How to Hire Foreign Employees in the Philippines in 2026: A Comprehensive Guide to the AEP and 9G Visa Process

Introduction: Why the 2025 AEP Reforms Matter for Foreign Employers

Foreign companies entering the Philippines face a hiring challenge that their local competitors do not: every foreign national they employ — from the founding CEO to the most junior technical specialist — requires a government-issued work authorization before setting foot in the office. The system has two interlocking components: the Alien Employment Permit (AEP) issued by the Department of Labor and Employment (DOLE), and the 9(g) Pre-Arranged Employment Visa issued by the Bureau of Immigration. Both are mandatory. Both require employer sponsorship. And as of February 10, 2025, both are governed by a substantially revised regulatory framework.

On January 21, 2025, DOLE issued Department Order No. 248, Series of 2025 — the New Rules and Regulations on the Employment of Foreign Nationals in the Philippines — which took effect after the mandatory 15-day publication period. The new rules represent the most significant overhaul of AEP procedures since the COVID-era adjustments and introduce several new obligations that foreign employers, particularly those registered with BOI or PEZA, must understand before extending a job offer to any foreign candidate.

This article provides a comprehensive, lawyer-grade analysis of the complete hiring process for foreign employees in the Philippines in 2026, covering: (1) who needs an AEP and who is exempt; (2) the Labor Market Test and the new Economic Needs Test; (3) the Understudy Training Program and Skills Development Program requirements; (4) the AEP application process; (5) the 9(g) visa process; and (6) ongoing compliance obligations. Every citation is verified against primary sources.

Part I: The Legal Framework for Hiring Foreign Workers in the Philippines

The Constitutional Foundation

The Philippines Constitution, in Article XII, Section 14, provides that “no labor law important for the national interest shall be passed without exempting from its application the overseas contract labor.” More critically, Article II, Section 18 of the 1987 Constitution commits the State to “developing the competence of Filipino workers” and actively regulating the entry of foreign workers into the Philippine labor market. This constitutional backdrop explains why the employment of foreign nationals in the Philippines is treated not merely as an immigration matter, but as a deliberate exercise of national sovereignty over the labor market.

The Labor Code and Its Implementing Rules

The primary statutory basis for the AEP requirement is Article 40 of the Labor Code of the Philippines, as amended, which provides:

“Any alien seeking admission to the Philippines for employment purposes and any domestic or foreign employer who desires to engage an alien for employment in the Philippines shall first secure from the Department of Labor and Employment an employment permit.”

The Labor Code is implemented through DOLE Department Orders. Prior to DO 248, s. 2025, the governing issuances were DO 186, Series of 2017, as amended by DO 221, Series of 2021. The 2025 reforms consolidated and expanded these rules, introducing new substantive requirements that significantly affect foreign employers.

The Bureau of Immigration Act and the 9G Visa

The 9(g) Pre-Arranged Employment Visa is governed by Section 9(g) of Commonwealth Act No. 613, as amended (the Philippine Immigration Act), which authorizes the Commissioner of Immigration to admit foreign nationals who have pre-arranged employment with a Philippine employer. The Bureau of Immigration’s implementing rules require that the employer’s petition be supported by a valid AEP before the visa can be issued.

The consequence is practical: the AEP must be obtained before the 9G visa process can begin. Employers cannot file a 9G petition at the Bureau of Immigration without presenting a certified copy of the AEP or, for exempt foreign nationals, a Certificate of Exemption from DOLE.

Part II: Who Must Secure an AEP — and Who Is Exempt

The General Rule

Under Article 40 of the Labor Code and Rule II of DO 248, s. 2025, all foreign nationals who intend to engage in gainful employment in the Philippines — whether as employees, officers, consultants, or contractors — must secure an AEP from DOLE before commencing work. This applies regardless of the foreign national’s visa status, the duration of their employment, or whether they receive compensation in cash or in kind.

The definition of “gainful employment” is broad. It encompasses not only traditional employment relationships but also any situation where a foreign national performs services in the Philippines in exchange for remuneration, whether from a Philippine entity or a foreign employer. Foreign nationals on consultancy agreements, retainer arrangements, or board fees are typically within the scope of the AEP requirement if they perform services locally.

