How to terminate an offshore employee compliantly is a question answered by the law where that person sits, not by the Fair Work Act. For a Philippine-based hire, the Department of Labor and Employment's Department Order 147-15 sets the standard: a written notice of the charge, a real chance to answer it, a second written notice of the decision, and for redundancy, thirty days' notice served on the worker and on the DOLE regional office.
Most Australian founders have budgeted for none of that.
Terminating an offshore employee is decided where they work, not where you bank
On 14 September, Human Resources Director Australia reported a Fair Work decision in Madeline de Ath v The Trustee for Evans Family Trust [2026] FWC 3487. The employer had a valid reason and lost anyway, because the educator was never told her job was at risk and never got a meeting. Compensation started at twelve weeks' pay of $10,472.40, was cut 25 percent for thin job-search evidence and another 50 percent for the conduct itself, and landed at $3,927.15.
Australian founders read that number and relax. Four thousand dollars, worst case.
Outstaffer sells against this, so read on with that in mind: our Employer of Record service exists because the exit is where direct arrangements break.
Their Manila-based hire is not covered by that regime at all, which feels like the end of the problem and is the start of it. The obligation moves. DOLE's Department Order 147-15 gives the employee no less than five calendar days to reply to the first notice, and requires separation pay on authorised causes whether or not anyone complains. That is the part a first offshore hire usually gets wrong.
The arithmetic of a compliant exit
Take a Philippine employee with three years' service whose role is made redundant. Section 5.5 of DO 147-15 sets redundancy separation pay at one month's pay for every year of service, so three months. Section 5.3 adds thirty days' written notice before the termination takes effect, and that notice is worked or paid.
Four months of one salary, leaving the account inside a single cycle, for a role that has already stopped producing.
Set that against the fee founders scrutinise. Outstaffer publishes Employer of Record pricing from USD $250 per employee per month, so a year of compliant employment is USD $3,000. The exit alone, for that same three-year hire, is usually the larger number, and it is the one nobody models when totalling up the monthly cost.
What does the twin notice rule actually require?
Two separate written notices, not one letter. The first states the specific ground and the facts behind it and allows at least five calendar days to respond. The second states the decision once that response has been considered. A single termination email fails both.
Does thirty days' notice mean thirty days of pay?
In practice, yes. The notice runs before the termination takes effect, and a copy goes to the DOLE regional office, which removes the option of a quiet handshake exit.
The honest counter, and it is a good one
Enforcement is not automatic. A departing employee has to file with the National Labor Relations Commission, many never do, and plenty of Australian businesses have ended offshore engagements badly for years with no consequence.
True, and it is an argument about the odds rather than the obligation. It also stops working the moment the person is angry, represented, or talking to colleagues still on your payroll.
Related reading
What I would do before the next offshore employee starts
Price the exit at hire. Write the separation formula into the model the day the role is approved, and get local advice on your own arrangement, because these rules turn on facts a blog post cannot see. If you cannot carry a four-month exit on a role you are about to create, that is worth knowing in September rather than in March.
If you want it priced properly, sign up and put one role through it and the employment cost and the exit cost sit in the same place. Knowing how to terminate an offshore employee compliantly is cheaper to learn now.
A real question for anyone running a remote team: do you know what ending one of those roles costs you today, or are you assuming it is the Australian number?
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