In order to get the best possible workforce, at times, it is necessary to extend the search even outside the Philippine territory after careful evaluation of the advantages and limitations of such a search. For one, the prospective foreign employee may contribute to the company’s productivity and even growth through the introduction of new concepts that would be of help to the company’s business development. Having different perspectives on how to do things, such as learning the best practices across the relevant sectors around the world, is key to having effective performance, especially given the fast-paced world that we live in. Effectiveness, in return, equates to stability and profit which is good for business.
However, to balance the need to diversify a corporate organization, and at the same time protect Filipino workers, the Constitution as well as laws, provide for limitations and guidelines with regard to the employment of aliens here in the Philippines.
This article discusses pertinent Constitutional and legal limitations in the employment of foreign nationals, as well as the legal and other requirements for alien employment here in the Philippines.
Alien Employment in the Philippines: Constitutional and Legal Limitations
In its Declaration of Principles and State Policies, the Constitution provides, “The State affirms labor as a primary social economic force. It shall protect the rights of workers and promote their welfare.” Moreover, under Article XII thereof, it is provided, “The State shall promote the preferential use of Filipino labor, domestic materials, and locally produced goods, and adopt measures that help make them competitive.” On the other hand, under the Labor Code, it is provided that, “The State shall afford protection to labor, promote full employment, ensure equal work opportunities regardless of sex, race or creed and regulate the relations between workers and employers.”
Thus, social legislation and pertinent rules and regulations have been established to implement the mandate of the preferential use of Filipino labor and to ensure the full protection of labor, such that the employment of foreign nationals in the Philippines is subject to the determination of the non-availability of a Filipino citizen who is competent, able, and willing to perform the services for which the foreign national is to be employed.
Moreover, under the Anti-Dummy Law, as amended, foreigners may not be employed in certain nationalized business, with or without remuneration, except technical personnel whose employment may be specifically authorized by the Secretary of Justice. The Supreme Court in King v. Hernaez, G.R. No. L-14859 (1962), explained the reason behind the prohibition, thus:
When the law says that you cannot employ an alien in any position pertaining to management, operation, administration and control, "whether as an officer, employee, or laborer therein", it only means one thing: the employment of a person who is not a Filipino citizen even in a minor or clerical or non-control position is prohibited. The reason is obvious: to plug any loophole or close any avenue that an unscrupulous alien may resort to flout the law or defeat its purpose, for no one can deny that while one may be employed in a non-control position who apparently is harmless, he may later turn out to be a mere tool to further the evil designs of the employer. It is imperative that the law be interpreted in a manner that would stave off any attempt at circumvention of this legislative purpose.
On the other hand, entities registered under the Omnibus Investments Code may employ foreign nationals in technical, supervisory, or advisory positions, for a period not exceeding five years from its registration, extendible for limited periods at the discretion of the Board of Investments.
Requirements for the Employment of Non-resident Aliens
Before non-resident aliens may be allowed to work in the Philippines, they must first obtain an employment permit, which is commonly known as an alien employment permit (AEP). On the other hand, jurisprudence provides that resident aliens are not required to obtain an AEP, rather, what is required of them is an alien employment registration certificate.
Department of Labor and Employment (DOLE) Order Nos. 186-17 and 221-21 provide for specific guidelines with regard to applications for AEP. Accordingly, all applications for AEP shall be filed and processed at the DOLE Regional Office or Field Office having jurisdiction over the intended place of work within 10 working days from the date of signing of the contract or prior to the commencement of employment. The applicant shall pay a fee of PHP 10,000.00 for an AEP with a validity of one year, inclusive of a PHP 4,000.00 publication fee, and an additional of PHP 5,000.00 for every additional year or a fraction thereof, for an AEP with a validity of more than one year.
Validity of the Alien Employment Permit
The AEP shall be valid for the position and the company for which it was issued for a period of one year unless the employment contract or other modes of engagement provides otherwise, which in no case shall exceed three years. The AEP shall remain valid until it expires, for the same position, despite the transfer of the company to another location and even in case the foreign employee has been transferred or subsequently assigned to related companies in another region. However, the employer must notify the concerned DOLE Regional Office of any transfer or reassignment of the foreign employee within 10 working days.
In case of any change in the foreign national’s position or employer, the former shall be required to file a new application for AEP and surrender the previously issued AEP card for nullification.
Exemption from an Alien Employment Permit
There are certain foreign nationals who are exempted from securing employment permits such as the dependent spouse of any member of the diplomatic corps, accredited officials and personnel of international organizations, and their dependent spouse, provided that the reciprocity requirement is present in both cases, i.e., the country of the foreign national provides for the same exemption to qualified Filipino nationals working therein. Foreign nationals who are officers, staff, and employees working in an Embassy are also exempted from securing an AEP as well as foreign nationals granted exemption by law.
In addition to the above-mentioned, refugees and stateless persons recognized by the Department of Justice pursuant to Article 17 of the United Nations Convention and Protocol Relating to Status of Refugees and Stateless Persons are also exempted from securing an AEP.
Nonetheless, all foreign nationals excluded from securing an AEP are required to secure a Certificate of Exclusion from the Regional Office.
Grounds for Denial of Application for an Alien Employment Permit
The rules provide that misrepresentation in the application, such as a false statement that has a negative effect on the evaluation of the application made knowingly, or without belief in its truth, or recklessly, whether it is true or false, is grounds for denial of the application for an AEP. Also, a conviction for a criminal offense or being a fugitive from justice in the alien’s country or abroad is grounds for denial.
Penalty for Working without an Alien Employment Permit
Foreign nationals intending to work here in the Philippines, given that they are qualified under the limitations provided by law and the rules, unless exempted, must file an application for an AEP. Equally, the employers must see to it that prior to engaging foreign nationals as employees, the latter have secured the required AEP, otherwise, both the foreign nationals and the employers may be subject to a fine of PHP 10,000.00 for every year or a fraction thereof.
It is noteworthy that in the case of WPD Marketing v. Galera, G.R. No. 169207 (2010), involving a foreign national working in the Philippines without the required employment permit, the Supreme Court allowed such foreign national to file an illegal dismissal case before the National Labor Relations Commission, recognizing her as an employee, notwithstanding the absence of the required AEP. However, the Court therein did not award the monetary benefits claimed, because to do so, according to the Court, will be to sanction the violation of the Philippine labor laws requiring aliens to secure work permits before their employment.
For any legal assistance you may need, you may send your inquiries and other legal concerns to info@gqlaw.com.ph.