Philippines Payroll Compliance Proof Pack: Payslips, 13th‑Month Pay, and Statutory Remittance (SSS, PhilHealth, Pag‑IBIG)

Author: Philip Murphy, COO & Founding Partner
Reviewed by: Martin English, CEO & Founding Partner
Date Published: Nov 4, 2025

Disclosure: Informational only. Not legal, tax, or financial advice.

To pay a remote employee in the Philippines legally, the worker should be employed through a Philippine legal employer, paid through compliant payroll, issued payslips, covered for statutory contributions, and tracked for 13th-month pay. If your company does not have a Philippine entity, a Philippines Employer of Record can act as the local legal employer and provide the payroll proof pack that shows salary, SSS, PhilHealth, Pag-IBIG, BIR withholding where applicable, 13th-month pay, and payroll approvals were handled correctly.

For SOS EOR hires, the basic payroll cost model is:

Monthly salary + employer statutory costs + 13th-month accrual + selected benefits or allowances + US$190 per employee per month

A proof pack matters because overseas companies should not rely on “payroll is compliant” as a promise. They should be able to review payroll before release and audit payroll evidence after payment.

TL;DR

A Philippines Payroll Compliance Proof Pack is a structured set of documents that proves employees were paid correctly, statutory contributions were handled, 13th-month pay was tracked, and payroll can be reviewed by the buyer.

For a Philippines EOR team, the proof pack should include:

Proof Item	What It Shows
DOLE-aligned employment contract	The employee has a local employment structure
Employee master record	Role, salary, start date, benefits, department, manager, and status
Payroll register	Gross salary, allowances, deductions, employer costs, and net pay
Payslips	Employee-facing record of pay, deductions, and net amount
SSS contribution evidence	Social security contribution handling
PhilHealth contribution evidence	Health insurance contribution handling
Pag-IBIG contribution evidence	Housing fund contribution handling
13th-month pay record	Mandatory annual pay is accrued, calculated, and paid
Remittance receipts or summaries	Statutory remittance process can be verified
BIR withholding process	Compensation tax withholding and year-end process are documented where applicable
Leave and holiday records	Local HR and workforce records are maintained
Final pay / offboarding record	Employee exit and final settlement are documented
Payroll approval trail	Buyer reviewed and approved payroll before release

A compliant Philippines EOR should not only say “payroll is compliant.” It should be able to show the proof pack.

For the broader compliance framework, see Philippines EOR Compliance.

Quick Answer

A Philippines payroll compliance proof pack is the evidence bundle a buyer should receive from an EOR or payroll provider to verify that payroll was processed correctly, statutory obligations were handled, and the employee was paid legally.

To pay a remote employee in the Philippines legally, the company needs one of two structures:

Situation	Compliant payroll path
You have a Philippine legal entity	Employ the worker through that entity and run local payroll
You do not have a Philippine legal entity	Use a Philippines EOR to employ the worker locally
The worker is genuinely independent	Use a contractor agreement only if the relationship is genuinely independent
The role is ongoing, full-time, and managed like an employee	Use EOR or local employment rather than long-term freelancer treatment

At minimum, the proof pack should show:

• who was employed
• what they were paid
• what was deducted
• what the employer contributed
• what the employee received
• what statutory contributions were handled
• how 13th-month pay was accrued or paid
• what was approved before payroll release
• what evidence exists after remittance
• how leavers and final pay were handled

The goal is simple:

Every payroll cycle should be reviewable before release and auditable after payment.

For companies with long-term Filipino freelancers who now function like employees, the next step is to move freelancers onto compliant payroll.

Who This Tool Is For

This proof pack is for:

• CFOs approving EOR payroll in the Philippines
• founders hiring Philippine employees without a local entity
• HR leaders reviewing offshore employment risk
• finance teams checking payroll invoices
• buyers comparing EOR providers
• companies converting contractors to employees
• teams scaling from 1 to 20+ Philippine employees
• investors, acquirers, or auditors reviewing workforce compliance

This is not a general article about Philippine payroll. It is a practical document checklist for proving payroll compliance.

