The Yempo Guide to Mitigate Legal Risks when Outsourcing in the Philippines
Adding remote IT and accounting talent to your team is about cost savings, plus filling hard to recruit roles with excellent talent. But when we ask our clients why they love working with Yempo vs alternative providers of offshore accounting talent and outsourced IT they nearly always say the same thing. We give them ‘peace of mind’.
- Peace of mind that their remote team members receive fair pay and conditions.
- Peace of mind that they are compliant with local labour laws.
- Peace of mind that we are with them at every step of the way.
- Peace of mind that we have the experience to avoid and resolve issues.
- Peace of mind that IT is secure and networks up to scratch.
Of these concerns, the one that tops almost every client’s list is compliance with local labour laws in the Philippines.
‘Peace of mind. An employer who fully understands local labour laws.’ – David D., MD, FiveP
‘Michelle (Yempo’ s CEO) understands the Philippines labour market & legislation. Yempo is a great employer, not a sweatshop.’ – Kirsten F., CEO, Accounting for Good
Why do Yempo’s clients value our ability to protect them from labour laws so highly?
A large percentage of Yempo’s clients are small to medium sized enterprises. Many have not engaged overseas talent before. Most don’t have in-house legal teams. Perhaps outsourcing is a new activity for you? Our experienced internal team fills legal knowledge gaps so that business leaders, like you, can add remote talent to their teams without fear of incurring unknown risks.
We offer UK and Australian businesses the peace of mind that comes from working with a local Employer of Record (EOR) in the Philippines.
Understanding the legal risks of outsourcing to the Philippines
To fully appreciate the value of partnering with Yempo, let’s explore the legal risks that can arise with overseas hiring and how we ensure our clients avoid these pitfalls.
There are several pertinent UK and Australian employment law cases that highlight holes that might trap the unwary. These are:
This UK case highlights how a worker based overseas can still be protected under UK employment law. Mr. Ravat, a British citizen working in Libya for a UK company, claimed unfair dismissal. The UK Supreme Court ruled in his favour, establishing that UK employment law could apply if the employee had a strong enough connection to the UK.
The takeaway: UK businesses outsourcing overseas cannot assume they are free from domestic legal obligations. If your remote worker has a substantial connection to the UK, such as regular reporting lines or a contract governed by UK law, your business could be liable under UK employment law even if the worker is based in another country.
This UK case laid the groundwork for assessing jurisdiction in employment disputes involving overseas workers. The judgment emphasised the importance of considering all the circumstances, including the employee’s location and the legal terms of their engagement.
The takeaway: Even indirect employment relationships can give rise to legal risk if the employment context suggests the UK has jurisdiction.
In this Australian case, the Australian Fair Work Commission found that Ms. Pascua, a paralegal working in the Philippines, was an employee, not a contractor. It confirmed that the Fair Work Act can apply even when work is done entirely overseas.
The takeaway: Australian businesses must ensure that their offshore employment arrangements are watertight and in full compliance with both Australian and local laws.
How Yempo shields you from legal exposure
As a local Employer of Record in the Philippines, we take on all legal responsibility for employment, payroll, taxes, benefits, and HR compliance. You enjoy the advantages of a remote team without carrying the legal risk.
‘I’ve been asked why we don’t directly hire Philippines based talent. My answer is that the knowledge that Yempo ensures compliance with local labour legislation is worth its weight in gold.’ – Jacki M., Founder, We are Lumen
How it works:
1. We hire Philippines-based IT, Accounting and Business Support talent legally on your behalf.
Your remote team members are officially employed by Yempo under Philippine law. This means they receive all legally mandated benefits, such as 13th month pay, government contributions, and proper leave entitlements.
2. We keep you fully compliant with labour laws.
We stay up to date with all changes to Philippine labour laws and HR regulations, ensuring your operations remain compliant. You can outsource IT roles or build a remote offshore accounting team with the confidence that we ensure everything is done by the book.
3. We have the experience and expertise to rapidly resolve issues.
Our in-house HR team proactively manages issues, so you never face surprises. From contract disputes to end-of-employment procedures, we ensure a smooth process for everyone involved.
All of our clients have access to Michelle, Yempo’s founder, as a point of escalation.
Why Yempo Is the Preferred Choice for UK & Australian SMEs
‘We have a lot of experience with offshoring and Yempo is the first company we’ve found where delivery exceeds what we expected.’ – Warwick M and Chris G., Compliance Data Lab
While the Philippines is a top destination for offshore talent, not all outsourcing companies in the Philippines offer the same level of legal and operational protection to their clients. Many low-cost providers can’t afford to engage the HR talent required to protect clients from legal risks.
Yempo is different. We bring:
- A 10+ year track record in compliant employment solutions.
- A fully transparent, ethical approach to outsourcing.
- Deep expertise in the Philippine labour market.
- Personalised support for each client’s unique needs.
If you wish to save money by building offshore IT and/or offshore accounting teams we can make this happen for you. You’ll have peace of mind that your organisation is not exposed unanticipated legal risks.
Stay competitive: don’t let legal worries hold your business back
Outsourcing to the Philippines offers unmatched benefits in terms of cost, efficiency, cultural alignment, and access to top-tier talent for UK and Australian companies. But we know that compliance concerns can make gaining these benefits feel like a step into the unknown.
Don’t let fear stop your business from growing.
At Yempo, we make it easy and risk-free for UK and Australian businesses to build high-performing, legally compliant, offshore IT and offshore accounting teams. As your local Employer of Record in the Philippines, we’re with you from your first hire to your thirtieth.
Book a quick chat with Michelle today, to know more about our best practices in providing offshore accounting and IT staff from the Philippines – or shoot us an email at [email protected]. We are happy to answer your questions!
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