oy
RECEIVED

Republic of the Philippines
HOUSE OF REPRESENTATIVES
Quezon City

EIGHTEENTH CONGRESS.
Second Regular Session

House BILL No! 422

Introduced by HON. LUIS RAYMUND “LRAY” F. VILLAFUERTE, JR.

AN ACT FURTHER STRENGTHENING THE
GOVERNMENT SERVICE INSURANCE SYSTEM

Revising the Government Service Insurance System law needs urgent action to
conform to recent developments and address long-running issues such as lack of
transparency, inefficient collection, poor record-keeping and even numerous
allegations corruption

This bill was introduced in the 15'" Congress where it reached approval in the 3’
reading but was not acted upon by the Senate. It was introduced again in the 16" and
17" Congress but were also unfruitful.

The salient points of the bill include:
1. Giving the government employee who retired from government service the
option to enjoy retirement benefits under RA 1616 or RA 660.
2. Increasing the GSIS Board of Trustees to 9 members to accommodate a
member from the retirees group.
3. Equalizing the grant of retirement benefits for all branches of the government.
4. Expanding the coverage and benefits of the government employees under the
GSIS to allow dependents to avail of survivorship benefits whether they are
gainfully employed or not.

The immediate passage of the bill is most eamestly sought.

at

” F, VILLAFUERTE, JR.



Republic of the Philippines
HOUSE OF REPRESENTATIVES
Quezon City

EIGHTEENTH CONGRESS
Second Regular Session

7492

HOUSE BILL NO.

Introduced by HON. LUIS RAYMUND “LRAY” F. VILLAFUERTE, JR.

AN ACT FURTHER STRENGTHENING THE GOVERNMENT SERVICE
INSURANCE SYSTEM

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

SEC. 1. Short Title. — This Act shall be known as the “Revised Government
Service Insurance System (GSIS) Act 2020"

SEC. 2. Declaration of Policy. — It is a declared policy Of the State to provide,
develop and promote a sound social security system responsive to the needs of its
employees, Likewise. the State shall review and strengthen policies that advance and
protect the welfare of employees in the public sector and ensure their right to
participate in policy and decision-making processes affecting their rights and benefits.
Toward this end, the State shall:

(a) _ Ensure the adoption of policies beneficial to GSIS members, paving the
way for a responsible, integrated and transparent social security system;

(b) Provide greater representation for members at the highest policy-
making level of the GSIS

(©) _ Insulate the Social Insurance Fund (SIF) from dissipation due to the
volatility of the global economy; and

(d) Ensure that top-level officials of the GSIS are held accountable for
mismanagement and inefficiencies in the delivery of services to members and
beneficiaries.


PART | - DEFINITIONS

SEC. 3. Definition of Terms. — Unless the context Otherwise indicates. the following
terms shall mean:

(a) GSIS — The Government Service Insurance System created by Commonwealth
Act No. 186;

(b) Board — The Board of Trustees of the Government Service Insurance
System:

(c) Employer — The national government. its political subdivisions.
branches, agencies or instrumentalities. including. government-owned or controlled
corporations. and financial institutions with original charters, the Constitutional
commissions and the judiciary.

(d) Employee or Member — Any person. receiving compensation while in
the service of un employer as defined herein. whether by election or appointment,
irrespective of status of appointment, including barangay and sanggunian officials, (e)
Active Member — A member who is not separated from the service;

() Beneficiaries — Beneficiaries Shall be the following-.
1) For married members
(i) The legitimate spouse, and
(ii) The legitimate. legitimated. legally adopted child, including the
illegitimate child. who is unmarried. not over the age of
majority. or IS over the age of majority but is considered a
person with disability

(PWD) and incapable of self-support due to a mental or physical Impairment acquired
prior to age of majority;
2) For unmarried members
(i) The legitimate, legitimated. legally adopted child. including the
illegitimate child, who is unmarried, not over the age of majority.
or is over the age of majority but is considered a person with
disability (FWD) and incapable of self-support due to a mental
or physical impairment acquired prior to the age of majority, or

(ii) Inthe absence of children, the parents Provided. however. That
the parents no longer be considered as beneficiaries once the
member marries and/or begets a child: or

(iii) Inthe absence of either (i) and (li), a designated beneficiary who shall have the
same qualifications and be entitled to the same benefits as a legitimate. legitimated,
legally adopted or illegitimate child under paragraph (f)(1)(ii) of this Section: Provided,
That the designation must be made before the member turns 50 years old: Provided.
further. That the designation can only be made once.


(g) Benefits - refer to those administered by GSIS on behalf of its members.
as found under Sections 14 to 38 of this Act, specially retirement, separation,
unemployment, disability, death/funeral, survivorship and life insurance;

(h) Compensation — The basic pay or salary received by an employee,
pursuant to his/her election or appointment. excluding per diems, bonuses. Overtime
pay, honoraria. allowances and any other emoluments received in addition to the
basic pay which are not integrated into the basic pay under existing laws;

(i) Contribution — The amount payable to the GSIS by the member and the employer
in accordance with Section 10 Of this Act;

() Current Daily Compensation — The actual daily compensation or the actual
monthly compensation divided by the number of working days in the month of
contingency but not to exceed twenty-two (22) working days;

(k) Average Monthly Compensation (AMC) quotient arrived at after dividing the
aggregate compensation received by the member during his/her lust thirty-six (36)
months of service preceding his/her separation/retirement/disability/death by thirty-six
36). or by the number of months he/she received such compensation if he/she has
less than thirty-six (36) months of service: Provided. That the average monthly
compensation shall in no case exceed the amount and rate as may be respectively
set by the Board under the rules and regulations implementing this Act as determined
by the actuary of the GSIS'.

(I) Revalued Average Monthly Compensation — An amount equal to one hundred
seventy percent (170%) of the first One Thousand Pesos (P1.000,00) of the average
monthly compensation plus one hundred percent 100%) of the average monthly
compensation in excess of One Thousand Pesos (P1,000.00);

(m) Pensioner — Any person receiving old-age or permanent total disability pension
or any person who has received the retirement benefits Provided. however. That one
who is receiving survivorship pension benefits as defined in Sections 33 to 36 Of this,
Act is not considered pensioner;

(n) Disability — Any loss or impairment of the normal functions of the physical and/or
mental faculty of a member which reduces or eliminates his/her capacity to continue
with his/her current gainful occupation;

(0) Permanent Partial Disability — Accrues or arises due to complete and permanent
loss of certain portions of the physical faculties. resulting in the disability to work for a
limned period of tune;

(p) Permanent Total Disability Accrues or arises due to injury or disease. causing
complete, irreversible. and permanent incapacity that will permanently disable a
member to work or to engage in the same occupation resulting in loss Of Income;

(q) Temporary Total Disability — Accrues or arises when the impaired physical and/or
mental faculties can be rehabilitated and/or restored to their normal functions. but such
disability shall result in temporary incapacity to work or to engage in any occupation;


(r) Total Admitted Assets — as used under this Act. refers to the value, as appearing
in the GSIS' financial statements, of its revenues, income, and other property. less the
amount of its liabilities;

(s) Total Length of Service — The number of years in government service. regardless
Of Status of employment, with or without premium contributions. to be used in
determining the eligibility of a member for retirement under this Act. The term service
shall include fulltime service with compensation: Provided. That curt-time and other
Services with compensation may be included under such rules and regulations as
may be prescribed by the GSIS; and

(t) Revaluation Factor (RF) — A supplemental amount to the AMC that is calculated
relative to the annual average inflation rate. The revaluation factor shall be
JM1O0dically adiusted as may be recommended by the GSIS' Actuary and approved
by the Board of Trustees.

(u) Total Income — The amount of profit derived from the GSIS’ operations and
investments Provided. That compulsory and optional premium contributions to the
Social Insurance Fund from both employers and employees shall not form part of
GSIS' total income.

