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When planning to outsource your team legally from another country, it is important to consider the local employment laws, regulations and processes you must follow. Thus, to hire remote workers in the Philippines, you must familiarize yourself first with the Philippine Labor Code. However, there are a lot of notable differences between this law from other countries worldwide.

So, to help you prepare for hiring remotely in the Philippines, here is a comprehensive guide on Philippine Labor Laws.

The Rights of Employees and Employers According to Philippine Labor Laws

While it is excellent to maintain international relations in your business, notable differences in culture and laws can hinder building employer-employee relationships. To build a great relationship with your remote workers and encourage employee retention in your company, it is crucial to stay compliant with your employee’s local labor and employment laws.

However, it is also important to note that employers also have their own set of rights, especially regarding employee management, termination, and type of employment offer.

Providing employment contracts

Beneficial to both parties, having an employment contract presented by the employer is one of an employee’s rights. This serves as a legal bind between the two parties and a way to set boundaries and employment provisions.

An employment contract must include the following:

It is also important to include the rules, regulations, and limitations to make the contract more comprehensive.

Note that a project-based employee is regarded as definite while those hired for long-term arrangements are considered indefinite.

Compensation for remote workers

When talking about employment, compensation is one of the important things that an employer must come to an agreement with the employee.

Aside from the agreement from both parties, there is a minimum wage set by the Regional Tripartite Wages and Productivity Board that you must consider when determining just compensation. However, this depends on the region where the business or the employee is located in the Philippines.

At the end of the year, all Filipino employees are entitled to 13th-month pay. In some cases, other employers make it up to a 14th-month bonus.

Working hours

The standard working hours for Filipino employees is 40 hours for the five days that they will work for a regular wage. Depending on the agreement set between both parties, hours rendered beyond that time may be considered overtime work that may be compensated through pay or schedule offset. Overtime pay is equivalent to a percentage of their hourly rate. It may vary on weekends or holidays unless there is a stipulation in collective bargaining that says otherwise.

After a consecutive working day of at least six days, employees are entitled to a resting period of 24 hours or more. It is also important to note that there is a night shift differential pay for the working schedule between 10 p.m. to 6 a.m., and pregnant women are prohibited from working this shift.

Public holidays

Type of Leaves in the Philippines

In the Philippines, there are a lot of public holidays that people must observe. Employees can either not work these days or work and receive twice the amount of their daily wage.

Here are some of the public holidays:

Vacation Leave

Aside from public holidays, all regular Filipino employees are entitled to a minimum of 5 vacation leaves after one year of service. However, some companies offer over 15 days of leave as one of the benefits for their employees.

Sick leave

Although employers are not required to offer sick leave benefits to their employees, it is still customary for companies to offer their employees 15 sick leaves.

In addition, sick employees are eligible for benefits under the Social Security System if they can pay their contributions for at least three months in the 12-month period preceding the six-month period that they got ill.

Maternity/Paternity Leave

For female employees, they are entitled to 105 days of fully paid maternity leave. However, she must have paid at least three months' contribution in the 12-month period preceding the six-month period of pregnancy. Single mothers can also extend their paid maternity leave for 15 days, given that they do not have a partner who can help them take care of the child. Female employees can also extend their maternity leave for an additional 30 days but without pay.

Meanwhile, male employees have a minimum of 7 days of paternity leave, and women can transfer up to 7 additional leaves to their husbands.

Health Insurance Benefits

To ensure the health of Filipino employees, the state provides compulsory universal healthcare that both employees and employers will fund. However, employers can also offer private health insurance for their workers as additional benefits.

Termination and Severance

To ensure that there is fair treatment between employers and employees, the Philippine Labor Laws state the right of employers to terminate employees under some circumstances. A probationary period cannot exceed six months. If the employee does not meet the qualifications for their position or there is a just cause, the employer can terminate him/her.

As for regularized employees, the process of termination may vary depending on the cause of dismissal.

Just cause

If it is due to a just cause, there must be a written notice or memorandum stating the date of termination and the reason behind it. The employees can provide their explanation within six days after the notice is given.

Here are some of the just causes for termination:

Authorized cause

Meanwhile, companies can also dismiss their employees through an authorized cause, given they give their employees a notice of termination at least one month before the effective termination date.

It is an authorized cause if it falls under:

Employees terminated due to an authorized cause are entitled to severance pay, and it should be worth half to one month of their monthly salary for every year of service. Meanwhile, those who are dismissed due to just causes do not have the same right for this.

Understanding laws apart from your own country’s can be challenging and time-consuming. It is also prone to misunderstanding and mistakes, which may cause legal issues for cross-border employment.

Make employment more convenient through EOR services

We understand how complex studying Philippine Labor Laws can be, which is why engaging with an Employer of Record company like Remotify can help you cut through the complexities and simplify the way you outsource and expand your team.

