In brief

The Department of Labor and Employment (DOLE) has issued Department Order No. 221, s. 2021 (“DO No. 221, s. 2021“), or the Revised Rules and Regulations for the Issuance of Employment Permits to Foreign Nationals (access here). Companies that will be applying for or renewing alien employment permits (AEP) for their foreign employees will have to comply with the new requirements under DO No. 221, s. 2021

---

Key Takeaways

The salient points of DO No. 221, s. 2021 are as follows:

• AEP applications must be filed prior to the commencement of employment or within 10 working days from the date of the signing of employment contract.
• New requirements for an AEP application include: (i) a certified true copy (CTC) of the Philippine Economic Zone Authority (PEZA) certificate, if applicable; (ii) proof of the required job vacancy’s publication; and (iii) an affidavit stating that no applications were received or no Filipino applicant was considered for the position.
• A police report is now required for the replacement of AEP cards due to loss.
• At least 15 calendar days prior to the application for AEP, the employer must publish the job vacancy being applied for by the foreign nationals in a newspaper of general circulation. The DOLE Regional Office (DOLE RO) must conduct a labor market test (LMT) within two working days from receipt of the AEP application.
• New AEP applications shall be processed within five working days after publication. Renewal AEP applications shall be processed and issued within five working days after submission of documentary requirements and payment of fines, if any.
• AEP cards must be claimed within 10 working days from notification, failure of which is a ground for revocation of the application.
• The AEP shall remain valid in case the foreign national is transferred or assigned to related companies in another region. However, the employer must publish the position, as described above, when filing for renewal. The employer must notify the DOLE RO within 10 working days from the date of transfer or reassignment.
• The employer must submit a quarterly report on foreign nationals employed. It must also notify the DOLE-RO of any changes in the employer’s information, such as name, address and contact number.
• Foreign nationals working without valid (e.g., expired) AEPs and their employers shall be barred from filing AEP applications for five years. On the other hand, foreign nationals working with fraudulent AEPs and their employers shall be barred from filing AEP applications indefinitely.
• Certificates of Exemption or Exclusion are available for certain foreign nationals.
• Accreditation is now required for authorized representatives who will process AEP applications.

In more detail

Filing of new and renewal AEP applications

The process for filing new AEP applications is as follows:

1. Prior to the filing of the AEP application, the employer must secure all relevant permits and authorities, including: (i) a special temporary permit in case of practice of a regulated profession (e.g., accountancy, architecture or  engineering); (ii) authority to employ alien issued by the Department of Justice (DOJ), or proof of application, in case the employer is covered by the Anti-Dummy Law (e.g., engaged in a nationalized industry); and (iii) authority to hire foreign national from the Department of Environment and Natural Resources (DENR), or proof of application, in case the employer is engaged in mining.
2. At least 15 calendar days prior to the filing of the AEP application, the employer must post a job vacancy for the position in a newspaper of general circulation.
3. New requirements for the AEP application include: (i) a CTC of the PEZA certificate, if applicable; (ii) proof of the aforementioned publication; and (iii) an affidavit stating that no applications were received or no Filipino applicant was considered for the position.
4. Within 10 days from the signing of the contract or prior to the commencement of employment, the employer must file the application for issuance or renewal of AEP, submitting all the documentary requirements, including the permits described above.
5. Within two days from the receipt of the AEP application, the DOLE will perform the LMT. For a period of 30 days, the DOLE-RO will post the new AEP application on their website and the Public Employment Service Office job boards.
6. Within five days after the lapse of the period for publication, the DOLE will process the AEP application.
7. The AEP must be claimed within 10 days from notice of issuance, except if the employer requests that the AEP be sent through courier service providers, failure of which is a ground for revocation.

The process for filing renewal AEP applications is as follows:

1. Prior to the filing of the AEP application, the employer must secure all relevant permits and authorities, including: (i) a special temporary permit in case of practice of a regulated profession (e.g., accountancy, architecture or engineering); (ii) authority to employ alien issued by the DOJ, or proof of application, in case the employer is covered by the Anti-Dummy Law (e.g., engaged in a nationalized industry); and (iii) authority to hire foreign national from the DENR, or proof of application, in case the employer is engaged in mining.
2. If the foreign national was transferred or assigned to another region, within 15 calendar days from the filing of the AEP application, the employer must post a job vacancy for the position in a newspaper of general circulation.
3. As early as 60 days before the expiration of the AEP, the employer must file the application for issuance or renewal of AEP, submitting all the documentary requirements, including the permits described above.
4.  Within five days from receipt of complete documents, the DOLE will process the AEP renewal application.
5. The AEP must be claimed within 10 days from notice of issuance, except if the employer requests that the AEP be sent through courier service providers, failure of which is a ground for revocation.