PART II-MEMBERSHIP IN THE GSIS
SEC. 4. Compulsory Membership. -

(2) All government personnel, whether elective or appointive, irrespective
of status of appointment, provided they are receiving fixed monthly compensation and
have not reached the mandatory retirement age of 65 years. are compulsorily covered
as members of the GSIS and shall be required to Bly contributions:

(b) Contractual and casual employees who an employee-employer
relationship with a government agency are also compulsorily covered;

(©) An employee who is already beyond the mandatory retirement age of
65 but whose appointment in government service has been approved by the Office of
the President of the Philippines or has been extended by the Civil Service
Commission for the purpose of completing the fifteen (15) years Of service required
under R.A. No. 8291 to qualify for retirement benefits’

(@) following government employees are not members of the GSIS:
1) Uniformed personnel Of the Armed Forces of the Philippines (AFP), Philippine
National police (PNP). Bureau of Fire Protection (BFP) and Bureau of Jail
Management and Penology (BJMP)
2) Barangay, Sanggunian and other government officials who are not
receiving fixed monthly compensation:
3) Government employees covered by separate retirement schemes, as
enumerated under Section 4(e) of this Act; and

4) Personnel who are not receiving fixed monthly compensation and/or
do not have monthly regular hours of work.


(©) The following. who are covered by separate retirement schemes. are
also required to remit regular monthly contributions to the GSIS for their life Insurance
policies in order to answer for their life insurance benefits defined under this Act.

1) Members of the Constitutional bodies:
2) Members of the judiciary, including those with equivalent ranks;
3) Members of the national prosecution service; and

4) All Others who are or may be subsequently covered by a separate
retirement law.

SEC. 5. Optional Membership — The following shall be given the option to continue
their membership in GSIS. even beyond the mandatory retirement age of 65:

(a) An official elected to public office before age 65 but who will reach the mandatory
retirement age of 65 during his/her term. The elective official shall allowed to continue
paying life and retirement premiums until the end of his/her term, including any periods
of reelection or election to another public office: Provided, That such period/s of re-
election or election are continuous;

(b) An official appointed by the President of the Philippines to public once before age
65 for a fixed term and with a fixed monthly compensation. but who will reach the
mandatory retirement age of 65 during his/her tenure. The appointive official Shall be
allowed to continue paying life and retirement premiums until the end of his/her tenure,
including any period/s of term extension or re-appointment to another office: Provided,
the of extension or re-appointment is/are continuous;

(c) An official or employee who holds a co-terminus or highly confidential position who
reaches the age of 65 years. and whose services are considered automatically
extended until the expiration of the employee's or official's appointment or until the
employee's or official 's services are earlier terminated.

SEC. 6. Effect of Separation from the service. — A member separated from the
service either by resignation. retirement. disability, dismissal from the service or
retrenchment shall be deemed an inactive member of the system. An inactive member
shall be entitled to whatever he/she has qualified for in the event of any contingency
compensable under this Act.

SEC. 7. Members’ Rights. — In addition to their rights under existing laws, the
members shall have the following rights:

(a) Right to courteous and responsive service
1) To be considered a GSIS member from the first day of government service,
2) To provided prompt and accurate service;
3) To be accorded respect by the executives and employees of the
GSIS; and
4) To be afforded comfortable and customer-friendly facilities when
transacting with the GSIS
(b) Right to information


1) To be informed of the laws, regulations, policies or programs affecting
the members’ rights. benefits. obligations, and privileges. including
amendments or changes thereto;

2) To be informed of GSIS policies and regulations pertaining to benefits
and claims administration:

3) To be informed of the various modes and options in availing
themselves of benefits;

4) To receive accurate and updated membership data, records and
information. including records of premium remittances and loan
payments

5) To have GSIS data and records protected from unauthorized, unlawful. or Improper
disclosure; and

6) To be informed in advance of documents required to facilitate transaction,
processing and updated Status of claims or loan applications.

(c) Right to GSIS benefits

1) To receive on time the benefits the member has qualified to even after
separation from service;

2) To avail of a mode of retirement from among the different applicable
retirement laws and to be to change the chosen mode: Provided. That
the member has met the qualifications required under the chosen
mode: Provided, further. That the pension has not yet been received
or paid;

3) To be protected against discrimination and thus receive the same
benefits and privileges granted other members similarly situated; and
To receive benefits exempt from all taxes, fees. charges and duties of
all kinds except for unpaid personal premium contributions and
monetary liabilities due to the fund.

4)

(d) Right to expeditious processing of claims
|) To claim and receive on time benefits provided under applicable laws:
2) To exhaust all legal remedies under existing laws. and

3) To be protected from diminution of benefits that may arise with the
passage of a subsequent law or regulation.

(©) Right to be heard
1) To be represented in the GSIS governing Board of Trustees (Board);
2) To participate in meaningful exchanges of views. Dialogues and fora conducted by
GSIS without fear of reprisal;
3) To be consulted on the policies and programs to be implemented by the (‘SIS,
4) To convey grievances and be accorded immediate response; and

5) To transact business with the GSIS in person.


SEC. 8. Special Rights for the Elderly, PWDs, and Seriously-IIl Members,
Pensioners and Beneficiaries. - The following rights are to be afforded to the
elderly, PWDs and seriously-ill member pensioners and beneficiaries:

(a) To be provided special access lanes;

O') To be prioritized in the processing and releasing of claims and benefits;

c)To be given preference in the dissemination of information pertaining to
gi }
policies;

(d)To be accorded leniency in the submission of documents.

SEC. 9. Agencies/employers’ Responsibilities — The government agencies
covered by this Act, as employers, shalll have the following responsibilities.

(a) To deduct and remit employees’ and employers’ contributions to the
GSIS within the prescribe time mandated by law.

(b) To promptly provide documents required to facilitate the processing of

claims

(©) To provide additional documents as necessary to reconcile the records

of accounts;

(d) To promptly inform GSIS. through their Agency Authorized Officers (AAOs) of any
update pertaining to personal or service records that may affect the processing of their
employees’ claims and benefits.

PART Ill - SOURCES OF FUNDS

SEC. 10. Contributions. -

(a) It shall be mandatory for the member and the employer to pay the monthly
contributions specified in the following schedule:

Percentage of Monthly Compensation Payable
By

Monthly
Compensation Member Employer

9% 12%



Members who are excluded from compulsory retirement coverage as enumerated
under Section 4(e) of this Act shall pay three percent (3%) of their monthly
compensation as personal share, and their employers a corresponding three percent
(3%) for their life insurance coverage.

(b) The employer shall include in its annual appropriation the necessary amounts for
its share of the contributions indicated above, plus any additional premiums that may
be required on account of the hazards or risks of its employees’ occupation,

(c) It shall be mandatory and compulsory for all employers to include the payment of
contributions in their annual appropriations. The appropriate penal. civil and
administrative sanctions under Section 65 of this Act shall be imposed upon
employers who rail to include the payment of contributions in their annual
appropriations or otherwise fail to remit the accurate/exact amount of contributions on
time. or delay the remittance of premium contributions to the GSIS. The heads of
offices and agencies shall be administratively liable for non-remittance or delayed
remittance of premium contributions to GSIS.

SEC. 11. Collection and Remittance of Contributions. -

(a) The employer shall report to the GSIS the names of alll its employees,
their corresponding employment status, positions, salaries and such other pertinent
information. including subsequent changes therein. if any, as may be required by the
GSIS. The employer shall deduct each month from the monthly salary or
compensation of each employee the contribution payable by him/her in accordance
with the schedule prescribed in the rules and regulations Implementing this Act.

(b) Each employer shall remit directly to the GSIS the employees’ and
employers’ contributions and loan amortizations within the first ten (10) days of the
calendar month following the month to which the contributions apply. The collection
and remittance by the employer of the contributions and loan amortizations to the
GSIS shall take priority over and above the payment of any and all obligations,
except salaries and wages of its employees.

(©) All outstanding government share premium contributions which were
not paid by any government office or agency shall included 111 the annual budget
and shall be remitted automatically by the Department of Budget and Management
(DBM) to the GSIS.

