THE SOCIAL SECURITY ACT OF 1997
REPUBLIC ACT NO. 1161
It was approved on July 18, 1954 but was only
implemented on September 1, 1957 because of several
amendments it undergone throughout the years, such
as deletion of the provisions on unemployment
benefits, broadening the coverage of SSS, the benefits
increased and the enjoyment thereof liberalized, as well
as the retirement benefits being increased and the
minimum age requirement for coverage was removed.
Thereafter, several other laws increasing the amount of
social security benefits were promulgated.
The Social Security Law was enacted pursuant to the
policy of the State to establish, develop and promote a
sound and viable tax-exempt social security system
suitable to the needs of the people throughout the
Philippines and provide meaningful protection to its
members. The enactment of social security law is a
legitimate exercise of police power. It is in accordance
with the constitutional provisions on the “promotion of
social justice to insure the well-being and economic
security of all the people.”
CONSTRUCTION OF THE SOCIAL SECURITY LAW
The provisions of the law are to be liberally construed in
favor of those seeking its benefits.
THE SOCIAL SECURITY SYSTEM (SSS)
The SSS is the implementing arm of the Social Security
Act. It is a corporate body directed and controlled by
the Social Security Commission.
I. COVERAGE
Before, the coverage of the Social Security Law is
predicated on the existence of an employer-employee
relationship. This is no longer true because the policy
now is to encourage even the self-employed to become
SSS members.
I.A. COMPULSORY COVERAGE
Coverage in the SSS is compulsory upon:
 All employees not over 60 years of age
 All employers engaged in business in the
Philippines, including religious, charitable or
non-profit institutions
 Domestic helpers subject to the Kasambahay
Law
 Aliens employed in the Philippines
 Self-employed persons, including, but not
limited to following:
o Self-employed professionals;
o Partners and single proprietors of
businesses;
o Actors, actresses, directors,
scriptwriters, and news correspondents;
o Professional athletes, coaches, trainers,
and jockeys; and
o Individual farmers and fishermen
I.B. EFFECTIVE DATE OF COVERAGE
a) Employers – on the first day of operation
b) Employees – on the first day of his employment
c) Self-employed – upon his registration with the
SSS
I.C. VOLUNTARY COVERAGE
 Spouses who devote full time to managing the
household and family affairs
 Filipinos recruited for overseas employment by
foreign-based employers
NOTE: Securing an SSS number does not automatically
make a person an SSS member. he will be considered a
member only when he has been reported for SSS
coverage and has paid at least one-month contribution.
A member of SSS cannot withdraw his membership and
becomes a member for life. therefore, during such time
that the member failed to remit contributions, the
benefits and loan privileges provided by the SSS can still
be availed as long as the member meets the qualifying
conditions for entitlement thereto.
I.D. EMPLOYEES NOT COVERED BY THE SSS LAW
 Purely casual employees;
 Employees serving on an alien vessel, when
such vessel is outside of the Philippines;
 Employees of the Philippine Government or any
of its instrumentalities and agencies;
 Employees of foreign government, international
organization, and their wholly-owned
instrumentality;
 Temporary employees, if excluded by regulation
of the Social Security Commission (SSC),
however, in the absence of such regulation,
temporary employees will be covered.
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The law provides employers to have 2 distinct
obligations:
 To make a timely report of its employees for
coverage; and
 To make timely remittance of premiums
So, when the employer fails to report the employee for
SSS coverage or fails to remit the premium
contributions, such failure or refusal, by express
provision of Sec 22 (b) of the Social Security Act, shall
not prejudice the right of the covered employee to the
benefits. in short, the employee would still be entitled
to the social security benefits.
Also, if the employee dies, becomes disabled, gets sick
or reaches the retirement age without him being
reported for coverage or without the premium
contributions being remitted, the SSS will still pay the
employee the corresponding benefits, but the SSS will
hold the employer liable for damages equivalent to the
benefits the employee or his heirs are entitled to
receive. Moreover, the employer will be held criminally
liable for such violation.
failure to make timely remittance of the premium
contributions will hold the employer liable to 3%
monthly penalty from the date the contribution falls
due until paid. the 3% is intended to ensure that the
employer complies with its obligation to remit premium
contributions. And the employer will be held criminally
liable for such violation.
The penalty for failure to remit premium contributions
is punitive in character, hence, good faith is not a
defense. From the moment the remittance of premiums
due is delayed, the penalty immediately attaches to the
delayed premium payments by force of law.
II. BENEFITS – There are 6 benefits under the SSA,
the Maternity leave benefit, Sickness benefit,
Permanent disability benefits, Retirement benefits,
Death benefits and Funeral benefit.
II.A. MATERNITY LEAVE BENEFIT
The maternity leave benefit is equivalent to 100% of the
average daily salary credit. this is available to a female
SSS member who:
 gives birth or suffers miscarriage/abortion; and
 has paid at least three (3) monthly contributions
in the twelve-month period immediately
preceding the semester of her childbirth,
abortion or miscarriage.
The duration of maternity leave is either:
 60 days for normal delivery or
 78 days for caesarian delivery
Procedure for availment:
