Hire employees in the Philippines using an Employer of Record

In the Philippines, the minimum wage depends on where the employee works. Regional wage boards set daily rates, so Metro Manila and Central Visayas have different floors, and the rate follows the workplace, not your head office.

On top of salary, 13th-month pay is mandatory for rank-and-file staff and due by 24 December. Statutory paid leave, by contrast, is only five days, so most of what employees expect comes from the contract.

The rules below come from the Department of Labor and Employment (DOLE), its wage commission, and the Social Security System (SSS), and the sources are listed at the end.

How do you employ someone in the Philippines?

Your choice is between a Philippine company, a contractor and an employer of record (EOR).

A Philippine company fits a team you're committing to. You register it, then handle payroll, SSS, PhilHealth and Pag-IBIG yourself.

A contractor works for independent tasks. Hire with Columbus can run the contractor agreement and payments from $22.50 per contractor per month.

An EOR employs your hire through a Philippine company: it signs the contract, runs payroll and holds the SSS, PhilHealth and Pag-IBIG registrations, and you direct the work. Hire with Columbus does this from $179/month per employee, and onboarding is usually 2 to 3 days.

Contracting rules to check with your provider

Contracting and subcontracting arrangements are governed by articles 106 to 109 of the Labor Code and DOLE Department Order 174-17. One consequence: a contracted worker left without a service assignment for three continuous months is owed separation pay.

So ask your provider which Philippine entity employs your hire, under which arrangement, and how it complies with those rules.

What do you have to pay a Philippine employee?

Regional minimum wages

Minimum wages are daily rates set region by region by Regional Tripartite Wages and Productivity Boards. They also vary by sector class, so the rate depends on the workplace and how the establishment is classified.

The wage commission notes that NCR-27's implementation is awaiting a final court decision. Check the current order for the actual workplace before you set pay.

Paying below the applicable wage order carries double indemnity: the employer must pay double the unpaid amount, and that doesn't remove criminal liability. Where the employer is a company, the responsible officers face the penalty.

13th-month pay

13th-month pay is mandatory for rank-and-file employees who worked at least a month in the calendar year. It's one-twelfth of the total basic salary earned in the year, paid by 24 December, and employers can pay half of it before the school year opens. The simplest way to budget it is one-twelfth of salary each month.

Social contributions

Because the SSS salary credit is capped, the employer share on a ₱50,000 salary is ₱3,500 a month and the employee share ₱1,750. Contributions on the part of the credit above ₱20,000 go to the employee's Pension Booster account.

The PhilHealth schedule in DOLE's handbook stops at 2025, and Pag-IBIG adjusts its amounts by circular. Ask your provider which current circulars it uses before you budget from these figures.

Put a real salary through the Philippines calculator to see the totals.

What are the rules on hours and overtime?

The normal working day is eight hours. Work beyond eight hours on an ordinary working day is paid at the hourly rate plus 25%, and plus 30% on a rest day or special day.

Each hour worked between 10 p.m. and 6 a.m. carries a night shift differential of 10% on top.

Employees get at least an hour off for a meal, or at least 20 minutes in listed cases, in which case the time counts as hours worked. Managerial employees are excluded from these rules.

Which leave is required by law?

Service incentive leave

The statutory floor is five days of service incentive leave a year, for employees with at least a year of service. It can be used for sickness, holidays or anything else. Managerial employees are excluded.

Since five days is the minimum, write the leave you actually offer into the contract.

Public holidays in 2026

There are 12 regular holidays. They're paid even when not worked, and work on a regular holiday is paid at least 200%. Ten are fixed by proclamation for 2026:

Eid al-Fitr and Eid al-Adha are the other two, dated each year by separate proclamation. Special non-working days, such as 24 and 31 December, are no work, no pay for private employees unless a policy or agreement says otherwise, with a premium of at least 30% when worked.

Sick pay

Beyond the five days of service incentive leave, sick pay comes from SSS. Its sickness benefit is 90% of the employee's average daily salary credit.

Family and other leave

Maternity leave is 60 days with full pay after a miscarriage or emergency termination. Budget for the employer's share of maternity pay: the difference between the SSS benefit and full salary.

How does separation work?

Ending a job for an authorised cause, such as redundancy or retrenchment, needs written notice to both the employee and the DOLE regional office at least one month before the intended date. Separation pay is due as well.

A part year of at least six months counts as a full year. Employees made involuntarily unemployed may also claim an SSS unemployment benefit, after at least 36 monthly contributions, 12 of them in the previous 18 months.

Retirement pay

An employee who retires between 60 and 65 after at least five years of service is owed retirement pay of at least half a month's salary per year of service, calculated as 22.5 days per year. Retail, service and agricultural businesses with ten or fewer employees are exempt. SSS retirement benefits are available from 60, and 65 is the compulsory age under the SSS schedule.

What has changed recently?

• 1 January 2025: SSS contribution increase. The total rate is 15% of the monthly salary credit, 10% employer and 5% employee, on credits up to ₱35,000.
• 25 July 2026: Metro Manila wage order NCR-27. ₱718 to ₱755 a day, rising on 20 January 2027, with implementation awaiting a final court decision.

Hiring in the Philippines with Hire with Columbus

Hire with Columbus employs your hire through a Philippine entity, covering the contract, payroll, 13th-month pay and the SSS, PhilHealth and Pag-IBIG registrations and contributions. You pick the person and run the work.

From $179/month per employee and from $22.50/month per contractor, with onboarding in roughly 2 to 3 days after the offer is accepted. Estimate costs with the Philippines cost calculator, check pricing or get started.

Sources

Government sources for this guide:

• DOLE Bureau of Working Conditions, Handbook on Workers' Statutory Monetary Benefits, 2023 edition (checked 22 September 2026)
• National Wages and Productivity Commission, Current regional daily minimum wage rates (as of 25 July 2026)
• Social Security System, Contributions (as of 1 January 2025)
• Social Security System, Maternity, sickness and unemployment benefits (checked 22 September 2026)
• Social Security System, Retirement benefit (checked 22 September 2026)
• Supreme Court E-Library, Proclamation No. 1006: 2026 regular holidays and special days (as of 5 October 2026)
• Social Security System, Social security laws, including the Expanded Maternity Leave Law (checked 12 September 2026)