Probation period
in the Philippines.

SALARY PAYMENT IN Philippine Peso (₱)

CONTRACT LANGUAGES Tagalog / English

PAYROLL TAX 17%

PAYROLL CYCLE Monthly

TIME TO HIRE 12 hours
Get Started

Horizons-owned entity with local country experts in Seoul.

We offer fair, scalable, and transparent pricing on South Korea PEO service. Contact us for a cost breakdown

End service in South Korea with no additional penalties or fees.

Including vision, dental, death & disability, travel, and more.

Hire and pay talents
with Horizons in
180+ countries

Get started

Philippines

Probation period in the Philippines – Overview

In the Philippines, the employee probationary period is a standard practice governed by the Labor Code of the Philippines and other relevant labor laws and regulations. The probationary period allows both the employer and the employee to assess suitability for the position on a trial basis.

Here is an overview of the key aspects of probationary employment in the Philippines.

What is a Probation Period in the Philippines?

Probation periods serve as a trial stage for both employers and employees in the Philippines. During this time, companies assess if new hires meet the necessary skills and qualifications for regular employment.

The Labor Code of the Philippines strictly regulates the duration of probation. Article 281 states that the maximum probationary period is six months, starting from the first day of work. This period can only be extended if a formal apprenticeship agreement exists, specifying a longer duration.

It’s crucial to remember that after successfully completing the probation and remaining employed, the employee automatically becomes a regular staff member with benefits and job security.

Probationary Employment Guide for New Applicants in the Philippines

Employment Contracts and Probation Periods in the Philippines

Employment contracts in the Philippines often include a clause outlining the probationary period, which acts as a trial phase for new hires. This clause should clearly state the duration of the probation, as mentioned earlier, which cannot exceed six months under the Labor Code, unless a formal apprenticeship agreement exists that dictates a longer period.

It’s important to note that the probationary clause doesn’t guarantee job security. Employers have the right to terminate the employment of probationary employees if they fail to meet specific performance standards. However, these standards must be clearly outlined in the contract and communicated to the employee at the time of hiring.

Conversely, successfully completing the probation period typically leads to regular employment status, granting the employee additional rights and benefits.

Legal Rights of Philippine Employees Under Probation

Despite being in a probationary status, these employees are entitled to the same labor standards as regular employees, such as minimum wage, safe working conditions, and statutory benefits, including social security, health insurance, and employee compensation. This means also that they are protected by Minimum Wage Laws (Republic Act No. 602), qualify for legal holidays, leave entitlements, 13th month pay, and have the right to join unions for collective bargaining.

Even during the probationary period, companies cannot arbitrarily dismiss employees. Terminations must be based on “just” or “authorized” causes as outlined by the Labor Code Art. 282 Termination by Employer. Examples of justifiable dismissal include serious misconduct, inefficiency, or failure to meet the standards set during the hiring process.

If terminated without justification, probationary employees have the right to file a complaint with the Department of Labor and Employment (DOLE) for illegal dismissal.

Legal Obligations of Philippine Employers

In the Philippines, employers have specific legal obligations towards probationary employees, designed to ensure fairness and compliance with labor laws and regulations. These obligations include:

1. Provide Clear Employment Terms

Employers must clearly communicate the terms of employment, including the duration of the probationary period (not exceeding six months unless otherwise specified for certain professions), job responsibilities, and performance standards required for regularization.

2. Observe Labor Standards

Similar to their treatment of regular employees, employers are obligated to provide probationary employees with minimum wage, adherence to work hours, overtime pay, holiday pay, and other statutory benefits as mandated by the Department of Labor and Employment (DOLE).

3. Fair Performance Evaluation

Employers are required to conduct a fair and objective evaluation of the probationary employee’s performance based on the standards communicated at the beginning of the employment period. This evaluation must be done before the end of the probationary term to decide on the employee’s regularization or termination.

4. Due Process in Termination

Should the employer decide to terminate the employment of a probationary employee due to failure to meet performance standards or for any authorized cause, they must observe due process. This includes providing written notice stating the grounds for dismissal and giving the employee an opportunity to explain or contest the decision.

Employers are advised to keep documentation of performance evaluations and any correspondence related to termination procedures to ensure compliance with legal requirements and to protect against potential legal disputes.

Benefits of Probation Periods in the Philippines

Probationary periods offer distinct advantages for both employers and employees.

1. Benefits of Probation Period for Employers

Giving new employees a trial period helps employers in several ways:

Employers can utilize the probation period to comprehensively assess the skills, work ethic, and company culture fit of a new hire for long-term success in the role and contributes positively to the team dynamic.
Companies can identify any potential mismatches between the candidate’s qualifications and the actual job demands. This allows them to correct these issues instead of facing the hassle and cost associated with replacing an unsuitable employee later.
The feedback gathered during the probation period serves as valuable input for tailoring training and development programs to address the specific needs and performance gaps of the new hire.

2. Benefits of Probation Periods to Employees

A probationary period works both ways – here’s what’s in it for employees:

The probationary period allows new employees to experience the company culture, work environment, and daily responsibilities firsthand. This provides them with crucial information to assess whether the role aligns with their expectations, career goals, and working style before committing to long-term employment.
Probation offers a structured learning environment where new employees can receive guidance, mentorship, and training from experienced colleagues. Employees acquire the necessary skills and knowledge to perform effectively in their role and set themselves up for success in the company.
A well-defined probationary period provides employees with clear performance expectations and a framework for evaluation. It ensures fairness and transparency in the assessment process, allowing them to understand their strengths and weaknesses and work towards meeting defined goals.