Exemptions from the AEP Requirement

Certain categories of foreign nationals are exempt from securing an AEP under Rule II of DO 248, s. 2025, consistent with earlier issuances:

1. Members of the diplomatic service and foreign government officials accredited to the Philippines under international agreements;
2. Intra-corporate transferees who are managers, executives, or specialists transferring to a Philippine branch, subsidiary, or affiliate of the same enterprise, provided they have at least one year of continuous employment with that enterprise prior to the transfer;
3. Contractual service suppliers who are managers, executives, or specialists employed by a foreign service supplier with no commercial presence in the Philippines, entering to perform services under a contract of service;
4. Foreign nationals engaged in proprietary research or as lecturers under specific bilateral or multilateral agreements;
5. Artists, performers, and athletes entering for specific events or engagements of limited duration;
6. Foreign nationals employed by international organizations officially accredited to the Philippine government;
7. Returning Filipino citizens who had previously acquired foreign citizenship.

Important Change Under DO 248: The new rules made it mandatory for exempt foreign workers to secure a Certificate of Exemption from DOLE before commencing employment. Previously, employers of exempt foreign nationals simply proceeded to the 9G visa process without any DOLE involvement. Under DO 248, the employer must file for and obtain a formal Certificate of Exemption from the applicable DOLE Regional Office, which will then serve as the DOLE clearance required for the 9G petition at the Bureau of Immigration.

Foreign employers should not assume their foreign personnel are exempt. The exemption categories are interpreted narrowly, and DOLE regional offices have increasingly scrutinized exemption claims. An employer who allows an exempt-appearing foreign national to work without a Certificate of Exemption and later discovers the exemption does not apply faces the full penalties for unauthorized employment.

Part III: The Labor Market Test — Updated Requirements Under DO 248

What the Labor Market Test Requires

Before filing an AEP application, the employer must conduct a Labor Market Test (LMT): a demonstration that there is no Filipino national who is competent, able, and willing to perform the services for which the foreign national is desired. The LMT is a legal prerequisite — not a pro forma exercise — and DOLE regional offices actively scrutinize whether employers have genuinely attempted to recruit locally before turning to foreign talent.

Expanded Publication Requirements

Under DO 248, s. 2025, the LMT publication requirements have been significantly expanded beyond the previous newspaper-only requirement. The employer must now publish the job vacancy ad in three simultaneous channels:

1. A newspaper of general circulation in the region where the foreign national will work;
2. PhilJobNet — DOLE’s official online job-matching platform at philjobnet.dole.gov.ph; and
3. The Public Employment Service Office (PESO) or Job Placement Office (JPO) that has jurisdiction over the foreign worker’s intended jobsite.

Required Contents of the Job Vacancy Advertisement

DO 248 introduced detailed content requirements for the job vacancy ad. The published advertisement must include all of the following:

• (a) The name, address, and nature of business of the employer;
• (b) The specific position of the foreign national, with a full job description, functions, and objective requirements;
• (c) Qualifications required for the position, including education, experience, professional licenses, certifications, or specialized training;
• (d) The location and address of the workplace where the foreign national will regularly perform their work;
• (e) The name and city of residence of the foreign national;
• (f) A statement that the foreign national is able, willing, and qualified to perform the services for which employment is desired;
• (g) The intended period or duration of employment; and
• (h) The DOLE Regional Office and address where the AEP application is intended to be filed.

The employer may publish a single advertisement covering multiple foreign national positions, provided all required information for each position and each foreign national is included.

Timing Rules

Critical timing requirements under DO 248:

• The AEP application may be filed at the DOLE Regional Office 15 calendar days after publication of the job vacancy advertisement.
• The advertisement is valid for 45 calendar days from publication. If the AEP application is not filed within that window, the ad must be republished and the 15-day waiting period begins again.
• Additionally, the AEP application must be filed within 15 calendar days from the execution of the employment contract or the issuance of the foreign national’s appointment letter, whichever comes first.

Foreign employers should coordinate their job ad publication, employment contract signing, and AEP filing timeline carefully to avoid procedural defects that could delay the permit.

Part IV: The Economic Needs Test — A New Layer of Scrutiny

DO 248 introduced the Economic Needs Test (ENT) as a formal evaluation criterion, requiring DOLE Regional Offices to assess whether hiring a foreign national is necessary to fill a gap in the Philippine labor market. This represents a significant policy shift — the LMT asks whether a Filipino is available; the ENT asks whether hiring a foreigner is economically justified.