What Is a Payroll Compliance Proof Pack?

A payroll compliance proof pack is a structured bundle of employment, payroll, statutory, and approval documents.

It should prove that:

Question	Proof Needed
Is the worker properly employed?	Employment contract and employee record
Was salary calculated correctly?	Payroll register and approved salary record
Was the employee paid?	Payslip and net pay record
Were deductions clear?	Payroll register and payslip
Were employer costs visible?	Payroll register and invoice breakdown
Were statutory items handled?	SSS, PhilHealth, Pag-IBIG evidence or summaries
Was 13th-month pay tracked?	Accrual and payment record
Was payroll approved?	Approval trail
Can finance audit the payroll?	Final payroll pack
Were leavers handled correctly?	Final pay and offboarding record

Without this pack, buyers may have payroll activity but not payroll proof.

How to pay a remote employee in the Philippines legally

To pay a remote employee in the Philippines legally, the worker must be employed through a Philippine entity or an Employer of Record that can run local payroll, issue payslips, handle statutory contributions, withhold tax where applicable, and track 13th-month pay. Direct overseas transfers may work for contractors, but employee payroll needs local employment records and compliance proof.

If your company does not have a Philippine entity, use an Employer of Record in the Philippines to legally employ the worker locally. The EOR becomes the legal employer in the Philippines while your overseas company manages the employee’s daily work.

A compliant payroll proof pack should show:

Payroll item	What the proof pack should show
Employment contract	Legal employer, job title, salary, start date, schedule, and benefits
Payroll register	Gross pay, deductions, employer costs, allowances, and net pay
Payslip	Employee-facing pay record for each payroll cycle
SSS	Employer and employee contribution handling
PhilHealth	Health insurance contribution handling
Pag-IBIG	Housing fund contribution handling
BIR withholding	Compensation withholding where applicable
13th-month pay	Monthly accrual and annual payment record
Benefits / HMO	Employee benefit package if included
Allowances	Internet, equipment, WFH, shift, or role-specific support
Approval trail	Internal review before payroll release
Final pay file	Separation date, final pay computation, release timing, and certificate of employment handling

For cost planning, use this formula:

Total monthly employee cost = salary + employer statutory costs + 13th-month accrual + benefits / allowances + EOR or payroll administration fee

For more detail on employment cost modelling, see the Philippines cost to hire guide.

For buyers comparing documents and benefits when hiring via an EOR, the key question is whether the provider can show employment, payroll, statutory, benefits, and offboarding evidence — not just say those items are included.

Why Payroll Proof Matters in a Philippines EOR Relationship

In an EOR relationship, the EOR is the local legal employer. The buyer usually manages the worker’s daily work, but the EOR handles local employment and payroll.

That means the buyer needs visibility into what the EOR is doing.

Risk Without Proof	What Can Go Wrong
No contract evidence	Employment structure is unclear
No payslips	Employees lack payroll transparency
No payroll register	Finance cannot review salary, deductions, and net pay
No statutory evidence	SSS, PhilHealth, and Pag-IBIG handling cannot be verified
No 13th-month tracking	Year-end cost and compliance risk
No remittance summaries	Buyer cannot audit statutory process
No approval trail	Payroll changes cannot be traced
No final pay record	Leaver disputes and overpayments become harder to manage

A strong EOR should make payroll easy to inspect.

What are the employer statutory contributions in the Philippines?

Employer statutory contributions in the Philippines generally include SSS, PhilHealth, and Pag-IBIG, with employee deductions and employer shares handled through payroll. For 2026 payroll planning, confirm the current contribution tables before publishing because rates, ceilings, and salary-credit ranges can change through official advisories.

