Why Hiring Compliance Matters for Foreign Employers
If you’re a foreign business owner hiring workers in the Philippines, whether you’re building virtual teams or managing a group of freelancers, you’ve probably run into some questions about Hiring Compliance.
And you’re not alone.
Many business owners start out working with Filipino freelancers or virtual assistants. But as your business grows, so does the complexity. Suddenly, you need to worry about labor laws, payroll tax obligations, social security, healthcare benefits, and whether or not you’re even allowed to pay your workers as freelancers anymore.
That’s where Comply.ph comes in.
Our platform helps you build virtual teams legally and ethically. We specialize in employee conversions, turning your freelancers, contractors, and virtual assistants into real employees; fully compliant under Philippine law. You get peace of mind, and your team gets job security and benefits.
To help you get started, we’ve compiled the 8 most common Hiring Compliance FAQs foreign business owners ask us.
Let’s dive in.
1. Do I need to register a business entity in the Philippines to hire employees?
Short answer: No, not if you use Comply.ph.
Hiring full-time employees directly in the Philippines typically requires you to register a local business entity, open a local bank account, set up a payroll system, and file monthly taxes. It’s a complex, costly, and time-consuming process.
But with our platform, you don’t need to do any of that.
Here’s how we simplify it for you:
- Comply.ph acts as the Employer of Record.
- We officially hire your workers under our Philippine entity.
- You retain full control of day-to-day tasks and performance management.
- We handle all legal, HR, payroll, and tax requirements.
So instead of registering a business in the Philippines, you can build a virtual team with zero local admin and full legal compliance.
2. What does “Employer of Record” actually mean?
This is one of the most important concepts to understand when hiring internationally.
An Employer of Record (EOR) is a third-party entity that legally employs workers on your behalf. With Comply.ph, that means:
- We are the legal employer of your Filipino staff.
- You are the operational manager—they work directly for you.
- We manage employment contracts, benefits, payroll, taxes, and government filings.
What this means for you:
- You stay compliant with Philippine labor laws.
- You avoid misclassification risks.
- You don’t need to build HR or legal infrastructure locally.
It’s the easiest and most compliant way to build virtual teams in the Philippines.
3. Can I convert my current freelancers or virtual assistants into full-time employees?
Yes—and you absolutely should.
Many foreign business owners start by hiring freelancers through marketplaces or referrals. But if those workers are performing ongoing tasks, reporting to you regularly, and working like full-time employees, you’re running a compliance risk.
Under Philippine law, they should likely be classified as employees, not freelancers.
At Comply.ph, we specialize in employee conversions.
Here’s how it works:
- We assess your current team setup and employment relationships.
- We onboard your freelancers or virtual assistants as real employees under our Philippine entity.
- You continue working with them exactly as before, with no disruption to your operations.
- They receive full government-mandated benefits, job security, and a legal employment contract.
This process:
- Helps you retain top talent by offering them job stability.
- Reduces your legal risk.
- Demonstrates that you value and respect your Filipino team.
4. What are the risks of continuing to hire freelancers without proper compliance?
If you’re paying people as freelancers but treating them like employees, you’re opening yourself up to legal and financial exposure.
Here are the risks:
- Worker Misclassification Penalties: The Philippine government may determine that your freelancers are actually employees, which can result in fines, back pay, and unpaid taxes.
- Contractor Disputes: Disgruntled freelancers could file complaints about unfair practices or lack of benefits.
- Loss of Talent: Freelancers may leave for companies that offer real employment and better benefits.
With Comply.ph, you can avoid all of this. We help you:
- Classify and convert freelancers into employees the right way.
- Provide social security, healthcare, and holiday pay.
- Create a professional, long-term relationship with your team.
5. What benefits are Filipino employees entitled to under the law?
When you build virtual teams with Comply.ph, we make sure your workers receive everything the law requires, and more.
Here’s what we provide:
- SSS (Social Security System): Retirement, maternity, sickness, and death benefits.
- PhilHealth: National health insurance.
- Pag-IBIG Fund: Housing and savings fund.
- 13th Month Pay: Mandatory one-month bonus paid in December.
- Paid Leaves: Sick leave, vacation leave, and more (depending on tenure and contracts).
- Government-mandated holidays: Paid time off for public holidays.
We go beyond the basics by also offering:
- Payroll processing
- Onboarding and HR support
- Legal employment contracts
- End-to-end compliance management
When you work with us, your team feels like real employees—because they are.
6. Who controls the day-to-day work and salary of the employee?
You do.
Even though we are the legal employer on paper, you are the operational boss. That means:
- You decide who to hire and what salary to offer.
- You assign tasks and manage performance.
- You control team structure and strategy.
Here’s how the process works on Comply.ph:
- You tell us what roles you need.