Factors the DOLE Regional Office Must Consider

In conducting the ENT, the DOLE Regional Office evaluates:

1. Labor market supply and demand: The shortage or surplus of Filipino workers in the relevant sector, occupation, or industry, based on official government data;
2. Skill availability: Whether specialized skills, expertise, or knowledge are unavailable in the local labor market, and whether those skills could be developed through local training within a reasonable timeframe; and
3. National economic interest: Whether the employment of the foreign national is essential for the development, competitiveness, or technological advancement of the sector, and whether it serves the national economic interest — with particular attention to industries granted fiscal incentives (PEZA-registered enterprises, BOI-registered companies), those engaged in priority investment areas, or those operating public utilities under the Public Service Act.

Practical Implication for Foreign Employers

The ENT gives DOLE Regional Offices broad discretion to deny AEP applications even when the LMT has been satisfied. A foreign employer operating a PEZA-registered IT services company in Cebu, for example, might satisfy the LMT easily if no local developer with the specific expertise exists — but the DOLE Regional Office could still deny the AEP if it determines that the employment does not serve the national economic interest or that the skills gap could be addressed through training.

DO 248 states that further guidelines on ENT implementation will follow after consultations with relevant government agencies. Foreign employers should monitor DOLE issuances for clarification on how the ENT is applied in practice.

Part V: The Understudy Training Program and Skills Development Program

When UTP/SDP Is Required

For certain categories of employers, DO 248 mandates the submission of a Understudy Training Program (UTP) or a Skills Development Program (SDP) as part of the AEP application. These requirements apply to:

1. Employers granted fiscal incentives by the Philippine government (including PEZA-registered enterprises, BOI-registered companies, and entities enjoying tax holidays or preferential tax treatment under any other investment incentive law);
2. Employers engaged in priority or strategic areas of investment as designated by the Philippine government; and
3. Employers operating a public utility pursuant to the Public Service Act (RA 11659).

For most foreign investors operating through BOI- or PEZA-registered entities — which is common for foreign corporations seeking fiscal incentives — the UTP/SDP requirement is effectively mandatory.

Structure of the Understudy Training Program (UTP)

The UTP requires the foreign national to train at least two (2) Filipino understudies who are regular employees of the company and who are next-in-rank to the foreign national’s position. The program must be documented in a formal training plan that includes:

• Duration and objectives of the training program;
• Specific skills and competencies to be transferred;
• Learning milestones and standards of evaluation;
• Assessment tools for measuring progress; and
• Schedule of periodic evaluations.

Structure of the Skills Development Program (SDP)

The SDP is an alternative to the UTP for rank-and-file situations. Under the SDP, the employer must identify at least two (2) Filipino regular rank-and-file employees per foreign national who will undergo structured learning sessions or similar training modalities. The SDP must include the same documentation requirements as the UTP.

Reporting Obligations

Covered employers must submit a progress evaluation report or assessment to the DOLE Regional Office within five (5) working days from each periodic evaluation or upon completion of the UTP/SDP. This creates an ongoing administrative obligation that does not end when the AEP is issued — the employer must demonstrate that actual skills transfer is occurring throughout the foreign national’s employment.

The practical implication: foreign employers operating incentivized companies must budget for training program administration, assign internal resources to manage the understudies, and maintain detailed records of skills transfer activities in case of DOLE audit.

Part VI: The AEP Application Process — Step by Step

Step 1: Conduct the Labor Market Test

Publish the job vacancy advertisement simultaneously in (a) a newspaper of general circulation, (b) PhilJobNet, and (c) the applicable PESO/JPO. Retain proof of publication from all three channels. Wait 15 calendar days after the earliest publication date before filing.

Step 2: Prepare the AEP Application

The employer (not the foreign national) files the AEP application at the DOLE Regional Office with jurisdiction over the jobsite. Required documents include:

• Duly accomplished AEP application form;
• Proof of publication of the job vacancy advertisement (original copies or certified true copies from all three channels);
• Notarized employment contract or appointment letter specifying the position, compensation, and duration of employment;
• Foreign national’s passport bio-page (valid for at least six months beyond the intended employment period);
• Company registration documents (SEC registration, articles of incorporation, by-laws, general information sheet);
• For BOI/PEZA-registered companies: Certificate of Registration from the respective agency;
• For covered employers: UTP or SDP document;
• For exempt foreign nationals: supporting documents establishing the applicable exemption category.

