How an EOR handles legal and administrative responsibilities of Virtual Assistants in the Philippines

Leveraging the talent pool of highly skilled virtual assistants in the Philippines has become a strategic move for many organizations. The country’s well-educated virtual assistants with strong English proficiency and willingness to work on the US shift make it one of the top choices for outsourcing talent. However, hiring and managing virtual assistants in the Philippines can be complex, especially if you are unaware of the recruitment-related risks and challenges.

One of the most significant challenges businesses face is the intricate web of legal and administrative responsibilities that come with employing Filipino VAs. From payroll and tax withholding to ensuring compliance with local labor laws, these tasks can be time-consuming and prone to errors if not handled correctly.

This is where an Employer of Record (EOR) can provide invaluable assistance. Because the EOR is based in the Philippines, it can act as the legal employer of the Virtual Assistants hired by you and diligently handle all their legal and HR responsibilities. This blog highlights the common risks and challenges and how an EOR in the Philippines can help you mitigate them.

Common HR risks you may face when hiring Filipino Virtual Assistants remotely

When hiring remote virtual assistants (VAs) in the Philippines, businesses may encounter several risks related to human resources that could make the recruitment
complicated and challenging. Here are some of the primary challenging areas:

Payroll and tax withholding

The Philippines has a complex tax system with various exemptions, deductions, and rates. Ensuring accurate payroll processing and tax withholding can be time-consuming and prone to errors for your business.

Employee benefits

Filipino employers are required to provide certain benefits to their employees, such as social security contributions, health insurance, and paid leave. Understanding these mandatory benefits and ensuring compliance can be overwhelming for foreign companies.

Know more: Employee Benefits and Compensations in Philippines

Workers’ compensation insurance

Workers’ compensation insurance is mandatory in the Philippines. It provides financial protection to employees in case of work-related injuries or illnesses. Failure to carefully manage proper coverage and compliance with local regulations could result in legal issues.

Compliance issues

Paying Filipino virtual assistants directly monthly may seem simple, but it opens the door to significant legal consequences if the W-8BEN form is overlooked. This form is essential for certifying their foreign tax status and determining whether withholding taxes apply. Your business could face tax penalties and compliance issues without properly completing this form. Ignoring this step turns convenience into risk, making it a critical challenge to overcome in managing international hires.

Undedicated professionals

Hiring virtual assistants as freelancers could have inherent risks that can disrupt your operations. Any restrictions do not bind them, and they can stop working for you without notice, wasting your training investment. Additionally, there is no exclusivity, meaning freelancers often work with multiple clients simultaneously. This means you will still have to pay them full-time hours when they could be dedicating part-time effort to your projects. Without formal employment, you will likely lack control and commitment.

What is an EOR, and how can it help your business?

To mitigate the risks and challenges of hiring virtual assistants in the Philippines, as explained above, you can seek the assistance of a third-party entity in the Philippines that specializes in handling the legal and administrative aspects of employment for another company.

That 3rd-party organization is called an Employer of Record (EOR). So, how does an EOR work for you? For businesses looking to hire Filipino virtual assistants, an EOR provider can offer several advantages:

1. Reduced administrative burden: Managing the hiring and employment process involves a lot of time-consuming administrative work, from payroll management to handling tax filings and employee benefits. EORs manage employee payroll, ensure tax compliance, and handle benefits administration. This not only saves time and resources but also ensures that your business stays compliant with the local regulations.

2. Compliance assurance: One aspect of hiring virtual assistants in the Philippines is ensuring compliance with local labor laws. EORs understand and adhere to the local employment laws in the Philippines, ensuring that your hired virtual assistants always remain compliant.

3. Retention and commitment: An EOR ensures that employees are bound by formal employment contracts, which increases their commitment and reduces turnover. Unlike freelancers, virtual assistants in the Philippines hired through an EOR will be less likely to leave abruptly, providing more stability, continuity, and higher ROI. While the cost of hiring virtual assistants in the Philippines via an EOR may be slightly higher, the value lies in consistent performance, better employee engagement, and compliance with local labor laws, ensuring a more dependable and productive workforce.

4. Managing employee benefits: An EOR can assist you in offering competitive employee benefits that conform to the local legal requirements. This will be more useful when you want to find and attract the top virtual assistants in the Philippines. With the assistance of an EOR, you can have a competitive advantage when hiring virtual assistants in the Philippines.

Know more: Employer of Record in the Philippines

Global Squirrels’ EOR entity in the Philippines

Global Squirrels is a staffing and payroll platform that helps hire both full-time and contractors (on-site and globally) based on the job requirements provided by businesses. One can perform all the steps of recruitment and payroll on our platform from posting jobs and interviewing pre-screened candidates to onboarding and managing employees’ benefits and pay: everything on a single dashboard.

Global Squirrels also offers an EOR solution that effortlessly handles all your legal responsibilities as an employer of Virtual Assistants in the Philippines. Our platform guarantees 100% compliance by abiding by the Filipino labor rules, reducing the possibility of employee misclassification, and offering compliance analytics and evaluations. Without setting up an entity in the Philippines, you may quickly hire virtual assistants remotely using our EOR solution.

Global Squirrels’ SaaS platform offers you hiring plans that best suit your business by offering:

1. Purple plan: If you have already sourced a Virtual Assistant in the Philippines and are looking for a solution that can handle HR responsibilities, the Purple plan is the ideal choice. With this plan, Global Squirrels’ EOR entity in the Philippines will handle essential tasks such as onboarding, payroll, employee management, and legal compliance. The purple plan will also guarantee that your virtual assistant exclusively works for your business, ensuring reliability, commitment, and full control over their work hours.

2. Orange plan: When you choose the Orange plan, Global Squirrels will find the best Virtual Assistant talent in the Philippines based on your job requirements. In addition to staffing, our platform will also handle their HR and legal responsibilities, including onboarding, payroll, compliance, and benefits, while ensuring zero employer risks to your business.

Do you want to know more about how our EOR solution can help you? Request a demo of our platform here.