Our EOR services include the following:

We also provide you with options to:

This makes the employment process more convenient and less troublesome in terms of legalities and labor compliance. It is one reason why many companies who are planning to extend their team in the Philippines prefer working with EOR companies rather than setting up their own entity.

Aside from that, Remotify also offers ongoing support for businesses like HR services and payroll management. We aim to maintain a great employee-employer engagement between the parties for better work performance and relationships.

Conclusion

While there are many provisions in Philippine Labor Law that you need to consider when employing remote Filipino workers, all the benefits that you could get from these talents will still be worth it. However, if you want a convenient, simplified, and legal employment process, you should partner with an EOR company like Remotify.

Learn more about the services we offer by visiting our page here.

FAQs

A. Are There Any Legal or Regulatory Restrictions for Hiring Remote Employees from the Philippines?

Ans. Yes, there are certain legal requirements that employers need to be aware of when hiring remote workers from the Philippines. These include obtaining a business permit or license, registering with the Bureau of Internal Revenue and Social Security System in the Philippines, registering at the Securities and Exchange Commission (SEC) and compliance with labor laws and other employment regulations.

B. How Can I Ensure Proper Communication and Collaboration With My Philippine Team?

Ans. Employers of Record (EOR) can help to ensure proper communication and collaboration between employers and their Philippine remote workers. An EOR provides a single point of contact for employers, allowing them to easily manage payroll, benefits, taxes, and other compliance-related matters related to hiring Filipino remote workers. They also provide support in the arrangement of the necessary legal and regulatory requirements, as well as offering additional services such as dispute resolution, employee engagement, and healthcare.

C. What is the minimum wage in the Philippines?

Ans. The current minimum wage starts from PHP 573 per day, depending on region and sector. The minimum wage for workers in the Philippines is set by the Regional Tripartite Wages and Productivity Board (RTWPB).

D. How much is overtime pay in the Philippines?

Ans. For hours worked over eight hours per day or 48 hours per week between 10 p.m. and 6 p.m., there is an overtime bonus ranging from 10% to 35% depending upon the work timings. Holidays are also subject to a different rate which ranges from 130% to 200% of the employee's salary depending on the kind of holiday.

E. How to pay remote employees in the Philippines?

Ans. Employers of Record (EOR) can help with the payment process for Philippine remote employees by managing payroll, benefits, taxes, and other compliance-related matters. This eliminates the need for employers to establish a separate legal entity in the Philippines to pay their remote workers, saving them time and money in the long run.

F. What are the typical working hours of remote workers in the Philippines?

Ans. The Philippines has a 24/7 work culture. Employees will work during the hours required by the client. If that means working at night, employees will have no problem with it.

About Remotify

Remotify is your next-generation solution to growing your team remotely and cost-effectively in the Philippines.

Through our Employer of Record services, Remotify will employ and payroll your workers in the Philippines and do the heavy lifting for you. We will take care of local HR, compliance, attendance tracking, payroll, and reporting so you can focus on what is most important: growing your business.

This means you can quickly and securely hire employees in the Philippines, attracting top talents and keeping them engaged through the process. At the same time, you avoid the overhead of establishing your own entity.

From complex local tax and labor laws to in-country capital requirements and compliant HR management, payroll, and benefits disbursement, getting started in a new country to tap on its low cost and great talents can be a time-consuming endeavor. But with the right partner, it doesn’t have to be. Remotify is here to keep things simple for you.

The Rise of Outsourcing in the Philippines

The Philippines holds approximately 10% to 15% of the global BPO market, positioning it as a key international player in the outsourcing industry. 

The local BPO industry contributes $32.5 billion annually to the economy, which makes outsourcing a great source of opportunity and revenue for the country.

Despite challenges in the global market, the Philippine outsourcing industry’s revenues continued to climb even during the pandemic. By 2022, the outsourcing industry reached over 1.4 million employees, surpassing its original target.

The Philippines is considered one of the top outsourcing destinations in the world — and there are several reasons why this is the case.

Why Businesses Should Outsource to the Philippines 

Why Businesses Should Outsource to the Philippines 

Cost efficiency

You can save 70% of operational costs by outsourcing in the Philippines because of the low living costs, allowing you to allocate resources to other high-priority areas.

English proficiency

Filipinos have a high English proficiency at a young age as this is the medium of instruction in schools. This ensures Filipino employees can easily understand and communicate with English-speaking international employers.

Culture compatibility

The Philippines has a long history of being occupied by countries such as Spain and the United States. This gives the Philippines a strong cultural affinity with Western countries, which makes it easy for Filipinos to adapt to an international work environment.

24/7 staffing

The Philippine outsourcing ecosystem is very mature and is built for the global employment market. Highly westernised with a 24/7 culture in the metros, the workforce can provide business solutions anytime and anywhere, regardless of the time difference. This benefits businesses with customer service and online sales, which require 24/7 availability.