SEC. 12. Interests on Delayed Remittances. — Agencies which delay the
remittance of any and all monies due the GSIS shall be charged interest as may be
prescribed by the Board but not more than two percent (2%) simple interest per month.
Such interest shall paid by the employers concerned.

SEC. 13. Government Guarantee. — The government of the Republic of the
Philippines hereby guarantees the fulfillment of the obligations of the GSIS to its
members as and when they fall due.


PART IV — BENEFITS
SEC. 14. Determination of Amount of Benefits. —

(a) The computation of total length of service for the purpose of determining
a member's eligibility to the benefits payable under this Act shall be based on the
service rendered starting from the date of original assumption/election, including
periods of service at different times under one or more employers, those performed
overseas under the authority of the Republic of the Philippines, and those that may
be prescribed by the GSIS in coordination with the Civil Service Commission.

(b) The computation of actual benefits payable under this Act shall be based
on the total length of service, Provided, However. That computation of benefits prior
to June 24, 1997 shall be based on the period/s of service when required premium
contributions were paid

For the purpose of this section, the term service shall include full-time service with
compensation: Provided, that part-time and other services with compensation may be
included under such rules and regulations as may be prescribed by the GSIS.

RETIREMENT BENEFITS

SEC. 15. General Conditions for Entitlement. — A member who retires from service
shall be entitled to the retirement benefits enumerated in Section 16 (a) hereof:
Provided, That the member:

(a) Has rendered at least fifteen 15) years of service;

(b) Is at least Sixty (60) years of age at the time of retirement; and

(c) Is not receiving a monthly pension benefit from permanent total disability.
SEC. 16. Retirement Benefits. -

(a) Retirement benefit shall either be:

1) Cash payment equivalent to sixty (60) months of the member's basic monthly
pension (BMP) payable at the time of retirement plus an old-age pension benefit
equal to the baste monthly pension payable monthly for life, starting upon expiration
of the five-year (5) guaranteed period covered by the cash payment. or

2) Cash payment equivalent to eighteen (18) months of the member's basic monthly
Pension plus monthly pension for life payable immediately with no five-year (5)
guarantee.

(b) Unless the service is allowed under Section 5 of this Act or extended
by appropriate authorities, retirement shall compulsory for an employee at Sixty-
five (65) years of age with at least fifteen (15) years of service: Provided. That if
the employee has less than fifteen (15) years of service, he/she may be allowed
to continue in the service in accordance with existing civil service rules and
regulations


SEC. 17. Computation of the Basic Monthly Pension. -

(a) The basic monthly pension is equal to two and one half percent (2.5%)
of the sum of the Average Monthly Compensation and Revaluation Factor, multiplied
by the total length of service and taking into consideration Section 14 of this Act:
Provided, that the basic monthly pensions shall exceed ninety percent (90%) Of the
average monthly compensation.

(b) The basic monthly pension may be adjusted upon the recommendation
of the GSIS actuary, and approved by the Board or Trustees.

SEC. 18. Periodic Pension Adjustment. — The monthly pension of all pensioners
including all those receiving survivorship pension benefits shall be periodically
adjusted as may be recommended by the GSIS' actuary and approved by the Board
in accordance with the rules and regulations prescribed by the GSIS.

SEPARATION BENEFITS

SEC. 19. General Conditions for Entitlement. — A member Who separates from
the service before he/she is eligible for retirement under Section 15 of this Act shall
be entitled to the separation benefits enumerated in Section 20 hereof: Provided, That
the member:

(a) Has rendered at least three (3) years of service; and
(b) Is not receiving a monthly pension benefit from permanent total disability.

SEC. 20. Separation Benefits. — The separation benefit shall be paid as
follows:

(a) _ Ifthe member has rendered at least three (3) years but less than fifteen
(15) years Of service and is at least sixty (60) years or age at the time of resignation
or Separation, he/she shall be entitled to a one-time cash payment equivalent to one
hundred percent (100%) of his/her average monthly compensation for each year of
service that paid premium contributions, but not less than Twelve thousand pesos
(P12,000.00). The one-time cash payment shall be payable immediately or upon
reaching sixty (60) years of age, at the option of the member: Provided. that the
average monthly compensation is equivalent to the average salary received by the
member during the last three (3) years of service,

(b) If the member has rendered at least fifteen (15) years of service but is
below sixty (60) years of age at the time of resignation or separation, he/she shall be
entitled to a one-time cash payment equivalent to eighteen (18) times his/her basic
monthly pension at the time of resignation or separation. plus an old-age pension
benefit equal to the basic monthly pension payable monthly for life upon reaching the
age of sixty (60).

SEC. 21. Effect of Re-Employment in Government Service After Separation. —
All service credited for retirement, resignation or separation for which corresponding


benefits have been paid under this Act or other laws shall be excluded in the
computation of service in case of reinstatement in government service and
subsequent retirement or separation which is compensable under this Act.

UNEMPLOYMENT BENEFITS

SEC. 22. General Conditions for Entitlement. — A member who is separated from
the service due to the abolition of his/her office or position resulting from
reorganization shall be entitled to the unemployment benefits enumerated in Section
23 hereof: Provided, That the member:

(a) Has been paying the required contributions for at least one (I) year prior
to separation;

(b) Has not been paid the voluntary separation benefit equivalent to onetime
cash payment or 18 times the BMP, should he/she opt to avail of the same before
reaching the age of 60; and

(©) Has not availed of any early retirement program as a result of his/her
office's reorganization.

SEC. 23. Unemployment or Involuntary Separation Benefits. — Unemployment
benefits shall computed as fifty percent (50%) of the average monthly compensation
of the member, payable in accordance with the following schedule:

Contributions Made Benefit Duration

7 year but less than 3 years 2 months

3 or more years but less than 6 years S months

6 or more years but less than 9 years 4 months
The — first payment
shall be | 9 ormore years but less than 11 years 5 months equivalent
to two (2) monthly
benefits, a | 11 oF more years but less than 15 years months | seven (7)
day waiting period shall

be imposed on succeeding monthly payments.

All accumulated unemployment benefits paid to the employee during his/her entire
membership with the GSIS shall be deducted from voluntary separation benefits.

The GSIS shall prescribe the detailed guidelines in the operationalization of this
Section in the rules and regulations implementing this Act.


PERMANENT DISABILITY BENEFITS

SEC. 24. General Conditions Entitlement — A member who suffers permanent
disability for reasons not due to his grave misconduct, notorious negligence, habitual
intoxication, or willful intention to kill himself/herself or another, shall he entitled to the
disability benefits provided for in this Act: Provided, That he/she is in the service at
the time of disability or has paid a total of at least one hundred eighty (180) monthly
contributions prior to his/her disability. if already separated from the service.

SEC. 25. Types of Disability Benefits. — There are two (2) types of permanent
disability, which shall be determined by the GSIS based on established medical
standards: (a) permanent total disability and (b) permanent disability

SEC. 26. Permanent Total Disability Benefits -

(a) The following disabilities shall be deemed permanent and total.
1) complete loss of sight of both eyes;
2) loss of two (2) limbs at or above the ankle and wrist;
3) permanent complete paralysis (2) limbs;
4) brain injury resulting in incurable imbeciliy or insanity; and
5) such other cases as may be determined by GSIS Board of Trustees.

(b) |The member shall receive a monthly income benefit for life equal to the
basic monthly pension effective from the date of disability.

(c) Acash payment equivalent to eighteen (18) times his/her basic monthly
pension shall also be given if the member IS in the service at the time of disability and
he/she has paid a total Of at least one hundred eighty (180) monthly contributions.

(4) A member cannot enjoy the monthly income benefit for permanent
disability and old-age retirement simultaneously.

(c) Ifa member does not satisfy the conditions stated under Section 24
hereof but has rendered at least three (3) years of service at the time of his/her
disability, he/she shall be advanced the cash payment equivalent to one hundred
percent (100%) of his/her average monthly compensation for each year of service
he/she paid contributions. but not less than Twelve Thousand Pesos (P12.000.00)
which should have been his/her separation benefit.

