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Frequently Asked Questions

Do you have questions about outsourcing and offshoring in the Philippines? KMC Solutions answers some of the clients' most common inquiries regarding KMCS' outsourcing process, Filipino labor laws and taxes, employee compensation, as well as concerns about doing business in the Philippines. If you have other questions that weren't addressed in this section, please fill out the contact form and we will get back to you as soon as possible

Questions About KMC Solutions

Why choose KMC Solutions?

KMC Solutions has an experienced cross-cultural management team composed of Filipinos and expatriates with years of experience in the BPO industry as well as dealing with foreign clients and businesses of all scales. We always keep communication lines open and ensure transparency in all processes, so our clients are always up-to-date and informed about their business operations in the Philippines.

What sets KMC Solutions apart from other BPO companies in the Philippines?

Unlike other BPO companies, KMC Solutions provides an integrated service delivery model through our sister companies, Kittelson & Carpo and KMC MAG Group. Doing business in the Philippines would be a lot easier for client companies as K&C can take care of the registration and paperwork required as well as offer legal and consulting advice. KMC MAG Group can assist expatriates in their search for housing in Metro Manila or elsewhere in the Philippines and in locating an office space or building for their business, should they decide to expand their operations in the country.

Questions About Outsourcing and Offshoring in the Philippines

Why outsource or offshore to the Philippines?

SMEs and multinational corporations from all over the world such as JP Morgan Chase, IBM, and Accenture have outsourced and offshored jobs in the Philippines because of the following factors:

  • Lower cost in labor and operational expenditure
  • Professional and reliable work ethic
  • Globally competitive labor force
  • Strong proficiency in the English language and Western culture

What services can be outsourced or offshored to the Philippines?

The Philippines is the leading contact center hub for voice accounts because of the Filipinos' strong proficiency in English. However, over the years, companies have outsourced other knowledge-based processes and tasks to take advantage of the country's talented population and low labor costs. Read more about the different services that can be outsourced to the country in the Knowledge section.

How long does it take to set up an office in the Philippines?

This depends on the type of office space you would be occupying -- with a serviced office, you can set up your operations within 1 day (subject to availability) while a traditional office space could take months, depending on the size of the requirement. Fitout of a bare office space alone takes around 2 months.

How much time do we need to recruit candidates for our business in the Philippines?

This depends on the number of candidates you need. If you are in need of 5 to 10 candidates, KMC Solutions can post ads, interview, and select candidates (with your final approval) within one month.

Questions About KMC Solutions’ Outsourcing and Offshoring Process

Is there a minimum number of months required for leasing seats or serviced offices?

Yes. Minimum is 6 months; however, some of our clients choose to sign with 1-year contracts to enjoy free office space rental on the 12th month.

Will I be able to claim the whole service as a tax deduction in my country?

There are certain ways of achieving a tax holiday. However, this usually involves setting up your own entity here in the Philippines, called PEZA. We can refer you to our sister company, Kittelson & Carpo, in case you would like to explore this option.

Questions About Risks in Outsourcing and Offshoring

How do I ensure that the employees possess the skills and attitude needed for the job?

KMC Solutions conducts a thorough background check and uses an established recruitment process that allows us to effectively screen the employees we are hiring and evaluate if it suits the client requirements. The clients are also involved in the interview and selection processes to ensure that all the employees they would be hiring are fit for the position.

Can I cancel the staff leasing service if the process is completed & there isn't a suitable candidate?

So far, clients have never experienced difficulty in finding the employee they need in the Philippines. However, in case this occurs, clients would only be invoiced once a candidate has been successfully placed (with the client's final approval) under KMC Solutions.

In the event of system failure, is KMC Solutions under obligation to fix the system?

KMC Solutions provides full system backup and 24/7 IT support from our central NOC, which covers provision of emergency power, redundant internet connection, and other amenities necessary for business operations. This provision is included in our client proposal and agreement.

Questions About Employee Compensation and Benefits

How much salary and benefits do Filipino employees usually receive?

It depends on the skill and experience required, as well as the nature of the job. Fresh graduates with no work experience usually receive around $325 to $418 a month worth of salary, and this becomes higher as the employee's required skill and work experience level becomes more specialized or vast.

Employee benefits, however, follow the government's rates table. The exact amount due also depends on how clients decide to structure the aforementioned salary (basic pay, allowance, and bonuses etc.); however, this is typically no more than $35/month:

  • Social security contributions: 7.37% of employee's salary
  • Philhealth contributions are at Php 200 to Php 300 ($4.55 to $6.82) depending on the employee's salary range
  • Night shift differential plus 10% of regular wage for work performed from 10:00 PM to 6:00 AM
  • 13th month pay: 1 month pay, which must be given not later than Dec. 24 of every year

Check out this infographic to know more about the costs of running a business in a serviced office.

Is it possible to provide a medical benefit for the employees?

Yes. Aside from the government-mandated Philhealth contribution, KMC Solutions provides an additional healthcare insurance for all employees. This usually costs Php 1000 ($ 23) a month.

What will happen if after several months we don't want an employee because of the quality of his work?

It is relatively easy to let go of an employee and KMC Solutions would assist in ensuring this was done in line with the local labor code by providing proof and necessary documents. We could also handle this in your behalf. If termination is done during the first 6 months' probationary period, employers are required to provide 1-week notice to the employee.

However, for regularized employees (6 months to 1 year tenure), employers would need to provide a month's notice and a month's salary (unless there were valid grounds for termination), while for employees with a tenure of 2 years, this would be equivalent to 2 months' salary, and so on.

However, for regularized employees (6 months to 1 year tenure), employers would need to provide a month's notice and a month's salary (unless there were valid grounds for termination), while for employees with a tenure of 2 years, this would be equivalent to 2 months' salary, and so on.


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