How to Deal with the Labour Crunch in Singapore

Posted on July 13, 2015 by Pragya Gupta

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As you know, the F&B sector in Singapore has been facing a labour crunch for years now. Currently, for every foreign worker, the F&B sector needs to hire 6 local workers which is an impossible ratio for companies to handle. To attract more local workers, restaurants have had to raise costs without any increase in quality of service. Restaurants that were unable to do this resorted to leaving tables empty.

The Restaurant Association of Singapore proposed some solutions, including relaxing the foreign workers’ levy. While this measure is up to the government’s discretion, there are ways that restaurants can cope with the labour crunch.

Increasing Productivity through Technology

There are many front-end and back-end processes that can be streamlined by automating. In terms of adopting new technology, the restaurant industry has traditionally lagged behind the rest. However, the need to automate is clearer now than ever before. There are many examples in Singapore where restaurants have installed POS systems, set up digital menus or moved the practice of making reservations online.

Sakae Sushi in Singapore is a great example of automated processes. They have a conveyor belt that serves sushi. The belt is an island that is surrounded by tables so that customers can pick whichever dish they like. The restaurant also has iPads on every table to allow customers to order using the menu on the iPad.

McDonald’s Singapore is just catching up to the reality of increasing costs. Four out of approximately 120 outlets in Singapore have kiosks from which customers can order. 20% of their customers use kiosks. The systems reduce manpower required to take orders. It also makes the ordering process fool-proof, thereby saving time and money by preventing errors due to miscommunication between the customer and employee. In addition to reducing errors, McDonald’s employees can focus on back-end tasks and speed up service.

Balancing out costs: The result of automating is that there are shorter queues and more customers walking in through the door. The self ordering payment systems that Ananda Bhavan, a restaurant chain in Singapore uses, cost around $40,000. But in the long run, the investment pays off because of more orders and higher revenue.

To see a more tangible improvement in processes, Aptsys – a self-ordering POS system – released statistics on their website on how their product benefits restaurants. By their estimates, ordering speed increased by 70%, repeat orders increased by 30% and human errors decreased by 80%.

Tax credits: The government of Singapore has come up with incentives for companies to adopt newer technology. This includes training the staff with the new technology as well. The Productivity and Innovation Credit Scheme gives companies a 400% tax deductions or 60% cash payout as long as the improvements in technology come under the six qualifying activities.

Singaporean restaurants are increasingly seeing a fall in revenue because of empty tables and increasing labour costs. The only way for the industry to cope with falling margins is to adopt technology that can reduce manpower. We have previously suggested ways to upgrade and adopt new technology in areas of reservations, POS systems and food delivery. Over the next few years, it remains to be seen whether foreign worker quotas will be relaxed in order to release the pressure that these industries are under. Currently, the way to move forward is by using the tax credits that the government is offering to upgrade restaurant technology.

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How do I open a restaurant in Singapore? Presenting the PayrollHero Knowledge Kit!

Posted on July 3, 2015 by Pragya Gupta

The PayrollHero blog aims to be the knowledge repository for any restaurant owner or retailer in Southeast Asia. We have built our database with things you need to know while doing business in Singapore.

With that in mind, we have been working on a little project. Presenting the PayrollHero Knowledge Kit!

Download now… Free!
This starter kit was put together to give you high level information about Singapore, share some thoughts from restaurant owners, and present relevant statistics from our market research.

The information here includes research that will help you open a restaurant in Singapore or expand into the country.

We talk about what CPF contributions are with information about the different Ethnic Funds that require contributions.The pages are linked to relevant tax forms and websites that offer more detailed information if you want it.
There is an industry overview and analysis on the latest consumption trends in the country. We give you a salary table to refer to for your Human Resources (HR) team in Singapore.
We also give you practical write-ups on how to get an import license, food hygiene requirements and the best internet service provider for your restaurants.