High educational attainment 

The Philippines produces 700,000 university graduates per yet, creating a highly skilled and talented workforce that can compete in the global employment market and provide businesses with high-performing employees.

Benefits of Outsourcing to the Philippines

Benefits of Outsourcing to the Philippines

By outsourcing to the Philippines, you can experience the following benefits for your business:

Low labour costs

The Philippines provides more affordable services while maintaining high-quality output compared to other countries. For example, China may offer lower labour costs than the Philippines, but may not be as English-proficient and culturally compatible as Filipino workers.

Highly skilled workforce

The Philippines has a highly skilled workforce that excels in IT, finance and healthcare, allowing Filipino employees to succeed in different industries. You can be confident that your outsourced staff from the Philippines will demonstrate proficiency and competence in their respective fields.

Data privacy and security

Sensitive data and confidential business information are often shared with third-party service providers when outsourcing work, which is why it’s important for you to consider data privacy and security when choosing an outsourcing provider.

Philippine regulations require external service providers to follow strict data privacy and security measures. You can trust your external service providers in the Philippines to implement measures to adequately protect sensitive data.

Popular Outsourcing Services in the Philippines

There are three common types of outsourcing services in the Philippines you can choose from. 

Professional Employer Organisation 

While a Professional Employer Organisation (PEO) acts as a company’s outsourced HR partner, it is not the employer of the organisation’s workforce. PEOs serve as co-employer for businesses and work well for small enterprises with full-time employees. This requires you to have an entity in the country you are employing your team in.

Employer of Record

Unlike a PEO, an Employer of Record (EOR) takes on all employer-related responsibilities for small to large businesses. An Employer of Record can quickly hire top talent for your business without requiring you to set up a local entity while ensuring you remain compliant and reduce costs in the long run.

Fully managed services

This is also known as the traditional business process outsourcing model (BPO), which is best for business owners that have a hands-off approach, as the BPO will handle on-ground and on-site operations for outsourced employees. This also means you will not have control over the hiring process for your team or their wages. The traditional BPO pricing structures are typically bundled and offer no transparency as to how much of the fee goes to your team.

Companies that Outsource to the Philippines

Outsourcing to the Philippines has contributed to the success of numerous companies, some of the most popular ones being:

Google

According to Bloomberg, Google has more outsourced workers than direct employees, and many of their contract workers are from the Philippines. 

Outsourcing in the Philippines enables Google Inc. to fill in support roles and specialised positions at affordable labour costs while maintaining quality output from top talent.

American Express

A well-known credit card company in the Philippines, American Express works alongside BPO companies in the Philippines to offload non-core tasks to external providers. This allows the business to focus on key business areas while its back-office solutions are handled by outsourced employees. 

Wells Fargo

Another well-known multinational company that works with outsourced teams is Wells Fargo, which has a wide pool of dedicated remote professionals across Asia. Some of the tasks that Wells Fargo outsources in the Philippines include fraud management, financial accounting, payroll and customer support.

Choosing the Right Outsourcing Partner in the Philippines

Before you decide to choose an outsourcing provider in the Philippines, you must consider the following factors first.

The political and economic landscape in the Philippines

As a business, you need to consider a location’s political, social and economic health to develop a solid outsourcing strategy. Philippine regulations and governing bodies are supportive of the outsourcing industry because of its significant contribution to the national economy, resulting in little to no risks when outsourcing in the country.

Company values and goals

You need to review a potential provider’s company values and goals, ensuring that their principles align with yours. 

Company reputation

Check a potential service provider’s track record and reputation to ensure that you are partnering with a credible company.

Expertise and services

Identify the type of outsourcing services your business needs and make sure to assess whether a potential provider has a specialisation in different fields (e.g. IT, finance, customer service).

Budget adherence

Canvass the fees for the options you’re considering and calculate which providers can reduce costs for your business and which are more expensive in the long run.

How Remotify Helps Businesses

Remotify is one of the leading Employer of Record service providers in the Philippines. It is committed to being a good business for all — from its clients to its remote employees.

Businesses can expect the following benefits from partnering with Remotify:

Case Study: National Corporate Housing Expands Operations with the Help of Remotify

National Corporate Housing offers temporary, furnished corporate housing around the world and is headquartered in the United States. As its Employer of Record, Remotify provides HR support to National Corporate Housing, ensuring that the company maximises its talent.

“Remotify’s in-region service and elevated customer experience, combined with their understanding of our business and organisational needs, really set them apart from other potential HR suppliers.” — Tom Meertens, COO of National Corporate Housing

Frequently Asked Questions

1. Why do foreign companies want to outsource in the Philippines?

The Philippines is considered one of the top outsourcing destinations for many reasons. Foreign companies that partner with a top outsourcing provider in the Philippines can expect the following:

2. Why outsourcing to the Philippines is better than any other country in Asia?

The combination of qualities that the Philippine workforce possess enable the country’s outsourcing services to compete globally. 

