Photo from Social Security System
The following post does not create a lawyer-client relationship between Alburo Alburo and Associates Law Offices (or any of its lawyers) and the reader. It is still best for you to engage the services of your own lawyer to address your legal concerns, if any.
Also, the matters contained in the following were written in accordance with the law, rules, and jurisprudence prevailing at the time of writing and posting, and do not include any future developments on the subject matter under discussion.
AT A GLANCE
- Employers have legal duties and responsibilities as regards the payment of SSS.
- For example, every employer required to deduct and to remit such contributions shall be liable for their payment and if any contribution is not paid to the SSS as herein prescribed, the delinquent employer shall pay besides the contribution a penalty thereon of two percent (2%) per month from the date the contribution falls due until paid.
- Employers shall safeguard the social security protection of their employees and ensure compliance with the Social Security Act of 2018 as well as its Implementing Rules and Regulations.
Related article: COVID-19 Sickness Benefit under the Social Security Act
Duties of the employer under the Social Security Act of 2018
Employers shall safeguard the social security protection of their employees and ensure compliance with the Social Security Act of 2018 (Republic Act No. 11199) as well as its Implementing Rules and Regulations. Under the law, an SSS employer-member is obliged to:
1. Register with the SSS and secure an Employer (ER) Number by accomplishing the Employer Registration Form (SS Form R-1);
2. Require prospective employees to register with the SSS and present their SS numbers for reporting to the SSS;
3. Report all employees for coverage, regardless of status of employment, within thirty (30) days from actual employment date using the Employment Report Form (SS Form R-1A) for submission to any SSS branch, or online via the employer’s My.SSS account in the SSS website (www.sss.gov.ph);
4. Deduct from employees’ salaries/wages their monthly SS contributions, and remit these to SSS through the mandatory use of Payment Reference Number (PRN) for real-time posting of payments and contribution details. The PRN can be generated via the My.SSS facility upon employer’s confirmation of the electronic Collection List (e-CL), which shall already serve as the Contribution Collection List (SS Form R-3) of employees, hence, hard copies of the SS Form R-3 need not be submitted;
5. Maintain true and accurate work records of his/her employees, which shall include monthly contributions and loan amortizations, if any, and record sickness, injuries, and death of employees in manual logbook or electronic file of work-connected accidents. Such records shall be open for inspection by the SSS or its authorized representatives quarterly, or as often as the Social Security Commission (SSC) may require;
6. Deduct and remit to the SSS all salary, educational, stocks investment or privatization loan amortization of his employees through the Member Loan Payment Return Form (SS Form ML-1) at any SSS branch or accredited banks based on the prescribed deadline;
7. Submit to the nearest branch a monthly report of employees’ loan amortizations through an accomplished Member Loan Billing Statement (SS Form ML-2), in electronic media together with the validated Member Loan Payment Return Form (SS Form ML-1) or SBR and SS Form ML-1 based on the prescribed deadline. Employers may also use their My.SSS account in submitting the SS Form ML-2 online;
8. Pay in advance the following:
(1) SS and EC sickness benefits due their employees based on SSS approved sickness notification, and
(2) SS maternity benefits due to their qualified female employees.
Thereafter, file for reimbursem*nt of all sickness and maternity benefits legally paid in advance to their employees;
9. Inform SSS using the Employer Data Change Request Form (SS Form R-8) of any changes/updates in their data/records with the SSS, as well as temporary/permanent cessation of business operations;
10. Keep their employees updated on the changes in SSS policies and increases in their benefits;
11. Ensure that all forms submitted are properly and accurately accomplished;
12. Submit updated Specimen Signature Card (SS Form L-501) annually;
13. Certify SSS-related documents for their employees when required for their claims; and
14. Comply with the rules and regulations promulgated by the SSC and implemented by the SSS. (Source: SSS Website, accessed at https://www.sss.gov.ph/sss/appmanager/pages.jsp?page=employerduties#:~:text=Ensure%20that%20all%20forms%20submitted,and%20implemented%20by%20the%20SSS, on September 21, 2022.)
May an employer be held criminally liable for violations or non-compliance with the Social Security Act?
Yes. Penal sanctions are provided under Section 28 of the Social Security Act of 2018 for violations or non-compliance such as (1) failure or refusal to register its business, (2) failure or refusal to report its employees for coverage. (3) failure or refusal to produce records for inspections, and (4) failure or refusal to deduct and remit the contributions and/or loan repayments of its employees to SSS.
The law says:
(e) Whoever fails or refuses to comply with the provisions of this Act or with the rules and regulations promulgated by the Commission, shall be punished by a fine of not less than Five thousand pesos (₱5,000.00) nor more than Twenty thousand pesos (₱20,000.00), or imprisonment for not less than six (6) years and one (1) day nor more than twelve (12) years, or both, at the discretion of the court: Provided, That where the violation consists in failure or refusal to register employees or himself, in case of the covered self-employed or to deduct contributions from the employees’ compensation and remit the same to the SSS, the penalty shall be a fine of not less than Five thousand pesos (₱5,000.00) nor more than Twenty thousand pesos (₱20,000.00) and imprisonment for not less than six (6) years and one (1) day nor more than twelve (12) years. (Section 28, R.A. No. 11199)
May an employer incur civil liabilities under the SS Act?
Yes. The employer may incur civil liabilities under the law such as:
(1) unpaid SSS contributions and two percent (2%) penalty for late payments thereon per month from the date the contribution falls due until fully paid;
(2) damages on unpaid contribution when employee contingency arises; and
(3) unpaid SS loan amortizations deducted from the employee, plus interests and penalty.
The law says:
Section 22. Remittance of Contributions –
(a) The contribution imposed in the preceding section shall be remitted to the SSS within the first ten (10) days of each calendar month following the month for which they are applicable or within such time as the Commission may prescribe. Every employer required to deduct and to remit such contributions shall be liable for their payment and if any contribution is not paid to the SSS as herein prescribed, the delinquent employer shall pay besides the contribution a penalty thereon of two percent (2%) per month from the date the contribution falls due until paid. If deemed expedient and advisable by the Commission, the collection and remittance of contributions shall be made quarterly or semi-annually in advance, the contributions payable by the employees to be advanced by their respective employers: Provided, that upon separation of an employee, any contribution so paid in advance but not due shall be credited or refunded to his employer.
(b) The contributions payable under this Act in cases where an employer refuses or neglects to pay the same shall be collected by the SSS in the same manner as taxes are made collectible under the National Internal Revenue Code, as amended. Failure or refusal of the employer to pay or remit the contributions herein prescribed shall not prejudice the right of the covered employee to the benefits of the coverage. xxx” (Section 22, R.A. No. 11199)
Alburo Alburo and Associates Law Offices specializes in business law and labor law consulting. For inquiries regarding taxation and taxpayer’s remedies, you may reach us at info@alburolaw.com, or dial us at (02)7745-4391/0917-5772207.
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