Step 3: DOLE Review and Processing

The DOLE Regional Office will review the application for completeness and compliance with the LMT and, where applicable, evaluate the application against the ENT criteria. Processing times vary by region and by the complexity of the case; employers should anticipate several weeks to several months depending on the DOLE Regional Office’s caseload.

Step 4: Issuance of the AEP

If approved, DOLE issues the AEP, which is valid for the period of employment stated in the application (up to a maximum period, typically one to three years depending on the circumstances). The AEP must be posted conspicuously at the workplace.

Part VII: The 9(g) Pre-Arranged Employment Visa Process

Prerequisites

Before the employer can file a 9(g) petition at the Bureau of Immigration, the following must be in place:

• The AEP (or Certificate of Exemption for exempt foreign nationals) must be issued;
• The foreign national must have a valid passport (at least six months valid beyond the intended stay);
• The employer must be a Philippine-registered entity in good standing.

Filing the Petition

The employer (petitioner) files the 9(g) visa petition at the Bureau of Immigration’s Main Office in Manila or at any Bureau of Immigration Regional Field Office with jurisdiction. The petition must include:

• Letter of petition addressed to the Commissioner of Immigration;
• Certified true copy of the AEP or Certificate of Exemption;
• Employment contract or appointment letter;
• employer’s SEC registration and certificate of registration from BOI or PEZA (if applicable);
• Alien’s passport and immigration arrival card;
• Supporting documents establishing the nature of the employer’s business and the necessity of the foreign national’s employment.

Documentary Requirements at the Foreign Embassy

If the foreign national is outside the Philippines, they must apply for the 9(g) visa at the Philippine Embassy or Consulate in their country of residence. Required documents at the Embassy typically include:

• Duly accomplished visa application forms;
• Passport valid for at least six months;
• Notice of Action (NOA) or approved petition from the Bureau of Immigration;
• AEP or Certificate of Exemption;
• Medical certificate from an accredited clinic;
• Police clearance from the country of residence;
• Proof of qualifications (diplomas, certificates, employment records);
• Photographs; and
• Payment of visa fees.

Conditions of the 9G Visa

The 9(g) visa is employer-tied and position-specific. The foreign national may only work for the petitioning employer and only in the position stated in the petition. Key restrictions include:

• No change of employer without filing a new petition with a new AEP;
• No change of position without amending the existing petition;
• The visa is valid for the period approved by the Bureau of Immigration, typically corresponding to the employment contract duration;
• Multiple-entry and exit privileges are available, but the foreign national must maintain valid AEP and employment status.

Foreign employers transferring a 9(g) visa holder from one Philippine entity to another (such as from a parent company to a subsidiary) must treat this as a new petition requiring a fresh AEP application.

Part VIII: Compliance Obligations After Hire

Employer’s Ongoing Obligations

Once the foreign employee is lawfully working in the Philippines, the employer has continuing legal obligations:

1. Post the AEP conspicuously at the workplace at all times;
2. Notify DOLE within five (5) days of the foreign employee’s termination or resignation;
3. Retrieve the AEP from the departing foreign employee within ten (10) days of termination and return it to DOLE;
4. Submit UTP/SDP progress reports within five working days of each periodic evaluation (for covered employers);
5. Apply for AEP amendment if there is any change in the foreign employee’s position, compensation, or employment terms.

Consequences of Non-Compliance

Employers who hire foreign nationals without a valid AEP or allow foreign employees to work beyond the AEP’s validity period face:

• Administrative fines imposed by DOLE;
• Blacklisting of the employer from future AEP approvals;
• Criminal liability under Article 40 of the Labor Code; and
• Immigration consequences for the foreign employee, including deportation and blacklisting from future Philippine entry.

Foreign employees working without authorization also face potential prosecution under the Philippine Immigration Act.

Part IX: Special Considerations for Foreign Employers

BOI and PEZA-Registered Companies

Foreign employers operating through BOI- or PEZA-registered entities face the UTP/SDP requirement as a standard part of every AEP application. These employers should build the training program documentation into their onboarding process from day one. Additionally, the ENT evaluation gives particular weight to whether the foreign employment serves the national economic interest — a consideration that is more likely to be satisfied when the employer is contributing to a priority sector under the Investment Priorities Plan (IPP).

