24 Nov 2025 · 8 min
John Jonas breaks down five benefits employers commonly offer Online Filipino Specialists: 13th month pay, SSS contributions, Pag-IBIG fund, PhilHealth, and private HMO plans. He shares when he started each benefit and gives practical tips like requiring receipts and letting workers choose their plans.
Hello and welcome to the Secret Sauce of Outsourcing Podcast, the podcast that's dedicated to making you better at outsourcing your work. My name is John Jonas and this is episode 185 benefits in quotes for OFS you might pay for. So I'll be honest, I hate the word benefits when it comes to work related additions. In the U.S. most benefits serve to tie someone down to a job that they don't like. I mean, I can't tell you how many times I've heard this over the years. Like, oh, I have this great idea, or I'd really love to be running an Internet business, but I can't just quit my job and start out on my own. What about benefits? And I'm like, dang, man, this thing that's paying you 10 or $20,000 a year is preventing you from starting your own business and making, you know, millions of dollars or hundreds of thousands of dollars, whatever it is. It just seems so silly to me. But from an employer's perspective, dang. Employee benefits is one of the reasons why employees stick around, right? So as an employer, it totally makes sense. And in the Philippines, a lot of Filipinos prefer long term employment because of it. It just makes them work for you and only for you. It's the icing on the cake. I mean, they'll, you know, they'll talk to their, oh, you have a monthly salary and perks. Why would I want to do anything else if I had that with just one job? So, you know, benefits as an employer can make a really, can really make sense. So here are the potential benefits that you might pay your ofs, and I'll tell you what things we pay ours and what we don't. So number one, the benefit that most Filipinos would want and that they look forward to is the 13th month. And I will put a link in the description below to more information about this, but this is the one thing on this list that's really kind of not optional. But so if you're new to outsourcing and you feel like you don't have enough to give a lot of employee perks, this is the easiest option. It's given once a year. It's one month extra salary. So let me just tell you a little bit about how this works. So in the Philippines, if you're a Filipino employer, it's actually legally required that when someone has worked for you for a year, you give them a bonus of one month's pay called the 13th month. And actually it's paid in December and it's prorated. So the actual calculation is how much did you pay them throughout the year? Divided by 12 would equal the 13th month. So if they started in February and you're paying them $500 a month for full time work or it doesn't matter how much for full time or part time work, it doesn't matter. In December, you add up how much you've paid them total through the year, divide by 12. So that's going to be 500 times 11 because you've paid them 11 salaries starting in February and you know, whatever, I don't know what that number is. So you divide it by 12 and that's the amount that you pay. And it should be paid in early December. It's not a Christmas bonus, but somewhere before Christmas is when it's expected to be paid. So this is the only one of these things that you should be paying. You should plan for it. Your workers will plan on getting paid the 13th month. They plan their whole Christmas around it. They plan their like mandatory expenses around it. It's a pretty big deal for them. So the rest of these now are optional. So I mean everything is optional, but okay. So number two, Social Security system, SSS is what they call it. This is the Philippines version of Social Security in the US and this is where Filipinos can draw their pension once they've completed 10 years of payments. This is also how they get unemployment, disability, maternity paternity benefits and retirement benefits. So it's less than $50 a month is what this would cost. And it's pretty easy for you to pay or for you to pay to them, for them to pay into their SSS and that this is a big one for them. So number three would be the Pagibig fund. I have no idea how to say this. It's PAG IBIG and it is their home development mutual fund. So it's an investment savings fund owned by the Philippines government and controlled by the government to help Filipinos buy their own homes. Even if they don't plan to buy a home, they contribute to it because it also offers a lot of loan programs and benefits when they need loans. So the cost of this one is like less than $10 a month, US$10 a month. So it's a pretty pretty, it's a pretty affordable one to help pay if you want to do it. Number four would be PhilHealth. So this is their form of socialized medicine. Pretty much everyone there is required to pay into it one way or another. So it's called Philhealth it's not like healthcare really. All it does is reduce medical bills from hospitals. It's also recognized by all Philippines hospitals, which not all HMO or normal insurance plans are recognized by all hospitals. I'll talk about that Next. So, so PhilHealth is like the health thing that everybody pays to, but it like someone goes to the doctor and it costs them US$5,000. PhilHealth is going to reduce it to 3,000 and now they have a $3,000 bill. So it's, I mean it's a good reduction. Still a lot of money. You know, it doesn't, it doesn't take care of things, but it's an easy thing to pay to pay for for you less than $10 a month. So number five on the list would be an HMO like private health insurance. And this is trickier than the others. But most of the work should be done by your ofs. So unless you have an official business set up in the Philippines, like you have an LLC in the Philippines, which almost nobody does, including us, we do not, then your ofs will need to sign up for this on their own and you can either prepay them for the monthly payments or reimburse them for the monthly payments. They're obviously going to prefer the prepayment, but either way you should require a receipt as proof of payment. So we require them to send us a receipt of them paying for their hmo. A decent HMO plan in the Philippines is a private room. That's how you know, like which plan should we go for? They'll give you like six different plan options. The private room plan with top hospitals is a pretty reasonable one and typically will cost between 400 to $600 per member per year. So it's less than $50 a month. I'm gonna put a list of like HMO providers that you can look at in the description. Here are a couple of them. MaxiCare is probably the most popular. Intellicare is another really good one. We used ValueCare originally. We had everybody use ValueCare and it just wasn't working out because like different parts of the country take different insurances and value care just wasn't working for everyone. So in the end, we recently let all of our team members pick the one that fits them. Most of them went with maxicare. I'll link to another blog post with more details on this in the description. Look, none of this is required. You don't have to pay any of these things. You should pay the 13th month, which is obviously the most expensive one, but that's the one that like it's man, it's really expected by them and you should be paying it. So we paid that one from the beginning. So here's kind of an approximate timeline for when we started paying for these things. So the 13th month, I paid it right from the start and that was starting in 2005. SSS and PhilHealth I started adding to their salary in the second year year of having OFS work for me. So that was 2006 and this was just a one time salary increase. I had people asking about it and they were like, we would like to pay our SSS and we should be paying PhilHealth but you know, it's like a good amount out of our salary and could you help us? Like oh yeah, how much is it? Oh yeah, it was $30 a month. Sure, I'll pay that, no problem. And it's gone up since then, but that's what I did. So I just increased their salary by whatever the amount was and then I never dealt with it again. So if I had to give advice for when to pay this or any of these extras aside from the 13th month, I would say pay it when your OFS is contributing more to your business than you're paying them. So if you're paying them $600 a month, then if they're making you $600 a month or more, then add the benefits like it's a pretty easy thing to keep them working for you. So we started paying poggy big. Actually the poggy big one, the home loan one, is so small that I never really worried about it. You know, it'd be like a $5 increase to their salary and I just figured that kind of wasn't worth it. But we have helped people with loans quite a few times over the years. Help them out when they needed something and then the hmo. So we didn't provide for their private health insurance until about 2014. Our team was asking for it. PhilHealth doesn't do enough. And so we started in 2014. That was when we did value care. And then a couple years later we were like, oh yeah, this isn't working for everyone. So we just let people pick their own thing. They're responsible for signing up for it. We do have an HR person who helps them with that, but we just provide it to everyone who joins our team now and they provide us a receipt each month. So if you have questions on this, I'm available. Johnnlinejobs PH Please check out the blog post in the description below. They are very helpful. So thanks. Talk to you later.
