A Practical Guide to Hiring Foreign Workers in the Philippines

June 26, 2026

Foreigners can work in the Philippines, but only if they meet strict visa, permit, and labor market rules. For companies that want to hire foreign nationals, the core requirement is the Alien Employment Permit (AEP), issued by the Department of Labor and Employment (DOLE), together with a valid work visa. Understanding hiring foreign workers rules is essential because the process affects talent strategy, compliance, and long-term workforce planning.

DOLE has recently updated the rules through Department Order No. 248, which introduces labor market testing, economic needs testing, and training obligations for employers seeking to hire foreign nationals. This means hiring foreign workers is no longer just about securing a permit; it is also about demonstrating that local talent is being prioritized, that the company has a genuine need for foreign expertise, and that skills transfer to Filipino workers is planned.

What an Alien Employment Permit Is and When It Is Needed

The Alien Employment Permit (AEP) is the official work authorization for foreign nationals who are not exempt. It is required for:

Any foreigner seeking admission to the Philippines for employment purposes.
Any domestic or foreign employer who desires to engage a foreigner for employment in the Philippines.

The AEP may be issued only after a determination that no person in the Philippines is competent, able, and willing to perform the services for which the foreigner is desired. That is the “local first” test, and it is central to Philippine labor policy on foreign employment.

All foreign nationals on working visas, including those already in the Philippines under on-working visas, must have an AEP. Without it, they are considered to be working without legal authorization and may face fines, imprisonment, or deportation. Some exemptions apply to diplomatic services, foreign government officials accredited with the Philippine government, missionaries engaged only in missionary work, and certain international organizations such as the Asian Development Bank and UN agencies, but most private-sector foreign employees must secure an AEP.

Visa Requirements and Work Authorization

The AEP is part of a broader work authorization system that also requires a valid work visa. In addition to the AEP, existing rules require foreigners to obtain a work visa. Pending issuance of the AEP, or if the AEP is issued but the work visa application is still awaiting approval, a Provisional Permit to Work may be obtained to allow the foreigner to engage in work pursuant to an employment arrangement.

The work visa is typically obtained through the Bureau of Immigration and the appropriate Philippine embassy or consulate, depending on where the foreigner first applies. The AEP confirms that the employer has a legitimate need for foreign labor and that the local labor market test has been satisfied; the work visa then confirms that the foreigner is authorized to enter and remain in the country for employment purposes.

New Compliance Rules Under Department Order No. 248-25

DOLE’s Department Order No. 248-25 introduces new compliance requirements for employers hiring foreign nationals. These updates include:

Labor Market Test (LMT): Employers must now post job openings on at least three public platforms, including PhilJobNet, before hiring foreign nationals, and this applies to both new and renewal AEP applications.
Economic Needs Test (ENT): The ENT applies to companies receiving government incentives, operating in strategic investment sectors, or public utilities. DOLE will conduct market impact assessments prior to approving employment permits.
Understudy Training Program (UTP): Certain employers must implement training plans for Filipino workers to gradually assume the roles occupied by foreign nationals. This is intended to support skills transfer and long-term workforce development.

These changes reflect a policy shift toward prioritizing Filipino talent and ensuring that foreign labor is used only when necessary. For employers, this means hiring foreign workers requires more documentation and a more deliberate approach to recruitment and training.

Who Can Be a Foreign Employee and What Jobs Are Allowed

Under current rules, a foreign employee must be someone who is not a Filipino citizen and who is authorized to work in the Philippines through an AEP and work visa. The position must be one that cannot be filled by a competent, able, and willing Filipino, as determined by DOLE.

There is no blanket prohibition on foreign employment, but the labor market test and ENT ensure that foreign workers are used only for specific needs, such as:

Highly technical or specialized roles.
Executive or management positions where foreign expertise is required.
Roles that support the company’s strategic or investment plans where local talent is not readily available.

Missionaries or religious workers who intend to engage in gainful employment are not exempt from securing an AEP, even if they are engaged in religious activities.

Employer Obligations and Local Presence

Foreign employers must establish a local presence or work with a local entity in order to hire an employee. While there is no express prohibition under the Labor Code for foreign employers without a presence here to directly employ workers in the Philippines, there are certain obligations imposed by different laws that cannot be complied with by a foreign employer without a registered office in the country.

These specific obligations include, among others, compliance with mandatory contribution requirements of the Social Security System, Philippine Health Insurance Corporation (PhilHealth), and Home Development Mutual Fund (Pag-IBIG), as well as the withholding and remittance of taxes on compensation. More importantly, the Secretary of Labor and Employment has visitorial and enforcement powers over the premises of the employer at any time of the day or night to determine any violation of the Labor Code.

Such power presupposes the existence of a local establishment that is not only within but also subject to Philippine jurisdiction. Foreign employers may directly enter into agreements with independent contractors in the Philippines, but such agreements are not governed by the restrictions, prohibitions, and minimum standards of the Labor Code, as no employer-employee relationship exists.

Practical Steps for Hiring Foreign Workers

The process for hiring foreign workers has several key steps:

Determine if the position is eligible for foreign employment by confirming that no qualified Filipino is available.
Post job openings on at least three public platforms, including PhilJobNet, to satisfy the Labor Market Test.
Apply for an AEP through the nearest Regional Office of DOLE, with the employer applying on behalf of the foreign national.
Obtain a work visa for the foreign national, which may involve coordination with the Bureau of Immigration and the Philippine Embassy or Consulate.
Secure a Provisional Permit to Work if the foreigner is waiting for the AEP or work visa to be issued.
Register the foreign employee with SSS, PhilHealth, and Pag-IBIG, and withhold and remit taxes on compensation.

For companies that are receiving government incentives, operating in strategic investment sectors, or public utilities, the Economic Needs Test may also apply, and DOLE will conduct market impact assessments prior to approving employment permits.

Final Insights

Hiring foreign workers in the Philippines is a controlled process that balances the need for foreign expertise with the protection of local labor. The core requirement is the Alien Employment Permit, together with a valid work visa, and the recent Department Order No. 248-25 has added new layers of compliance, including labor market testing, economic needs testing, and training obligations. For companies that want to access foreign talent, the key is to plan early, document the need carefully, and follow DOLE’s requirements.

Is Assistance Available?

Yes. Triple i Consulting is available to help you navigate the process of hiring foreign workers in the Philippines, from eligibility assessment to AEP and work visa application, and ongoing compliance with DOLE, SSS, PhilHealth, Pag-IBIG, and tax obligations. We provide end-to-end support for foreign employment, ensuring that your business remains compliant while accessing the talent it needs. Contact us today to schedule an initial consultation with one of our employment and immigration specialists: