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Philippines Employment Guide

Your essential guide to the workforce, working customs, and labor rules in Philippines

Access essential insights to manage employment smoothly, stay compliant, and build a thriving team
Capital

Manila

Time Zone

Philippine Standard Time UTC +8

Currency

Philippine Peso (PHP)

Languages

FIlipino, English

Payroll

Bi-Monthly

Employers Tax

13.5%

Employer of Record (EOR)
Professional Employer Organization (PEO)

Employment Law

Payroll & Tax
Compensation & Benefits

Talent Landscape

The Philippines continues to be a top-tier destination for global business outsourcing because of the its high-volume, cost-effective transactions, and high fluency in the English language. Filipino tech talent are likely to join organizations that show high process efficiencies, continuous talent improvement/development, and an empowered, accountability-driven culture.

In-Demand Roles

Full Stack Developer

Sales Development Representative

Account Manager

Business Development Executive

Product Marketing Executive

Working Culture

Titles and nicknames

Titles are commonly used in the Philippines, both casually and professionally. People often call others “Ate”, “Kuya”, “Ma’am”, or “Sir.” It’s normal for a subordinate to call a superior “Ma’am” or “Sir,” reflecting respect and hierarchy in the workplace.

Importance of pride

‘Hiya’ or ‘mahiyain’ is a Filipino value emphasizing modesty and reputation. Employees take pride in how they are perceived and avoid public embarrassment. Preserving one’s pride is crucial to maintaining a positive workplace dynamic.

Effective in bridging cultures

Filipinos are adept at navigating both Western and Asian cultures, shaped by a history of East and West influences. This cultural blend, along with frequent interaction with tourists and foreign professionals, allows them to communicate effectively in cross-cultural settings.

Strong service orientation and hardworking

Filipinos are known for their strong work ethic, discipline, and productivity. They thrive in structured environments with clear processes. The concept of ‘kapwa’ or togetherness fosters a collectivistic culture, where teamwork is valued regardless of differences in status or wealth.

Average Salary

Job Position
Avg Monthly Salary (USD)
*3-5 Years of Experiences
Tech Engineering
Software Engineer
$1,780
AI Engineer
$1,420
Business Development & Sales
Business Development Officer
$818
Sales Manager
$854
Product
Product Manager
$1,182
Data
Data Analyst
$818
Data Scientist
$1,318
Marketing & PR
Marketing Associate
$682
Marketing Manager
$1,065
Public Relations Manager
$818
Corporate Services
Human Resources Generalist
$682
Accountant
$682
Administrative Officer
$545
Job Position
Avg Monthly Salary (USD)
*3-5 Years of Experiences
Tech Engineering
Software Engineer
$1,780
AI Engineer
$1,420
Business Development & Sales
Business Development Officer
$818
Sales Manager
$854
Job Position
Avg Monthly Salary (USD)
*3-5 Years of Experiences
Product
Product Manager
$1,182
Data
Data Analyst
$818
Data Scientist
$1,318
Job Position
Avg Monthly Salary (USD)
*3-5 Years of Experiences
Marketing & PR
Marketing Associate
$682
Marketing Manager
$1,065
Public Relations Manager
$818
Job Position
Avg Monthly Salary (USD)
*3-5 Years of Experiences
Corporate Services
Human Resources Generalist
$682
Accountant
$682
Administrative Officer
$545

Payroll

Minimum Wage

The minimum wage varies between regions and industry, particularly agriculture and non-agriculture. For example, the minimum wage for a non-agriculture worker in the National Capital Region is ₱610. It is ₱443 in the Davao Region

Basic Salary

Employees who work in excess of 8 hours are entitled to overtime pay of 25% on top of their normal wage, or 30% for if the work is done on a rest day

Additional Compensation

The 13th-month pay, also known as a 13th salary or bonus, is an additional compensation provided beyond an employee’s base annual salary. This supplementary payment is usually equivalent to 1 month’s salary and is disbursed within the financial year, typically before 24 December

Employment Law

Contracts

In Philippines, there are typically two types of employment agreements:

  • Permanent Contract: An indefinite contract with security of tenure. The permanent contract incorporates clauses that address both probationary and regular status. Upon successful completion of the probationary period, the practice is to issue a confirmation letter rather than introducing a separate contract.
  • Fixed-Term Contract: A contract for a specific period.

