Employment Contract for Philippines

Employment Contract Template for Philippines

A Philippine Employment Contract is a formal agreement governed by the Labor Code of the Philippines (Presidential Decree No. 442) and related employment legislation. This document establishes the legal relationship between an employer and employee, outlining essential terms and conditions of employment including compensation, benefits, duties, working hours, and other rights and obligations of both parties. The contract must comply with minimum labor standards set by Philippine law, including mandatory benefits such as 13th month pay, SSS, PhilHealth, and Pag-IBIG contributions, while also addressing specific industry requirements and company policies.

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What is a Employment Contract?

The Employment Contract serves as the primary document establishing and governing the employer-employee relationship in the Philippines. It is used when hiring new employees, converting temporary workers to permanent status, or updating employment terms. The contract must align with the Labor Code of the Philippines and related employment laws, incorporating mandatory provisions for worker protection while allowing flexibility for industry-specific requirements. This document typically includes comprehensive details about job responsibilities, compensation, benefits, working conditions, and termination procedures, ensuring both parties understand their rights and obligations. It's essential for maintaining clear employment records, preventing disputes, and demonstrating compliance with Philippine labor regulations.

What sections should be included in a Employment Contract?

1. Parties: Identification of the employer and employee with complete details as required by Philippine law

2. Background: Brief context of the employment relationship and purpose of the agreement

3. Definitions: Key terms used throughout the contract

4. Position and Duties: Job title, role description, and primary responsibilities

5. Commencement and Term: Start date and duration of employment (whether fixed-term or indefinite)

6. Probationary Period: Duration and terms of the probationary period, if applicable (maximum 6 months under Philippine law)

7. Work Location and Hours: Primary workplace and standard working hours

8. Compensation and Benefits: Salary, mandatory benefits (13th month pay, SSS, PhilHealth, Pag-IBIG), and other benefits

9. Leave Entitlements: Vacation, sick leave, and other statutory leave entitlements

10. Confidentiality: Protection of company confidential information and trade secrets

11. Intellectual Property: Ownership of work products and innovations created during employment

12. Performance Standards: Expected performance levels and evaluation processes

13. Termination: Grounds and procedures for contract termination, notice periods, and final settlements

14. Post-Employment Obligations: Non-compete, non-solicitation, and other post-employment restrictions

15. Governing Law: Specification of Philippine law as governing law and jurisdiction

What sections are optional to include in a Employment Contract?

1. Relocation: Terms for temporary or permanent relocation, used when the role may require geographic mobility

2. Commission Structure: Detailed commission calculations and terms, used for sales or commission-based roles

3. Overseas Work: Special terms for overseas assignments or travel, used for positions requiring international work

4. Vehicle Allowance: Terms of company vehicle or transport allowance, used when position requires regular travel

5. Remote Work: Policies and procedures for remote work arrangements, used for flexible or remote positions

6. Training Requirements: Mandatory training programs and professional development requirements, used for specialized roles

7. Bond Agreement: Terms of employment bond, used when company provides significant training or education

8. Housing Benefits: Terms of housing benefits or allowances, used for relocating employees or specific positions

What schedules should be included in a Employment Contract?

1. Schedule A - Job Description: Detailed description of role, responsibilities, and reporting relationships

2. Schedule B - Compensation Details: Detailed breakdown of salary components, allowances, and benefits

3. Schedule C - Company Policies: Key company policies that form part of the employment terms

4. Schedule D - Performance Metrics: Specific KPIs and performance evaluation criteria

5. Schedule E - Benefits Summary: Detailed description of all benefits and eligibility criteria

6. Appendix 1 - Code of Conduct: Company's code of conduct and ethical standards

7. Appendix 2 - Confidentiality Agreement: Detailed confidentiality terms and protected information

8. Appendix 3 - IT Policy: Rules for use of company IT systems and data protection requirements

Authors

Alex Denne

Head of Growth (Open Source Law) @ Genie AI | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents | Serial Founder & Legal AI Author

Jurisdiction

Philippines

Publisher

Genie AI

Cost

Free to use
Relevant legal definitions
Clauses
Relevant Industries

Technology

Manufacturing

Financial Services

Retail

Healthcare

Education

Construction

Business Process Outsourcing

Telecommunications

Hospitality

Agriculture

Mining

Transportation

Energy

Real Estate

Professional Services

Media and Entertainment

Food and Beverage

Relevant Teams

Human Resources

Legal

Finance

Operations

Information Technology

Sales

Marketing

Customer Service

Research and Development

Production

Quality Assurance

Business Development

Administration

Compliance

Security

Relevant Roles

Chief Executive Officer

Department Manager

Software Engineer

Administrative Assistant

Sales Representative

Human Resources Officer

Financial Analyst

Operations Manager

Marketing Coordinator

Customer Service Representative

Project Manager

Research Analyst

Production Supervisor

Quality Control Inspector

Business Development Executive

Technical Support Specialist

Account Manager

Legal Counsel

Data Scientist

Maintenance Technician

Industries
Labor Code of the Philippines (Presidential Decree No. 442): The primary legislation governing employment relationships in the Philippines, covering fundamental aspects of labor standards, employment conditions, and worker rights
Republic Act No. 8282 (Social Security Law): Mandates social security coverage and benefits for employees in the private sector
Republic Act No. 7875 (National Health Insurance Act): Requires PhilHealth coverage for employees, providing health insurance benefits
Republic Act No. 11223 (Universal Health Care Act): Extends and enhances healthcare coverage requirements for employees
Republic Act No. 9679 (Home Development Mutual Fund Law): Requires Pag-IBIG Fund membership for employees, covering housing and short-term loans
Republic Act No. 8187 (Paternity Leave Act): Provides paternity leave benefits for married male employees
Republic Act No. 11210 (Expanded Maternity Leave Law): Provides extended maternity leave benefits for female employees
Republic Act No. 6971 (Productivity Incentives Act): Encourages implementation of productivity incentives programs
Republic Act No. 10361 (Domestic Workers Act): Specifically governs domestic employment relationships if applicable
Republic Act No. 11058 (Occupational Safety and Health Standards): Sets requirements for workplace safety and health standards
Republic Act No. 10173 (Data Privacy Act): Governs the collection and processing of employee personal information
Republic Act No. 7877 (Anti-Sexual Harassment Act): Addresses sexual harassment in the workplace and requires preventive measures
Teams

Employer, Employee, Start Date, Job Title, Department, Location, Probationary Period, Notice Period, Salary, Overtime, Vacation Pay, Statutory Holidays, Benefits, Bonus, Expenses, Working Hours, Rest Breaks,  Leaves of Absence, Confidentiality, Intellectual Property, Non-Solicitation, Non-Competition, Code of Conduct, Termination,  Severance Pay, Governing Law, Entire Agreemen

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