own income tax and contributions.
As a client, you aren’t responsible for withholding or remitting their taxes, but you should ensure that your working relationship doesn’t resemble full-time employment to avoid misclassification risks. It’s also important to have a clear contract outlining the scope of work, responsibilities, payment terms, and other key details.