But we don’t want to give you simple hard facts that you could just Google anyway. The Knowledge Kit has a wealth of information in the form of personal stories and experiences in these countries. We interviewed the president of SaladStop!, Mr. Adrien Desbaillets. He gave advice on how he chooses locations in Singapore among other practical nuggets of information. We see it as a way to help the community because there is no better way to learn than from people who have gone through the same roadblocks as your are facing right now.

We hope this information is useful to you. We would love to hear back from you with what you think about the Knowledge Kit, how we can make things better and how you use this Kit for your own research into the restaurant industry.

Lastly, we are releasing more of these for the retail industry. Watch out for more information about these industries and countries. We have also created a Knowledge Kit for the Philippines.

So go ahead and click on the image above to access the Knowledge Kit. Let us know what you think. And good luck with your new business!

Continue reading →

Food Hygiene Regulations in Singapore

Posted on June 23, 2015 by Pragya Gupta

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In Singapore, food hygiene is monitored by the National Environment Agency (NEA). All food retail businesses must be registered to the NEA and regulated by the organization to prove that any food sold or produced by the food retail businesses is safe for consumption (retail businesses include restaurants, cafes, and more but excludes hawker centres).

Grading System

The NEA grades food service establishments based on personal and food hygiene and housekeeping of the premises. The grade must be displayed somewhere within the premises where it can be visible to the public. This is a method for the NEA to encourage establishments to improve their grade by adopting better practices. The assessment of the premises by the NEA results in the following grades:

A – a score of 85% or higher
B – a score of 70% to 84%
C – a score of 50% to 69%
D – a score of 40% to 49%

In order to help food service establishments to improve their cleanliness, the NEA has published the Food Handler’s Handbook and other practices and guiding materials.

Points Demerit System (PDS)

The PDS system is used in order to establish precedence for revoking licenses. Offences are categorized as minor, major and serious. Offences lead to demerit points. If an establishment collects 12 demerit points within 12 months, the establishment can be suspended for 2 to 4 weeks or its license can be revoked based on previous records. However this is a general guideline. The punishment differs for the type of establishment. For example, coffeeshops, food courts and canteens that accumulate 12 points over 12 months will be suspended for three days. Here is a detailed list of offences and the demerit points that they cost.

Food Handlers

The term food handlers refers to any person who is directly involved with food preparation: like the chefs, sous chefs, kitchen assistants, staff that handles beverages. Food handlers need to be registered by the NEA. As the owner of the establishment, you need to register all food handlers by filling up this form and submitting it to the nearest Regional Office. To find your nearest Regional Office, you must call 1800-2255 632 (1800-CALL NEA). In order to qualify as a food handler, a basic food hygiene course must be completed. The Food & Beverage Workforce Skills Qualification (WSQ) takes 6 hours of course work and 1.5 hours of assessment. Upon completion of assessment, the food handles will be given a Statement of Attainment. There are 2 subsequent refresher training sessions after 5 years and 10 years. The details on refresher training are on this page.

Food Safety Management System (FSMS)

The FSMS is used to ensure that manufacture, distribution and storage of food is safe for consumption. Every food service establishment must have an FSMS plan. The components of the plan are the following:

1. FSMS Plan

a. Flow diagram: with Critical Control Points identified

b. Hazard Analysis Critical Control Points: charts for Critical Control Points (CCPs)

2. “WSQ Apply Food Safety Management System for Food Service Establishments” Certificate (Statement of Attainment)

For more information on the FSMS and the requirements for your FSMS plan, click here. The link also gives information on different rules for new caterers and caterers that need to renew their license.

Finally, the NEA along with Spring Singapore has created a Singapore Standard for food service establishments so that they can make their FSMS plans by referring to the guideline. The guideline is $42 and can be purchased here. The process of creating the FSMS plan involves a workshop which includes 14 hours of course work and 5 hours of assessment.

That sums up the brief introduction to food hygiene regulations in Singapore. Hope that helps!

Executive Interview: Mike O’Hagan of Mike’s Manila Tours

Posted on June 21, 2015 by Stephen Jagger

As part of a new series on this blog we will be profiling executives that are working to help entrepreneurs and business owners expand into new markets.