(f) Unless the member has reached the minimum retirement age at the time
of disability, his/her entitlement to permanent total disability benefit shall be when:
1) He/She recovers from disability as determined by the GSIS, whose decision shall
be final and binding; or
2) He/She fails to undergo medical examination when required by the
GSIS.

SEC. 27. Effect of Re-Employment on the Disability Benefits Being Received. -


(a) Entitlement to permanent total disability benefit shall continue in the
event of reemployment and the member's new salary grade, rank or position is lower
than that of his/her previous employment prior to his/her disability Provided, That the
member has properly informed the GSIS of his/her re-employment,

(b) The disability benefits to be received after re-employment shall be
adjusted by the GSIS; to be computed as the difference between the amount of the
existing disability benefit and the member's salary from his/her new employment;

(©) Failure by the member to inform the GSIS of the re-employment shall
result in the suspension of disability benefits being received.

PERMANENT PARTIAL DISABILITY BENEFITS SEC. 28.
Permanent Partial Disability Benefits. -

(a) The following disabilities shall be deemed permanent partial:
1) Complete and permanent loss of the use of:
any finger
any toe
one arm
one hand
one foot
one leg

(vii) one or both ears

(vill) sight of one eye
2) Such Other cases may be determined by the GSIS.

(b)The member shall receive a cash payment in accordance with a
schedule of disabilities to be prescribed by the GSIS.

TEMPORARY TOTAL DISABILITY BENEFITS

SEC. 29. General Conditions for Entitlement. — An active member whose injuries
result in temporary incapacity to work or to engage in any occupation, shall be entitled
to the temporary total disability benefits provided for in this Act

SEC. 30. Temporary Total Disability Benefit. —

(a) A member shall be entitled to seventy-five percent (75%) of his/her
current daily compensation for each day or fraction thereof of temporary disability
benefit not exceeding one hundred twenty (120) days in one calendar year after
exhausting all his/her sick leave credits and collective negotiation agreement sick
leave benefits, if any, but not earlier than the fourth day Of his/her temporary total
disability: Provided, however, That a member cannot enjoy the temporary total
disability benefit and sick leave pay simultaneously: Provided, further, That if the
disability requires more extensive treatment that lasts beyond one hundred twenty
(120) days, the payment of the temporary total disability benefit may be extended by
the GSIS but not to exceed a total of two hundred forty (240) days.



(b) The temporary total disability benefit shall in no case be less than One
Hundred Sixty-Five Pesos (P 165.00) a day subject to periodic review every three (3)
years:

(©) _ notices required of the and the employer, the mode of payment, and the
other requirements for entitlement to temporary total disability benefits shall be
provided in the rules and regulations to be prescribed by the GSIS.

SEC. 31. Non-scheduled Disability. — For injuries or illnesses resulting in a
disability not listed in the schedule of partial/total disability provided herein, the GSIS
shall determine the nature of the disability and the corresponding benefits therefor.

DEATH BENEFITS

SEC. 32. Funeral Benefit. — The amount of funeral benefit shall be determined and
specified by the GSIS in the rules and regulations but shall not be less than Thirty
Thousand pesos (P30,000.00) Provided, That it shall be adjusted after five (5) years
upon proper recommendation by the GSIS President and General Manager and
approved by the GSIS Board of Trustees and shall paid upon the death of any of the
following:

(a)An active member as defined under Section 3(e) Of this Act; or

(b)A member who has been from the service, but who may be entitled to
future benefit pursuant to Section 6 of this Act; or

(©)A pensioner, as defined in Section 3(m) or this Act; or

(d)A retiree who at the time of higher retirement was of pensionable age
under this Act but who opted to retire under RA No. 1616.

SURVIVORSHIP BENEFITS

SEC. 33. Genera Entitlement Survivorship Benefits. — When a member or
pensioner dies, the qualified beneficiaries shall be entitled to the survivorship benefits
provided under Sections 34 to 36, subject to the conditions therein provided for.

SEC. 34. Survivorship Pension. — The survivorship pension shall consist of;

(a) The basic survivorship which is fifty percent (50%) of the basic monthly
pension but shall not be more than fifty percent (50%) of the maximum step salary of
an Undersecretary The cap on the survivorship pension may be reviewed every five
(5) years by the Board, based on the recommendations of the GSIS actuary. by
considering the issuances on the salary standardization law; and

(b) The children's not exceeding fifty percent (50%) of the basic
monthly pension.
The maximum amount of basic survivorship pension prevailing at the time of death of
the member or pensioner shall apply. Any subsequent increase/s in the maximum


step salary of an Undersecretary will not result in any adjustment to the survivorship
pension already being paid.

SEC. 35. Death of a Member — (a) Upon the death of a member, the qualified
beneficiaries shall Entitled to survivorship benefits, which shall paid as follows:

(a) _Ifatthe time of death, a married member was in active service and has
rendered at least fifteen (15) years of service:
1) The legitimate spouse, if he/she is the sole beneficiary, shall receive the cash
payment equivalent to eighteen (18) multiplied by (x) the BMP and the basic
survivorship pension for life;

2) The qualified children, as defined under Section 3(f)(1)(ii) hereof are

the only beneficiaries. they shall be entitled to pension equivalent to
ten percent (10) of the BMP for each child but not to exceed fifty
percent (50%) of the BMP;
When the survivors are the legitimate spouse and the qualified
children, the legitimate spouse shall receive the cash payment
equivalent to eighteen (18) multiplied by (x) the BMP and the basic
survivorship pension, and the qualified children shall receive the
children's pension mentioned in the preceding paragraph (2);

3)

(b) fat the time of death. the unmarried member was in the active service
and has rendered at least fifteen (15) years of service:

1) The qualified children, as defined under Section 3(f)(2)(i) hereof are the only
beneficiaries, they shall be entitled to pension equivalent to ten percent (10%) of the
BMP tor each child but not to exceed fifty percent (50%) of the BMP;

2) The parents, if they are the only qualified beneficiaries. shall

receive the cash payment equivalent to eighteen (18) multiplied by
(x) the BMP;
In the absence of a child and the parent/s, the designated
beneficiary, as defined under Section 3()(2)(iii) hereof, if he/she is
the only qualified beneficiary. shall receive the cash payment
equivalent to eighteen (18) multiplied by (x) BMP: Provided,
however, That if the designated beneficiary is a child, he/she shall
be entitled to pension equivalent to ten percent (10%) of the BMP
until he/she reaches the age of majority;

3

(c) _ If at the time of death, the member was in active service with less than
fifteen (15) years of service, the qualified beneficiaries shall receive the cash payment
equivalent to 100% of the AMC for every year of service but not less than Twelve
Thousand Pesos (P12,000.00) to be computed in accordance with Section 14 of this
Act.

(d) _ If at the time of death. the member was separated from the service, the
qualified survivors shall be entitled to:
1) The survivorship pension if the inactive member has at least fifteen (15) years of
service; or



2) The cash payment equivalent to one hundred percent (100%) of the
‘AMC for every year with paid contributions. but not less than twelve
thousand pesos (P12,000.00) if the inactive member has at least
three (3) years but less than fifteen (15) years of service, was less
than sixty (60) years old at the time of death und has not yet
received his/her separation benefit from the GSIS.

SEC. 36. Death of a Pensioner. — Upon the death of an old-age pensioner or a
member receiving the monthly income benefit for permanent disability, the qualified
beneficiaries shall be entitled to the survivorship pension defined in Section 34 of this
Act, subject to the provisions Of Section 35 hereof. When the pensioner dies within
the five-year guaranteed period covered by the cash payment, the survivorship
pension shall be paid only after the expiration of the said period.

LIFE INSURANCE BENEFITS

SEC. 37. Compulsory Life Insurance. — All employees, except for those
enumerated under Section 4(e) of this Act, shall, under such terms and conditions as
may be promulgated by the GSIS. be compulsorily covered with life insurance, which
shall automatically take effect on the date of their employment.