As of July 7, 2026, use these dated figures for planning:

Statutory item	2026 figure to show in proof pack	Employer / employee treatment	Source note
SSS	15% contribution rate, based on the SSS contribution table effective 2025	Generally split as employer and employee shares under the official table	SSS publishes the official contribution table and states the 15% rate in the 2025 schedule.
PhilHealth	5% premium rate, with ₱10,000 income floor and ₱100,000 income ceiling	Shared equally between employer and employee for employed members	PhilHealth’s official 2025 advisory set 5%; PIA reported PhilHealth confirmed 5% remains for 2026.
Pag-IBIG	2% employee and 2% employer contribution, generally capped at ₱10,000 monthly fund salary	Employer remits both employee and employer shares	Pag-IBIG Circular No. 460 raised the maximum fund salary basis to ₱10,000 and keeps the employer counterpart at 2%.
BIR withholding	Based on compensation income and withholding-tax rules	Employer withholds and remits where applicable	BIR provides official withholding-tax information and a withholding-tax calculator.

A payroll proof pack should not only say “statutory contributions included.” It should show the actual contribution basis, employee share, employer share, remittance record, and payroll approval trail.

For each payroll cycle, keep:

• gross salary
• taxable compensation basis
• employee deductions
• employer statutory costs
• statutory contribution summaries
• payslip copy
• payroll register
• proof of approval before salary release
• BIR withholding treatment where applicable

This is especially important for overseas companies because payroll compliance needs evidence. A provider quote that says “fully compliant payroll” is not enough unless the provider can also show payslips, registers, remittance summaries, and contribution handling.

The Complete Payroll Compliance Proof Pack

1. Employment Contract

The proof pack should include a signed employment contract or contract record.

Contract Item	Why It Matters
Legal employer	Shows who employs the worker locally
Employee details	Confirms employee identity and records
Job title and duties	Confirms role scope
Salary and pay frequency	Confirms compensation terms
Benefits	Confirms statutory and optional benefits
Work arrangement	Remote, hybrid, office, shift, or location terms
Probationary terms	Confirms review and standards
Confidentiality	Protects company and client information
IP / work product terms	Protects code, content, SOPs, reports, documents, and output
Termination and offboarding terms	Supports compliant exits

For EOR employees, the local employment contract should be issued through the EOR.

2. Employee Master Record

The employee master record is the source of truth for payroll setup.

Field	Why It Matters
Employee name / ID	Identifies the worker
Job title	Supports payroll and reporting
Department / cost center	Helps finance allocate cost
Manager	Confirms work owner
Start date	Confirms payroll start
Employment status	Active, probationary, regular, resigned, terminated
Salary	Payroll basis
Allowances	Recurring or one-off additional pay
Benefits	HMO, equipment, internet, bonus, or other package items
Work schedule	Shift, timezone, rest days
Location	Wage, documentation, and HR context
Statutory registration status	Confirms setup for SSS, PhilHealth, and Pag-IBIG

If the employee master record is wrong, payroll will usually be wrong.

3. Payroll Register

The payroll register is the buyer-facing payroll control document.

It should show:

Payroll Field	Why It Matters
Employee name / ID	Identifies each worker
Pay period	Confirms coverage dates
Gross salary	Main pay amount
Allowances	Internet, equipment, night shift, transport, or role-specific allowances
Bonuses / incentives	Shows variable pay
Reimbursements	Shows one-off approved costs
Employee deductions	Employee-side statutory and approved deductions
Employer contributions	Employer-side statutory costs
Tax withholding	Compensation tax handling where applicable
Net pay	Final employee payment
13th-month accrual	Monthly visibility of mandatory annual pay
Variance notes	Explains changes from the prior payroll
Status notes	New hire, leaver, salary change, allowance change, correction

The buyer should review the payroll register before payroll is released.

4. Payslips

Payslips are the employee-facing proof of payroll.

A payslip should clearly show:

Payslip Item	Why It Matters
Employee name	Confirms recipient
Pay period	Confirms coverage
Gross pay	Shows earnings before deductions
Allowances	Shows added pay items
Deductions	Shows statutory and approved deductions
Tax withholding	Shows tax deducted where applicable
Net pay	Shows amount paid
Employer / payroll entity	Confirms payroll source
Payroll date	Confirms payment cycle

Payslips reduce confusion and give employees a clear record of pay.

5. SSS Contribution Evidence

SSS contribution evidence should show that social security contributions were handled.

