Social Security Act of 2018
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Social Security Act of 2018
Republic Act No. 11199
February 7, 2019
Case Overview and Summary
Summary of Republic Act No. 11199 (Social Security Act of 2018)Establishment and Objectives of the Social Security System (SSS) (Sections 1-3)
- Establishes the SSS as a tax-exempt social security system to provide meaningful protection against disability, sickness, maternity, old age, death, and other contingencies resulting in loss of income.
- Aims to extend social security protection to Filipino workers, local or overseas, and their beneficiaries.
- Promotes a culture of "work, save, invest and prosper" and ensures maximum profitability of investible funds.
- The SSS is an independent and accountable government-owned and -controlled corporation (GOCC) directed by the Social Security Commission.
Powers and Duties of the Commission and SSS (Section 4)
- The Commission has the power to:
- Formulate rules and regulations to carry out the Act's provisions. (Section 4(a)(1))
- Establish a Provident Fund for members' contributions and earnings. (Section 4(a)(2))
- Maintain a Provident Fund for SSS officials and employees. (Section 4(a)(3))
- Conduct actuarial studies and adjust benefits, contributions, and rates accordingly. (Section 4(a)(4))
- Approve restructuring proposals for payment of due contributions and loans. (Section 4(a)(5))
- Authorize cooperatives or associations to act as collecting agents. (Section 4(a)(6))
- Compromise or release civil liabilities related to investments. (Section 4(a)(7))
- Condone or compromise penalties on delinquent contributions under certain conditions. (Section 4(a)(8))
- Implement a schedule of contribution rates and monthly salary credits. (Section 4(a)(9))
- Develop special social security programs for workers with unique situations. (Section 4(a)(10))
- Approve and review actions of the SSS. (Section 4(a)(11))
- The SSS has the power to:
- Submit annual reports to the President and Congress. (Section 4(b)(1))
- Require actuarial valuations and provide for benefit increases. (Section 4(b)(2))
- Establish offices and inspect them periodically. (Section 4(b)(3))
- Enter into agreements for proper administration. (Section 4(b)(4))
- Adopt budgets and authorize expenditures. (Section 4(b)(5))
- Set up accounting systems and personnel. (Section 4(b)(6))
- Require reports and conduct investigations. (Section 4(b)(7))
- Acquire, develop, and dispose of property. (Section 4(b)(8))
- Acquire property for housing projects and facilities. (Section 4(b)(9))
- Enter into agreements with GSIS or other entities for portability. (Section 4(b)(10))
- Sue and be sued in court. (Section 4(b)(11))
- Perform other corporate acts for enforcement of the Act. (Section 4(b)(12))
Settlement of Disputes and Appeals (Section 5)
- Disputes related to coverage, benefits, contributions, and penalties are cognizable by the Commission and must be decided within 20 days after submission of evidence. (Section 5(a))
- Decisions of the Commission can be appealed to the Court of Appeals or Supreme Court within 15 days of notification. (Sections 5(b)-(c))
- The Commission can issue writs of execution to enforce its decisions. (Section 5(d))
Auditor, Counsel, Oaths, and Records (Sections 6-7)
- The Chairman of the Commission on Audit is the ex officio Auditor of the SSS. (Section 6(a))
- The Secretary of Justice is the ex officio counsel of the SSS. (Section 6(b))
- Authorized SSS officials can administer oaths, issue subpoenas, and compel attendance of witnesses and production of records. (Section 7)
Definitions (Section 8)
The law defines terms such as:
- SSS, Commission, employer, employee, dependents, compensation, monthly salary credit, monthly, contribution, employment, beneficiaries, contingency, average monthly salary credit, average daily salary credit, semester, quarter, credited years of service, member, self-employed, net earnings, and fixed charges.
Coverage (Sections 9-9B)
- Coverage in the SSS is compulsory for all employees not over 60 years old and their employers, with some exceptions. (Section 9(a))
- Spouses who manage the household and family affairs may be covered voluntarily. (Section 9(b))
- Coverage is compulsory for self-employed persons as determined by the Commission, including professionals, business owners, actors, athletes, farmers, and fishermen. (Section 9-A)
- Coverage is compulsory for sea-based and land-based overseas Filipino workers (OFWs) not over 60 years old. (Section 9-B)
Effective Date of Coverage and Effect of Separation or Interruption (Sections 10-11A)
- Compulsory coverage for employers takes effect on the first day of operation, and for employees on the day of employment. (Section 10)
- When an employee is separated, the employer's obligation to pay contributions ceases, but the employee can continue paying to maintain benefits. (Section 11)
- If a self-employed member has no income in a given month, they are not required to pay contributions but may continue paying to maintain benefits. (Section 11-A)
Benefits (Sections 12-14B)
- Monthly Pension: Calculated based on average monthly salary credit, credited years of service, and minimum amounts specified in the law. Additional benefit allowances may be granted. (Section 12)
- Dependents' Pension: 10% of the monthly pension or P250, whichever is higher, for each dependent child up to 5. (Section 12-A)
- Retirement Benefits: Members with at least 120 monthly contributions can receive a monthly pension upon reaching 60 or 65 years old, with options for lump sum payments. (Section 12-B)
- Death Benefits: Primary beneficiaries are entitled to the monthly pension upon the member's death if at least 36 monthly contributions were paid. (Section 13)
- Permanent Disability Benefits: Members with at least 36 monthly contributions are entitled to the monthly pension upon permanent total disability, with provisions for permanent partial disability. (Section 13-A)
- Funeral Benefit: A grant of P12,000 is paid upon the death of a member, permanently totally disabled member, or retiree. (Section 13-B)
- Sickness Benefit: Members with at least 3 monthly contributions in the preceding 12 months are entitled to a daily sickness benefit for up to 120 days of confinement per year, subject to conditions. (Section 14)
- Maternity Leave Benefit: Female members with at least 3 monthly contributions in the preceding 12 months are entitled to a daily maternity benefit for 60 or 78 days, subject to conditions. (Section 14-A)
- Unemployment or Involuntary Separation Benefits: Members with at least 36 monthly contributions, 12 of which are in the preceding 18 months, are entitled to monthly cash payments equivalent to 50% of the average monthly salary credit for up to 2 months, subject to conditions. (Section 14-B)
Non-Transferability of Benefits and Exemptions (Sections 15-16)
- Benefits are not transferable, and powers of attorney for collection are not recognized, with some exceptions. (Section 15)
- The SSS and its assets, contributions, accruals, income, benefit payments, supplies, and documents are exempt from taxes, fees, charges, customs duties, attachments, garnishments, levies, and seizures. (Section 16)
Fees of Agents and Attorneys (Section 17)
- Agents or attorneys cannot demand fees for preparing or pursuing claims, with an exception for attorneys appearing as counsel before the Commission, who can charge up to 10% of the awarded benefits.
