Labor, Employment, and HR Consulting in the Philippines
We advise businesses and investors setting up operations in the Philippines to help them design their entire human resource policies, as well as their organizational development framework before they commence business operations. We work with existing companies to evaluate the suitability of their existing HR policies on their organizational structure and offer policy improvement and compensation alignment if needed.
Our HR Consultants also offer valuable advice on drafting legally compliant employee contracts, salary structures, compensation packages, and incentive schemes to help employers align their internal labor policies with mandatory Philippine laws.
We are constantly up-to-date with the latest amendments in Philippine labor laws and regulations to help our local and foreign clients stay well-informed with local labor practices. Our HR Consulting team provides services to Small-to-Medium Enterprises (SMEs) and multinational corporations located in the major cities and business districts around Metro Manila (Makati, Bonifacio Global City, Ortigas, Eastwood, etc.).
Salary Structure & Wages
In general, salaries are slowly increasing in the Philippines due to economic growth, especially in the IT-BPO/Call Center industries. However, IT professionals, tech support, and call center support representatives’ salaries are still significantly lower than in the US, Canada, Australia, and Europe. The average monthly salary of tech or customer support representatives in the Philippines ranges from US$350 to US$500. The salary of an IT professional in the Philippines can range anywhere from $400 – $3,000 depending on experience and skill-set.
Mandatory Employee Benefits
The Philippine Social Security System consists of Social Security System (SSS), Home Development Mutual Fund (HDMF), and Philippine Health Insurance Corporation (PhilHealth). The SSS was created to provide private employees and their families with protection against disability, sickness, old age, and death. The Government Service Insurance System (GSIS) is an equivalent system for Philippine government employees. The HMDF is a provident savings system providing housing loans to private and Philippine government employees, and to self-employed persons who elect to join the Fund. PhilHealth is administered by the Philippine National Health Corporation, which is designed to provide employees with a practical means of paying for adequate medical care in the Philippines.
The laws on labor standards and employment relations are consolidated in the Labor Code of the Philippines. Employees in the Philippines generally work eight hours per day or 48 hours per week. Some offices and industries work half or full days on Saturdays. Rest periods of short duration during work hours shall be counted as hours worked. In the IT-BPO industry most of the employees’ schedules are at the graveyard shift to coincide with U.S. hours.
13th Month Pay
The 13th month pay in the Philippines is equivalent to 1/12 of the basic salary received by an employee within the year. If a Filipino employee worked for less than a year (regardless of the cause for the termination of employment), the amount due to him is determined by dividing the total salary he received by the number of months he was employed.
National, Official, and Non-working Holidays
In general, providing a fixed list of holiday dates is difficult because most of the 2008 regular holidays and nationwide special holidays are movable, as provided under Republic Act No. 9492 (an Act rationalizing the celebration of national holidays). For these movable holidays, the President is tasked by law to issue a Proclamation, at least 6 months prior to a movable holiday, fixing the specific date of that non-working day.
Types of Employment
Depending on the company and/or industry, there are various types or categories of employment in the Philippines. This essentially comes down to how the employer wants the employee’s employment to be structured, which should be bound by a contract signed by both the employer and employee. Generally, types of employment in the Philippines are listed as, Project, Seasonal, Regular & Casual, Term or Fixed, and Probationary Employment.
Termination of Employees & Severance
An equality of rights exists between employer and employee. While the employer cannot force the employee to work against his or her will, neither can the employee compel the employer to continue giving him or her work if there is a lawful reason not to do so. Thus, the employer may terminate the services of an employee for just or authorized causes after following the procedure laid down by law, but the employer has the burden of proving the lawfulness of the employee’s dismissal in the proper forum.