Mike O'Hagan We spoke with David Elefant a while back about doing business in the Philippines, today is Mike O’Hagan who conducts tours of Philippine BPOs to Australians who are interested in setting up their operations in the Philippines.

1. Can you tell me more about your business (tours)?
Every 2-3 weeks, I bring 6 Western business owners to the Philippines where I teach and show them “how to offshore”, all the alternatives with the do’s and don’ts. They range from pre-start-ups, micro, small, medium, large and even listed companies.

There are seven different offshoring solutions – I teach all seven. We cover back office process, specialised services and manufacturing.

I also give them a massive dose of entrepreneurship.

The business is called MikesManilaTours and was started 3 years ago. I started after I made many mistakes when establishing a couple of offshored teams here and after observing many others making the same mistakes.

My role is to educate – as opposed to showing them their prefect solution. That is why unlike other offshoring tours where commissions are involved, my tours are unbiased and are designed to equip business owners with enough information about the good and bad sides of offshoring in order for them to make a wise decision for their business.

2. Why do you like the Philippines so much?
Offshoring is a worldwide trend. The mantra is make it in the east, sell it in the west. I’ve been involved in Vietnam, India, Pakistan, Russia and Ireland. They have their points but none match the Philippines for friendly, helpful well educated people. The Philippines government is backing the industry and making in easy to operate. The country is stable and easy to access.

3. Why is the Philippines a good market for Australian companies to outsource to?
Worldwide, the Philippines stands out due to over 100 years of education in English with Christian core values combined with 3rd world wages and massive numbers of workers. When aligned with the internet/cloud computing and allowed any sized western business to access these educated workers, the Philippines is a unique and very attractive opportunity.

The same time zone as Western Australia means we generally employ between 6am and 3pm when the biggest player, USA, who employ 75% of the 1 million plus workers engaged in offshoring, employ from 10pm until 4am. This means that Australian businesses don’t need to deal with night differential wage adjustments for their off shored workers.

The workplace culture of Australians also suit the Filipino work ethics.

4. What is the biggest benefit to the Philippines?
It’s the new export. Money coming into the economy, directly into the households – whilst only giving their time and education in return. For years, the Philippines has been struggling with the supply of jobs. Australian businesses offshoring to the Philippines help the country elevate the unemployment problem by providing job opportunities for Filipinos.

I also feel there’s something in – how can we alleviate poverty? Employ them!

5. What is the biggest challenge for Australian companies setting up in the Philippines?
Misinformation. A lot of Australian companies set up in the Philippines without fully understanding what they’re getting themselves into. They fail to understand the different ways they can engage services / solutions, fail to comprehend the education levels and skill gaps in Filipino manpower, and they fail to allot time to understand the culture differences.

MikesManilaTours is structured to overcome these issues.

6. What resources do you consume (and suggest people consume) for learning about HR in the Philippines? (newsletters, blogs? magazines?)
I learn from other business owners. I do this in closed confidential type groups where we share all. My favorite is EO – Entrepreneurs Organisation. I’m very careful with blogs. I place more trust in the personal trustee Filipino staff than most of what’s written online.

7. What area of the Philippines do you suggest people setup their BPO in and why? (Fort, Makati, Pasig, etc)
Manila is typical of capital cities (worldwide) in a way that it attracts the smarter graduates who come for the better opportunities with higher wages. They then discover transport and higher costs dilute the dream. Today, large Aussie businesses are also poaching staff in NCR.

If you need people with high level skills – then Manila is the best choice for you. If your needs are common skills then the provinces are far better. Lower wages, more loyalty with the staff.

8. How many tours do you do a year?
I have 6 other businesses in 4 countries so I run the tours when I’m available. Numbers may be a better way to measure this – to date we have brought over 320 people up. Many have multiple business interests – no idea how many. We estimate we have created about 5000 jobs.

