TWENTIETH CONGRESS OF THE 
REPUBLIC OF THE PHILIPPINES 
First Regular Session
of »)jf
S. No.
)
SENATE
1072
25 AUG -6 P4 33
MiCEtVEtWr;
Introduced by Senator Jinggoy Ejercito Estrada
AN ACT
ESTABLISHING THE OVERSEAS FILIPINO WORKERS SOCIAL SECURITY 
AND RETIREMENT SYSTEM AND APPROPRIATING FUNDS THEREFOR
EXPLANATORY NOTE
Overseas Filipino Workers (OFWs) have long been hailed as modern-day heroes 
for their invaluable contributions to their families and keeping the Philippine economy 
afloat. With over 10 million Filipinos working and living abroad, OFWs remit billions of 
pesos annually—sustaining families, bolstering consumption, and stabilizing the 
national economy. Despite their crucial role, many OFWs remain vulnerable to 
economic insecurity, particularly when they reach old age, due to the absence of a 
comprehensive social protection and retirement system to suit their needs.
While the existing Social Security System (SSS) is open to voluntary 
contributions from OFWs, many face logistical, informational, and systemic barriers 
that prevent them from consistently contributing or receiving adequate benefits. The 
current framework also lacks mechanisms that consider the unique employment 
conditions, migratory patterns, and contractual nature of overseas work.
This bill seeks to establish an OFW social security and retirement system which 
is a specialized, government-administered program designed to provide long-term 
social security, retirement benefits, and safety net for OFWs when they retire. The


system will include mandatory and voluntary contribution schemes, with matching 
government share, to ensure the fund's sustainability.
Under the measure, any OFW who voluntarily retires before reaching 45 years 
old but who has served for at least five (5) years in overseas employment or separated 
from the overseas employment shall be paid retirement or separation benefits 
equivalent to one and one-fourth (IV4) month basic salary for every year of their 
respective overseas employment.
In view of the foregoing, the passage of this bill is earnestly sought.
INGSOY EJERCITO ESTRADA


TWENTIETH CONGRESS OF THE 
REPUBLIC OF THE PHILIPPINES 
First Regular Session
)
SENATE
S. No. 1072
' of1i)f frrrrrtur/
25 AUG-6 P4 33
ifCnVEiAc
Introduced by Senator Jinggoy Ejercito Estrada
AN ACT
ESTABLISHING THE OVERSEAS FILIPINO WORKERS SOCIAL SECURITY 
AND RETIREMENT SYSTEM AND APPROPRIATING FUNDS THEREFOR
Be it enacted by the Senate and House of Representatives of the Philippines in 
Congress assembled:
1 
Section 1. Short Title. - This Act shall be known as the "Overseas Filipino
2 
Workers Retirement System Acf.
3 
Sec. 2. Declaration of Policy. - It is hereby declared the policy of the State to
4 
protect and promote the welfare of overseas Filipino workers. Towards this end, there
5 
is a need to pioneer and develop innovative means to provide incentives designed to
6 
uplift their standard of living as well as those of their families.
7 
Sec. 3. Definition of Terms. - For purposes of this Act, the following terms shall
8 
mean:
9 
a) Beneficiaries refer to the dependent spouse of an OFW, his dependent
10 
children, whether legitimate or illegitimate, who are the primary
11 
beneficiaries. In their absence, the dependent parents shall be the
12 
secondary beneficiaries. In the absence of the foregoing, another person
13 
designated by the OFW;
14 
b) Dependent refers to the legitimate, legitimated or legally adopted child who
15 
is unmarried, not gainfully employed, and not over twenty-one (21) years
16 
of age, or over twenty-one (21) years of age but he is congenitally
17 
incapacitated and incapable of self-support, physically or mentally,
18 
legitimate spouse dependent for support upon the employee, and the
1


