An Act Amending Further Commonwealth Act Numbered One Hundred and Eighty-Six, As Amended.

REPUBLIC ACT No. 4968

AN ACT AMENDING FURTHER COMMONWEALTH ACT NUMBERED ONE HUNDRED AND EIGHTY-SIX, AS AMENDED.

Section 1. Subparagraph (e) of the first paragraph of Section two of Commonwealth Act Numbered One hundred eighty-six, as amended, is further amended to read as follows:

"(e) 'Life Insurance' shall mean any form of insurance on life authorized herein, such as limited payment life, endowment, etc. 'Retirement Insurance' shall mean any form of insurance on retirement as authorized herein. Benefits granted by this Act by virtue of such life or retirement insurance shall not be considered as compensation or emolument."

Section 2. Subsection (a) of Section four of the same Act, as amended, is hereby further amended to read as follows:

"(a) Membership in the System shall be compulsory upon all appointive officers and employees in the executive, legislative, and judicial branches of the government, including those whose tenure of office is fixed or limited by the Constitution or by law; upon all regular employees of the Philippine Tuberculosis Society and the Philippine National Red...

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Summary of Republic Act No. 4968

Definitions and Coverage:
- Defines "life insurance" and "retirement insurance" (Section 1)
- Compulsory membership for appointive officers, employees in executive, legislative, judicial branches, regular employees of certain organizations, Armed Forces, and elective officials receiving compensation (Section 2)
- Casual, substitute, or temporary employees and teachers covered for term insurance of 2,750 pesos if appointed for at least 2 months (Section 2)

Contributions and Premiums:
- Specifies rates of contribution or premiums for life insurance and retirement insurance, based on employee's monthly salary (Section 3)
- Employers required to pay their share of premiums, unless reduced rates approved by the System (Section 3)
- Unpaid premiums or contributions bear interest not exceeding 6% per annum (Section 3)

Additional Premiums and Amounts:
- National Government to pay additional premiums for services rendered before June 16, 1951, in annual amortizations of 17.3 million pesos for 50 years starting 1967 (Section 7)
- National Government to pay additional premiums for increased retirement benefits due to this Act, in annual amortizations for 40 years starting not earlier than 10 years from approval (Section 7)

Retirement Benefits:
- Amount of monthly annuity at age 57 based on formula involving years of service and average monthly salary (Section 11a)
- Options for equivalent benefits, including joint-life annuity, lump-sum payment, and others approved by the System (Section 11a)
- Survivors benefit for beneficiaries if employee dies before retirement eligibility (Section 11b)
- Disability benefit if permanently and totally disabled, based on years of service (Section 11c)

Retirement Eligibility and Conditions:
- Retirement allowed after 20 years of service, with gratuity based on years of service and salary (Section 12c)
- Automatic and compulsory retirement at 65 years, with lump-sum payment and future annuity, unless continued service approved (Section 12e)
- Automatic and compulsory retirement age for judiciary is 70 years (Section 12e)
- Option to retire at 63 years with lump-sum payment and future annuity (Section 12e)
- Option to retire at 60-62 years with partial lump-sum payment and future annuity (Section 12e)

Administration and Other Provisions:
- Authorizes appointment of president, executive vice president, senior vice president and actuary, and other officers of the System (Section 18)
- Declares certain retirement acts inoperative or abolished, but preserves rights of those already retired (Section 9)
- Prohibits creation of new insurance or retirement plans by employers, and abolishes supplementary retirement plans (Section 10)
- Repeals or modifies inconsistent laws (Section 11)
- Effective upon approval (Section 12)