Republic of the Philippines
HOUSE OF REPRESENTATIVES
Quezon City, Metro Manila

FIFTEENTH CONGRESS
SECOND REGULAR SESSION

4942

HOUSE BILL NO.

Introduced by CIBAC Party List Representatives
Sherwin N. Tugna and Cinchona Cruz-Gonzales

AN ACT AMENDING SECTIONS 3, 22, 25, 26, 27, 28, 29, 30 OF R.A. NO. 1161, AS
AMENDED, OTHERWISE KNOWN AS THE SOCIAL SECURITY LAW

EXPLANATORY NOTE

The Social Security Law was enacted to protect employees of private firms
against the risks of disability, sickness, retirement and death. Thus, it is incumbent that
the funds contributed for the employees are safeguarded and are ensured to benefit
them when the risks mentioned have occurred.

This bill seeks to amend provisions of R.A. 1161, as amended by R.A. 8282,
otherwise known as the “Social Security Law” to ensure the following: 1) the funds are
managed by competent people who have the heart to use them in accordance with
the mandate of the law; 2) the contributions of the employers which have become
insolvent are to be considered ordinary preferred liens so as to protect the contributions
of the employees; 3) in case the employee entitled to the benefits under the law does
not receive at the time of his death the amount equivalent to all the contributions
made on his behalf, the Commission shall pay the remaining amount to his
beneficiaries.

The Social Security Commission tasked to direct and control the System must be
composed of members who shall be required to have previous experience in technical
and administrative fields related to the purposes of the law and must be known for their
integrity. These appointive members will make decisions regarding the contributions for
the employees who mostly rely on these funds when the risks have occurred. Thus, it is
reasonable to require that they have the competence and skill to properly comply with
their duties and the integrity to ensure that they will not divert the funds for other
purposes.

The contributions to be paid must be remitted to the System. However, in case
an employer has become insolvent, there is no protection granted under the law to


ensure that the contributions will still be paid. In order to protect the contributions of the
employees, this bill classifies the unremitted contributions as ordinary preferred claims,
having the same status as those stated in Article 2244 of the Civil Code.

There are instances when an employee has paid more than what he receives
from the System. Thus, this bill adds another phrase which provides that when this
happens, the System must ensure that it pays the employee or his estate all the
contributions made on his behalf by his employer. The provision is added to remedy the
inequity that results when the employee cannot receive all the contributions made on
his behalf. The System shall not benefit at the expense of the employee. For the
System to benefit from the contribution of the employer for its employees is tantamount
to confiscation of one’s property without due process of law. This is against the right
granted under the 1987 Constitution, the fundamental law of the land. The law was
enacted for the benefit of the employees and neither for the employers nor the System.

In view of the foregoing, immediate passage of the bill is eamestly sought.

Rep. cncrl lm

CIBAC Party-|



Republic of the Philippines
HOUSE OF REPRESENTATIVES
Quezon City, Metro Manila

FIFTEENTH CONGRESS
SECOND REGULAR SESSION

House BiLNo.__ 4942

Introduced by CIBAC Party List Representatives
Sherwin N. Tugna and Cinchona Cruz-Gonzales

AN ACT AMENDING SECTIONS 3, 22, 25, 26, 27, 28, 29, 30 OF R.A. NO. 1161, AS.
AMENDED, OTHERWISE KNOWN AS THE SOCIAL SECURITY LAW

Be it enacted by the Senate and House of Representatives of the Philippines in
Congress assembled:

SECTION 1. Section 3 of R.A. No. 1161, as amended, is hereby amended to read as
follows:

"SEC. 3. Social Security System. - (a) To cary out the purposes of this Act,
the Social Security System, hereinafter referred to as ‘S85’, a corporate
body, with principal place of business in Metro Manila, Philippines is
hereby created. The SSS shall be directed and controlled by a Social
Security Commission, hereinafter referred to as ‘Commission’, composed
of the Secretary of Labor and Employment or his duly designated
undersecretary, the SSS president and seven (7) appointive members,
three (3) of whom shall represent the workers’ group, at least one of
whom shall be a woman; three (3), the employers’ group, at least one (1)
of whom shall be a woman; and one (1), the general public jwhese
representative—shall_have—adequate- and—experience

fi i ity}, to be appointed by the President of the

regarding_social_security},

Philippines. The six (6) members representing workers and employers shall
be chosen from among the nominees of workers’ and employers’
‘organizations, respectively. The Chairman of the Commission shall be
designated by the President of the Philippines from among its members.
The term of the appointive members shall be three (3) years:Provided,
That the terms of the first six (6) appointive members shall be one (1), two
(2) and three (3) years for every two members, respectively:Provided,
further, That they shall continue to hold office until their successors shall
have been appointed and duly qualified. All vacancies, prior to the
expiration of the term, shall be filled for the unexpired term only. Ihe
appointive members shall have previous experience in the technical and



administrative fields related to the purposes of this Act and must be
known for their integrity. They ails ssi
shall receive at least two thousand five hundred pesos (P2,500.00) per
diem for each meeting actually attended by them but not fo exceed Ten
thousand pesos (P10,000.00) a month:Provided, That members of the
Commission shall also receive a per diem of at least Two thousand five
hundred pesos {P2,500.00) but not to exceed Fifteen thousand pesos
(P15,000.00) a month: Provided, further, That said members of the
Commission shall also receive reasonable transportation and
tepresentation allowances as may be fixed by the Commission, but not to
exceed Ten thousand pesos (P10,000.00) a month.

“(b) The general conduct of the operations and management functions of
the SSS shall be vested in the SSS President who shall serve as the chief
executive officer immediately responsible for carying out the program of
the SSS and the policies of the Commission. The SSS President shall be a
person who has had previous experience in the technical and
administrative fields related to the purposes of this Act and must be
known for his integrity. He shall be appointed by the President of the
Philippines and shall receive salary to be fixed by the Commission with the
approval of the President of the Philippines, payable from the funds of the
SSS.

SECTION 2. Section 22 (b) of R.A. No. 1161, as amended, is hereby amended to read as
follows:

“SEC. 22. Remittance of Contributions.

boos 20K
x

"(b) The contributions payable under this Act in cases where an employer
refuses or neglects to pay the same shall be collected by the SSS in the
same manner as taxes are made collectible under the National Internal
Revenue Code, as amended. Failure or refusal of the employer to pay or
remit the contributions herein prescribed shall not prejudice the right of
the covered employee to the benefits of the coverage.

"The right to institute the necessary action against the employer may be
commenced within twenty (20) years from the time the delinquency is
known or the assessment is made by the SSS, or from the time the benefit
accrues, as the case may be.

t he insolvent, 1 Tf f ths
the itt Th ttributic ns item Ni it
rin fe jim ec ific Article 2244 the Civil


Code and enjoy preference in the distribution of the assets of the

Section 3. A new section 25 must be added which provides:

“SEC. 25. PROTECTION FOR FULL ENJOYMENT OF BENEFITS. In any case

where a covered employee. upon retirement or death, would receive less
than what he his emt had actually contributed to the System,
the remaining balance of the total amount so contributed up to the time
of his death or retirement must be paid to him or his estate.”

Section 4, Sections 25, 26, 27, 28, 29 and 30 must be renumbered as Sections 26, 27, 28,
29, 30 and 31 respectively.

Section 5. Separability Clause. - If any provision of this Act is declared invalid, the other
provisions not affected thereby shall remain valid.

Section 6,Repealing Clause. - All laws, proclamations, executive orders, rules and
regulations or parts thereof inconsistent with this Act are hereby repealed, modified or
amended accordingly: Provided, That no person shall be deemed to be vested with
any property or other right by virtue of the enactment or operation of this Act.

Section 7. Effectivity Clause. -This Act shall take effect fifteen (15) days after its
complete publication in the Official Gazette or in at least two (2) national newspapers
of general circulation whichever comes earlier.

Approved,