Best Practices for Managing Probationary Employees in the Philippines

For employers in the Philippines, managing probationary employees effectively requires a thoughtful approach. Implementing best practices during this crucial period can foster a productive experience for both parties, leading to successful onboarding and increased employee retention.

Here are some key strategies to consider:

1. Setting Clear Expectations

To optimize the probationary period and ensure it serves its intended purpose of evaluating new hires, employers in the Philippines should begin by setting clear expectations. This crucial step involves providing comprehensive job descriptions, outlining performance standards, and communicating the goals and responsibilities associated with the position.

2. Regular Feedback and Support

Incorporating regular feedback sessions is essential for managing probationary employees effectively. Employers should schedule consistent check-ins to discuss performance, address any concerns, and offer guidance for improvement. This not only fosters a supportive work environment but also significantly enhances the employee’s chances of success.

3. Invest in Training

Investing in thorough training and orientation programs during the probation period is beneficial for both the employee and the employer. Equipping new hires with the necessary knowledge and skills allows for a more accurate assessment of an employee’s fit and performance in their role.

4. Documentation and Record-Keeping

Maintaining detailed documentation of performance and any disciplinary actions taken during the probationary period is crucial. These records assist in making informed decisions regarding the employee’s future with the company and provide legal protection in cases of disputes.

What is the standard probationary period in the Philippines?

The maximum duration of the probationary period is six months from the date of commencement of employment, unless a different period is stipulated in company policy or applicable collective bargaining agreement (CBA). Any extension beyond this period is generally not allowed, except for certain exceptions as may be provided by law or when a longer period is necessary for the learning or training for the position.

What is the legal framework for the probationary period in the Phiippines?

1. Employer Obligations

Employers must clearly communicate the standards and expectations for regularization at the onset of employment. This transparency is crucial for fairness and legal compliance. Failure to meet these communicated standards is a valid reason for termination at the end of the probationary period, but the process must adhere to due process requirements, including proper documentation and communication.

2. Employee Rights

Probationary employees enjoy the same rights and benefits as regular employees, barring tenure protection. This includes receiving the minimum wage, holiday pay, service incentive leave, and other statutory benefits. The key difference lies in the security of tenure post-probationary period. Successful completion leads to regularization, conferring additional job security and benefits.

3. Regularization and Termination

The decision to regularize an employee should be based on objective standards related to performance and conduct. Employers are advised to conduct evaluations well before the six-month mark to facilitate decision-making. If an employee is deemed unsuitable, the employer must observe due process in termination, which includes notice and explanation of the basis for the decision.

Hiring in the Philippines, Made Easy

Your business can easily hire employees in the Philippines without opening a local entity. We handle local employment law, complex tax regulations, and international payroll in 180+ countries worldwide. All you need to do is focus on your business.

FAQs

How much notice do employers need to give before terminating employment during the probation period in the Philippines?

An employer in the Philippines has the right to dismiss an employee during their probationary period without notice.

How much notice do employees need to give before resigning during the probation period in the Philippines?

An employee in the Philippines has the right to terminate the employment contract during their probationary period without notice.

Can an employer extend the probationary period in the Philippines?

The employer can extend the probationary period in the Philippines, but the duration can never exceed 6 months total

Can I dismiss an employee during their probation period in the Philippines?

Yes, during the probationary period, both the employer and the employee have the option to terminate the employment relationship without the need for a just or authorized cause.

Do employees in the Philippines have to give notice during the probation period?

No, during the probationary period, both the employer and the employee have the option to terminate the employment relationship without the need for a just or authorized cause.

Success stories from businesses we’ve helped enter and grow in new markets.

Client Testimonials

"As a seed-stage, London-based startup, we were initially hesitant to expand internationally due to the administrative workload involved. Horizons took the headache out of the process, allowing us to hire a team of software engineers in Germany."

Gabor SzedlakCo-founder & COO at MindLabs (UK)

"I truly appreciated the thoroughness and the professionalism of Horizons personnel while we hired internationally with them. They were knowledgable on all subject matters pertaining to international employment."

Gary PaskyVP Software Development, PICS ITech (USA)

"On deciding to begin commercial activities in Asia Pacific, we needed a provider to handle the employment and remuneration of our workforce. With Horizons the result was fast, efficient, and fit-for-purpose. We recommend Horizons as an EOR provider.”

Chris MorrellManaging Director, Schaeffler Group (Germany)

"The collaboration with the Horizons team is excellent. Both our local employee as well as our HQ in Germany are more than pleased with the support provided and the simplicity of the service. We can highly recommend the Horizons solution to anyone."

Christoph EngelbertCo-Founder & CTO, Clevabit (Germany)

"We needed an EOR that could provide expert support for payroll in APAC. We are pleased with Horizons’ expertise and the fact that they are flexible, responsive, and easily accessible from Belgium. They were able to provide services within the short timeline we required."

Katia FlamandHuman Resources, Devian Chemicals (Belgium)

Probation period in the Philippines.