9. How many of your attendees actually end up setting up in the Philippines?
My numbers are a little warped by “Accountants”. Of the 320 about 100 were accountants who notoriously are not very entrepreneurial. About 25% of the accountants do something in the Philippines. Of the remaining 220 people, about 83% take action after the tour. Usually they move some of their processes, then discover they can create more value by developing and adding new processes to their business – some engage specialised services – a few create entirely new businesses from the opportunities that they have realised when they went on tour.

10. What is the most important thing to keep in mind when deciding to do business in the Philippines?
Trust. You must know who to trust. There are many “advisors” who are biased with their advice due to commissions and directed agencies. Every week, I’m finding Aussies in trouble because they received the wrong advice – they didn’t fully understand all the alternatives.

11. any other thoughts? tips? feedback?
Learn before you do. Nothing beats coming to the Philippines and seeing for yourself how it all works – where the big gains can be made.
Continue reading →

Get Your New Employee Off To A Good Start

Posted on June 14, 2015 by

In our recent blog posts on millennials, we’ve talked about how to get the right young star talents into your company and how to stop them from leaving once you’ve got them working for you.

PayrollHero Team is expanding, and as we speak a new batch of interns are flying in to come work with us here at our Singapore office. And it just had me thinking- it is so important to have these young rock stars feel welcome into our working culture. Why? I can understand first hand how daunting it can be for a 20 something year old to travel thousands of miles be apart of something you don’t have a first clue about and figuring all of that out in a new country.

What most employers think when onboarding new employees, they typically check tasks off a to-do list which may include- a quick introduction, an office tour, getting to learn the company vision and other tasks. But what is most often left to last, (and usually ignored) is having a plan that is focused on making new employees feel welcome, appreciated and feel part of the company culture as soon as possible.

And these efforts will have it rewards– high employee retention and loyalty to the company will reflect favorably to the bottomline. Paying close attention to the company culture and adding to it is really important. I would like to quote Jonathan Mildenhall, CMO with Airbnb, where he says “the culture becomes an incubator for creativity
and innovation, and ultimately for business performance.”

Here’s a few things companies can do to welcome a new hire:

Have A Welcome Strategy Put In Place
Before the hiring process starts, have a meeting where everybody (from the management down) who will be involved in the new hire to brainstorm and come up with a detailed plan for bringing a new person to the team. It is important for the company to create a good first impression as well. One of the most important things a new hire at Airbnb goes through is a full week of cultural immersion, so the person will come out of that week feeling like he can be a true ambassador for the company and brand.

Have A Mentor/ Buddy System
It’s good to assign somebody or even better, the whole team to spend some time with the new employee to take him out for lunch or happy hour after work, show how stuff works and provide support when needed. Helping the new guy feel part of the team quickly would be good to help him get rolling on the job and assimilate easier.

Express Genuine Interest in the New Employee As A Person.
Getting to know your new hire as an individual is great for building rapport with the person. Knowing more information about him would come in handy, like for instance if you know he’s visual or auditory will tell you how he prefers to be appreciated. For an auditory person, being complimented verbally is better than receiving it in an email and the opposite is true for a visual person.

It is always good to keep in mind these little information which creates a more personalized welcome and heightens his experience with the company.

Stay tuned to find out who are our new interns and how they are doing with PayrollHero.

The PayrollHero Team is fast expanding and we’re on the look out for rock star talents to join us. Drop us an email and tell us more about you.

Certified Profile: Clare Matchett, ServiceSeeking Manila

Posted on June 12, 2015 by Stephen Jagger

As part of a new series on this blog we will be profiling certified PayrollHero users to learn more about them, their business, where they go to learn and best practices.

First up is Clare Matchett, General Manager for ServiceSeeking Manila.

1. How would you describe your business?
ServiceSeeking Manila is the Manila arm of ServiceSeeking.com.au, Australia’s best way to get free quotes from local businesses. Our team handles customer service, sales, data analysis, web development, SEO and a whole lot more.

2. What tools do you use to recruit?

We use traditional recruiting tools like job websites, forums and events. One of the most successful recruitment channels is actually referrals from existing team members. Some of our best staff were encouraged to apply by friends and family who worked with us and loved the company culture and office atmosphere.

