New provisional work permit rules will delay foreign employees’ start dates

IMPACT – HIGH

What is the change? A new rule mandates that foreign workers who want to work while their Alien Employment Permit applications are pending must first apply for provisional work permits.

What does the change mean? Foreign assignees will have to wait longer before they can start work.

• Implementation timeframe: Immediate.
• Visas/permits affected: Alien Employment Permit (AEP), 9(g) Pre-arranged Employment visa.
• Who is affected: Foreign assignees applying for an AEP or 9(g) visa, and those whose applications are pending.
• Impact on processing times: The new provisional work permit requirement will add another step to processing. Employers must fulfill several document requirements to apply for provisional work permits.
• Business impact: Businesses may experience some loss of productivity during the waiting period while foreign employees apply for provisional permits.
• Next steps: Employers should plan for the new waiting period and the new documentary requirements when making assignments in the Philippines.

Background: Last December, the Philippine Bureau of Immigration announced the new measure in Operation Order SBM-No. 2013-019. Enforcement of the order was on hold until now.

The order states that foreigners with pending applications for Alien Employment Permits or 9(g) Pre-arranged Employment visas must secure provisional work permits (PWP) before starting work. The PWP will be valid for three months or until a work visa is issued, whichever happens first.

The employer must submit several documents to apply for a provisional work permit, including a letter stating that it will withhold taxes on the employee’s income, an employment contract, the employee’s passport, a tax I.D. number, incorporation papers, and an application form.

BAL Analysis: The new rules represent a major change in the steps required for foreign workers to obtain work authorization and begin work. The rules add to the documentary burden on employers and applicants, and delay when applicants may legally start work by as much as three weeks. Employers should be aware of the changes and plan accordingly.

This alert has been provided by the BAL Global Practice group and our network provider located in the Philippines. For additional information, please contact your BAL attorney.

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