Philippines
[Updated 4/11/24] Typical employee benefits in the Philippines include health insurance, retirement plans, paid time off (vacation, sick leaves, holidays), employee wellness programs, life insurance, employee assistance programs, flexible work arrangements, education and training opportunities, employee discounts, and perks, and maternity and paternity leave. Employers commonly provide these benefits to support their employees’ well-being, financial security, work-life balance, and professional growth. It’s important to note that the specific benefits offered may vary between companies and industries.
Country Insight
Market and Benchmark Insight Report for the Philippines – 2024
Mandatory Benefits
There are several mandatory employee benefits in the Philippines that employers are required to provide to their employees. These benefits include the following:
- Social Security System (SSS): This program provides social security protection to private sector employees, self-employed individuals, and voluntary members. It covers retirement, disability, sickness, maternity, and death benefits.
- PhilHealth: The Philippine Health Insurance Corporation (PhilHealth) is a national health insurance program providing members with medical coverage and benefits. Employers and employees contribute a portion of their salaries towards PhilHealth.
- Pag-IBIG Fund: The Home Development Mutual Fund, also known as Pag-IBIG Fund, is a government-mandated savings program that helps Filipino workers secure housing and provides short-term loans. Both employers and employees contribute to this fund.
- Employees’ Compensation Program (ECP): The ECP provides benefits and compensation to employees who suffer work-related injuries, disabilities, or death.
- 13th Month Pay: This is a mandatory benefit wherein employees receive an additional month’s salary, equivalent to 1/12 of their basic salary. It is typically paid in December.
- Service Incentive Leave: Under the Labor Code of the Philippines, employees who have rendered at least one year of service are entitled to a minimum of five days of paid service incentive leave per year.
- Holiday Pay: Employees are entitled to additional pay when they work on regular or special non-working holidays as designated by law.
- Maternity Leave: Female employees are entitled to a minimum of 105 days of paid maternity leave for childbirth, with an option to extend for an additional 30 days without pay.
- Paternity Leave: Male employees are entitled to seven days of paid paternity leave for the birth of their child.
- Retirement Benefit – Under RA 7641, retirement is a mandatory benefit set with a retirement age of 60 and 65 years old and employed for five (5) years. A retiring employee shall be entitled to retirement pay equivalent to at least one-half (1/2) month’s salary for every year of service, a fraction of at least six (6) months being considered one whole year.
Supplementary Benefits
Other Supplementary Benefits in the Philippines provided by the employers, the following:
- Group Life & Group Personal Accident Programs – from a minimum of 24 times to 48 times monthly basic salary and/or based on lumpsum amount.
- Total & Permanent Disability Benefits – Total and Permanent disability benefits are equivalent to GLI and GPA benefits. It can be provided on lumpsum payment once the insured member is permanently disabled and cannot perform his work.
- Critical Illness – Critical Illness cover is a rider attached to Group Life Policy. However, most life and non-life insurance providers are now covering a stand-alone policy to cover such numbers of critical illnesses.
- Group Medical – Employer Contribution & Co-Sharing, one hundred percent (100%) of the related company respondents fully subsidize the employees’ medical coverage premium.
- Maternity Benefits –This is usually not a typical benefit provided in the general market. Although, some of the multinational companies and local employers are covering maternity benefits.
- Dental – Dental benefit is common and part of the medical rider benefits.
- Vision – Optical is not a typical benefit provided in the market. Some companies may provide this through self-administered programs with a corresponding benefit per employee.
- Business travel insurance – Employers normally purchase group travel insurance for those employees traveling on business on their behalf.
Flexible employee benefit arrangements
Flexible benefits, also known as cafeteria-style benefits or flexible spending accounts, are not yet widespread in organizations in the Philippines. While some companies may offer flexible benefits, they are still relatively less common than traditional benefits packages. On the other hand, additional benefits provided through flexible benefit programs may be subject to tax.
Common Perks
Varying percentages of multinational companies may offer the following perks to senior executives, middle managers, and clerical and administrative employees.
Family-related allowances
- Subsidized lunches/canteen
- Luncheon vouchers
- Club memberships
- Professional organization membership (for senior executives only)
- Low-cost loans
- Educational assistance
- Relocation and a rice allowance (around 10 sacks each year)
- Mobile phones (for senior executives and middle managers only)
- Clothing/uniforms (for clerical and administrative staff only)
Howden Philippines provided this information about employee benefits in the Philippines. If you need support with your benefits program in the country, contact Asinta, and we will put you in touch with Howden.