How to Move Your Filipino Contractor to an EOR Arrangement

If you’re paying a Filipino professional as an independent contractor, there’s a good chance you already know the arrangement is legally grey. Maybe your accountant flagged it. Maybe you read about the Fair Work Commission rulings. Maybe you just want to do the right thing.

The good news: transitioning to an Employer of Record (EOR) structure is straightforward, and it doesn’t have to disrupt the working relationship you’ve already built.

Why the contractor arrangement is the problem

Under Philippine law, a worker who works regular hours, takes direction from you, and operates exclusively (or primarily) for your business is likely an employee — regardless of what the contract says.

For Australian businesses, the risk is compounded. Recent Fair Work Commission rulings have established that offshore workers can be considered employees under Australian law depending on how the relationship is structured. Criminal wage theft laws — in effect since January 2025 — mean misclassification isn’t just a civil matter anymore.

Paying someone as a contractor when the working relationship is employment isn’t a technicality. It’s a liability.

What changes when you move to EOR

When your Filipino contractor transitions to an EOR arrangement, here’s what actually changes:

For your worker:

• They become a formally employed worker with an employment contract under Philippine law
• They receive all statutory entitlements: SSS, PhilHealth, Pag-IBIG contributions, 13th month pay, service incentive leave
• Their employment is registered with Philippine government agencies (BIR, SSS, PhilHealth, Pag-IBIG)

For your business:

• Team Up Now becomes the legal employer on record — not you
• All compliance, payroll processing, and tax filing sits with us
• You continue directing the work exactly as before
• Your Fair Work and ATO exposure is eliminated

What doesn’t change:

• The working relationship — your person still works for you, on your tools, under your direction
• Their day-to-day role and responsibilities
• How you communicate and collaborate

How the transition works

Step 1: Tell us about the existing arrangement Share the role details, current salary, and start date. We’ll prepare the employment documentation and contribution calculations.

Step 2: We prepare the employment contract Team Up Now issues a Philippine-law-compliant employment agreement. Your worker reviews and signs it.

Step 3: Payroll and contributions are set up We register your worker with BIR, SSS, PhilHealth, and Pag-IBIG (if not already registered) and configure payroll under our Philippine entity.

Step 4: You receive one monthly invoice From this point, you pay Team Up Now a single monthly invoice covering salary, statutory contributions, and our flat EOR management fee. We handle everything else.

Most transitions are complete within one to two weeks.

What to tell your worker

Transparency matters here. Most Filipino professionals welcome the transition — it means proper employment, full entitlements, and job security. Frame it as a positive:

“We’re moving your arrangement to a formal employment structure through our EOR provider. Your role stays exactly the same, but you’ll now have a proper employment contract, full statutory benefits, and your contributions paid correctly.”

In our experience, workers who understand what EOR means are almost universally relieved.

The cost difference

Moving from contractor to EOR adds employer statutory contributions — SSS, PhilHealth, Pag-IBIG, and 13th month provision — plus Team Up Now’s flat A$300/month management fee. For most roles, the additional cost is A$400–600/month depending on salary level.

Use our EOR cost calculator to see the exact number for your situation before you do anything else.

Ready to transition?

If you have a Filipino contractor you want to move to a compliant structure, book a free consultation and we’ll walk you through the process. No obligation, no pressure — just a straightforward conversation about what it takes to get your arrangement right.