For example, India may have a larger pool of IT professionals, but the Philippines has an advantage in terms of English proficiency and cultural similarity to Western countries. Vietnam may offer lower labour costs, but it may not have the same level of expertise as the Philippines in certain industries, such as call centre services and accounting and data entry services.

3. How much does IT cost to outsource to the Philippines?

While there are many variables that you need to consider (such as the services you need and the duration of the project), IT outsourcing services in the Philippines can range from US$80 - US$150 per user every month.

4. What business processes are usually outsourced in the Philippines?

The three most common business processes outsourced in the Philippines are:

5. What is the average cost of outsourcing to the Philippines?

In the Philippines, outsourcing companies typically calculate fees based on workforce costs, service fees and government-mandated employee benefits. Outsourcing rates may vary depending on the company you partner with, but the average cost is approximately US$285,000, including the contract bid price and contract administration fee.

If the past year ever taught us anything with over a year of enforced work-from-home experience, it’s that managing remote teams work and it’s here to stay.

Today, it is not just something forced on companies' management but is driven by various efficiency, comfort, and productivity of employees. It is no wonder that over 61% of employees surveyed by Forbes prefer working remotely while 97% of them refuse to work full-time in physical offices.

In this article, we will talk about why many companies are hiring remote workers, the costs that you should cover, and the things you can do to make outsourcing remotely more efficient.

Why companies shift to a remote workplace

According to Gartner CFO, over 74% of companies are planning to shift to remote work even after the pandemic permanently. This is because, unlike most people expected at first, this setup is actually effective and promotes the productivity of their employees. It also helps in saving operational costs because there is no need for a physical office and commuting every day.

Here are some of the benefits of a remote work setup:

It helps in Saving Operational Costs

The company doesn’t have to pay for office spaces, equipment, and travel reimbursement in a remote work setup. In addition, your wage rate offer for your employees can also be significantly lower based on their cost of living because of the demographic differences.

It removes geographic obstacles in finding the ideal employee

Because you only need a computer and internet connection to hire employees remotely, finding the ideal candidate for a position across the borders is easier.

It improves your employees’ satisfaction and retention

As mentioned before, many employees prefer a work-from-home setup as it gives them a better work-life balance. According to a study from Owl Labs, workers are 13% more likely to stay on their job with a remote setup.

It increases productivity

A lot of people automatically think that there are more distractions when working from home. However, it is actually quite the opposite, and a study from Stanford University states that remote workers tend to be 13% more productive than those in the office.

It offers diversity and inclusivity

A remote work environment promotes diversity as it makes hiring across borders no matter the ethnicity, gender, and age more convenient. It can be beneficial, especially for businesses that need fresh thinking and want to promote workplace diversity.

Due to these benefits combined, more and more business owners and CEOs consider staying remote and shifting their back and front office into a digital one.

Costs to expect when managing remote teams

Before we dive into the actual process of hiring competitive remote employees, let’s talk about what costs to expect in the process. While it is true that hiring remote workers is more cost-efficient than having in-house employees, you’ll still need to prepare for some expenses.

Here are some of the expenses you will need to consider when you hire remotely:

Read about setting up an entity vs outsourcing on our blog to dive deeper.

How to cut your costs by partnering with an EOR company

One of the horrors of foreign businesses in outsourcing is spending too much money and time setting up an entity in a country and not finding ideal employees in the end. However, there is actually a cost-effective way to avoid the lengthy and expensive process of setting up an entity--partnering with an Employer of Record (EOR).

An EOR serves as the local employer of your remote employees while maintaining your jurisdiction and management prerogative for your team. EORs can help with complex tasks such as:

On top of these, some EORs like Remotify can even help you source employees, conduct background checks, and assist you with the whole hiring journey from drafting a job description to closing the hire. Remotify also gives you the option to engage your team better and help you provide health benefits, procure essential equipment for your employees, and provide GDPR and cybersecurity training for an extra layer of security and a higher chance of retaining your team.

To learn more about what we can do for you, check out Our Services at Remotify.

Simplify outsourcing with Remotify now!

Hiring remotely is definitely something all businesses should consider where applicable due to its many benefits on cost, employee well-being, future-proofing, and productivity.

However, while shifting digitally is very accessible, there are still processes and procedures to look out for when hiring remote employees across borders legally and securely. Going through the process the right way is worth the benefit, security, and operational cost savings your company can have.

If you want all the complexities of hiring remotely done for you, partnering with an EOR company like Remotify is the ideal solution.



About Remotify

Remotify is your next-generation solution to growing your team remotely and cost-effectively in the Philippines.

Through our Employer of Record service, Remotify will employ and payroll your workers in the Philippines and do the heavy lifting for you. We will take care of local HR, compliance, attendance tracking, payroll, and reporting so you can focus on what is most important: growing your business.

This means you can quickly and securely hire employees in the Philippines, attracting top talents and keeping them engaged through the process. At the same time, you avoid the overhead of establishing your entity.