SEC. 38. Dividends. — An annual dividend may be granted to all members of the
GSIS whose life insurance is in force for at least one (I) year in accordance with a
dividend allocation formula to be determined by the GSIS.

SEC. 39. Optional Insurance. - Subject to the rules and regulations prescribed by
the GSIS, a member may apply for insurance and/or pre-need coverage embracing
life, health, hospitalization, education, memorial plans, and such other plans as may
be designed by the GSIS, for himself/herself and/or his/her dependents. Any employer
may likewise apply for group insurance coverage for its employees. The payment of
the premiums/installments for optional insurance and pre-need products may be made
by the insured or his/her employer and/or any person acceptable to the GSIS.

SEC. 40. Reinsurance. — The GSIS may reinsure any of its interests or thereof with
any private company or reinsurer whether domestic or foreign: Provided, That the
GSIS shall submit an annual report on its reinsurance operations to the Insurance
Commission.

PART V - ADJUDICATION OF CLAIMS AND DISPUTES

SEC. 41. Prescription. — Claims for administered by GSIS as defined under Section
3(g) of this Act shall not prescribe: Provided, however, that a claim based on a
contingency which occurred poor to the effectivity of this Act shall be subject to the
four-year prescriptive period.

SEC. 42. Facility of Payment. — GSIS shall prescribe rules and regulations to
facilitate payment of benefits. proceeds. and clams for benefits under this Act and any
other laws administered by the GSIS. Payments made by the GSIS prior to its receipt
of an adverse claim, to a beneficiary or claimant subsequently found not entitled


thereto, shall not bar the legal and eligible recipient to his/her right to demand the
payment of benefits, proceeds. and clams from the GSIS.

SEC. 43. Settlement of Disputes. — The GSIS shall have original and exclusive
jurisdiction to settle any dispute regarding claims and benefits arising under this Act
and any other laws administered by the GSIS.

The Board may designate any member of the Board or official of the GSIS who is a
lawyer, to act as hearing officer to receive evidence, make findings of fact and submit
recommendations together with all the documentary and testimonial evidence, to the
Board within thirty (30) working days from the time the parties have closed their
respective evidence and filed their last pleading. The Board shall decide the case
within thirty (30) days from the receipt of the hearing officer's findings and
recommendations. The cases heard directly by the Board shall be decided within thirty
(30) working days from the time they are submitted by the parties for decision.

SEC. 44. Appeals. — Decisions of the Board of Trustees shall be appealable to the
Court of Appeals. The appeal shall not stay the execution of the award or decision
unless ordered by the Court of Appeals or by the Supreme Court.

SEC. 45. Execution of Decision. — When no appeal is perfected and there is no
order to stay by the Board, by the Court of Appeals, or by the Supreme Court, any
decision or award of the Board shall be enforced and executed in the same manner
as decisions of the Regional Trial Court. For this purpose, the Board shall have the
power to issue to the city or provincial sheriff or its appointed sheriff such writs or
execution as may be necessary for the enforcement of such decision or and any
person who shall fail or refuse to comply with such decision, award, writ or after being
required to do so shall, upon application by the GSIS, be punished for contempt.

SEC. 46. Oaths Witnesses. and Production of Records. — When authorized by
the Board, an official or employee of the GSIS shall have the power to administer oath
and affirmation, take depositions. certify to official acts, and issue subpoena ad
testificandum and subpoena duces tecum to compel the attendance of witnesses and
the production of books, papers, correspondences and other records deemed
necessary as evidence in connection with any question arising under this Act. Any
case of contumacy shall be dealt with in accordance with the provisions of Section
580 of the Revised Administrative Code.

PART VI - FUNDS OF THE GSIS
SEC. 47. Funds. — The GSIS shall administer the Social Insurance Fund, which
consists of all contributions payable under Section 10 of this Act together with the
earnings and accruals thereon. The said Fund shall be used to finance the benefits
administered by the GSIS under this Act. In addition, the GSIS shall administer the
following funds, to be known collectively as the "GSIS-Administered Funds":

(a) The Optional Insurance Fund for the insurance coverage described in
Section 39 hereof,


(b) | The Employees' Compensation Insurance Fund created under P.D. 626,
as amended,

(c) The General Insurance Fund created under Act No. 656, as amended,
and

(d) Such other special funds existing or that may be created for special
groups or persons rendering services to the government.

The GSIS shall appropriate of its surplus for each fund under this section to guarantee
the fulfillment of its obligations. The appropriate surplus shall be maintained to ensure
the payment of under this Act and the other GSIS Administered Funds governed under
the above-mentioned laws. The appropriated surplus cannot be used for any purposes
other than those for which they were set aside and appropriated.

The funds administered by the GSIS shall not be used for purposes Other than those
provided for under th1S Act, The Board of Trustees may allocate an amount not
exceeding fifty percent (50%) of the unappropriated surplus from any of the GSIS-
Administered Funds, except the Employees’ Compensation Insurance Fund, to the
Social Insurance Fund: Provided, That the amount shall used solely to meet the
required reserves to fulfill the obligations of the GSIS to its members: Provide further,
That it is approved by the President of the Philippines, upon the recommendation of
the Governance Commission for Government-Owned and Controlled Corporations
(GCG).

No portion of the funds of the GSIS or income thereof shall accrue to the general fund
of the national government and its political subdivisions, instrumentalities and other
agencies including government-owned and controlled corporations except as may be
allowed under this Act.

SEC. 48. Deposits and Disbursements. — All revenues collected and all accruals
thereto shall deposited, administered and disbursed in accordance with the law. A
maximum expense loading of twelve percent (12%) of the yearly total income and
0.7% of the total admitted assets may be disbursed for administrative and operational
expenses except as may be otherwise approved by the President of the Philippines,
on the basis of actuarial and management studies.

SEC. 49. Investment of Funds. — The funds Of the GSIS which are not needed to
meet the current obligations may be invested under such terms and conditions and
rules and regulations as may be prescribed by the Board: Provided, That investments
shall optimize the requirements of liquidity, safety/security and yield as embodied in
formal Investment policy guidelines approved by the Board in order to ensure the
actuarial solvency of the funds of the GSIS: Provided further, That the GSIS shall
submit un annual report on alll investments made to both Houses of Congress of the
Philippines. The funds may be invested in the following:

(a) _ in interest-bearing or zero-coupon bonds or securities or other evidence
of indebtedness of the Government of the Philippines;


(b) _ininterest-bearing or zero-coupon deposits or securities in any domestic
bank doing business in the Philippines: Provided, That in the case of such deposits,
these shall not exceed at any time the unimpaired capital and surplus or total private
deposits of the depository bank, whichever is smaller: Provided further, That said
bank has prior designation as a depository for the purpose by the Monetary Board of
the Central Monetary Authority;

(c) _ in short-and-medium term loans to members such as salary, policy,
educational, emergency, stock purchase plan and other similar loans: Provided, That
GSIS shall lend no less than forty percent (40%) of the investable fund of the GSIS
Social Insurance Fund for these purposes;

(@ _ inbonds, securities, promissory notes or other evidence of indebtedness
of educational or medical institutions to finance the construction, improvement and
maintenance of schools and hospitals;

(©) _ in real estate property including shares of stocks involving real estate
property and investments secured by first mortgages on real estate or other
collaterals acceptable to the GSIS: Provided, that such investments shall, in the
determination of the Board, redound to the benefit of the GSIS. its members, as well
as the general public;

(f) in debt instruments and other securities traded in the secondary
markets;

(g) _ in loans to or in bonds, debentures, promissory notes or other evidence
of indebtedness of any solvent corporation created or ex1Sting under the laws of the
Philippines;

(h) in common and preferred stocks of any solvent corporation or financial
institution created or existing under the laws of the Philippines listed in the stock
exchange subject to the requirements of liquidity, safety, security, and retums as
embodied in formal investment policy guidelines approved by the GSIS Board of
Trustees;

(i) in domestic mutual funds including investments related to the operations of
mutual funds; and

() in foreign mutual funds and in foreign currency deposits or foreign currency-
denominated debts, non-speculative equities and other financial instruments or other
assets issued In accordance with existing laws of the countries where such financial
instruments are issued: Provided, That these Instruments or assets are tradable
andior listed in a duly recognized exchange: Provided further, That not more than ten
percent (10%) of the investable funds shall be invested abroad.