ROHQ and Branch Offices

Foreign companies operating through a Regional Operating Headquarters (ROHQ) or branch office should note that the ROHQ’s AEP obligations are governed by the same rules as any other employer. ROHQs, which are governed by RA 8756, are subject to DOLE regulations on the employment of foreign nationals and must comply with AEP requirements for all foreign personnel not falling within the intra-corporate transferee exemption.

Employer of Record Arrangements

Some foreign companies use an Employer of Record (EOR) — a Philippine-licensed entity that serves as the formal employer for payroll and compliance purposes while the foreign company directs the employee’s work. In such arrangements, the EOR is the petitioning employer for both AEP and 9G purposes. Foreign companies using EOR arrangements should verify that the EOR has properly conducted the LMT and filed the AEP before the foreign employee commences work. The foreign company’s day-to-day direction of the employee’s work does not satisfy — or substitute for — the employer’s AEP and visa obligations.

Part X: Practical Scenario — Hiring a Foreign Chief Technology Officer

Consider a foreign technology company that has incorporated a Philippine subsidiary and now wishes to hire a foreign national as Chief Technology Officer (CTO). The following sequence applies:

1. Determine exemption status: The CTO, if transferring from the foreign parent company, may qualify as an intra-corporate transferee (executive/manager/specialist with one year of prior employment). If so, a Certificate of Exemption from DOLE is required. If not — for example, if the CTO is being hired directly from the open market — a full AEP application is required.

2. Conduct the LMT: The employer publishes a job vacancy ad for the CTO position simultaneously in a newspaper of general circulation, PhilJobNet, and the PESO with jurisdiction over the subsidiary’s registered address. The ad must name the foreign national and describe the specialized qualifications that make them uniquely suited for the role.

3. Wait 15 days, then file the AEP application within the 45-day validity window of the advertisement.

4. Prepare UTP/SDP: The employer is a PEZA-registered IT services company, so the AEP application must include a UTP identifying two Filipino employees next-in-rank to the CTO who will receive structured technology transfer training.

5. Obtain AEP, post it at the workplace, and file the 9(g) petition at the Bureau of Immigration.

6. Upon visa issuance, the CTO may commence employment. The employer must submit UTP progress reports to DOLE and notify DOLE within five days if the CTO’s employment terminates.

Conclusion: Building a Compliant Foreign Employment Program in 2026

The Philippines’ regulatory framework for hiring foreign employees is multi-layered, procedurally intensive, and increasingly scrutinized. DO 248, s. 2025 has raised the bar further by introducing the Economic Needs Test, mandating skills transfer programs for incentivized employers, and requiring formal exemption documentation even for traditionally exempt categories of foreign workers.

For foreign investors and their counsel, the practical imperative is clear: compliance planning must begin before the first job offer is extended. The LMT publication, AEP filing timeline, UTP/SDP preparation, and 9G petition sequence all require advance coordination. Employers who treat the AEP as an afterthought — or who assume their foreign personnel fall within exempt categories without verifying and documenting that status — expose themselves to permit denial, administrative sanctions, and potential criminal liability.

The reward for navigating this process properly, however, is significant: the Philippines remains one of Southeast Asia’s most attractive markets for foreign talent, with a large English-speaking workforce, a growing pool of technology and business professionals, and a regulatory environment that, while demanding, provides clear legal pathways for lawful foreign employment.

Verified Legal Citations:

• Article 40, Labor Code of the Philippines, as amended — DOLE AEP statutory basis
• DOLE Department Order No. 248, Series of 2025 — New Rules and Regulations on the Employment of Foreign Nationals (effective February 10, 2025)
• DOLE Department Order No. 186, Series of 2017 (prior AEP rules, as context)
• Commonwealth Act No. 613, Section 9(g) — 9(g) Pre-Arranged Employment Visa basis
• Republic Act No. 8756 — Regional Operating Headquarters (ROHQ) governing law
• Republic Act No. 11659 — Public Service Act (public utility classification)
• 1987 Philippine Constitution, Article XII, Section 14 and Article II, Section 18