REPUBLIC ACT NO.

1161
AN ACT TO CREATE A SOCIAL
SECURITY SYSTEM PROVIDING
SICKNESS,
UNEMPLOYMENT RETIREMENT,
DISABILITY AND DEATH BENEFITS FOR
EMPLOYEES.
(THE SOCIAL SECURITY ACT OF 1997)
 - Approved on July 18, 1954,
implemented on September1, 1957.
 DEVELOPMENT OF THE LAW
1. R.A. No. 1792
-First amendatory act. Deleted the provisions on
unemployment benefits.

2. R.A. No. 2658

-SSS was broadened, the benefits increased and
the employment thereof liberalized.
 DEVELOPMENT OF THE LAW
3. R.A. No. 3839
-Retirement benefits were increased and the
minimum requirement for coverage was
removed.

4. R.A. No. 4482

-Reimbursable amount of sickness benefits
advanced by employers was increased.
 DEVELOPMENT OF THE LAW
• Thereafter, several other laws increasing the
amount of social security benefits were
promulgated namely; R. A. No. 4857, P.D.
Nos., 24, 177, 347, 735, 1202, 1636, E. O. Nos.
28,102, R.A. Nos. 7322, and 8282, the latter
having been approved on May 1, 1997.
 RATIONALE BEHIND THE ENACTMENT
OF THE SOCIAL SECURITY LAW
-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 members and their
beneficiaries against the hazards of disability,
sickness, maternity, old age and death, and other
contingencies resulting in loss of income or financial
burden.
 VALIDITY OF THE SOCIAL SECURITY
LAW
- The enactment of the Social Security Law is a
legitimate exercise of police power. It is in full
accord 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 Social Security Law are to
be liberally construed in favor of those seeking
its benefits.
 THE SOCIAL SECURITY LAW IS NOT A
LAW ON SUCCESSION

-It is not the heirs of the employees but the

designated beneficiaries who are to receive the
social security benefits. It is only when the
beneficiary is the estate, or when there is no
designated beneficiary or if the designation is
void, that the Social Security System is
required to pay the employer’s heirs.
 SOCIAL SECURITY LAW IS NOT A PART
OF THE TAXATION SYSTEM
-Social Security Law is not part of the taxation
system because it is not intended for raising
revenues but for the promotion of the general
welfare.
 COVERAGE OF SSS

A. Compulsary Coverage

a) All employees engaged in business in the

Philippines, including religious, charitable or
non-profit institutions;

b) All employees not over 60 years of age

c) Domestic helpers receiving Php1,000/month

 COVERAGE OF SSS

d) Aliens employed in the Philippines;

e) Self-employed persons, including but not limited

to the ff:

i)Self-employed professionals;

ii)Partners and single proprietors of business;

 COVERAGE OF SSS
iii)Actors, actresses, directors, scriptwriters and
news correspondents;

iv)Professional athletes, coaches, trainers and

jockeys;

v)Individual farmers and fishermen.

 Effective date of coverage:

a) For employers- on the 1st day of his operation

b) For employees- on the 1st day of his

employment

c) For self-employed- upon his registration with

the SSS
 B. Voluntary Coverage

The ff. may be covered by the SSS on a voluntary

basis:

a) Spouses who devote full time to managing

the household and family affairs;

b) Filipinos recruited for overseas employment

by foreign- based employers.
 When a person has secured an SSS
Number does it mean that he is
already an SSS AMEMBER?

- No. 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.
 Can a member withdraw his
membership with the SSS?

- No. When a person registers for SSS

membership, he becomes a member for life.
 Employees not covered by the SSS
Law:
a) Purely casual employees;

b) Employees serving on an alien vessel, when

such vessel is outside of the Philippines;

c) Employees of the Philippine government or

any of its instrumentalities and agencies;
 Employees not covered by the SSS
Law:
d) Employees of foreign gov’t, international
organization, and their wholly-owned
instrumentality;

e) Temporary employees, if excluded by

regulation of the ssc;
Employees not covered by the SSS Law:

Note: In the absence of a regulation

exempting temporary employees from
coverage, temporary employees are covered
because there is no way of telling whether or
not the said employees belong to a group or
class designated by regulation of the Social
Security Commission as exempt.
 Obligations of employer under the
Social Security Law:
a) To make a timely report of its employees for
coverage; and

b) To make timely remittance of premiums.

 Effect of non-reporting or non-
remittance
- Such failure or refusal shall not prejudice the right
of the covered employee to social security benefits.
In short, the employee would still be entitled to
the social security benefits.

- Will hold the employer liable to a 3% monthly penalty

from the date the contribution falls due until paid.

- Furthermore, the employer will be held criminally liable

for such violation.
 Good faith is not a defense

- 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.
Demand is not a condition precedent
for remittance of premium
contributions
- The employer is duty-bound to remit the
contributions without need of any demand from
the employee. It is the legal obligation of every
employer to remit within the first seven days of
the month the contributions of the employee
and the employer to the SSS failing in which
invites the imposition of the penalty of 3 %.
 Contributions of the self- employed
- The self- employed pays both the employer’s
and employee’s contribution. The monthly
earnings declared by the self-employed member
at the time of his registration shall be the basis
of his monthly salary credit, unless he makes
another declaration of his monthly earnings,
in which case, such latest declaration becomes
the new basis for his monthly salary credit.
 Policy on the primacy of regular
employment over self- employment
- If one is both an employee covered by the SSS and a
self - employed person, he shall pay the
contributions under both status and coverage.
However, when the combined contributions paid to
the SSS as a regular employee and as a self- employed
member exceed the maximum contributions based
on the highest monthly salary credit prevailing at the
time od simultaneous coverage, the excess shall be
refunded accordingly to the member. The excess
contributions to be refunded shall come from the
self- employed contributions.
 Effect of interruption of business or
professional income
- If the self- employed member does not earn
income in any given month, he is not required
to pay contributions for that month. He, may,
however be allowed to continue paying
contributions under the same rules and
regulations applicable to separated employee
member. Retroactive payment of contributions
is not allowed.
Effect of separation from employment