SEC. 50. Records and Reports. - The GSIS shall keep and cause to keep such
records as may be necessary for the purpose of making actuarial studies, calculations
and valuations of the funds of the GSIS including such data needed in the computation
of rates of disability, mortality, morbidity, separation and retirement among the
members and any other information useful for the adjustment of the benefits of the


members. The GSIS shall maintain appropriate books of accounts to record its assets,
liabilities, income, expenses, receipts and disbursements of funds and other financial
transactions and operations.

SEC. 51. Exemption und Valuation of the Funds. - The GSIS shall make a periodic
actuarial examination and valuation of its funds in accordance with accepted actuarial
principles.

SEC. 52. Exemption for Tax, Legal Process and Lien. — It is hereby reaffirmed as
a State policy that the actuarial solvency of the funds of the GSIS shall be preserved
and maintained at all times and that contribution rates necessary to sustain the
benefits under this Act shall be kept as low as possible m order not 10 burden the of
the GSIS and their employers. Taxes imposed on the GSIS tend to impair the actuarial
solvency of its funds and increase contribution rate necessary to sustain the benefits
of this Act. Accordingly, notwithstanding any laws to the contrary, the GSIS, its
revenues (including all accruals thereto), transactions and benefits paid shall remain
exempt from all forms and kinds of direct or indirect taxes, assessments, fees, charges
or duties imposed by the national or local government. These exemptions shall
continue unless expressly, specifically, and categorically revoked or repealed, and
any assessment against the GSIS as of the approval of this Act is hereby considered
paid and cancelled. Consequently, all laws, ordinances, regulations, issuances,
opinions or jurisprudence contrary to or in derogation of this provision are hereby
deemed repealed, superseded and rendered ineffective and without legal force and
effect.

The exemptions provided herein shall neither be affected nor derogated by
subsequent laws to the contrary unless this Section is expressly, specifically, and
categorically revoked or repealed by law and a provision is enacted to substitute or
replace the exemption referred to herein as an essential factor to maintain or protect
the solvency of the fund, notwithstanding and independently of the guarantee of the
national government to secure such solvency or liability.

The funds and/or the properties of the GSIS referred to herein shall exempt from
attachment, garnishment, execution, levy or other processes issued by the courts,
quasi-judicial agencies or administrative bodies including Commission on Audit (COA)
disallowances. The benefits, sums or monies corresponding to the benefits under this
Act shall likewise be exempt from attachment, garnishment, execution, levy or other
processes issued based on financial obligations or liability of any member, including
any percuniary accountability arising from or caused or occasioned by his/her exercise
or performance of his/her official functions or duties, or incurred relative to or in
connection with his/her position or work except when his/her monetary liability,
contractual or otherwise, is in favor of GSIS

PART Vil- ADMINISTRATION
SEC. 53. Implementing Body. - The Government Service Insurance System as
created under Commonwealth Act No. 186 Shall Implement the provisions of this Act.


SEC 54. Powers and Functions of the GSIS. — The GSIS shall exercise the
following powers and functions:

(a) Formulate, adopt, amend and/or rescind such rules and regulations as
may be necessary to carry out the provisions and purposes of this Act, as well as the
effective exercise of the powers and functions, and the discharge of duties and
responsibilities of the GSIS. its officers and employees: Provided, that these
implementing rules and regulations shall not contravene the provisions of this Act, nor
shall it result in the diminution of any benefit provided by law.

(b) Adopt or approve the annual and supplemental budget of receipts and
expenditures including salaries and allowances of the GSIS personnel and to
authorize such capital and operating expenditures and disbursements of the GSIS as
may be necessary and for the effective management and operation of the GSIS;

(c)__ Invest the funds of the GSIS, directly or indirectly. in accordance with
the provisions of this Act;

(d) Acquire. utilize or dispose of, in any manner recognized by law, real or
personal property in the Philippines or elsewhere necessary to carry out the purposes
of this Act;

(e) Conduct continuing actuarial and statistical studies and valuations to
determine the financial condition of the GSIS and. taking into consideration such
studies and valuations and the limitations herein provided, re-adjust the benefits.
contributions. premium rates. interest rates or the allocation or re-allocation of the
funds to the contingencies covered’.

(f) Have the power of succession;

(g) Sue and be sued:

(h) Enter into. make. perform and carry out contracts of every kind and description
with any person, firm or association or corporation, domestic or foreign;

(i) Carry on any other law-fill business whatsoever in pursuance of, or in connection
with the provisions of this Act;

(j) Have one or more offices in and outside Of the Philippines. and to conduct its
business and exercise its powers throughout and in any part of the Republic of the
Philippines and/or in any or all foreign countries, states and territories: Provided, That
the GSIS shall maintain a branch office in every province where there exists a
minimum of fifteen thousand (15,000) membership.

(k) Borrow funds from any source, private or government, foreign or domestic. only as
an incident to the securitization of housing mortgages Of the GSIS and on account Of
Its receivables from any government or private entity.

(I) Invest, own or otherwise participate in equity in any establishment. firm or entity.


(m) Approve appointments in the GSIS. except appointments to positions which are
policy determining. primarily confidential or highly technical in nature. according to the
Civil Service rules and regulations: Provided. That all positions in the GSIS shall be
governed by a compensation and position classification system and qualifications
standards approved by the GSIS Board of Trustees based on a comprehensive job
analysis and audit Of actual duties and responsibilities: Provided, further, That the
compensation plan shall be comparable with the prevailing compensation plans in the
private sector and shall be subject to the periodic review by the Board no more than
once every four (4) years without prejudice to yearly merit reviews or Increases based
on productivity and profitability.

(n) Design and adopt an Early Retirement Incentive Plan (ERIP) and/or financial
assistance for the purpose of retirement for its own personnel;

(0) Fix and periodically review and adjust the rates of interest and other terms and
conditions for loans and credits extended to members or other persons. whether
natural or juridical,

(p) Enter into agreement with the Social Security System or any Other entity.
enterprise, corporation or partnership for the benefit of members transferring from one
system to another subject to the provision or RA 7699. otherwise known as the
Portability Law’.

(q) Have the power to float proper instrument to liquefy long term maturity by pooling
funds for short-term secondary market;

(r) Submit annually. not later than June 30. a public report to the President of the
Philippines and the Congress of the Philippines regarding its activities in the
administration and enforcement of this Act during the preceding year Including
information and recommendations on Board policies for the development and
perfection of the programs of the GSIS.

(s) Maintain a provident fund, which consists of contributions made by both the GSIS
and its officials and employees and their earnings, for the payment of benefits to such
officials and employees or their heirs under such terms and conditions as it may
prescribe;

(t) Approve and adopt guidelines affecting investments, insurance coverage of
government properties. settlement of claims. disposition of acquired assets,
privatization or expansion of subsidiaries, development of housing projects, increased
and loan packages to members and the enforcement of the provisions of this Act.

(u) Any provision of law to the contrary notwithstanding, to authorize the payment of
extra remuneration to the officials and employees directly involved in the collection
andlor remittance of contribution, loan re-payment and other monies due to the GSIS.
at such rates and under such conditions as it may adopt. Provided. That the best
interest Of the GSIS shall be observed thereby;

(v) Determine, fix and impose interest upon unpaid premiums due from employers and
employees;


(w) Ensure the collection or recovery of all indebtedness, liabilities and/or
accountabilities, including unpaid premiums or contributions in favor of the GSIS
arising from any cause or source whatsoever. due from all obligors. whether public or
private. The GSIS shall demand payment or settlement of the obligations referred to
herein within thirty (30) days from the date the obligation becomes due. and in the
event of failure or refusal of the obligor or debtor to comply with the demand, to initiate
or institute the necessary or proper actions or suits, criminal. Civil or administrative or
otherwise. before the courts, tribunals, commissions. boards. or bodies of jurisdiction
within thirty (30) days reckoned from the expiry date of the period fixed in the demand
within winch to or settle the account;

(x) Design and implement programs that will promote and mobilize savings and
provide additional resources for social security expansion and at the same time afford
individual members appropriate returns on their savings/investments. programs shall
be so designed as to spur socio-economic Lake-off and maintain continued growth;
and

(y) Exercise such powers and perform such other acts as may be necessary, useful.
incidental or auxiliary to carry out the provisions of this Act. or to attain the purposes
and objectives of this Act.

