What Makes Up the Cost
| Cost component | What it covers |
|---|---|
| Gross salary | Must meet the regional minimum wage for the workplace. |
| 13th-month salary | At least 1/12 of basic salary earned in the year, paid by December 24. |
| SSS employer contribution | 10% of the monthly salary credit, with a minimum credit of PHP 5,000 and a maximum of PHP 35,000, plus a small fixed Employees’ Compensation contribution. |
| PhilHealth employer contribution | 2.5% of basic monthly salary, with an income floor of PHP 10,000 and ceiling of PHP 100,000, up to PHP 2,500. |
| Pag-IBIG employer contribution | 2% of monthly compensation up to PHP 10,000, up to PHP 200. |
| Paid leave | 5 days of Service Incentive Leave after one year, plus maternity and paternity leave as required by law. |
| Benefits | Health insurance and other benefits are often expected by candidates. |
| EOR service fee | A flat monthly fee per employee or a percentage of payroll. |
Example: Employer Costs at Three Salary Levels (Illustration, 2026)
| Cost component | PHP 30,000 monthly basic salary | PHP 60,000 monthly basic salary | PHP 150,000 monthly basic salary |
|---|---|---|---|
| Employer SSS incl. EC contribution | 3,030 | 3,530 | 3,530 |
| Employer PhilHealth | 750 | 1,500 | 2,500 |
| Employer Pag-IBIG | 200 | 200 | 200 |
| 13th-month accrual (1/12) | 2,500 | 5,000 | 12,500 |
| Total monthly cost before EOR fee | 36,480 | 70,230 | 168,730 |
| Added on top of salary | about 21.6% | 17.1% | 12.5% |
Illustration only. Excludes the EOR fee, overtime, bonuses and optional benefits. Rates change, so confirm current figures with the authorities.
Flat Fee vs. Percentage of Payroll
With a percentage-of-payroll model, the EOR service fee increases as salaries rise. A flat monthly fee is more predictable for higher salaries. Compare the model and the full written fee breakdown rather than the service fee alone.
Questions to Ask Before You Sign
- What is included in the EOR service fee?
- Are there separate onboarding or offboarding fees?
- Are benefits administration fees charged separately?
- What are the minimum contract term and notice period?
- How are 13th-month pay and statutory contributions billed?
- What currency and payment fees apply?