3. What is your hiring philosophy?

We look closely at applicants’ personality and general aptitude and tend to place more emphasis on this than skills, education and past experience in our industry. If someone is the right fit, they’ll have the curiosity, bubbliness and problem solving ability that helps them thrive in a company that moves quickly and believes in collaboration, openness and fun.

4. What blogs / newsletters do you read to stay up to date in your industry?

My favourite newsletter is from Sandler Training, a sales training company with a no nonsense approach to prospecting and winning and keeping clients.

5. How do you build company culture at ServiceSeeking?

We emphasise our company values and make these a core part of recruitment, training and annual reviews. Weekly wrap ups with the entire office also let everyone know what others are working on, celebrate the small “wins” and help team members see the importance of their own role in our big picture success.

6. I saw on Linkedin you were “Streamlining HR policies and the recruitment process” can you explain more about that?

We’ve learned over the years that being different to the average big BPO company is a key factor in our success in Manila. We’ve worked hard to cut out policies and processes that are not in line with our values and can hold our team back from delivering great quality service.

7. Is speaking Tagalog an advantage to you in running the business?

My tagalog has a long way to go, but I do think employees appreciate when a foreigner takes the time to learn! It has certainly helped me understand more about Philippine culture, and it always gets a smile when I drop a word into the conversation, even with the wrong pronunciation.

8. Regarding the PayrollHero Certifications, what did you think of the certification courses?

I was very impressed with the certification courses PayrollHero and its training partners provide. We were helped along every step of the way and the support made the transition from outsourced payroll provider to running this in-house much more smooth.

9. Was the certifications helpful in getting the most out of PayrollHero?

Much of the software is intuitive and just “makes sense”, but payroll in the Philippines is notoriously complicated. We’ve been able to transition to using PayrollHero without adding any new team members and this is mostly because of the great communication with the PayrollHero staff. Discrepancy checks were particularly helpful in letting us know where we’re at with the transition and how to set up loans, advances, bonuses, allowances and government contributions correctly.

PayrollHero has a deliberate onboarding process that is designed to understand every customer’s unique needs so that we can quickly and effectively transition your business onto PayrollHero. Reach out today for a free, 30 min. one on one conversation about how PayrollHero can work within your organization.

Payroll in APAC: Singapore

Posted on June 10, 2015 by Pragya Gupta

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Employer contributions in Singapore are collected by the Central Provident Fund (CPF). The deductions and levies contribute towards savings for Singaporeans and Permanent Residents (PRs) for retirement, insurance and building their homes. There are also certain levies that go towards different ethnic funds. We will go through all these deductions and levies.

CPF

CPF contributions are done by the employee and employer. The contributions ar singapore cpf e restricted to Singaporeans and PRs only. There are 4 major accounts that CPF contributions go into: Ordinary Account (for retirement, housing finance, investment, education), Special Account (for old age and special contingencies), Medisave Account (for hospital bills) and Retirement Account (this account is opened once the employee turns 55). Check out these links to find out contributions rates and deadlines.

Foreign Workers Levy

The levy is imposed on employers who employ foreign workers with Work Permits or S Passes. Levies do not need to be paid for employees with Employment Passes. The levy is calculated based on the ratio of Singaporeans to foreign employees that your business employs. Here is a link on how the foreign levy is calculated. The levy is paid on the first of every month. More details on the FWL here.

Skills Development Levy

The SDL goes to the Skills Development Fund, which provides grants for training programmes and workforce upgrading programmes. The levy must be paid for Singpaorean, PR and foreign workers. The rates are linked here.

Ethnic Fund

There are 4 Self Help Group (SGH) Funds that collect levies based on the ethnicity of your employees. The four funds are:

Chinese Development Assistance Council (CDAC) Fund, administered byCDAC
Eurasian Community Fund (ECF), administered by the Eurasian Association(EA)
Mosque Building and Mendaki Fund (MBMF), administered by Majlis Ugama Islam Singapura (MUIS)
Singapore Indian Development Association (SINDA) Fund, administered by SINDA

The levy is paid out of employees’ salaries. Employees may choose to opt out of the levy by signing the relevant forms. The levy must be paid every month. Here are the rates.

