# Hire in Philippines

Source: https://overseashire.com/hire/philippines · verified 2026-10-05 · confidence medium

Large pool of English-fluent talent in customer support, back office, virtual assistance, design and growing software development. Culturally aligned with US business, and the time zone favours Asia-Pacific and US night shifts.

## Employer cost
Employer on-costs 14–22% of gross salary. Employer contributions: SSS 10% of monthly salary credit (MSC range PHP 5,000-35,000, so max PHP 3,500 plus small EC premium), PhilHealth 2.5% of basic salary up to PHP 100,000 (max PHP 2,500), Pag-IBIG 2% of monthly fund salary capped at PHP 10,000 (max PHP 200). Together about 6% of pay at PHP 100,000 salary rising to about 13% at PHP 30,000. Adding the mandatory 13th-month pay (8.33% of basic) gives ~14.5% to ~21.5%. Excludes service incentive leave cash conversion, HMO and other benefits. Rechecked 5 Oct 2026: at PHP 100,000/month employer cost = SSS 3,500 + EC 30 + PhilHealth 2,500 + Pag-IBIG 200 = 6,230 (6.2%); at PHP 30,000 = SSS 3,000 + EC 30 + PhilHealth 750 + Pag-IBIG 200 = 3,980 (13.3%). PwC's maximum (SSS PHP 2,000 + provident fund PHP 1,500 + EC PHP 30) reconciles with 10% of the PHP 35,000 maximum salary credit. 13th-month pay (8.33%) brings these to about 14.5%-21.6%.

| Contribution | Rate | Notes |
|---|---|---|
| SSS (Social Security System) | 10% of monthly salary credit (total 15%, employee 5%) | MSC PHP 5,000-35,000 since 2025; plus EC contribution PHP 10-30. |
| PhilHealth | 2.5% of basic salary (total 5%) | Income ceiling PHP 100,000/month, max employer share PHP 2,500. |
| Pag-IBIG (HDMF) | 2% of monthly fund salary, capped at PHP 10,000 (max PHP 200) | Employee contributes 2% (1% if earning PHP 1,500 or below). |

Mandatory benefits: 13th-month pay (by 24 December); Service incentive leave (5 days after one year); Holiday pay for regular holidays; Maternity leave 105 days; Paternity leave 7 days; SSS, PhilHealth, Pag-IBIG coverage; Separation pay for authorized-cause dismissal

## Rules
- Payroll: semi-monthly (at least twice a month, intervals not exceeding 16 days)
- Probation: Maximum 6 months; probationary employees must be told the regularisation standards at hiring.
- Notice and severance: Authorized-cause termination (redundancy, installation of labour-saving devices) requires 30 days' written notice to the employee and DOLE and separation pay of 1 month or 1 month per year of service, whichever is higher; retrenchment/closure not due to serious losses: 1 month or 0.5 month per year, whichever is higher. No separation pay for just cause dismissal. Employee resignation requires 30 days' notice.
- Termination: Security of tenure applies; dismissal must be for just cause (misconduct, neglect of duty, etc.) or authorized cause, with the two-notice rule and an opportunity to be heard. Illegal dismissal means reinstatement with full back wages, or separation pay in lieu. Courts and NLRC are generally employee-friendly.
- Working time: 8 hours/day, 48 hours/week. Overtime at +25% on ordinary days and +30% on rest days/holidays; night differential 10% from 10pm to 6am.
- Paid leave: 5 days' service incentive leave after one year (many employers give more); 12 regular holidays plus special non-working days (varies per year).
- Minimum wage: NCR (Metro Manila) non-agriculture minimum raised from PHP 695 to PHP 755 per day from 26 September 2026 (PHP 718 for agriculture, small retail/service and small manufacturing), reported by GMA, Philstar and Tribune as Wage Order NCR-28 confirmed by the NWPC. A second step to PHP 780 on 20 January 2027 appeared only in the earlier Wage Order NCR-27, which a secondary source says was enjoined by a court and never took effect; it is not confirmed. Rates differ by region.

## Contractors
The four-fold test (selection, wages, dismissal power, control) with the control test decisive. Misclassified freelancers can claim regularisation, 13th month, leave and back wages. DOLE Department Order 174 restricts labour-only contracting. Risk is moderate to high for full-time dedicated freelancers.

## EOR
Direct employment requires a Philippine entity registered with SEC, BIR, SSS, PhilHealth, Pag-IBIG (with foreign ownership rules in some sectors). EOR is common for foreign firms hiring virtual assistants, developers and support staff. Providers advertise days to a couple of weeks.
Onboarding: EOR Days to ~2 weeks (provider claims; specific figure unverified); own entity About 1-3 months (estimate, not verified).

## FAQ
**What are the employer contributions in the Philippines?** SSS 10% of salary credit (max PHP 3,500), PhilHealth 2.5% up to PHP 100,000 and Pag-IBIG 2% capped at PHP 10,000 (PHP 200).

**Is the 13th-month pay mandatory?** Yes, equal to 1/12 of basic salary earned in the year, paid on or before 24 December.

**How long can probation last?** Up to 6 months.

**What is the separation pay for redundancy?** At least one month's pay or one month per year of service, whichever is higher, with 30 days' notice to the employee and DOLE.

Unverified: NCR minimum wage PHP 755 from 26 Sep 2026 is from news reports (Wage Order NCR-28); the January 2027 step and the status of NCR-27 (reported enjoined) are unconfirmed - check nwpc.dole.gov.ph; SSS 15%/MSC range and PhilHealth/Pag-IBIG rates confirmed via secondary payroll guides and PwC maximums, not sss.gov.ph; Probation, separation pay formulas, leave, maternity/paternity days from general knowledge of the Labor Code and statutes; Overtime and night differential percentages from general knowledge; EC premium range; EOR and entity timing

Sources:
- https://www.secondtalent.com/resources/philippines-payroll-benefits-tax/
- https://ayp-group.com/hiring-guides-v2/philippines
- https://topsourceworldwide.com/insights/hiring-employees-philippines/
- https://employsome.com/?p=6666
- https://aniday.com/en/philippines/employment-cost-calculator
- https://www.gmanetwork.com/news/money/economy/1003769/dole-p60-wage-hike-in-ncr-takes-effect-sept-26/story/
- https://taxsummaries.pwc.com/philippines/corporate/other-taxes
- https://www.forvismazars.com/ph/en/insights/hr-payroll-alerts/sss-contribution-rates-increased-to-15

Not legal or tax advice.