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Employer of record (Philippines)
Employer of record (Philippines) is a Philippine-registered company that is the legal employer of the person you hired, while you direct the work. The EOR signs the employment contract, runs peso payroll, remits SSS,.
Also called PH EOR, Philippine employer of record
The phrase is industry English, not a title in the Labor Code. L&E Global describes the pattern as a trilateral relationship: foreign principal, local employer, worker. DOLE and the Supreme Court have not issued a circular that blesses every vendor using the label. They have issued rules that punish the thin version of it.
How it works
The worker gets a Philippine employment contract, a probationary period that cannot run past six months, 13th-month pay, service incentive leave, and payslips that show statutory deductions. The EOR is the name on the remittance file. You approve the rate, the hours, the tools, and the performance bar. You can still fire the relationship commercially. The EOR has to terminate under just cause, authorized cause, or failure to meet standards that were written down on day one.
Ask for proof, not a slide. Employer registration numbers at SSS, PhilHealth, Pag-IBIG, and BIR. A contract that names the EOR as employer. Payslips in pesos. A 13th-month accrual. If those documents name a different company every month, you do not have an EOR. You have a payroll relay.
Example: you hire an executive assistant at ₱70,000 basic. The EOR withholds the employee SSS/PhilHealth/Pag-IBIG shares, adds the employer shares and employees’ compensation, accrues 1/12 for December, and invoices you the loaded peso cost plus its fee, often quoted in dollars. You never open a Philippine bank account. You also never get PEZA incentives. Those attach to an entity you control, not to a rented employer.
How it differs
Direct hire puts the person on your payroll. That only works cleanly if you already are a Philippine employer. A PEO in the U.S. sense cannot file as the employer here if you are not registered. A contractor invoice with no statutory file is not an EOR. Labor-only contracting is the failure mode: the local party supplies a body, has no real capital or control, and the foreign principal is treated as the employer anyway, including back wages and benefits.
Common errors
Assuming the EOR fee replaces 13th month and contributions. It sits on top of them. Writing U.S. at-will language into a Philippine contract. Splitting control so finely that a court later finds every affiliate jointly liable, which is the pattern in American Power Conversion v. Lim.