From complex local tax and labor laws to in-country capital requirements and compliant HR management, payroll, and benefits disbursement, getting started in a new country to tap on its low cost and great talents can be a time-consuming endeavor. But with the right partner, it doesn’t have to be. Remotify is here to keep things simple for you.

If the past year ever taught us anything with over a year of enforced work-from-home experience, it’s that managing remote teams work and it’s here to stay.

Today, it is not just something forced on companies' management but is driven by various efficiency, comfort, and productivity of employees. It is no wonder that over 61% of employees surveyed by Forbes prefer working remotely while 97% of them refuse to work full-time in physical offices.

In this article, we will talk about why many companies are hiring remote workers, the costs that you should cover, and the things you can do to make outsourcing remotely more efficient.

Why companies shift to a remote workplace

According to Gartner CFO, over 74% of companies are planning to shift to remote work even after the pandemic permanently. This is because, unlike most people expected at first, this setup is actually effective and promotes the productivity of their employees. It also helps in saving operational costs because there is no need for a physical office and commuting every day.

Here are some of the benefits of a remote work setup:

It helps in Saving Operational Costs

The company doesn’t have to pay for office spaces, equipment, and travel reimbursement in a remote work setup. In addition, your wage rate offer for your employees can also be significantly lower based on their cost of living because of the demographic differences.

It removes geographic obstacles in finding the ideal employee

Because you only need a computer and internet connection to hire employees remotely, finding the ideal candidate for a position across the borders is easier.

It improves your employees’ satisfaction and retention

As mentioned before, many employees prefer a work-from-home setup as it gives them a better work-life balance. According to a study from Owl Labs, workers are 13% more likely to stay on their job with a remote setup.

It increases productivity

A lot of people automatically think that there are more distractions when working from home. However, it is actually quite the opposite, and a study from Stanford University states that remote workers tend to be 13% more productive than those in the office.

It offers diversity and inclusivity

A remote work environment promotes diversity as it makes hiring across borders no matter the ethnicity, gender, and age more convenient. It can be beneficial, especially for businesses that need fresh thinking and want to promote workplace diversity.

Due to these benefits combined, more and more business owners and CEOs consider staying remote and shifting their back and front office into a digital one.

Costs to expect when managing remote teams

Before we dive into the actual process of hiring competitive remote employees, let’s talk about what costs to expect in the process. While it is true that hiring remote workers is more cost-efficient than having in-house employees, you’ll still need to prepare for some expenses.

Here are some of the expenses you will need to consider when you hire remotely:

Read about setting up an entity vs outsourcing on our blog to dive deeper.

How to cut your costs by partnering with an EOR company

One of the horrors of foreign businesses in outsourcing is spending too much money and time setting up an entity in a country and not finding ideal employees in the end. However, there is actually a cost-effective way to avoid the lengthy and expensive process of setting up an entity--partnering with an Employer of Record (EOR).

An EOR serves as the local employer of your remote employees while maintaining your jurisdiction and management prerogative for your team. EORs can help with complex tasks such as:

On top of these, some EORs like Remotify can even help you source employees, conduct background checks, and assist you with the whole hiring journey from drafting a job description to closing the hire. Remotify also gives you the option to engage your team better and help you provide health benefits, procure essential equipment for your employees, and provide GDPR and cybersecurity training for an extra layer of security and a higher chance of retaining your team.

To learn more about what we can do for you, check out Our Services at Remotify.

Simplify outsourcing with Remotify now!

Hiring remotely is definitely something all businesses should consider where applicable due to its many benefits on cost, employee well-being, future-proofing, and productivity.

However, while shifting digitally is very accessible, there are still processes and procedures to look out for when hiring remote employees across borders legally and securely. Going through the process the right way is worth the benefit, security, and operational cost savings your company can have.

If you want all the complexities of hiring remotely done for you, partnering with an EOR company like Remotify is the ideal solution.



About Remotify

Remotify is your next-generation solution to growing your team remotely and cost-effectively in the Philippines.

Through our Employer of Record service, Remotify will employ and payroll your workers in the Philippines and do the heavy lifting for you. We will take care of local HR, compliance, attendance tracking, payroll, and reporting so you can focus on what is most important: growing your business.

This means you can quickly and securely hire employees in the Philippines, attracting top talents and keeping them engaged through the process. At the same time, you avoid the overhead of establishing your entity.

From complex local tax and labor laws to in-country capital requirements and compliant HR management, payroll, and benefits disbursement, getting started in a new country to tap on its low cost and great talents can be a time-consuming endeavor. But with the right partner, it doesn’t have to be. Remotify is here to keep things simple for you.

Companies looking for new employees tend to look for more than what meets the eye. While making sure to get top talents, they also want to make sure that their business interests are protected and taken care of. This is the purpose of having an employment contract for new hires. But without the proper guidance, you might end up having a poorly written employment contract which could lead to the agreement being null and void or worse, losses for the company in the long run.  At the onset of each remote work employment, it’s best to ensure you and your new hire are protected with a mutually agreed upon, and binding contract. 

