All About Placement Fees and Other Required Fees of OFWs
Nov 13, 2013
Many Filipinos who want to work abroad are usually concern about the amount of money they would need to prepare for the processing of their working documents. Usual question revolves around the placement fees and how much should it be. Some are wondering if the plane ticket and other traveling fees should also be shouldered by the overseas Filipino workers (OFWs).
To shed light on these concerns, here are some of the frequently asked questions (FAQs) about the fees that an OFW have to deal with and the answers.
What is a placement fee and why is it required?
Recruitment agencies are allowed by law to collect placement fees from deployed OFWs. This fee is necessary because the business of recruiting workers is so risky that agencies need a fund that they can use just in case something happens to the deployed worker. This also means that the responsibility of the deploying agencies to the applicants extends even if the OFW is already working abroad.
How much should a placement fee be?
POEA-licensed recruitment agencies are allowed to collect placement fees that is equivalent to the one month salary of the deployed OFW. Some countries such as Taiwan may charge fees more than the one month salary because of additional fees such as broker’s fees, etc. However, this fee should be paid in installments.
When should one pay the placement fee?
Applicants will only pay the placement fee once they have already signed an employment contract. They can choose to pay only half of the placement fee at this point. The other half can be paid when the agency gives the plane ticket and other travel documents of the OFW. Recruitment agencies should not collect placement fees before an employment contract is signed. Applicants should remember that any agency/recruiter who demands payment right away is most probably illegal.
Why is it that some OFWs get to work out of the country without paying placement fee? Some deploying countries such as USA (for those under H2B visa), United Kingdom (UK), Netherlands, Ireland and some parts of Canada (British Columbia, Alberta, Manitoba, Saskatchewan) prohibit collection of placement fees. Also, other OFWs are fortunate enough not to pay placement fees because their recruitment agency has found an employer that is willing to shoulder the amount for the applicant.
Who are exempted from paying placement fees? Philippine law prohibits seabased recruitment agencies from charging placement fees and any other recruitment fees to seafarers. Household service workers (HSWs) and caregivers are also exempted from paying placement fee.
Aside from placement fee, what other fees should be shouldered by the OFW? The OFW is required to shoulder the payment for the following:
- NBI/Barangay/Police Clearance
- Birth Certificate
- Trade Test if needed
- Immunization (if required by the host country)
- Medical Certificate
What are the fees that must be shouldered by the employer and not the OFW? The fees for the following must be paid by the employer:
- Airplane Ticket
- OWWA Membership Fee
- POEA Processing Fees
What are the fees that OFWs are exempted from paying? OFWs are exempted from paying airport fees and travel tax. They just need to present their Overseas Employment Certificate (OEC) or any other documents from POEA to avail this privilege.