Daily Living, Budget Advice, and How to Get Things Donehow to deal with household staff

8. How to Deal with Household Staff

One of the wonderful things about living in the Philippines is that you can afford to have staff run your household, leaving you free to enjoy a life of leisure. Sometimes, there is a sort of “guilt” that accompanies this, as in, “Am I taking advantage of another person?” The answer to that question is a resounding NO! What you are, in fact doing, is providing an employment opportunity and, by extension, a stable source of income and livelihood for the persons in your employ.

Initially, you will have to invest quite a lot of time to teach your staff how you want things to be done. Set up standard operating procedures (S.O.P.) that are simple and easy to follow. Praise often for a job well done. If you have to call someone’s attention, do so in private and certainly not where others can bear witness. Be patient. Have a sense of humor. If you invest the time in intensive training, in about a month, your efforts should be well rewarded, leaving you free to enjoy your life in a well-managed household.

That being said, there are a few common-sense guidelines you should follow:

1. The people you are hiring will most often be living in your home. Even if you hire people on a “live-out” basis, they will still spend a majority of the day inside your home. 
It is always a good idea to have references for the people who will be spending a lot of time inside your private dwelling place. The best way to find helpers, drivers, gardeners, and other staff is to ask people you know, or better yet, ask the people you know to ask their own trusted staff, to send over potential employees. Usually, you will be inundated with spouses, siblings, cousins, neighbors, and/or friends of the employees of people you know, and THAT is your referral. The people you are about to interview are known to someone YOU know, so therefore, they are not an unknown entity. 
Although potential staff are generally trustworthy, there are unscrupulous persons wandering in the world, and you want to cut down on the possibility of inviting any of them into your intimate space!

2. During the interview process, DO ask the obvious questions! For example, if you are hiring someone to be a cook, ask them if they know how to cook. You can ask those candidates who interest you to come in for a one-day “trial”. If you want to see if someone can cook, ask them to come in and cook a meal for you to taste (you buy the ingredients). Ditto for a driver–have them drive you around for a day and see if they actually know how to operate a vehicle, and also know how to get around town. Laundry person, nanny, house cleaner, gardener….repeat procedure.

Pay them for one full day of labor, even if the only stay for part of a day. If they stay well into the night, pay them a little bit more. When you ask them how much they want to be paid for their “trial” day with you, the answer will almost always be, “Up to you, Sir/Ma’am.” No matter how hard you try, they will not name a price. Know then, what minimum wage is in your area (Manila, I believe, is PHP300.00 per day), and pay them that, plus an additional half day’s worth of labor.

Sometimes you will need more than a one day “trial”. You can arrange with the candidate to try him/her out for a few days or a week, but settle the cost of the wage at the outset, and at the end of the time, let them know straight away if they do or do not have a job with you. It would be polite to pay a “bale” (ba-leh), or advance, at the outset of the trial period of about one-third of the agreed-upon price. The balance should be paid upon termination of the trial period.

3. You should keep an information folder on anyone and everyone who works for you…name, mobile number, city address, provincial address, next of kin (in case of accident) and contact information, and a copy of their “bio data” or resume.

In addition, keep a signature sheet that they should signed each 15th and 30th of the month signifying that you have paid them their salary. Keep a signed, dated record of loans made to the employee in this file as well.

Also, before hiring, the employee has to provide you with an “NBI Clearance”, that is, an official document from the National Bureau of Investigation signifying that there is no arrest record or warrant for arrest for the employee.

4. Make sure that the person you are hiring is healthy! You should pay for, if they do not already have, a chest x-ray taken within the previous six months (particularly for a cook or nanny) to determine if there is any active tuberculosis (TB) infection (a TB test can also be done, but most of us in the Philippines will register exposure to TB at the least, so a chest x ray is a much better determinant of an active case of TB), a drug test, and a general check-up by a local physician. All of these tests, in total, should not run you more than about a thousand pesos (roughly twenty US dollars), which is a small price to pay for peace of mind. 
Give the potential employee the cash, accept the possibility that you might never see them again (which goes to showing the character of the person), and ask them to come back within one week’s time with all of the results of the medical tests.

5. Establish the parameters of the job clearly from day one: how much is the salary, when the salary will be paid (accepted practice is 15th and 30th of the month), when is the day off (including departure time and arrival time back at work), how much and in what format is the food allowance provided (in addition to salary a set amount for food per person per week and a small allowance at the beginning of each month for toiletries is the practice) in other words, will you give cash and let the employee purchase their own provisions, or will you do the purchasing and turn over the food and other goods to your employee(s)? When will they have their (two weeks paid) vacation (usually after one year of service)?

6. Establish clearly that the employee, by law, must pay a portion of their salary into the Social Security System (SSS), and that you, as employer, must do the same. The employer is also required to enroll each employee in PhilHealth and PagIbig services. For more complete information, please log on to www.gov.ph/download/default/asp.

In addition it helps to let your employee know at the outset that the maximum amount that you will ever loan is the equivalent of one month outstanding salary, and that until the employee has worked for you for at least six months, you will not be able, as a matter of policy, to loan any money at all unless it is for an emergency. If there is an emergency, and you are asked to give a cash advance, remember, you are not required to give it. If you decide to do so, have them sign a promissory note acknowledging the cash advance, not because you expect–or want– to ever be repaid, but because you will find that it is always helpful to keep a clear understanding of accounts between yourself and your employee.

7. Make sure that you explain to your employee clearly and calmly how you would like things done. It might take more than once, and you should give your instructions in short “bites” rather than a lot of information all at once. You like to have your shirts ironed with only a little starch…explain this to your laundry person. You like your hamburgers cooked medium rare? Explain this to your cook. You want your car washed and vacuumed each morning before you leave? Explain this to your driver. If an employee clearly understands what is expected of him or her, the relationship will go very well for both of you!

8. If you DO have to fire staff…and you will…please make it a point to take the person aside, out of range of other people, and inform the person that the present arrangement will no longer work.

Make sure that you pay “separation”, depending how long the person has worked with you; if over a year, then two weeks pay for each year they worked with you is the law. If they worked for you between six months and one year, then give two weeks salary as “separation” also. If less than six months, then one week’s separation is good.

BEFORE you hand over any cash, though, make sure that the person SIGNS a “quit-claim” saying that they have left your employment under mutually agreed-upon circumstances, that they have received all of their wages from you. Indicate that you have paid an additional “separation” and note the sum of the “separation” you have paid them. State VERY CLEARLY that the person has no claims upon you and that they are satisfied they have been paid in full for their services. Also, if there is a Village ID (subdivision ID card which allows staff to enter/exit your subdivision) involved, get the ID returned to you as it is your prerogative to keep it. You may turn it in to the Village Association if you wish.

If the person has borrowed money from you and owes you a balance, do stipulate this in the “quit claim”. You may withhold the amount owed from the salary and “separation”, but to do so would be bad form (even if you are firing them with cause). Instead, you may forgive the debt (and write it off to experience), or pay the person’s salary, but no “separation” in lieu of the debt owed. Add the signed “quit-claim” to the person’s file folder and hang on to all of those documents for at least two years, just in case you need them.

“ More and more folks are retiring at an earlier age, while they are still healthy enough to enjoy their lives. The problem is, in the First World, even a couple in their late fifties that have a $500,000 investment portfolio, which includes their home equity and other investments, won’t have enough retirement income to take advantage of their hard-won freedom. ”

The FREEDOM HANDBOOK
By Bruce Silverman
http://funphilippinesretirement.com
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