1 
legitimate parents wholly dependent upon the covered employee for regular
2 
support;
3 
c) Non-documented OFW refers to an overseas Filipino worker who does not
4 
have valid contract of employment nor possesses the necessary documents
5 
to work abroad; 
and
6 
d) Overseas Filipino Worker (OFW) refers to a Filipino citizen with a valid
7 
contract of employment outside the Philippines through a legitimate agency
8 
or employer and who possesses the necessary documents to work abroad;
9 
Sec. 4. Overseas Filipino Workers Social Security and Retirement System. -
10 
There is hereby established an Overseas Filipino Workers Social Security and
11 
Retirement System, hereinafter referred to as the System, which shall cover all
12 
documented OFWs who are duly registered with the Philippine Overseas Employment
13 
Administration.
14 
Sec. 5. Objectives. - The System shall have the following objectives:
15 
a) Provide retirement benefits and welfare assistance to OFWS and their
16 
dependents;
17 
b) Develop a savings pension plan by which OFWs can be encouraged
18 
collectively to contribute part of their earnings in order to protect them
19 
against the hazards of old-age, disability, sickness and death;
20 
c) Ensure the viability of the funds remitted by OFWs, and
21 
d) Establish a trust fund which will constitute the contributions of OFWs.
22 
The system shall endeavor to strike a right balance in management and
23 
safekeeping of the funds remitted by OFWs while extending the benefits of the
24 
System's services to the rightful beneficiaries.
25 
Sec. 6. Board of Trustees. - The System shall be administered by a board of
26 
trustees which shall be composed of the Secretary of Labor and Employment as
27 
chairperson, the Administrator of Philippine Overseas Employment Administration
28 
(POEA) as the Director of the System, two (2) representatives from the land-based
29 
overseas workers, two (2) representatives from the seafarer's group, and one (1)
30 
representative each from the management and labor sectors, as members.
31 
The director of the System and the representatives of both management and
32 
labor sectors, upon the recommendation of the Secretary of Labor and Employment


1 
and the representative of both the land-based overseas workers and the seamen or
2 
the seafarers, upon the recommendation of their respective organizations, shall be
3 
appointed by the President.
4 
The director shall be the chief executive officer of the System. He shall have
5 
the qualifications, rank and compensation of bureau director. The director shall be
6 
assisted by a deputy director who shall be appointed by the board of trustees upon
7 
the recommendation of the chairman.
8 
Sec. 7. Powers and Functions. - The Board of Trustees shall have the following
9 
powers and functions:
10 
a) Formulate and implement measures to attain the system's objectives and
11 
purposes;
12 
b) Enter into agreements or contracts for such service and aid, as may be
13 
necessary, for the proper and effective administration of the System;
14 
c) Manage the retirement fund and other sources of the System subject to
15 
pertinent accounting rules and regulations issued by the Commission on
16 
Audit;
17 
d) Adopt from time to time a budget of expenditures for the System including
18 
its annual budget which shall not be more than thirty percent (30%) of the
19 
retirement fund;
20 
e) Acquire property, real or personal, which may be necessary for the
21 
attainment of the objectives of this Act;
22 
f) Determine and fix the monthly contribution of the OFWs;
23 
g) Sue and be sued in court;
24 
h) Appoint such personnel as may be deemed necessary to ensure the efficient
25 
administration of the System; 
and
26 
i) Perform such other acts as may be necessary for the effective
27 
implementation of this Act.
28 
Sec. 8. Chairperson; Power and Functions. - The chairperson shall have
29 
authority and responsibility of exercising the powers and functions of the System. He
30 
shall be appointed by the President.
31 
The Chairperson shall have the following powers and functions:


1 
a) Formulate and implement policies and programs to attain the objectives and
2 
purposes of the System;
3 
b) Issue rules and regulations to carry out the objectives and purposes of the
4 
System;
5 
c) Administer fund resources and recommend to the Board of Trustees the
6 
annual budget of the System;
7 
d) Determine the functions, composition, and compensation of the personnel
8 
of the System;
9 
e) Determine and fix the amount of contributions of employers of land-based
10 
and sea-based OFWs;
11 
f) Coordinate all policies and programs relating to OFWs as provided in this
12 
Act; and
13 
g) Undertake necessary consultations concerning matters affecting the welfare
14 
of OFWS and their families, and recommend to the President policies and
15 
programs relative thereto.
16 
Sec. 9. Secretariat. - The Secretariat personnel shall be appointed by the
17 
Chairperson, upon the recommendation of the Director. The compensation of the
18 
personnel and the operating expenses of the Secretariat shall be charged to the
19 
Retirement Fund as hereinafter established.
20 
Sec. 10. Compulsory Coverage. - The System shall be compulsory upon all
21 
documented OFWs: Provided, That if an OFW is a member of Social Security System
22 
or any similar entity as provided under existing laws, the same shall be discontinued
23 
and any benefit or benefits accruing to the OFW from such membership shall be
24 
integrated into the System.
25 
Compulsory coverage of the OFW under this system shall take effect on the
26 
first day of employment in the foreign country.
27 
Sec. 11. Separation from Employment - When a covered OFW is separated
28 
from employment, the obligation to pay contributions from that employment shall
29 
cease at the end of the month of separation, but he shall be credited with all
30 
contributions paid and shall be entitled to all benefits provided in this Act.