Ask for:

Evidence Type	Why It Matters
Employee-level contribution summary	Shows each employee’s contribution
Employer share	Confirms employer-side obligation
Employee share	Confirms employee-side deduction
Remittance record or summary	Shows contribution handling
Payroll period mapping	Connects contribution to payroll cycle
Correction log	Shows how errors are fixed

The EOR should be able to explain how SSS contributions are calculated, deducted, remitted, and documented.

6. PhilHealth Contribution Evidence

PhilHealth contribution evidence should show that health insurance contributions were handled.

Ask for:

Evidence Type	Why It Matters
Employee-level contribution summary	Shows each employee’s contribution
Employer share	Confirms employer-side obligation
Employee share	Confirms employee-side deduction
Salary basis	Confirms calculation basis
Remittance record or summary	Shows contribution handling
Update process	Shows how rate changes are implemented

The EOR should monitor current PhilHealth contribution rules and update payroll accordingly.

7. Pag-IBIG Contribution Evidence

Pag-IBIG contribution evidence should show that housing fund contributions were handled.

Ask for:

Evidence Type	Why It Matters
Employee-level contribution summary	Shows each employee’s contribution
Employer share	Confirms employer-side obligation
Employee share	Confirms employee-side deduction
Maximum fund salary basis	Confirms contribution basis
Remittance record or summary	Shows contribution handling
Voluntary contribution notes	Clarifies any employee-elected additional savings

The EOR should document mandatory and voluntary Pag-IBIG contribution treatment clearly.

8. 13th-Month Pay Record

13th-month pay should be tracked before it is paid.

A proper proof pack should show:

13th-Month Item	What to Verify
Eligibility	Which employees are covered
Basic salary basis	Amount used for calculation
Accrual	Monthly tracking for finance
Proration	New hires and leavers handled correctly
Salary changes	Adjustments reflected correctly
Payment timing	When payment is scheduled or completed
Payslip record	Employee-facing proof of payment
Payroll record	Finance-facing proof of payment

13th-month pay should not be a surprise year-end line item.

How does 13th-month pay work in the Philippines?

13th-month pay in the Philippines is mandatory annual pay equal to at least 1/12 of an employee’s basic salary earned during the calendar year and must be paid on or before December 24. For payroll proof, track the salary basis, monthly accrual, proration, payment timing, and final-pay treatment if the employee exits.

DOLE’s Bureau of Working Conditions explains that 13th-month pay is computed as 1/12 of total basic salary earned within the calendar year, and DOLE states the payment should be made not later than December 24.

For monthly planning, use this formula:

Monthly 13th-month accrual = monthly basic salary ÷ 12

Monthly basic salary	Monthly 13th-month accrual	Annual 13th-month estimate
₱40,000	₱3,333.33	₱40,000
₱60,000	₱5,000	₱60,000
₱80,000	₱6,666.67	₱80,000
₱120,000	₱10,000	₱120,000

For 2026 payroll proof, the proof pack should show:

• employee eligibility
• monthly basic salary used
• 13th-month accrual per payroll period
• proration for new hires and leavers
• payment date
• payslip or payroll record
• approval trail
• final-pay treatment if the employee exits before year-end

13th-month pay should not appear as a surprise year-end cost. It should be accrued throughout the year and visible in the payroll proof pack.

9. BIR Withholding and Year-End Process

Where applicable, the EOR or local employer should manage compensation tax withholding and year-end documentation.

The buyer should ask for:

Proof Area	Why It Matters
Withholding process	Shows how compensation tax is handled
Payroll tax calculation basis	Shows how withholding is computed
Year-end process	Shows how annual documents are prepared
Leaver treatment	Shows how tax documentation is handled on exit
Correction process	Shows how errors are fixed
Employee document process	Shows whether employees receive required forms

The buyer does not need to calculate withholding directly, but the process should be clear.

10. Leave, Holiday, and Premium Pay Records

For Philippine employees, the proof pack should track leave, holidays, and applicable premium pay.

