Global coverage
Available in +150 countries
Employer costs, taxes, minimum wage and leave rules for hiring here, plus the faster route: hire a contractor with Ontop, no local entity needed.
2026
Currency
PHP ₱ (Philippine Peso)
Employer contributions
~12.5% employer (SSS ~8.5% + PhilHealth 5% / 2 + Pag-IBIG 2%)
Minimum wage
PHP 755/day (2026) ≈ $314/month
Payment frequency
Monthly / Semi-monthly
Calendar year (Jan 1 - Dec 31)
Capital
Manila
Timezone
PHT (GMT+8)
Short answer: The minimum wage in the Philippines in 2026 is PHP 755 a day (about PHP 19,692 a month, or $314). A typical full-time salary is around PHP 35,000 a month ($558). Professionals paid as contractors through Ontop earn a median of $1,280 a month (95 active contracts, September 2026).
| 2026 figure | Local currency | USD |
|---|---|---|
| Minimum wage, monthly | PHP 19,692 | $314 |
| Minimum wage, hourly | PHP 94.38 | $1.50 |
| Average salary, monthly (approx.) | PHP 35,000 | $558 |
| Median contractor pay through Ontop, monthly | n/a | $1,280 |
Minimum wage details: NCR non-agricultural from Wage Order NCR-28 (+P60 from 695), effective 2026-09-26. Agri/small retail (<=15 workers)/small manufacturing (<10) 718. Earlier NCR-27 (755 from 2026-07-25, 780 in Jan 2027) was enjoined by a Pasig court and is in litigation. Rates vary by region (set by each RTWPB); other regions are lower.. USD figures use exchange rates from 1 October 2026. Updated October 2026.
Next step: compare contractor rates in the Philippines with other countries or estimate the full cost of an employee.
The Philippines is one of the largest pools of remote talent in the world, and most foreign companies hiring here never need a local payroll. The reason is administrative more than financial: an employer has to register with and pay into three separate agencies (SSS, PhilHealth and Pag-IBIG), withhold tax for the BIR, and meet each agency's own deadlines every month.
Miss one and the surcharges stack up: 3% a month on late SSS contributions, 2% a month on PhilHealth, and a 25% surcharge plus interest on late BIR payments.
On a PHP 50,000 monthly salary, employer contributions add about PHP 6,250, for roughly PHP 56,250 a month. The full cost includes more:
Filipino professionals commonly work as independent contractors or freelancers, registered with the BIR and responsible for their own contributions. Companies paying contractors in the Philippines through Ontop pay a median of $1,280 a month (the middle half earn between $850 and $1,801), across 95 active contracts in September 2026. That is Ontop's own book, not a market survey. Compare roles and countries with the contractor cost by country calculator.
Ontop acts as contractor of record. You get a compliant contract (yours or an Ontop template), support on classification, and a single platform to pay from, with no Philippine entity and no monthly filings to three agencies. Your contractor gets paid into the Ontop Global Account in USD. Pricing starts at $49 per contractor per month.
Philippine labor law looks hard at control: who sets the hours, who directs the method, whether the person works only for you. A full-time role on your schedule, managed like in-house staff, is regular employment, and DOLE treats it that way regardless of the contract. If that describes the job, hire an employee. Ontop does not offer employer of record and never becomes the legal employer. If the role is defined by output, see how an alternative to EOR for contractors works.
Employee or contractor
If the work is project-based or you need to move fast, a contractor gets you the same talent with a fraction of the paperwork.
Employee
~PHP 56,250 total
/month
For a gross salary of
PHP 50,000 gross/month
Setup
Local entity or employer of record, plus tax and social security registration
Employer contributions
~12.5% employer (SSS ~8.5% + PhilHealth 5% / 2 + Pag-IBIG 2%)
Mandatory extras
13th Month Pay
Monthly admin
Semi-monthly or monthly payroll - SSS/PhilHealth/Pag-IBIG filings - 13th month December - BIR 2316 January
Contractor with Ontop
No local entity
$49
/contractor/month
The agreed rate, plus Ontop from $49 per contractor per month.
Sign a contract, yours or an Ontop template. No local registration on your side.
No employer contributions: the contractor handles their own taxes and social security.
One payment per invoice, in one payroll run.
Paid into their Ontop Global Account in USD.
See the full side-by-side comparison
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A contractor's rate usually covers their own taxes, so compare total cost, not just gross pay. Run your numbers in the contractor vs employee calculator.
Hiring here: the full breakdown
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Payroll guide
Employer costs come on top of gross pay. Use these figures to budget a hire and to compare it with a contractor rate.
Total monthly cost
~PHP 56,250 total
Example gross salary
PHP 50,000 gross/month
~PHP 37,000 net
Net pay to the employee
Tax and employee contributions
Withheld from gross pay
~PHP 6,250 employer SS
Employer contributions on that salary
Employer contributions
~12.5% employer (SSS ~8.5% + PhilHealth 5% / 2 + Pag-IBIG 2%)
Employee contributions
~8.5% employee (SSS ~4.5% + PhilHealth 5%/2 + Pag-IBIG 1-2%) + income tax
Total cost above gross
~12.5% above gross
Figures are estimates for planning. Rates change with each budget and can vary by sector, so confirm them before you make an offer.