- When an employee under compulsory

coverage is separated from employment, the
obligation of the employer and the employee
ta pay contributions arising from that
employment ceases at the end of the month of
separation.
 The Social Security Benefits:
1. Maternity leave benefit;

2. Sickness benefit;

3. Disability benefits;

4. Retirement benefit;

5. Death benefits;

6. Funeral benefit
 Maternity Leave Benefit (RA 11210,
The Expanded Maternity Benefits
-The maternity leave benefit is available to a female SSS
member who:

a) Gives birth or suffers miscarriage/abortion; and

b) Has paid at least 3 months monthly contributions in

the 12- month period immediately preceding the semester
of her childbirth, abortion or miscarriage;

Note: The maternity leave benefit is equivalent to 100% of

the average daily salary credit.
The duration of the maternity leave is:

-Maternity leave of 105 days with full pay, whether

the eligible female employee gives birth via
caesarian section or natural delivery.

-Maternity leave of 60 days with full pay in cases of

miscarriages (i.e., pregnancy loss before the
20th week of gestation) or emergency termination
of pregnancy (i.e., pregnancy loss on or after
the 20th week of gestation and includes stillbirth).
The duration of the maternity leave is:
-Allocation of 7 days of maternity leave credits to the
child’s father or an alternate caregiver.

-Additional maternity leave of 30 days without pay in case

of live childbirth provided a written notice to the
employer is given at least 45 days before the end of her
maternity leave. In case of a medical emergency, prior
notice is excepted but subsequent notice is required.

-Additional maternity leave of 15 days with full pay in

case the eligible female employee is also a solo parent as
defined under Republic Act No. 8972
• Note:
-Female workers with pending administrative cases
are entitled to the maternity leave benefits.

-The expanded maternity benefits apply regardless of

female worker’s employment status, civil status and
legitimacy of her child, and frequency of pregnancy.

-Maternity leave benefits should be availed by the

eligible female worker either before or after the
actual period of delivery in a continuous and
uninterrupted manner. Maternity leave can be used
as combinations of prenatal and postnatal leave
provided that postnatal care shall not be less than 60
days.
• In cases of live births, maternity leaves credits of 7 days
may be allocated to the following:

a) Child’s father, whether or not married to the female

worker; or

b) Upon election of the mother taking into account the best

interest of the child, an alternate caregiver in case of
death, absence, or incapacity of the child father who can
be either

b1) a relative within the fourth degree of consanguinity; or

b2) the current partner, regardless of sexual orientation or

gender identity, of the female worker
sharing the same household.
 Procedure for availment:
a) 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 employer the amount paid

upon receipt of satisfactory proof of such payment and
legality thereof;
 Procedure for availment:
• Note:
- It cannot be availed of simultaneously with
sickness benefit.
 Sickness benefit
- Are daily cash allowances to help carry through
the employee and his family during his
confinement. It is stipend to enable the employee
and his family to provide themselves with the bare
necessities for subsistence when he is not receiving
his wage or salary.

- Equivalent to 90% of the average daily salary

credit payable for each day of compensable
confinement or fraction thereof. The compensable
confinement begins on the first day of sickness.
 The sickness benefit is available to 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;

c) Has exhausted the company sick leave with pay,

if any.
 Sickness benefit
• Note: The daily sickness benefit cannot be
paid longer than 120 days in one calendar
year. It cannot be paid more than 240 days on
account of the same confinement. Unused
portion of the 120 days cannot be carried
forward to the subsequent year.
 Procedure for availment of sickness
benefit by employees:
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.

Note:
- If the notice of sickness or injury was filed after 5
days, the confinement shall be deemed to have
started not earlier than the 5th
day immediately preceding the date of notification.
Note:
-If the SSS member is unemployed or self-
employed, he shall directly notify the SSS of
his confinement within 5 calendar days after the
star thereof.

-Notice is not necessary of the employee was

confined in a hospital or if the employee
became sick or was injured while working or
within the premises of the employer.
 Procedure for availment of sickness
benefit by employees:
b) The employer shall advance the sickness
allowances and pay the employee every
regular pay day;

c) The SSS shall reimburse the amount paid

by the employer upon satisfactory proof of
payment and legality thereof.
Note:
- If the notification to the SSS was made by the
employer after 5 calendar days from receipt of
the notification from the employee, the
employer shall be reimbursed only for each day
of confinement starting from the tenth calendar
day preceding the date of notification to the
SSS.
Note:

- The SSS shall reimburse the employer only

for confinement within the 1 year period
immediately preceding the date of claim for
reimbursement, except confinement in a
hospital in which case the claim for benefit or
reimbursement must be filed within 1 year
the last day of confinement.
Note:

- If the employee has given the required

notification but the employer failed to notify the
SSS of the confinement or to file the claim for
reimbursement within the prescribed period,
resulting in the reduction of the benefit or
denial of the claim, the employer cannot
recover the daily allowance he advanced to the
employee.
Note:

- The claim for reimbursement shall be

adjudicated by the SSS within 2 months from
receipt thereof. If the employer does not
receive the reimbursement within 1 month
from the prescribed 2- month period for
adjudication, the reimbursement shall
thereafter earn simple interest of 1% per month
until paid.