Record Type	Why It Matters
Leave balance	Shows available and used leave
Leave approvals	Shows manager approval
Holiday treatment	Shows regular and special non-working holiday handling
Night shift differential	Shows applicable premium treatment where relevant
Overtime approval	Shows approved overtime and pay basis
Rest day work	Shows approved rest-day work treatment
Absence / unpaid leave	Shows payroll impact

These records matter especially for support, operations, night-shift, and 24/7 teams.

11. Payroll Approval Trail

The payroll proof pack should include evidence that payroll was reviewed and approved before release.

Approval Evidence	Why It Matters
Draft payroll register	Shows pre-release payroll review
Variance report	Explains changes from the previous payroll
Manager approval	Confirms employee status and role-level changes
Finance approval	Confirms cost, invoice, statutory, and FX review
Final approver	Confirms authority to release payroll
Approval date	Creates audit trail
Exception notes	Documents accepted issues or pending corrections

Payroll approval should not depend on informal chat messages.

12. Invoice Breakdown

The buyer should receive an invoice breakdown that separates salary from provider fees and pass-through costs.

Invoice Line	Why It Matters
Gross salaries	Shows employee pay total
Employer statutory contributions	Shows employer-side payroll obligations
Employee deductions	Shows amounts withheld from employee pay where relevant
Benefits	Shows HMO or other benefit costs
Allowances	Shows approved additional pay
Reimbursements	Shows one-off employee costs
13th-month accrual or payment	Shows mandatory annual pay cost
EOR service fee	Shows provider fee separate from employee costs
FX or currency adjustment	Shows conversion treatment where applicable

A bundled invoice with no breakdown weakens buyer control.

13. Final Pay and Offboarding Records

A payroll proof pack should include final pay records when employees exit.

Final Pay Item	Why It Matters
Resignation or termination record	Shows exit basis and date
Final salary	Confirms last salary amount
Prorated 13th-month pay	Confirms mandatory pay treatment
Leave balance treatment	Confirms final settlement
Deductions	Shows approved deductions
Equipment or clearance notes	Supports return and clearance
Final payslip	Employee-facing proof
Final pay approval	Buyer-facing approval trail
Access removal confirmation	Reduces system and data risk

Offboarding should be documented as carefully as onboarding.

Monthly Payroll Proof Pack Template

Use this checklist every payroll cycle.

Proof Pack Item	Required?	Received?
Employee master list	Yes
Draft payroll register	Yes
Payroll variance report	Yes
Payroll approval record	Yes
Final payroll register	Yes
Payslip confirmation	Yes
Invoice breakdown	Yes
SSS contribution evidence or summary	Yes
PhilHealth contribution evidence or summary	Yes
Pag-IBIG contribution evidence or summary	Yes
13th-month accrual report	Yes
BIR withholding summary where applicable	Yes
Leave and holiday records where applicable	Recommended
Reimbursements and allowance backup	Recommended
Final pay records for leavers	If applicable
Open payroll issue log	Recommended

Quarterly Payroll Compliance Review Template

Review these items quarterly.

Review Item	Why It Matters
Employee list vs payroll register	Confirms no missing or inactive employees
Salary changes	Confirms approvals and effective dates
Allowances and benefits	Confirms entitlement and cost control
SSS evidence	Confirms contribution handling
PhilHealth evidence	Confirms contribution handling
Pag-IBIG evidence	Confirms contribution handling
13th-month accrual	Confirms year-end liability
Payslip delivery	Confirms employee-facing transparency
Leaver records	Confirms final pay and removal
Payroll corrections	Tracks recurring errors
Payroll approval trail	Confirms buyer control
Statutory updates	Confirms provider is monitoring changes

At 20+ employees, quarterly review should become standard.

What Compliance Proof Should a Philippines EOR Provide?

A Philippines EOR should provide evidence, not only assurances.

