Placement Fee Ceiling for Taiwan and Korea

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POEA MEMORANDUM CIRCULAR NO. 09, s .1998: Placement Fee Ceiling for Taiwan and Korea

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Title Source: Supreme Court: Placement Fee Ceiling for Taiwan and Korea

Law: Poea Memorandum Circular No. 09, S .1998

Decision Date: May 8, 1998

A uniform placement fee ceiling of one month’s salary, exclusive of documentation and processing costs, is established for all land-based Filipino workers, including those hired for the Taiwan and Korean markets, to address rising deployment costs and ensure fair practices.

Law Summary

Uniform Placement Fee Ceiling

A uniform maximum placement fee is established at the ceiling of one (1) month's salary.
This fee excludes any documentation and processing costs, which may be charged separately.
The fee ceiling is applicable across all landbased workers regardless of their destination including Taiwan and Korea.

Background and Previous Fees

Department Order No. 34, series of 1996 previously fixed the placement fee ceiling at one month's salary, but did not cover Taiwan and Korea.
Prior to this memorandum, Taiwan's fees consisted of one month's salary (mobilization fee) plus a placement fee of P5,000.00.
Korea's fees under the Korean Federation of Small Business scheme included a P10,000.00 mobilization fee plus a P5,000.00 engagement fee.

Rationale for Adoption

The memorandum recognizes the need for a uniform fee policy due to rapidly changing labor market conditions and increased deployment and placement costs.
Harmonizing fees aims to provide regulatory consistency and safeguard the welfare of landbased OFWs.

Encouragement for Non-fee Charging

Agencies and employers who currently do not charge placement fees are encouraged to maintain this practice.

Implementation and Effectivity

The memorandum circular took effect immediately upon issuance on May 8, 1998.
It amends prior circulars including Memorandum Circular No. 5, series of 1997, and aligns fees with Department Order No. 34, series of 1996.

Governing Board Resolution

The POEA Governing Board resolution formally adopted the uniform placement fee ceiling.
The resolution was signed by the Secretary of Labor and Employment as chairman, and other board members.
It mandates strict adherence to the one month salary placement fee ceiling excluding other deployment costs.

Legal and Administrative Authority

The POEA (Philippine Overseas Employment Administration) Governing Board has authority to regulate placement fees and oversee employment of landbased OFWs.
This circular exercises such regulatory powers to ensure fair labor recruitment practices and cost transparency for OFWs.

END