How to Hire in the Philippines as a Foreign Company (2025 Guide)
- Connie Barrientos-Carey
- 2 days ago
- 3 min read
The Philippines continues to be one of the world’s most attractive talent markets—skilled professionals, strong English communication, competitive salaries, and a people-oriented work culture. But for foreign companies, hiring in the Philippines comes with one major challenge:
How do you legally hire and pay people in the Philippines without opening a local entity?
This 2025 guide breaks down everything you need to know—your options, risks, compliance requirements, and the simplest way to build a PH team without the overhead.
Why Foreign Companies Hire in the Philippines
Whether you're a startup, an agency, or a growing global company, the Philippines offers:
Highly skilled talent across tech, creatives, customer support, HR, finance, and operations
Strong English communication skills
Cultural alignment with Western and Asian markets
Competitive salary ranges
24/7 workforce availability
High levels of loyalty and service orientation
It’s a powerful market—if you hire correctly.
Your Hiring Options in the Philippines
Foreign companies have four choices:
Option 1: Hire as a freelancer
Fast and simple, but:
No employer-employee relationship
No benefits or government remittances
No compliance protection
Risk of misclassification
Best for: temporary or project-based roles. Risk level: High for long-term employees
Option 2: Engage a BPO or Call Center
The BPO becomes the legal employer. Cost is higher, but operations are fully supported.
Best for: full teams (10–100 staff), customer support operations. Risk level: Low, but expensive and less flexible
Option 3: Set up your own company in the Philippines
The most formal method, but:
Registration takes months
High legal and compliance overhead
Requires local signatories
Needs ongoing accounting, HR, payroll, and DOLE compliance
Best for: companies with 50+ long-term PH employees Risk level: Very low, but expensive
Option 4: Hire through an Employer of Record (EoR) (Fastest, safest, most flexible)
An Employer of Record (EoR) is a local PH company (like Aleph Talent Solutions) that becomes the legal employer of your hires, so you don’t need to set up a local entity.
This is the top option for 95% of foreign companies starting in PH.
What an Employer of Record (EoR) Does in the Philippines
Your EoR handles:
Employment contracts
Worker classification
Payroll processing
Statutory remittances (SSS, PhilHealth, Pag-IBIG)
Withholding tax
13th-month pay
Timekeeping and benefits
Offboarding and final pay
Government reporting and compliance
You keep full control of operations, tasks, KPIs, and performance.
You get a PH team without the legal risk. Your staff get stable employment and full benefits.
Why Companies Choose EoR Instead of Setting Up Locally
1. Zero legal risk
The EoR assumes employer liability—contracts, compliance, DOLE, BIR, SSS, PhilHealth, Pag-IBIG.
2. Zero overhead
No lawyers, accountants, payroll software, or HR team required.
3. Hire in days, not months
Your team can legally start in less than a week.
4. Perfect for 1–50 hires
Most foreign companies don’t need full incorporation.
5. Easy to scale
Add or remove headcount without corporate headaches.
6. Protects your brand
Compliance errors damage reputation—EoR prevents this.
Cost Example: Hiring Through an EoR (Illustrative)
If you hire a PHP 40,000/month employee:
Gross Salary: 40,000
Employer contributions: 4,000–6,000
EoR Management Fee (Aleph): fixed per employee
13th month prorated
No hidden costs, no markups.
Common Mistakes Foreign Companies Make When Hiring in PH
1. Paying employees as freelancers for long-term work
This can trigger penalties for misclassification.
2. Not remitting government contributions
Illegal and exposes you to back pay liabilities.
3. Using non-compliant contracts
PH labor laws require very specific clauses.
4. Not budgeting for 13th month pay
Mandatory—many foreign companies overlook this.
5. Trying to operate without guidance
Philippine labor is relationship- and compliance-heavy. An EoR eliminates the guesswork.
When Should You Use an EoR?
Use an Employer of Record if you:
Want to test the PH talent market
Want to hire 1–20 people quickly
Don’t want to set up a legal entity
Need to avoid compliance headaches
Want predictable monthly cost
Need local HR + payroll support
Aleph provides:
Fully compliant EoR
End-to-end payroll and HR administration
Recruitment support when needed
Transparent pricing
Human-centered support for your staff
Fast onboarding and proper documentation
We help you hire better, faster, and with dignity — without the overhead of direct employment.
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