So, whether you are a company willing to hire staff in the Philippines remotely, or a job seeker seeking secure and remote international employment, both parties need to understand the necessity of creating an employment contract.

What is a Remote Work Contract?

A remote work contract is a legal agreement between an employer and employee that states the working conditions for an employee. It sets out the terms and conditions under which the parties will undertake work for one another. It also entails how each party needs to fulfill its obligations for the at home jobs.

In most cases, employment contracts are in place to protect the employer from being sued for mistreatment or wrongful termination of employees. These agreements are also designed to protect employees from being fired unfairly. 

However, with at home jobs, there is no physical office that an employee must go to every day. Remote workers are expected to complete their tasks in their own homes or a location they choose. Therefore, employers need to set up certain guidelines and rules that employees can adhere to while working remotely.

digital contract for remote work

Essential Sections of a Remote Work Agreement

With the number of remote employees increasing every year, there are more people than ever working from home. Whether you work remotely yourself or have remote employees who do, having a formal remote work agreement can help protect your business.

By having your remote staff function like any other employee, you'll find it easier to manage their time,  productivity, avoid misunderstandings, and document all their responsibilities, accomplishments, and milestones. Here are the main components of a basic remote work agreement and how to write each clause:

1. Work Arrangement on At Home Jobs

A work arrangement clause is often included in a remote employment contract. It specifies the hours of work and work schedule to be followed by the employee, as well as the requirements for reporting any changes in the employee's schedule. It also includes the key performance metrics that employees must reach regularly while they're working for their at home jobs.

2. Compensation and Benefits for Remote Employee

When hiring a new remote employee, it's important to indicate what they'll be getting out of the offer. Compensation refers to all the monetary benefits that will be provided to the employee in exchange for his/her services. This includes aspects such as salary, bonus, stock options, and other bonuses and incentives.

To have an idea about the basic salaries of Filipino remote workers, you can check out this blog.

Meanwhile, benefits refer to all other non-monetary benefits that will be provided to the remote employee such as health care, insurance, and others. In the Philippines, employers are required to pay a portion of their employees’ monthly or quarterly contributions in SSS, Pag-big, and Philhealth. For your additional reference. Here is a more detailed and comprehensive explanation of Philippine labor law.

3. Employer and Remote Employee Obligations

For employers, a remote work agreement clarifies what is expected from employees and sets boundaries so that the employer can ensure compliance with company policies. For example, if the employer requires using time trackers and screen monitoring software, then it must first be agreed upon by both parties. If employers decide to allow telecommuting, it is also important to set up a system where they can monitor hours worked by remote workers.

A remote work agreement also sets expectations for employees. It should be clear whether or not they are allowed to use certain apps during their working hours. This also includes other remote work policies that they should comply with.

4. Computer Equipment and Software

A lot of companies require workers to use business-class equipment for these services or reimburse existing equipment used for work purposes. Some businesses also require employees to pay for any upgrades or additional equipment associated with their job duties. In these cases, the contract must mention the type of expenses the employer is willing to shoulder or reimburse.

In addition, most remote work agreements cover software programs and other relevant tech tools and applications used for secure and efficient remote work. 

5. Non-Disclosure Agreement (NDA)

Some employers include this as part of their employment contract but this can also be a separate agreement. In an NDA, the employee agrees that sensitive business information and ideas about the company will not be disclosed to other people outside the organization. This may include trade secrets, marketing strategies, manufacturing processes, or financial statuses.

6. Actions for Termination

Both parties should agree on what actions can result in termination, including whether firing an employee will be considered a breach of contract by the employer. The agreement should offer a clear understanding of the limitations of both parties within the employment

Create your contracts with our EOR service

Now that you know why work contracts are essential and what sections are needed in the agreement, with the proper knowledge and guidance on the matter, you can create a well-written contract that will protect you as the employer, and your employee as well.

Creating a contract on your own can be difficult, and the risk of not knowing what to put in it is high. It will always be best to take legal counsel, especially when in doubt. Do take note that no matter how well written your remote work contract is, the most important element you need to ensure is that the contract should be binding both in your country and your remote employee’s country of residence. This is where cross-border employment gets tricky and complicated for most as it deals with the Labor Laws concerning your employee.

We know that cross-border employment can both be rewarding but at the same time, complex. Remotify, with our EOR service can simplify everything for you. We can help you create a proper, and more importantly, legally binding remote employment contract that will be beneficial for you and your employees. Preparing a remote employment contract for you is part of our EOR service where we also handle payroll management and benefit allocation for your remote Filipino team.

To learn more about this, you can check out our website or contact us at [email protected] and we’ll be happy to assist you.