1 
Sec. 12. Retirement Benefits. - All covered OFWs who had paid at least one
2 
hundred twenty (120) monthly contributions prior to the semester of retirement and
3 
who has reached the age of forty-five (45) years shall be entitled to a monthly pension.
4 
The computation of the monthly pension shall be determined by the Board of
5 
Trustees in accordance with the actuarial system of the Social Security System.
6 
Upon the death of the retired OFW pensioner, his primary beneficiaries as of
7 
the date of retirement shall be entitled to eighty percent (80%) of the monthly pension
8 
and his dependents to the dependent's pension: Provided, That if he has no primary
9 
beneficiaries and he dies within sixty months from the start if his monthly pension, his
10 
secondary beneficiaries shall be entitled to a lump sum benefit equivalent to the
11 
greater of (a) twenty (20) times the monthly pension or (b) the difference of sixty
12 
(60) times the monthly pension and the total monthly pensions by the System
13 
excluding the dependent's pension.
14 
Sec. 13. Dependent's Pension. - The dependent's pension shall be equivalent
15 
to ten percent (10%) of the monthly pension for each dependent child which shall not
16 
exceed five (5), beginning with the youngest and shalt be without substitution:
17 
Provided, That his dependents born before his retirement of a marriage subsisting
18 
when he was forty (40) years old shall be entitled to the dependent's pension.
19 
Sec. 14. Eariy Retirement and Voiuntary Separation Benefits. - Any OFW who
20 
voluntarily elects in writing to retire prior to the age of forty-five (45) but who has
21 
served for at least five (5) years in overseas employment or separated from the
22 
overseas employment shall be paid retirement or separation benefits equivalent to
23 
one and one-fourth (VA) month basic salary for every year of their respective
24 
overseas employment or the nearest equivalent traction thereof favorable to them on
25 
the basis of the highest salary which they respectively received in the course of their
26 
employment in the foreign country.
27 
Sec. 15. Retirement Fund. - There shall be created an Overseas Filipino Workers
28 
Retirement Fund, hereinafter, referred to as the Fund, where all OFWs who are duly
29 
registered as such with the Philippine Overseas Worker's Administration (POEA) shall
30 
remit five (5%) of their gross monthly income for at least ten (10) years.
31 
The Fund shall be used for the purpose of providing retirement benefits and
32 
similar gratuities to OFW or their beneficiaries.


1 
Sec. 16. Source of Fund. - In addition to the monthly contribution of the OFWs
2 
to the Fund, the Fund shall be financed from the following sources:
3 
a) Ten percent (10%) from the fees charged by medical testing centers which
4 
provide medical test to overseas job-applicants:
5 
b) Ten percent (10%) from fees charged by Philippine international airports to
6 
outgoing OFWs;
7 
c) Ten percent (10%) from fees charged by OFW training centers; and
8 
d) Fifty million pesos (P50,000,000.00) annually for five (5) years to be
9 
appropriated and taken from the Contingency Fund of the Office of the
10 
President to complement the Overseas Filipino Workers Fund's Reserve.
11 
Sec. 17. Appropriations. - To effectively implement the provisions of this Act,
12 
there is hereby appropriated the amount of One hundred million pesos
13 
(P100,000,000.00) for the initial capitalization of the System to be charged to the
14 
current appropriations of the Office of the President.
15 
Thereafter, the amount necessary for the continuous operation of the System
16 
shall be included in the annual General Appropriations Act.
17 
Sec. 18. Implementing Rules and Regulations. - The POEA shall, within sixty
18 
(60) days after the effectivity of this Act, promulgate the necessary rules and
19 
regulations for the implementation of this Act.
20 
Sec. 19. Repealing Clause. - Any provision of laws, decrees, executive orders,
21 
proclamations, rules and regulations, or parts thereof, which are inconsistent with this
22 
Act are hereby repealed, amended or modified accordingly.
23 
Sec. 20. Separability Clause. - If any portion of this Act is declared
24 
unconstitutional or invalid, the other provisions not affected shall continue in full force
25 
and effect.
26 
Sec. 21. Effectivity Clause. - This Act shall take effect fifteen (15) days following
27 
the completion of its publication in two (2) newspapers of general circulation.
Approved,