What people earn here, from the legal floor to the main cities, plus the extra pay most employers budget for.
National average
~PHP 35,000
Per month
Metro Manila
PHP 40,000 - 120,000
~40%
Cebu
PHP 30,000 - 80,000
~15%
Monthly gross. National average salary per year:
~PHP 420,000
Minimum wage
PHP 755/day (2026) ≈ $314/month
Paid:
Daily
Extra pay
13th Month Pay
Mandatory - 1/12 of total basic salary earned during the year
December 24
Collective agreements can set sector minimums above the national one. Check whether one applies to the role before you set the salary. Next step: estimate the full cost of an employee.
Who collects what, how often, and what happens when a payment is late.
Income tax brackets
0% up to PHP 250,000 / 15% / 20% / 25% / 30% / 35%
Tax year:
Calendar year (Jan 1 - Dec 31)
Filing calendar
Monthly SSS/PhilHealth/Pag-IBIG by deadlines per agency
Social security payments
April 15 (Annual ITR 1700/1701)
Income tax
By January 31
Employee tax certificate
BIR Form 2316 (Certificate of Withholding)
April 15
Annual return
Annual Income Tax Return (1700/1701)
Late payment penalties
Late SSS: 3% monthly surcharge; late PhilHealth: 2% monthly; late BIR: 25% surcharge + 12% annual
Who collects what
Bureau of Internal Revenue (BIR)
Income tax and withholding
SSS (Social Security System)
Social security
DOLE (Department of Labour and Employment)
Labor law enforcement
The time off and paid leave every employee is entitled to by law. Budget for it when you compare an employee with a contractor.
Annual leave
Annual Leave / SIL
5 days Service Incentive Leave (SIL) minimum; sector CBAs grant more
Public holidays
~12 regular + 3 special public holidays
Sick leave
Sick Leave
No mandatory statutory sick pay beyond SIL; employer policies vary
Maternity leave
13 weeks (78 days) maternity (up to 105 days - RA 11210)
SSS Maternity Benefit (full salary equivalent from SSS)
The contracts you can use, and what ending an employment relationship costs.
Permanent
Regular Employment (Permanent)
Fixed term
Fixed-Term / Project-Based
Independent contractor
Independent Contractor / Freelancer
Collective agreements
Collective Bargaining Agreement (CBA)
Ending employment
Separation Pay
How it is calculated
0.5 to 1 month per year depending on cause; 1 month per year for authorized causes
Calling someone a contractor does not make them one. If the role works like employment in practice, local authorities can reclassify it, with back contributions and penalties.
The errors that most often trigger back payments and penalties here, and what to do instead.
13th Month Pay Miscalculation
Risk Level: HIGH
Philippine 13th month pay is 1/12 of total basic salary earned during the calendar year - not gross salary, not including allowances. Many employers calculate on the current monthly salary without accounting for mid-year hires, separations, or salary changes. DOLE inspections routinely find underpayment.
Employee vs Contractor Misclassification (Labor-Only Contracting)
Risk Level: HIGH
Philippine law prohibits labor-only contracting - engaging workers through a third-party agency that has no substantial capital and the workers perform the main business of the principal. DOLE orders direct employment regularization with full back-benefits.
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Next topicOntop is the Global Workforce Engine for contractor teams: contracts, compliance documents and payments in 150+ countries.
150+
countries
$49
per contractor per month
1 run
to pay your whole team
USD
Global Account for every contractor
FAQ
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Ontop works with contractors, not employees. As Contractor of Record, Ontop handles contracts, compliance documents and payments for contractors in 150+ countries. To employ someone, you need a local entity or an employer of record. Ontop doesn't act as your employer of record.
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Employers pay contributions on top of gross salary. The cost table on this page shows the rates that apply here and a worked monthly example. A contractor with Ontop costs the agreed rate plus Ontop from $49 per contractor per month.
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Many countries require an extra month or an annual bonus for employees. The salaries section on this page shows the one that applies here and when it is usually paid. Contractors are paid what you agree in the contract.
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Employers withhold income tax and the employee's social security share every pay run, then pay them to the local authorities. The taxes section on this page lists the brackets, rates and filing deadlines that apply here.
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Yes. The contractor vs employee calculator compares the full cost of an employee, employer contributions included, with a contractor rate plus Ontop's monthly fee.
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When the work is project-based, you need to start fast or you don't have a local entity. If the person will work fixed hours, under your direction and only for you, local law may treat them as an employee, so hire them as one.
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Misclassifying employees as contractors, missing tax and social security deadlines, and ignoring collective agreements that set higher wage floors. The mistakes section on this page covers the ones that come up most often here.
Compare employer costs, taxes and contractor rules in nearby countries:
Ready to hire? See Ontop pricing or learn how to build a global team without an employer of record.
Ready to hire? See Ontop pricing or learn how to build a global team without an employer of record.