Employee retention is one of the top priorities for business owners, managers, and executives across all industries. However, in the age of remote work, it is even more vital for companies to implement strategies and solutions aimed at helping their employees feel that sense of security, trust, and loyalty.

Employee retention is a big, expensive problem for businesses. To replace one good employee, US employers spend an average of 33% of a worker's annual salary. That’s a lot of money and time invested. The good news is that employee retention is not cut from stone and we can do something about it. As remote work becomes more prevalent, companies have a variety of ways to approach employee retention and we’re going to talk about them in this article.

1. Create a smart onboarding process

First and foremost, you need to outline the benefits of remote work—and make sure your team is aware of them. Rather than wooing them with promises your company can afford to fulfill, be transparent as possible. You might also want to provide extra perks for employees who choose remote work, such as offering flexible scheduling. This will help them feel like they're getting something in return for working remotely, and it'll encourage your employees to stick around with your company.

Moreover, It can be difficult for new employees who don't understand all the ins and outs of remote work. They may also have trouble adjusting if they've never done it before. Give them time to get used to your company culture, and don't be afraid to have several meetings to help get everyone up to speed on how you do business.

2. Develop talent and career development programs

Developing a talent and career development program is not an easy task, as it involves many moving parts. The first and most important aspect of your program is to define the roles of each part of your team and to have a plan for helping them grow into their roles. If you can't define clear roles, then you will have a hard time developing the talent within your organization. 

You should also gather feedback from all levels of your organization and making sure that your managers and supervisors are on board with this process will help ensure its effectiveness. Tying it back to company culture as well as to the vision of the company will also be key in creating a good talent and career development program for your remote organization. 

If employees are part of something greater than just themselves, then they will be more likely to take on new challenges, which will help them grow both professionally and personally.

3. Improve remote company culture

There's a lot of benefits to working remotely and not in an office, but one of the biggest downsides is that it can be hard to build a sense of community. Trouble forming bonds with remote colleagues can lead to some very real problems when it comes to motivation, productivity, and company culture.

To make the most out of your time working remotely, it's important to keep your team motivated, happy, and feeling like they are part of something bigger than themselves. Don't let your remote employees feel isolated or alone. Find ways to keep them engaged in the company culture, from regular phone calls to team outings. Remote workers can feel disconnected from their colleagues and that can be detrimental to morale.

4. Ensure timely and consistent pay for your remote workers

If you aren't paying your remote workers on time, or worse still paying them late, then this will have an impact on their lives outside of work.

Think about it: You wouldn't want to be late with a payment to a landlord or utility company, so why would you do it to your remote workers? Being late with payments causes unnecessary stress, which can have a knock-on effect on other areas of life if it becomes a habit. Things like this can ultimately lead to people leaving a job, which is something no business wants to happen.

remote employee happy

To do this, you must create an effective payroll system that works well with your remote setup. You should understand your bank partner’s policy on sending overseas payments to avoid any issues and delays. You can also partner with agencies like Remotify that offers payroll services.

To understand more about remote payroll systems, read this article.

5. Implement recognition and rewards systems

There are many different ways to design a recognition and rewards system for your remote employees. The key is to come up with a system that is based on the people you are trying to reward and tailor it appropriately for them. It is also important that you understand why you are doing this. If the purpose of a recognition program is to improve business performance, then having some kind of tangible prize at the end will help keep people motivated and engaged. The best type of recognition system should be one that encourages participation and contribution, as well as rewards individual effort.

However, tangible rewards are not always necessary. While it is effective for some, there are also times when monetary incentives can negatively impact motivation. Even worse, they can create a competitive environment in your team which may damage collaboration and trust. Instead of monetary rewards, you may consider other things such as long days off or time in lieu, or vouchers for food or leisure activities. These provide an opportunity for team members to go out together, rather than competing against each other for prizes.

It is also important to think about the frequency of your recognition programs. Two times per year is probably too infrequent; you might want to consider monthly or weekly recognition programs instead

Conclusion

As a business owner, you need to consider the reasons why your employees are leaving, and then implement management strategies to retain them. If you are considering a remote workforce as part of your business plan, you must consider the unique challenges and opportunities of remote work. With this, you must develop a successful strategy for ensuring employee success.

This is why at Remotify, we value remote employee engagement with companies and we help them build a great work environment and culture. This is through our Employer of Record services that include HR tasks, payroll management, and team engagement. To know more about this, you may visit this page or contact us at [email protected].

A lot of people often confuse international employment and remote freelancing simply because they are both done remotely.  However, they are actually very different and you should be aware of how and when to opt for either. In the instance of misclassification, an employer or freelancer may not be able to distinguish their rights and responsibilities in their job.

Considering this, it is important to have proper knowledge about the true meaning of being an international employee and a freelance worker. In this article, we will discuss some of the important things you should know.

What is a freelance work?