Proof Item	Why It Matters
DOLE-aligned employment contract	Shows local employment structure
Signed employee records	Confirms role, salary, start date, and employment terms
Payroll register	Shows salary, deductions, allowances, employer costs, and net pay
Payslips	Shows employee-facing payroll transparency
SSS evidence or summary	Shows social security contribution handling
PhilHealth evidence or summary	Shows health insurance contribution handling
Pag-IBIG evidence or summary	Shows housing fund contribution handling
13th-month pay record	Shows mandatory annual pay is tracked and paid
BIR withholding and year-end process	Shows tax withholding documentation where applicable
Leave and holiday records	Shows local HR administration
Offboarding and final pay records	Shows proper employee exit handling
HR escalation process	Shows how employee issues are handled
Data protection and access process	Shows how company and employee data are protected

For the full checklist, see Philippines EOR Compliance.

Payroll Compliance in the Philippines

Payroll compliance should show what was earned, deducted, contributed, paid, and documented.

Payroll Item	What Should Be Documented
Gross salary	Agreed salary for the pay period
Allowances	Internet, equipment, night shift, transport, or role-specific allowances
Deductions	Statutory and approved deductions
Employee contributions	Employee-side statutory deductions
Employer contributions	Employer-side statutory obligations
Tax withholding	Compensation withholding where applicable
Net pay	Final amount paid to employee
Payslip	Employee-facing payroll record
Payroll register	Employer-facing payroll record
13th-month accrual	Monthly accrual and annual payment treatment
Remittance evidence	SSS, PhilHealth, Pag-IBIG, and tax records or summaries
Approval trail	Review and sign-off before payroll release

A buyer should be able to inspect the payroll register before release and inspect statutory evidence after remittance.

What does it cost to pay a Philippine employee through SOS EOR?

The full cost of paying a remote employee in the Philippines should include salary, statutory employer costs, 13th-month pay accrual, benefits or allowances, and the EOR provider fee.

SOS’s EOR fee is a flat US$190 per employee per month.

Use this planning formula:

Total monthly cost = monthly salary + employer statutory costs + 13th-month accrual + selected benefits / allowances + US$190 SOS EOR fee

Example:

Cost item	Example
Monthly salary	PHP 80,000
13th-month accrual	PHP 6,666.67
Employer statutory costs	Calculate using current SSS, PhilHealth, and Pag-IBIG tables
Benefits / HMO	Depends on selected package
Allowances	Depends on company policy
SOS EOR fee	US$190 per employee/month
Total planning cost	Salary + statutory costs + 13th-month accrual + benefits/allowances + US$190

This is why a payroll proof pack should show both payroll evidence and invoice breakdown. Buyers need to know what is salary, what is statutory, what is benefits-related, what is 13th-month pay, and what is the provider fee.

Red Flags in a Payroll Compliance Proof Pack

Red Flag	Why It Matters
No employment contract sample	Local employment structure is unclear
No employee master record	Payroll setup cannot be audited
No payroll register	Buyer cannot review payroll
No payslip sample	Employee-facing transparency is weak
No SSS evidence or summary	Social security handling cannot be verified
No PhilHealth evidence or summary	Health contribution handling cannot be verified
No Pag-IBIG evidence or summary	Housing fund contribution handling cannot be verified
No 13th-month accrual	Year-end obligation may be underplanned
No approval trail	Payroll release lacks buyer control
No final pay workflow	Employee exits create risk
Bundled invoice only	Salary, statutory costs, and provider fees are hidden
“We handle compliance” with no documents	No proof if questioned

A provider that cannot produce a proof pack should not be treated as audit-ready.

How do I legally terminate an employee in the Philippines?

To legally terminate an employee in the Philippines, the employer must identify the lawful basis for termination, follow the correct due process, prepare written notices and records, compute final pay, and release final pay within the guideline period unless a more favourable policy applies. Final pay should include earned salary, unused benefits where applicable, 13th-month pay balance, and other amounts due.

Termination should be handled as a documented process, not only an HR conversation. The proof pack should show why employment ended, which process was followed, what notices were issued, what was paid, and when final documents were released.