- You set the budget, hours, and qualifications.
- We help you hire new team members or convert existing ones.
- We handle compliance and payroll, but you manage the work.
We make employee conversions simple and employer-friendly. You get all the benefits of hiring full-time workers, without the risks or red tape.
7. How long does the employee conversion process take?
In most cases, it only takes a few days to a couple of weeks.
Our team at Comply.ph has a streamlined onboarding process:
- Initial Consultation: We discuss your team setup and business needs.
- Employee Conversion: We issue compliant contracts and onboard your freelancers under our entity.
- Payroll & Benefits Setup: We enroll them in all mandatory government programs.
- Ongoing Management: We handle taxes, compliance, and HR support each month.
There’s no downtime or disruption. Your team keeps working while we take care of the back end.
And remember, you’ll always have full visibility and control without the burden of administration.
8. What does it cost to build a compliant team through Comply.ph?
We keep our pricing transparent and affordable. You set your employees’ salaries, and we charge a flat monthly fee to manage everything.
Your monthly invoice includes:
- Gross salary paid to the employee.
- Government contributions (SSS, PhilHealth, Pag-IBIG).
- Employer share of benefits.
- Our service fee for handling payroll, compliance, HR, and legal matters.
There are no hidden fees, and you get:
- A fully compliant Filipino workforce.
- Zero local registrations or tax filings.
- No internal HR or legal costs.
- Seamless employee onboarding and conversion.
The result? You save money, retain top talent, and stay 100% compliant.
Additional Tips for Staying Compliant When Hiring in the Philippines
Beyond just converting freelancers into employees, there are a few best practices you should follow when you’re serious about building a virtual team and want to stay on the right side of Philippine labor laws.
1. Use Legally Compliant Employment Contracts
Don’t rely on verbal agreements or informal email offers. Every employee should have a signed employment contract that:
- Specifies job title, salary, and working hours
- Includes termination clauses aligned with Philippine labor regulations
- Details the benefits the employee is entitled to
At Comply.ph, we provide legally vetted contracts in line with local regulations so you don’t have to worry about drafting or compliance errors.
2. Provide Government-Mandated Benefits from Day One
As soon as someone is classified as an employee, they must be enrolled in:
- SSS (Social Security System)
- PhilHealth (health insurance)
- Pag-IBIG (housing and savings fund)
We take care of all these contributions through our payroll system. You never have to worry about delayed enrollments or incorrect withholdings.
3. Set Clear Communication Channels
When you convert freelancers into employees, treat them as part of your company. That includes:
- Regular check-ins
- Structured performance reviews
- Defined roles and career progression
Doing this helps you build a loyal team that performs better over time.
What Makes Comply.ph the Best Platform to Build Virtual Teams in the Philippines?
If you’re still weighing your options, here’s why Comply.ph is the most trusted platform for employee conversions and hiring compliance:
We Handle Everything
- No local business registration needed
- No legal headaches
- No payroll setup stress
As the Employer of Record, we take on full responsibility for local compliance while you focus on managing your team.
We Make It Easy to Convert Freelancers Into Real Employees
Got a VA you trust? A team of contractors that already knows your business inside out? Let’s make it official. We convert them into employees under our entity while preserving your working relationship exactly as it is, just legally protected and compliant.
Full Transparency
You set the salary, and we make sure every peso is accounted for. One invoice, no hidden charges.
Long-Term Talent Retention
When your workers receive fair wages, government benefits, and job security, they stay. Our platform helps you secure top Filipino talent for the long-term.
Key Takeaways: What You Should Remember
Here’s a quick summary of what you need to know:
- You don’t need a local business entity to hire employees in the Philippines – Comply.ph acts as your Employer of Record.
- If you’re working with Filipino freelancers or VAs, they may legally qualify as employees, and we can convert them for you.
- Hiring compliance means providing proper contracts, fair wages, and mandatory government benefits.
- Comply.ph handles all compliance, payroll, and legal obligations, so you don’t have to.
- With our help, you can build virtual teams that are loyal, secure, and legally protected.
- You stay focused on growth—we handle everything else.
Ready to Turn Your Freelancers Into Full-Time, Compliant Employees?
At Comply.ph, we believe in making it easy for foreign business owners like you to build virtual teams in the Philippines, legally, ethically, and efficiently.
Whether you want to hire new staff or convert existing contractors into loyal employees, we’ll take care of the entire process, from onboarding and contracts to taxes and benefits.
And the best part? You’ll never have to navigate Philippine labor law on your own.
Book your free consultation call now and let’s talk about how we can help you:
- Stay compliant
- Build loyalty
- Retain top talent
- And focus on scaling your business
Don’t wait for a compliance issue to force your hand. Be proactive. Let’s do it the right way.
👉 Book Your Free Consultation Call with Comply.ph