Probation

Probationary periods are permitted and the maximum period allowed is 6 months

Public Holiday

The Philippines comprises different categories of holidays called regular holidays or special holidays. Employees who are required to work on public holidays are entitled to double pay – a pay rate of 130% applies on special non-working days. Employees are entitled to 10 paid public holidays which are rather unique to the country:

  • New Years’ Day
  • Maundy Thursday
  • The Day of Valor
  • Good Friday
  • Labor Day
  • Independence Day
  • National Heroes’ Day
  • Bonifacio Day
  • Christmas Day
  • Rizal Day

In addition, there are several special non-working days which may vary from year to year. While official public holidays are paid days off, non-special working days are unpaid rest days. They include:

  • Chinese New Year
  • People Power Revolution Anniversary
  • Black Saturday
  • End of Ramadan
  • Ninoy Aquino Day
  • All Saint’s Day Employees who work on a special working holiday are only entitled to their basic rate, since it is considered an ordinary working day. Examples include All Souls Day, Christmas Eve and New Year’s Eve.

Employee Leave

Annual Leave

  • 5 days of paid leave after 1 year of service.

Special Leave

  • Maternity Leave: 105 days + 30 days unpaid extension.
  • Paternity Leave: 7 days.
  • Single Parent Leave: 7 days/year.
  • Victim of Violence: 10 days for female workers facing abuse.
  • Gynecological Surgery: Up to 2 months for women after 6 months of service.
  • Compassionate Leave: 2-3 days for family bereavement.
  • Service Incentive Leave (SIL): 5 days after 1 year; up to 16 days maximum.

Medical Leave

  • 5 days for the first 2 years; increases by 1 day/year up to 15 days. Companies typically provide additional medical leave.
  • Hospitalization: 90% of daily wage for 3+ days.
  • Serious Illness: No waiting period for acute conditions.
  • Paid Sick Leave: 90% of salary up to 120 days/year.

Taxes

Employer Tax

Corporate income tax rate for both domestic and resident foreign corporations is 30% based on net taxable income.

Employee Tax

Residents' income in the Philippines is taxed progressively up to 32%. Residents are taxed on their total net income from sources both within and outside the country.

Taxable Income Band (PHP)
Tax Rate

0 – 10,000

5%
10,000 – 30,000
10%
30,000 – 70,000
15%
70,000 – 140,000
20%
140,000 – 250,000
25%
250,000 – 500,000
30%
500,000 and above
35%
Contribution Type
Details
Employee Monthly Contribution
17% of monthly salaries, up to SGD 6,000
Skill Development Levy (SDL)
0.25% of total wages, with a minimum of SGD 2 and a maximum of SGD 11.25 per employee/month

Bonus

Labor law in the Philippines provides for a 13th salary which should be paid by the 24th of December of every year, or in two installments – one in June and one in December.


Pro-rating applies if an employee commences work at any time within the calendar year, and has worked for at least a month

Termination

Termination with Notice

  • Legal only if there is a just or authorized cause.
  • Written notice must specify the reason, allowing at least 5 days for employee response.
  • Further notice is needed if termination proceeds.
    • Causes: Misconduct, contract breach, poor performance.
    • Witnesses and records are required.

Notice Period

Up to 3 months for permanent employees; 1 month for probationary employees.

Severance Pay

  • No severance for "just cause" terminations.
  • For "authorized cause," severance includes at least 1 month’s pay per service year (6+ months count as 1 year).
Explore Other Countries
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