For payroll and compliance proof, keep this checklist:

Termination item	What to document
Reason for termination	Just cause, authorised cause, resignation, redundancy, end of engagement, or other basis
Notice records	Written notices, employee response records, meeting notes, or acknowledgement
Due process	Steps followed before termination or separation
Final salary	Salary earned up to separation date
13th-month balance	Prorated 13th-month pay earned up to separation
Unused leave / benefits	Any amounts due under law, contract, or company policy
Deductions	Approved deductions only, with basis documented
Final pay computation	Clear line-by-line computation
Release date	Date final pay was released
Certificate of Employment	COE handling if requested
Access removal	Email, tools, files, CRM, finance systems, and device access removed
Equipment return	Laptop, monitor, headset, ID, security tokens, or other assets
Final payslip / record	Final payroll record given or retained

DOLE’s Labor Advisory No. 06-20 states that final pay should generally be released within 30 days from separation or termination unless a more favourable company policy, individual agreement, or collective agreement applies.

For EOR employees, the EOR should help coordinate the final payroll computation, payslip, statutory records, 13th-month balance, and final documents. The overseas client should still keep its own internal record of manager approvals, access removal, device return, and business handover.

Why Smart Outsourcing Solution Fits This Use Case

Smart Outsourcing Solution is a strong fit for companies that want payroll compliance visibility for Philippine EOR teams.

SOS can support:

• Philippines payroll compliance proof packs
• DOLE-aligned employment documentation
• employee master records
• payroll registers
• payslips
• SSS, PhilHealth, and Pag-IBIG handling
• 13th-month pay tracking
• remittance evidence or summaries
• payroll approval workflows
• invoice breakdowns
• final pay and offboarding records
• HR and payroll escalation support
• buyer-facing payroll reporting

SOS is strongest when a company wants a Philippines-focused EOR partner with practical payroll visibility, local compliance support, and clear documentation.

When SOS May Not Be the Right Fit

SOS may not be the right fit if:

• you want payroll hidden behind one bundled invoice
• you do not want to review or approve payroll
• you need one global EOR platform across many countries immediately
• you want to outsource the entire business function instead of managing employees directly
• you only need short-term freelancers
• you are ready to run Philippine payroll through your own local entity

A proof-pack approach works best when the buyer values transparency, documentation, and auditability.

FAQs

How do I pay a remote employee in the Philippines legally?

Use your own Philippine entity or an Employer of Record that can legally employ the worker, run local payroll, issue payslips, handle SSS, PhilHealth, Pag-IBIG, BIR withholding where applicable, and track 13th-month pay.

How does 13th-month pay work in the Philippines?

13th-month pay is mandatory annual pay equal to at least 1/12 of an employee’s basic salary earned during the calendar year. It must be paid on or before December 24 and should be tracked monthly in the payroll proof pack.

What are the employer statutory contributions in the Philippines?

Employer statutory contributions generally include SSS, PhilHealth, and Pag-IBIG. For 2026 planning, use SSS 15%, PhilHealth 5%, and Pag-IBIG 2% employee / 2% employer capped at ₱10,000 monthly fund salary, then verify current official tables before publishing.

How do I legally terminate an employee in the Philippines?

Confirm the lawful basis, follow due process, issue required notices, compute final pay, include any 13th-month balance and earned amounts due, remove system access, and keep final payroll records. DOLE’s final-pay guideline generally uses 30 days from separation unless a more favourable policy applies.

What should a payroll compliance proof pack include?

It should include the employment contract, employee master record, payroll register, payslips, SSS, PhilHealth and Pag-IBIG records, BIR withholding treatment, 13th-month accrual, benefits records, payroll approvals, and final-pay records.

What is a Philippines payroll compliance proof pack?

A Philippines payroll compliance proof pack is a structured bundle of employment, payroll, statutory, and approval documents that proves employees were paid correctly, statutory contributions were handled, 13th-month pay was tracked, and payroll can be audited.

What should be included in a payroll compliance proof pack?

A payroll compliance proof pack should include employment contracts, employee master records, payroll registers, payslips, SSS evidence, PhilHealth evidence, Pag-IBIG evidence, 13th-month pay records, BIR withholding process records where applicable, remittance summaries, approval trails, and final pay records for leavers.

Why are payslips important in Philippine payroll compliance?