If you are looking for a Singapore cloud based payroll platform – look no further. PayrollHero’s end to end solution includes time, attendance, scheduling, HRIS and Singapore payroll. Plus, amazing business intelligence. Let us know if you want a one on one demo.

For more information on CPF contributions, make sure to read this link. If you want to know more about employer contribution in the Philippine, check out Payroll in APAC: the Philippines.. Hope this helps!

Disclaimer: As always, consult your lawyer or accountant for advice! We are here to help, but your specific situation should be reviewed by a professional with complete knowledge of your situation.

Payroll in APAC: The Philippines

Posted on June 10, 2015 by Pragya Gupta

The Payroll in APAC blog posts are (as you might have guessed), a series of blog posts on tax and employer contribution laws in APAC nations. This gives payroll and human resource administrators a high level understanding on what you should know in these countries. Our first post is on the Philippines.

Creditable and Final Withholding Taxes:

The Bureau of Internal Revenue (BIR) is the Philippine equivalent of the IRS in the United States. Companies are required to withhold taxes from employees who are subject to income tax. They are then required to remit these taxes to the BIR.

There are two broad classifications of withholding taxes: Creditable withholding taxes and final withholding taxes. Creditable withholding taxes apply for certain income payments and are creditable against income tax. On the other hand, Final Withholding Taxes are not creditable against withholding taxes. Unlike the former, final withholding taxes are prescribed on royalties and interest incomes.

Social Security Service (SSS)

The SSS is the social security net for Filipinos. It covers a list of contingencies: from disabilities to maternity. All private companies are required to register with the SSS and deduct contributions for their employees. Around 70% of the contribution comes from the employer and 30% from the employee.

Deductions are made from the employee’s salary and remitted to the SSS. Payments are done monthly or quarterly, based on the type of employee. The summary on benefits and schedule on payments is posted here.

PhilHealth

The health insurance institution in the Philippines is called PhilHealth. All private and government institutions are required to register and deduct contributions from their employees’ salaries. PhilHealth covers a number of benefits. The share of the contribution is split between the employer and the employee. The payment dates and contribution schedule are available here.

Pag-IBIG – Home Development Mutual Fund

The final contribution that employers need to be aware of is Pag-IBIG. This institution provides housing finance for Filipinos. Contributions by the employer are equal to 2% of the employee’s salary. The dates for payment are in this link.

These are the 4 major tax and employer contribution laws that Payroll and Human Resource administrators should be aware of. At PayrollHero, we deduct the required contributions and generate payroll for our clients. Here are examples of how we compute BIR taxes, SSS, PhilHealth and Pag-IBIG contributions.

For more information on BIR, SSS, PhilHealth and Pag-IBIG with respect to what forms need to be filled and filing deadlines, make sure to click on the links!

Disclaimer: As always, consult your lawyer or accountant for advice! We are here to help, but your specific situation should be reviewed by a professional with complete knowledge of your situation.

If you are in need of a payroll provider in the Philippines that can provide an end to end solution, then let us know. PayrollHero’s Philippine cloud based payroll platform incorporates, time, attendance, scheduling, HRIS, business intelligence and Philippine payroll in one, easy to use solution.
Cloud Payroll Software for Philippines

Part III: Employer Contributions in the Philippines: Home Development Mutual Fund (Pag-IBIG)

Posted on June 8, 2015 by Pragya Gupta

This is the final iteration of the ‘Employer Contributions in the Philippines’ set of blog posts. So far, we have given you an overview of the BIR, the SSS and PhilHealth. We will now talk about the Home Development Mutual Fund – popularly known as Pag-IBIG Fund. The fund is the biggest source of housing finance in the Philippines. Along with the SSS and PhilHealth, employers also need to register to Pag-IBIG.

