PHILIPPINES: An Introduction to Employment

A Strengthened Workforce, Digital Nomad Visas, and the Social Security System

In 2025, the landscape of Philippine employment law has seen a focus on worker protections and stricter employer guidelines.

Strengthened workforce development through the Enterprise-Based Education and Training Framework Act

In light of the state’s constitutional policy to “promote full employment and equality of employment opportunities for all”, this Act was passed to expand enterprise-based education and training (EBET) opportunities, foster greater industry involvement in curriculum development and theoretical instruction, and strengthen on-the-job training and apprenticeship programmes to ensure alignment with industry needs and workforce demands.

The law, in acknowledging that gaining valuable training and experience should not come at the expense of a trainee’s basic needs, ensures that trainees receive an allowance sufficient to cover essential expenses like transportation and meals. In addition, to safeguard the wellbeing of minors, their training hours are strictly capped at 40 hours per week, with no overtime work allowed, striking a balance between skill-building and protection of minors. As for trainees under apprenticeship programmes, they are entitled to receive a training allowance of at least 75% of the minimum wage rate and an additional 24% of the hourly rate for programmes that require additional training hours in excess of the regular eight hours.

Enhanced workplace safety under the Revised Implementing Rules and Regulations of the Occupational Safety and Health Standards Act

The issuance by the Department of Labor and Employment (DOLE) of DO No 252-25, or the Revised Implementing Rules and Regulations of the Occupational Safety and Health Standards (OSH) Law, marks a major step forward in strengthening occupational safety and health in the workplace. From its expanded definitions and broader coverage to the clearer duties of employers and reinforced rights of employees – including the right to know, to report, and to refuse unsafe work – these updates are designed to eliminate ambiguity, improve compliance, and ultimately protect lives. They not only recognise the evolving nature of work and risk but also place a strong emphasis on transparency, accountability, and shared responsibility. With these changes, we move closer to creating a work culture where safety is not an afterthought but a core value.

Streamlined alien employment permit requirements: advancing economic development while safeguarding Filipino workers

DOLE’s DO No 248-25, or the Revised Alien Employment Permit (AEP) Rules, streamline the application process by requiring only one publication in a newspaper, while adding mandatory posting on PhilJobNet and at Public Employment Service Offices (PESOs) or Job Placement Offices (JPOs). This shift not only reduces the administrative burden and cost but also leverages digital and community-based platforms to increase visibility of job opportunities for Filipino workers, making the labour market test more transparent, accessible and effective in prioritising local employment.

Moreover, it implements a clear Economic Needs Test (ENT), requiring employers to justify the need to hire foreign workers by assessing whether qualified Filipino workers are unavailable for the position. The ENT ensures that the hiring of foreign nationals is aligned with actual labour market demands, prioritising Filipino employment while allowing foreign expertise only when truly necessary.

Furthermore, the Revised AEP Rules make skills transfer a formal and integral part of the AEP process. Employers of foreign nationals are now required to implement an Understudy Training Programme (UTP) or a Skills Development Programme (SDP) to train Filipino workers in the roles or skills performed by the foreign employee.

This shift not only ensures knowledge and technology transfer, but also aligns with the broader goal of strengthening the local workforce, so that over time, Filipinos can fully assume roles currently filled by foreign nationals.

The revised AEP rules strike a crucial balance between attracting foreign talent and protecting Filipino jobs by simplifying processes while ensuring Filipinos benefit from the arrangement.

Alignment with the global trend of digital nomad visas promoting tourism and economic development

Under Executive Order No 86, the Department of Foreign Affairs (DFA) is now authorised to issue Digital Nomad Visas (DNVs) to non-immigrant foreigners who wish to enter and stay temporarily in the Philippines to work remotely for clients or employers based outside the country. This initiative not only attracts foreign remote workers but also stimulates the local economy and fosters knowledge exchange.

DNVs allow foreign remote workers to stay in the Philippines for up to one year, with the option to renew for the same period and enjoy multiple entry privileges. This flexibility encourages longer stays, boosting local spending and creating more opportunities for local businesses and the broader economy.

Increase in Social Security System (SSS) contribution rates as the final tranche under RA No 11199

Effective 1 January 2025, the SSS has revised its contribution rate and monthly salary credits. The contribution rate has been raised from 14% to 15%, while the range for monthly salary credits has been adjusted to between PHP5,000 and PHP35,000. These updates are intended to improve member benefit provisions and ensure the long-term sustainability of the SSS fund.

Key developments in case law

In Aragones v Alltech Biotechnology Corporation, GR No 251736, 2025, an employment contract is perfected when there is a meeting of minds on a definite offer by the employer and an unequivocal acceptance by the prospective employee, supported by a lawful object (the services to be rendered) and a lawful cause (the employer’s promise of compensation).

The contract becomes binding the moment the offeree’s acceptance is communicated to the offeror, even if the parties agree that performance will commence at a later date. A deferred start date thus imposes only a suspensive period on the enforceability of the parties’ obligations and it does not suspend the contract’s existence. Moreover, should an employer attempt to treat that date as a condition precedent, any unilateral withdrawal after acceptance is void and deemed constructive fulfilment of the condition.

These recent key legal updates in Philippine labour laws reflect a clear commitment to adapting to the changing world that affects employment – whether it is strengthening employee protections, embracing new work arrangements like remote and freelance work, or improving compliance and enforcement mechanisms.

Together, these developments not only safeguard workers’ rights and welfare but also promote a more flexible, inclusive, and dynamic labour market that can drive economic growth. Staying informed and compliant with these evolving laws is essential for both employers and employees to foster a fair, safe and productive workplace in today’s rapidly shifting labour landscape.