A person who is doing freelance work is someone who works for different companies but does not have an employer to offer them a permanent job. Freelancing is pretty much running a business offering services to clients. This means that they need to allot time to advertise their services, manage their schedules, and send invoices.

Moreover,  they can take on multiple clients and work with them simultaneously. The freedom and flexibility that freelancers enjoy are some of the main reasons why people choose this type of employment instead of working for a single company.

However,  they are at risk of not getting any employee benefits and security of tenure. They are self-employed, which means they are responsible for their own taxes, benefits, equipment expenses, and insurance. Also, many freelancers often find themselves in a difficult situation when their client does not pay for the work rendered even if they have their contract.

Freelancers have recently been placed in the spotlight with the Philippine government placing more laws to protect those who are in the industry. In fact, there is a newly approved regulation that protects the rights of freelancers in the Philippines.

What is an international remote work?

In remote work, on the other hand, a person works for a foreign company and can only work for that particular company. International remote employees usually do not have to worry about paying taxes and other expenses because their employment covers them, staying compliant to the employee’s local labor laws. The responsibility of these workers lies in delivering high-quality results for their respective companies.

Aside from that,  their salaries are usually standard across the board. International employees work for a single employer, which means they typically enjoy job security and benefits just like a local employee in their country, namely:

If you want to know more about the Labor Law in the Philippines, check out this guide.

International employment also means that your day-to-day tasks can be monitored regularly. This is because you are an employee of a foreign company, so they regularly monitor your activities to make sure that work gets done on time. 

Which of the two is the best option for you?

There are a lot of differences between these two types of remote employment, but here are some key differences to keep in mind.

If you value freedom and flexibility where you can be the "boss" of your own schedule, the freelance work setup might be more applicable to you. You can choose how many tasks you want to take in and for which clients you want to accept work from. In terms of choosing projects, freelancers have the freedom to pick their own projects and clients.

On the other hand,  international remote employees have a fixed salary. They also work fewer hours compared to their freelancing counterparts because they do not need to take time marketing themselves or pitching to clients. However, these remote employees are protected by their country’s labor laws and many benefits from their employer that freelancers often lack. Moreover, being employed by a foreign company means that your company can dictate your working hours depending on your position and the time zone in which the company operates.

Overall,  freelancers usually enjoy more freedom and flexibility while international employees get the stability of employment and better benefits. You can find work easier as a freelancer because you do not need to wait for an employer to offer you a job and work comes as project-based.

Meanwhile,  international employees enjoy job security and protection against tax liabilities by their employers. As international employees, there is an employment contract that serves both parties that clearly stipulates a job description and compensation including benefits. They usually work regular and fixed hours agreed upon in the contract.

Now if you are working remotely and your employer requires you to only work for them and on a fixed set of hours, you are definitely an international employee. In this case, you need to check in and align with your employer for your labor rights and benefits. 

What are the risks in misclassifying your remote work setup?

If you want to practice your rights for the two classifications, it is important that your employer is being clear about your position and your working setup. 

If you are a freelance worker,  you can negotiate and even dictate the scope of work you are capable of rendering, and the duration of service to be included in the contract. Ultimately the employer will be the one to determine the duration of the project.

Meanwhile, being an international employee means that you and your employer must follow the labor code. An example would be in the case of overtime work - according to the Department of Labor, workers need to be paid overtime if they work more than 40 hours a week.  This means that if you are working 50 hours a week for your company but you are not being paid the correct amount then this is something you can bring up.

remote job

Also,  there are several requirements that your employer must comply with when hiring international remote employees. For example, these employees have a salary based on a fixed amount and should not be paid less than the minimum wage in your country. If you feel that you are being underpaid, then it is time to set an appointment with your HR to clarify, check other sources for industry-standard pay, or seek other employment opportunities.

If you are still not sure if your employer is misclassifying you as an international employee or not, seek the advice of professionals who specializes in labor laws and regulations regarding remote work.

How can an Employer of Record help?

According to the Department of Labor, there are specific requirements for hiring international employees such as building an entity in the country which may cost a lot. On the other hand, a company can also partner with outsourcing providers such as Employer of Record companies that can act as the agency that will legally hire their employees in the Philippines on their behalf.

An Employer of Record is a company that works as a local representative of the employee's employer. Through this system, employers can pay their employees through local banks and they will bill them every month.

An Employer of Record company like Remotify is helpful especially if you want to hire international workers online because it makes administration easier. We also offer payroll management, HR services, and labor compliance which are essential for any business. We will also be the ones to pay and manage the employees' taxes and social benefits.

Aside from that, we also offer optional services such as employee sourcing, Cybersecurity training, background checking, HMO management, and laptop procurement.

Conclusion

Now that you know the difference between international employment and freelance, it would be easier for you to determine which setup you prefer as you search for a remote job. If you and your employer are having trouble finding the best ways to comply with the Philippine Labor Law, then Remotify is here to help.

Check out Our Services page to know about how we can be of service or set a call with us here.

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