Requirements: Before you register your business with Pag-IBIG, you will need the following:

Employer’s Data Form (make sure you have a TIN and your SSS employer number to fill the form)
Specimen Signature Form (SSF [HQP-PFF-003])
SSS certification
Proof of business existence (Business permit/ Mayor permit)

You need to fill these forms and take them to the nearest Pag-IBIG service center. After the documents are processed, you will receive the Pag-IBIG Employer ID.

The following is the contribution that is required by the employer and employee

The Pag-IBIG registration process can be done online as well. After deductions, payment to the fund can be done online or through one of the accredited banks.

	Employee Share	Employer Share
PHP 1,500.00 and below	1%	2%
Over PHP 1,500.00	2%	2%

Finally, here we have an example on how PayrollHero calculates Pag-IBIG deductions.

This marks the end of our 3 part blogpost on Employer Contributions in the Philippines. For details on BIR, SSS and PhilHealth, click on the links. To see how PayrollHero calculates deductions on BIR, SSS and PhilHealth, make sure to click on the links.

Here is a helpful video from our friends at ZipMatch.com about Pag-IBIG

Disclaimer: As always, consult your lawyer or accountant for advice! We are here to help, but your specific situation should be reviewed by a professional with complete knowledge of your situation.

If you are interested in learning more about PayrollHero for your Philippine business, check out our website at PayrollHero.ph. We would be pleased to chat further about your needs.

Part II: Employer Contributions in the Philippines: PhilHealth

Posted on June 8, 2015 by Pragya Gupta

Philippines PhilHealth Our previous post was an introduction to employer contributions in the Philippines with a closer look on BIR and the SSS. In this post, we’ll give you an idea about how health insurance works in the Philippines. PhilHealth is the health insurance institution that all private and government companies are required to register their new employees to. Here is a list of benefits that PhilHealth covers. Unlike the SSS, the employer’s share towards insurance is equal to the employee’s share towards insurance. The contribution schedule is available here.

Step 1: Employers need to first register their business through the Philippines Business Directory.

Step 2: All employees must submit the PhilHealth Member Registration Form (PMRF) to the HR department. Once that is done, you need to register your employees by filling out Employee Data Record (ER1) Form and submit the ER1 Form with the PMRF for each employee.

Step 3: After the forms are processed, companies will be given the following:

PhilHealth Employment Number (PEN)
Certificate of Registration
PhilHealth Identification Number (PIN)
Member Data Record (MDR) of registered employees.

The Certificate of Registration is required to be displayed clearly in your business’s offices.

Step 4: After deducting employer and employee contributions from the basic monthly salary, payment must be made to PhilHealth or via Accredited Collecting Agents. The payment should be made on or before the due date. The table below is from the PhilHealth website:

Employers with PENs ending in 0-4	Every 11th-15th day of the month following the applicable period
Employers with PENs ending in 5-9	Every 16th-20th day of the month following the applicable period

Step 5: Once the payment is done, you will have to report it within 5 days with the revised RF-1 Form. Alternatively, you can report it online using the Electronic Premium Reporting System

Additional Info:

For new employees in the company, you will have to file the ER2 form to ensure that they are covered by PhilHealth too. Make sure to ask them if the have their PIN so that you can add it to the ER2 form. The form should be submitted to PhilHealth within 30 days of the new employees coming into office. For separated employees, Form RF1 must be filled and submitted within 30 days of the employee leaving. To amend employer data, ER3 form must be filed along with supporting documents.

This is it for PhilHealth. For reference, here is how PayrollHero calculates PhilHealth deductions. Check out Part III of our posts on employee contributions. We give you a crash course on Pag-IBIG deductions.

Disclaimer: As always, consult your lawyer or accountant for advice! We are here to help, but your specific situation should be reviewed by a professional with complete knowledge of your situation.

If you are interested in learning more about PayrollHero for your Philippine business, check out our website at PayrollHero.ph or contact us at sales@payrollhero.com. We would be pleased to chat further about your needs!