SEC 55. The Board of Trustees. — corporate powers and functions of the GSIS shall
be vested in and exercised by the Board of Trustees composed of the President and
General Manager of the GSIS and eight (8) other members to be appointed by the
President of the Philippines. Of these, four (4) shall be active or retired members of
the GSIS: at least one (|) shall a representative from the teachers recommended by
either the Philippine Public School Teachers Association (PPSTA). the Philippine
Association of School Superintendents (PASS). or by a leading national organization
of teachers; at least two (2) shall be from the leading organizations or associations of
government employees/retirees who possess the ethics. Experience and competence
to represent the needs of their sectors; and one (|) shall be a member of the legal
profession who at the time of appointment is also a member of the GSIS. The
remaining five shall recognized individuals from any of the following fields of expertise
banking and finance. investment, insurance. law. human resources, audit,
management and information technology. The Trustees shall elect from among
themselves a Chairman and a President and General Manager. who shall
automatically be the vice-chairman.

The Trustees, except the President and General Manager who shall cease as trustee
upon his separation. shall hold office for six (6) years to ensure continuity and stability
of programs and policies, or until their successors are duly appointed and qualified.
Provided, that one (I) or more members may be replaced every year depending on
the annual performance of the GSIS, subject to applicable laws: Provided further. That
vacancy, other than through the expiration of the tem. shalll be filled for the unexpired
term only. The members of the Board shall be entitled to remuneration as may be
provided by law,

SEC. 56. Powers and Functions of the Board of Trustees. — The Board of
Trustees shall have the following powers and functions:


(a) _ to formulate the policies. guidelines and programs to effectively Carry
Out the purposes of this Act,

(b)  topromulgate such rules and regulations as may be necessary or proper
for the effective exercise of the powers and functions as well as the discharge of the
duties and responsibility of the GSIS. its officers and employees;

(c) _ the recommendation of the President and General Manager. to approve
the annual and supplemental budget of receipts and expenditures of the GSIS. and
10 authorize such operating and capital expenditures and disbursements of the GSIS
us may be necessary or proper for the effective management. operation and
administration of the GSIS;

(4) upon the recommendation of the President and General Manager, to
approve the GSIS' organizational and administrative structures and staffing pattern
subject to existing civil service laws, rules and regulations, and to establish. fix.
review. revise and adjust the appropriate compensation package for the officers and
employees of the GSIS with reasonable allowances. incentives. bonuses, privileges
and other benefits as may be necessary or proper for the effective management.
operation and administration of the GSIS. which shall be exempt from R.A. No. 6758.
otherwise known as the Salary Standardization Law, and R.A No, 7430. otherwise
known as the Attrition Law.

(e) _ to fix and periodically review and adjust the rates of interest and Other
terms and conditions for loans and credits extended to its members or other whether
natural or juridical.

(f) the provision of any law to the contrary notwithstanding. to compromise
or release, in whole or in pan. any claim or settle liability to the GSIS. regardless of
the amount involved. under such terms and conditions as it may impose for the best
Interest Of the GSIS;

(g) to approve and adopt guidelines affecting investments, insurance
coverage of government properties, settlement of clams. disposition of acquired
assets, development of housing projects, increased benefit and loan packages to
members, and the enforcement of the provisions of this Act;

(h) to determine, fix and impose interest upon unpaid or unremitted
premiums and/or contributions, and

()) todo and perform any and all acts necessary, proper or incidental to the
attainment of the purposes and objectives of this Act.

SEC. 57. Positions in the GSIS. — The President and General Manager of the GSIS
shall be its Chief Executive Officer and shall be appointed by the President of the
Philippines. He/She shall be with management and Investments expertise necessary
for the effective performance or his duties and functions under this Act,


The GSIS President and General Manager shall be assisted by one or more executive
vice-presidents. senior vice-presidents, vice-presidents and managers in addition to
the usual supervisory and rank and file positions who shall be appointed and removed
by the President and General Manager with the approval of the Board, in accordance
with the existing Civil Service rules and regulations

SEC 58. Powers and Duties of the President and General Manager — The
President and General Manager of the GSIS shall, among others. execute and
administer the policies and resolutions approved by the Board and direct and
supervise the administration and operations Of the GSIS The President and General
Manager. subject to the approval of the Board. shall appoint the personnel of the
GSIS, remove. suspend or otherwise discipline them for cause. in accordance with
existing Civil Service rules and regulations, and prescribe their dunes and
qualifications to the end that only competent persons may be employed.

SEC. 59. Auditor. -

(a) The Chairperson of the Commission on Audit shall the ex officio auditor
of the GSIS and may assign the necessary personnel to assist the chairman of the
commission on audit in the performance of his/her duties; and

(b) The Chairperson of the Commission on Audit Or his/her authorized
representative shall submit to the Board soon after the close of each calendar year,
an audited statement showing the financial condition and progress Of the GSIS for
the calendar year Just ended.

SEC. 60. Legal Counsel — The Government Corporate Counsel shall be the legal
adviser and consultant of the GSIS. but the GSIS may assign to the Office of the
Government Corporate Counsel (OGCC) cases for legal action or trial, issues for legal
opinions, preparation and review of contracts/agreement and others, as the GSIS may
decide or determine from time to time: Provided, however. That the present legal
services group in the GSIS shall serve as its in-house legal counsel.

SEC. 61. Powers of the Insurance Commission — The Insurance Commissioner
or his/her authorized representatives shall make an examination of the financial
condition of the GSIS at least once every three (3) years: Provided, however. That the
GSIS shall pay the Office of the Insurance Commissioner an amount equal to the
actual incurred by the said office in the conduct of the examination, Including the
salaries of the examiners and of the actuary of such examination for the actual time
spent.

The report of said examination shall submitted to the Board of Trustees and
considered by the’GSIS in the-formulation of guidelines affecting insurance coverage
of government properties. Copies thereof shall likewise be furnished to the Office of
the President and the two Houses of Congress of the Philippines within five (f) days
after the close of examination.


PART VIII - GENERAL PROVISIONS

SEC. 62 Dispensation of Social Insurance Benefits. -

(a) The GSIS shall release the retirement benefits to the employee within
thirty (30) days from the actual date of retirement: Provided. That all requirements are
submitted to the GSIS at least ninety (90) days prior to the effective date of the
retirement;

(b) The GSIS shall not process nor adjudicate retirement claims under R.N
No. 1616 which function shall be vested in the agencies concerned, who shall process
and pay the gratuities of thew employees. The GSIS shall process and adjudicate
only the refund of retirement premium under R.A No. 910, The Board shall adopt the
proper rules and procedures for the Implementation Of this provision.

SEC. 63, Development and Disposition Acquired Assets - The GSIS shall have
the right to develop and dispose of its acquired assets obtained in the ordinary course
of its business. To add value to, improve profitability on, and/or enhance the
marketability of an acquired asset. the GSIS may further develop/renovate Its assets.
either with Its own capital or through a joint venture arrangement with private
companies or individuals.