Additional position

Section 5 of DO No. 221 provides that an LMT is required in cases where the foreign national is assigned an additional position during the effectivity of an AEP. They must file an AEP application with the DOLE-RO within 15 working days from the date of appointment.

Transfer of employees

Section 8 of DO No. 221 provides that  the AEP shall remain valid until it expires, even if the company transfers to another location or the foreign national is transferred or subsequently assigned to related companies in another region. The employer must notify the DOLE-RO of any transfer or re-assignment within 10 days from effectivity.

However, if a foreign national is transferred, when the AEP is renewed, the employer must comply with the required publication, as described above.

Penalties for working without valid/with fraudulent AEP

Section 10 of DO No. 221 provides that foreign nationals working without valid AEPs and their employers shall be barred from filing AEP applications for five years.

On the other hand, foreign nationals working with fraudulent AEPs and their employers shall be barred from filing AEP applications indefinitely.

In addition, a fine of PHP 10,000 for every year shall be imposed on both the foreign national and employers if a foreign national is hired without a valid, or with a fraudulent AEP. The same fine shall be imposed for filing late AEP application (e.g., beyond 10 days from the signing of the contract or after commencement of employment).

Certificate of exemption

Certificates of exemption are issued to foreign nationals who, while covered under Article 40 of the Labor Code, are exempted from securing AEP under relevant rules and regulations.

The following foreign nationals may apply for certificates of exemption from securing AEP:

1. Dependent spouse of any member of the diplomatic corps, provided there is an existing reciprocity agreement and/or exchange of notes between the Philippine government and their respective countries of origin;
2. Accredited officials and personnel of international organizations of which the Philippine government has entered into an agreement with, and their dependent spouse desiring to work in the Philippines;
3. Foreign nationals who are officers, staff and employees working in the embassy by reason of extraterritoriality principle, which is one of the generally accepted principles in International Law;
4. Foreign nationals who are officers and staff of peacekeeping or international organizations, either deployed in the Philippines or invited by non-governmental organizations as accredited, endorsed or certified by the appropriate government agencies, provided they will not engage in any gainful employment in the Philippines;
5. Foreign nationals who come to the Philippines to teach, present, and/or conduct research studies in universities and colleges as visiting, exchange or adjunct professors under formal agreements between the universities or colleges in the Philippines and foreign universities or colleges; or between the Philippine government and foreign government, subject to the rules of reciprocity;
6. Permanent resident foreign nationals and probationary or temporary resident visa holders;
7. Refugees and stateless persons recognized by the DOJ pursuant to Article 17 of the 1951 and 1954 UN Conventions Relating to Status of Refugees and Stateless Persons, respectively; and
8. All foreign nationals granted exemption by law.

Certificate of exclusion

Certificates of exclusion are issued to foreign nationals who are providing/supplying services in the country, but whose employers are based abroad, as well as those without an employer-employee relationship with a Philippine entity.

The following foreign nationals may apply for certificates of exclusion from securing AEP:

1. Members of the governing board with voting rights only and do not intervene in the management of the corporation or in the day-to-day operation of the enterprise;
2. President and treasurer, who are part owner/s of the company;
3. Intra-corporate transferee employed by the foreign service supplier for at least one (1) year continuous employment prior to deployment to a branch, subsidiary, affiliate or representative office in the Philippines as a manager, an executive or a specialist in accordance with trade agreements.
4. Contractual service supplier who is a manager, an executive, or a specialist employed by a foreign service supplier which has no commercial presence in the Philippines, and:
   1. enters the Philippines temporarily to supply a service pursuant to a contract between his/her employer and a service consumer in the Philippines;
   2. possesses the appropriate educational and professional qualifications; and
   3. employed by the foreign service supplier for at least one (1) year prior to the supply of service in the Philippines.
5. Authorized representatives of accredited/registered foreign principal/ employers, who participate in all recruitment activities of its duly licensed recruitment/manning agency by the Philippine Overseas Employment Administration (POEA) within or outside of the latter’s registered address or acknowledged additional office in the Philippines.

Reportorial requirements

The employer must submit a quarterly report of foreign nationals employed. It must also notify the DOLE-RO of any changes in the employer’s information, such as name, address and contact number.