Contributions (Sections 18-22A)
- Employers must deduct employee contributions from monthly compensation according to the schedule and rates determined by the Commission. (Section 18)
- Employers must pay employer contributions according to the schedule, and cannot deduct or recover these from employees. (Section 19)
- Self-employed members must pay both employer and employee contributions based on their declared monthly earnings. (Section 19-A)
- The government contributes funds to meet the SSS's estimated expenses and maintain an adequate working balance. (Section 20)
- The government guarantees the solvency of the SSS. (Section 21)
- Contributions must be remitted within 10 days of each calendar month, with penalties for late remittance. (Section 22)
- Self-employed members must remit quarterly contributions, with no retroactive payments allowed except as prescribed. (Section 22-A)
Collection and Reporting (Sections 23-24A)
- The SSS can require proper collection and payment methods, and proper identification of employers and employees. (Section 23)
- Employers must report the names, ages, civil status, occupations, salaries, and dependents of covered employees, and maintain employment records, subject to penalties for non-compliance. (Section 24)
- Self-employed members must register and report their information within 30 days of starting their profession or business. (Section 24-A)
Deposit, Disbursement, and Investment of Funds (Sections 25-26B)
- Contributions and accruals are deposited and disbursed like other public special funds, with a limit of 12% for administrative expenses. (Section 25)
- The Reserve Fund is established, with portions not needed for current obligations forming the Investment Reserve Fund, which the Commission manages and invests according to specified guidelines and limits. (Section 26)
- The SSS may appoint local or foreign fund managers. (Section 26-A)
- The SSS can establish a Mortgagors' Insurance Account to insure its interests on mortgaged properties, subject to examination by the Insurance Commission. (Section 26-B)
Records, Reports, and Penal Provisions (Sections 27-28)
- The SSS President must keep records of operations and submit annual reports to the President and Congress. (Section 27)
- Penal provisions are specified for various offenses, including making false statements, obtaining benefits fraudulently, misappropriating funds, and failing to comply with the Act or regulations. (Section 28)
Government Aid and Implementing Rules (Sections 29-30)
- The establishment of the SSS does not disqualify members and employers from receiving government assistance. (Section 29)
- The Commission must promulgate implementing rules and regulations within 90 days of the Act's effectivity. (Section 30)
Transitory Provisions (Section 31)
- Delinquent employers can remit or propose to pay contributions in installments within 6 months from the Act's effectivity without incurring penalties, subject to conditions.
Separability and Repealing Clauses (Sections 32-33)
- If any part of the Act is held invalid, the remaining provisions remain in full force and effect. (Section 32)
- Republic Act No. 1161, Republic Act No. 8282, and other inconsistent laws, proclamations, executive orders, rules, and regulations are repealed, modified, or amended accordingly. (Section 33)
Effectivity (Section 34)
- The Act takes effect 15 days after its publication in the Official Gazette or a newspaper of general circulation.
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Law
Social Security Act of 2018
Republic Act No. 11199
•February 7, 2019
REPUBLIC ACT NO. 11199
AN ACT RATIONALIZING AND EXPANDING THE POWERS AND DUTIES OF THE SOCIAL SECURITY COMMISSION TO ENSURE THE LONG-TERM VIABILITY OF THE SOCIAL SECURITY SYSTEM, REPEALING FOR THE PURPOSE REPUBLIC ACT NO. 1161, AS AMENDED BY REPUBLIC ACT NO. 8282, OTHERWISE KNOWN AS THE "SOCIAL SECURITY ACT OF 1997"
SECTION 1. Short Title. — This Act shall be known as the "Social Security Act of 2018."
SECTION 2. Declaration of Policy. — It is the policy of the State to establish, develop, promote and perfect a sound and viable tax-exempt social security system suitable to the needs of the people throughout the Philippines which shall promote social justice through savings, and ensure meaningful social security protection to members and their beneficiaries against the hazards of disability, sickness, maternity, old age, death, and other contingencies resulting in loss of income or financial burden. Towards this end, the State shall endeavor to extend social security protection to Filipino workers, local or overseas, and their beneficiaries.
In the pursuit of this policy, a social security...
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