The GSIS may sell its acquired assets in accordance with existing Commission on
Audit (COA) rules and regulations for an amount not lower than the current market
value of the property. For this purpose. the GSIS shalll conduct an annual appraisal of
Its property or acquired assets to determine its current market value; All notices of
sale shall be published in newspapers of general circulation

No injunction or restraining order issued by any Court. commission. tribunal or Office
shall bar. impede or delay the sale and disposition by the GSIS of its acquired assets
except on questions of ownership and national or public interest

SEC. 64. Government Assistance to the GSIS. — The GSIS may call upon any

employer for such assistance as may be necessary in the discharge of its duties and
functions

PART IX - SANCTIONS

SEC. 65. Penalty -


(a) The heads of the offices of the national government. its political
subdivisions, branches, agencies and instrumentalities, including government-owned
or controlled corporations and government financial Institutions, and the personnel of
such offices who are involved in the collection of premium contributions. loan
amortization and other accounts due the GSIS who shall fail, refuse or delay the
payment, turnover. remittance or delivery of such accounts to the GSIS Within thirty
(30) days from the time that the same shall have been due and demandable shall.
upon conviction by final Judgment, suffer the penalties of imprisonment of not less
than twenty (20) years nor more than thirty (30) years and a fine of not less than Five
Hundred Thousand Pesos (5,000,000.00) nor more than Five Million Pesos
(5,000,000.00) and in addition. shall suffer absolute perpetual disqualification from
holding public office and other accessory penalties as may be provided by law.

(b) _ The treasurer. finance officer. cashier. disbursing officer, budget officer
or other official or employee who fails to include in the annual budget the amount
corresponding to the employer and employee contributions. or who fails or refuses or
delays to remit to the GSIS by more than thirty (30) days from the time such amount
becomes due and demandable, or to deduct the monthly contributions of the
employee shall, upon conviction by final Judgment. suffer the penalties of
imprisonment from twelve (12) years and one (1) day to twenty (20) years and a fine
of not less than Five Hundred Thousand Pesos (P500,000.00) nor more than Two
Million Pesos (2,000.000.00) and, in addition, shall suffer absolute perpetual
disqualification from holding public office.

(©) Any employee, who after deducting the monthly contribution or loan
amortization from a member's compensation fails to remit the same to the GSIS within
thirty (30) days from the date they should have been remitted under Section 11(b)
shall be presumed to have misappropriated such contribution or loan amortization
and shall conviction by final judgment, suffer the penalties of imprisonment from
twelve (12) years and one (1) day to twenty (20) years and a fine of less than Five
Hundred Thousand Pesos (500.000.00) nor more than Two Million Pesos
(2,000.000.00) and, in addition, shall suffer absolute perpetual disqualification from
holding public office.

(d) Any employee or member who receives or keeps fund or property
belonging payable or deliverable to the GSIS and appropriates the same. or takes or
misappropriates or uses the same to any purpose other than that authorized by this
Act, or permits another person to take. misappropriate or use said fund or by
expressly consenting thereto. or through abandonment or negligence. or is otherwise
guilty of the misappropriation of said fund or property, in whole or in part, shall be
punished by a fine of not less than Five Hundred Thousand Pesos (500.000.00) nor
more than Two Million Pesos (2,000.000.00) and by imprisonment of not less than
twelve ( 12) years and one (1) day to twenty (20) years, and in addition, shall suffer
absolute perpetual disqualification from holding public office.

(ce) Any person found to have participated directly or indirectly in the
commission of fraud, collusion. falsification, or misrepresentation in any transaction
with the GSIS whether for himself/herself or for some other persons, shall be punished
by a fine of not less than Five Hundred Thousand Pesos (500,000.00) nor more than


Two Million Pesos (2,000.000.00) and by Imprisonment of not less than six (6) years
and one (1) day to twelve (12) years, and in addition. shall suffer absolute perpetual
disqualification from holding public office.

(f) Whoever shall obtain or receive any money or check invoking any
provision of this Act or any agreement hereunder, without being entitled thereto with
the intent to defraud any member, any employer, the GSIS, or any third party. shall
be punished by a fine of not less than Five Hundred Thousand Pesos (500,00.00) nor
more than One Million Pesos (1,000.000.00) and by imprisonment of not less than six
(6) years and one (1) day to twelve

(12) years and such other accessory penalties as may be provided by law,

(g) Whoever fails or refuses to comply with the provisions of this Act or with
the rules and regulations adopted by the GSIS shall punished by a fine of not less
than Five Hundred Thousand Pesos (P500,00.00) nor more than One Million Pesos
(1,000.000.00) and by imprisonment of not less than six (6) years and one (1) day to
twelve (12) years, and such other accessory penalties as may be provided by law.

(h) The officers and/or personnel referred to in paragraph (a) of this Section
shall be liable not only criminally but also civilly to the GSIS or to the employee or
member concerned in the form of damages, Including surcharges and interests;

(i) For the charges or complaints referred to in paragraph (a) of this
Section. the liabilities therein set forth shall be construed as waiver of the State of its
immunity from suit, hence, the above-mentioned offices and/or personnel may not
invoke the defense of non-suability of the State.

(j) __ tis presumed that all acts of the Board are made in the exercise of their
regular functions. In the event of failure, of the members of the Board, the President
and General Manager, and/or other officials of the GSIS to comply with their duties
and obligations under this Act, they shall be subjected to suspension of not less than
six (6) months nor more than one (1) year or a fine of not less than Five Hundred
Thousand Pesos (P500,000.00) nor more than Two Million Pesos (P2,000,000.00)
without prejudice to any criminal. civil. or administrative liability which may also arise
therefrom.

Criminal and civil actions arising from violations of the provisions of this Act may be
commenced by the GSIS or by the aggrieved member. either under this Act or. in
appropriate cases, under the Revised Penal Code and other special laws

SEC. 66. Implementing Rules and Regulations. —The implementing rules and
regulations to carry out the provisions of this Act shall be adopted and promulgated
by the GSIS. in consultation with the Governance Commission on Government-
Owned and Controlled Corporations (GCG) not later than ninety (90) days after the
approval of this Act.

SEC. 67 Non-impairment of Benefits, Powers. Jurisdiction, Rights, Privileges,
Functions and Activities. — Nothing in this Act shall be construed to repeal. amend


or limit any provision of existing laws, Presidential Decrees, Letters of Instructions, not
otherwise specifically inconsistent with the provisions of this Act.

SEC. 68. Exclusiveness of Benefits. — Whenever other laws provide similar
benefits for the same contingencies covered by this Act, the who qualifies for these
benefits shall have the option to choose which benefits Will be paid to him/her
However. If the benefits provided by the law chosen are less than the benefits
provided under this Act, the GSIS shall only the difference.

SEC. 69. Non-Conversion of Mode of Retirement. — No change in the mode of
retirement chosen shall be allowed once the proceeds, or a portion thereof. of the
member's retirement claim under a particular law were received by the member.
whether through check, e-crediting to his or her GSIS eCard/Unified Multi-purpose
Identification (UMID) Card. or such other manner as may be approved by the Board
of Trustees

SEC. 70. Appropriations. — The amount necessary to carry out the provisions of
this Act shall be included in the respective budgets of the agencies in the national
government obligation program of the year following its enactment into law and
thereafter.

SEC. 71. Separability Clause. — Should any provision of this Act or any part thereof
be declared invalid, the other provisions, so far as they are separable from the invalid
ones, shall remain in force and effect.

SEC. 72. Repealing Clause. — Presidential Decree No. 1146, Republic Act No. 8291,
Presidential Decree No. 712, and Section 9 of Republic Act No 656, as amended by
Presidential Decree No 245, are hereby expressly repealed. Alll other laws and any
other law or parts of law specifically inconsistent herewith are hereby repealed or
modified accordingly Provided. That the rights under the existing laws, rules and
regulations vested upon or acquired by an employee who is already in the service as
of the effectivity of this Act shall remain in force and effect Provided, further, that
subsequent to the effectivity of this Act, a new employee or an employee who has
previously retired or separated and is reemployed in the service shall be covered by
the provisions of this Act.

SEC 73, Effectivity. — This Act shall take effect fifteen (15) days after its publication
in the Official Gazette or in a newspaper of general circulation.

Approved,