Payslips give employees a clear record of gross pay, allowances, deductions, tax withholding where applicable, net pay, pay period, and payroll source. They reduce confusion and provide employee-facing payroll transparency.

What is 13th-month pay proof?

13th-month pay proof shows how mandatory annual pay is accrued, calculated, prorated for new hires or leavers, paid, and documented in payroll records and payslips.

What statutory remittance proof should a Philippines EOR provide?

A Philippines EOR should provide SSS, PhilHealth, and Pag-IBIG contribution evidence or summaries that show contribution handling by employee, pay period, employer share, employee share, and remittance status.

How does payroll compliance work in the Philippines?

Payroll compliance should show gross salary, allowances, deductions, employee and employer contributions, tax withholding where applicable, net pay, payslips, payroll registers, statutory evidence, 13th-month accrual and payment, and payroll approval trails.

What statutory benefits do Philippines employees need?

Philippine employees generally require statutory contribution administration for SSS, PhilHealth, and Pag-IBIG, plus 13th-month pay and proper payroll records. Employers may also provide HMO, allowances, bonuses, equipment, training, and enhanced leave depending on the employment package.

Should buyers receive payroll proof every month?

Yes. Buyers should receive a monthly payroll proof pack that includes the final payroll register, payslip confirmation, invoice breakdown, statutory contribution evidence or summaries, 13th-month accrual, and open issue log.

What is the difference between a payroll proof pack and payroll approval process?

A payroll approval process controls payroll before release. A payroll proof pack documents payroll after calculation and payment. Both are needed: approval prevents errors, and proof supports auditability.

Can SOS provide a payroll compliance proof pack?

Yes. SOS can support payroll compliance proof packs for Philippines EOR teams, including employment documentation, payroll registers, payslips, statutory handling, 13th-month tracking, remittance evidence or summaries, approval workflows, invoice breakdowns, and final pay records.

How do I pay a remote employee in the Philippines legally?

To pay a remote employee in the Philippines legally, the worker should be employed through a Philippine legal employer, paid through payroll, issued payslips, covered for applicable SSS, PhilHealth, Pag-IBIG, BIR withholding where applicable, and tracked for 13th-month pay. If your company does not have a Philippine entity, a Philippines EOR can act as the local legal employer.

Can a foreign company pay a Philippine employee directly?

A foreign company can transfer money to a worker, but that does not automatically create a compliant Philippine employment setup. If the person works like an employee, the company should use its own Philippine entity or an Employer of Record to handle local employment, payroll, statutory contributions, and HR administration.

How much is 13th-month pay in the Philippines?

13th-month pay is generally at least 1/12 of the employee’s total basic salary earned within the calendar year. For monthly planning, employers commonly accrue one month of basic salary over 12 months.

Who pays 13th-month pay in the Philippines?

The employer pays 13th-month pay. If the employee is hired through an EOR, the EOR administers the local employment process, but the cost should still be included in the buyer’s full employment cost model.

How much does SOS charge for EOR payroll administration?

SOS’s EOR fee is a flat US$190 per employee per month. This is added on top of salary, statutory employer costs, 13th-month accrual, selected benefits, allowances, and other agreed employment-related costs.

Can I move a Filipino freelancer onto compliant payroll?

Yes. If a Filipino freelancer is working like a long-term employee, the company can transition the worker to local employment through its own Philippine entity or through an Employer of Record. This gives the worker a clearer employment structure and gives the buyer payroll proof, payslips, statutory handling, and 13th-month tracking.

Ask for the Proof Pack Before You Scale

Before approving a Philippines EOR provider, ask for sample proof, not just a compliance promise.

Request:

• employment contract sample
• employee master record format
• draft payroll register
• final payroll register
• payslip sample
• SSS evidence or summary
• PhilHealth evidence or summary
• Pag-IBIG evidence or summary
• 13th-month accrual report
• remittance proof process
• payroll approval trail
• invoice breakdown
• final pay workflow

Read Philippines EOR Compliance
View Payroll Transparency & Approval Process
Speak with a specialist and get a quote

 

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