a) The employee should notify her employer of
her pregnancy and the probable date of her
childbirth which notice shall be transmitted to
the SSS;
b) The employer shall advance the payment within
30 days from the filing of the maternity leave
application; and
c) The SSS shall reimburse the employed the
amount paid upon receipt of satisfactory proof
of such payment and legality thereof
Note: It can be availed of only for the first 4 deliveries or
miscarriage. It cannot be availed of simultaneously with
sickness benefit.
II.B. SICKNESS BENEFIT
Sickness benefit is not payment or reimbursement for
hospitalization, medical treatment or medicine. Rather
they are daily cash allowances to help carry through the
employee and his family during his confinement.
Sickness benefit is equivalent to 90% of the average
daily salary credit payable for each day of compensable
confinement, begins on the first day of sickness.
May be availed by an SSS member who:
a) has paid at least 3 monthly contributions in the
12-month period immediately preceding the
semester of sickness
b) was confined for more than 3 days in a hospital
or elsewhere with the approval of the SSS; and
c) has exhausted the company sick leave with pay,
if any
Procedure for availment
a) The employee should notify his employer of the
fact of his sickness or injury within 5 calendar
days after the start of his confinement
b) The employer shall advance the sickness
allowances and pay the employee every regular
payday
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 c) The SSS shall reimburse the amount paid by the
employer upon satisfactory proof of payment
and legality thereof
II.C. PERMANENT TOTAL DISABILITY BENEFITS
Permanent total disability means disablement to do the
same or similar kind of work that the SSS member was
trained for and accustomed to perform because of:
a) Complete loss of sight of both eyes;
b) Loss of two limbs at or above the ankle or
wrists;
c) Permanent complete paralysis of two limbs;
d) Brain injury resulting in incurable imbecility ot
insanity; and
e) Such cases as determined and approved by the
SSS
Monthly Pension – available if the SSS member has paid
at least 36 monthly contributions prior to the semester
of disability.
Lump sum benefit – available if the SSS member’s
contribution is less than 36 monthly contributions.
Effects of death of a permanently and totally disabled
pensioner:
 The primary beneficiaries as of the date of the
disability shall be entitled to receive his monthly
pension
 If he has no primary beneficiaries and dies
within sixty (60) months from the start of his
monthly pension, the secondary beneficiaries
shall be entitled to a lump sum benefit
II.D. Permanent Partial Disability Benefits
Permanent partial disability is a situation where the
employee is unable to continue with his former work
because of complete and permanent loss of use of som
anatomical part of his body.
Percentage of the lump sum benefit – available if the
permanent partial disability occurs before 36 monthly
contributions have been paid prior to the semester of
disability
Monthly pension – available if the permanent partial
disability occurs after 36 contributions
NOTE: Partial disability pension ceases upon retirement
or death.
II.E. RETIREMENT BENFITS
Retirement benefits under the Social Security Act can be
availed by the SSS member if he has:
a) reached the age of 60 or the compulsory
retirement age of 65 years;
b) already retired from service or ceased to be
self-employed;
Monthly pensions for as long as he lives – available if
the member has paid at least 120 monthly contributions
prior to the semester of his retirement
Lump sum benefit equal to the total contributions paid
by him and on his behalf – if the member who retired
at the age of 60 years old has not paid at least 120
monthly contributions prior to the semester of his
retirement
Effects if the retired member dies:
 His primary beneficiaries as of the date of his
retirement shall be entitled to receive the
monthly pension;
 If he has no beneficiaries and he dies within 60
months from the start of his monthly pension,
his secondary beneficiary shall be entitled to a
lump sum benefit equivalent to the total
monthly pensions corresponding to the balance
of the five-year guaranteed period, excluding
the dependents’ pension.
II.F. DEATH BENEFITS
II.G. FUNERAL BENEFITS
Funeral benefit is granted to help defray the cost of
funeral expenses of a member who dies, including
death of a permanently totally disabled member or
retiree. Funeral benefit is Php 12,000.00 payable in cash
or in kind.
III. BENEFICIARIES
III.A. PRIMARY BENEFICIARIES
a) The dependent spouse, until he or she
remarries; and
b) The dependent legitimate, legitimated or legally
adopted, and illegitimate children
NOTE: The existence of both
legitimate/legitimated/legally adopted and illegitimate
children entitles the illegitimate children to 50% of the
share of the legitimate/legitimated/legally adopted
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children. In the absence of such, the illegitimate children
will be entitled to 100% of the benefits.

III.B. SECONDARY BENEFICIARIES

a) The dependent parents; or
b) Any other person designated by the member as
his secondary beneficiary

III.C. DEPENDENTS
a) The legal spouse entitled by law to receive
support from the member;
b) The legitimate, legitimated, legally adopted, and
illegitimate child who:
i. is unmarried; and
ii. has not reached 21 years of age; or
iii. if over 21 years of age, he is genitally
incapacitated or while still a minor has
been permanently incapacitated and
incapable of self-support, physically or
mentally;
c) The parent who is receiving regular support
from the member.

DEPENDENTS’ PENSION
This is granted to dependents in case of death,
permanent total disability or retirement of an SSS
member. The dependents’ pension is equivalent to 10%
of the monthly pension or Php 250.00.