In the Philippines, the Social Security System (SSS) serves as a vital safety net for private-sector employees. However, a recurring issue in the labor market is the failure of employers to remit collected contributions. This is not merely a breach of trust; it is a criminal offense under Philippine law.
Under Republic Act No. 11199, also known as the Social Security Act of 2018, the mandate for employers regarding contributions is absolute.
I. The Legal Obligation of the Employer
The law is clear: every employer is a trustee of the funds intended for the SSS. Their duties include:
- Mandatory Deduction: Deducting the employee's share of the contribution from their monthly salary.
- Compulsory Remittance: Remitting both the employee’s share and the employer's share to the SSS within the prescribed period.
- Proof of Payment: Providing employees with a breakdown of these deductions in their pay slips.
Key Rule: The failure of an employer to remit contributions does not prejudice the right of the covered employee to the benefits of the SSS. However, in practice, non-remittance often leads to the denial of loan applications or delays in benefit processing (sickness, maternity, disability, or retirement).
II. Criminal and Administrative Penalties
Non-remittance is considered a serious violation. The Social Security Act of 2018 imposes heavy penalties to deter delinquent employers:
- Imprisonment: Erring employers may face imprisonment for a period of six (6) years and one (1) day to twelve (12) years.
- Fines: A fine ranging from Php 5,000 to Php 20,000.
- Monthly Interest: A penalty of 2% per month is assessed on the unpaid amount from the date the contribution fell due until it is paid in full.
- Presumption of Estafa: If an employer deducts the contribution but fails to remit it to the SSS within 30 days, it is considered prima facie evidence of Estafa (deceit/swindling) under the Revised Penal Code.
If the offender is a corporation, the penalty is imposed on the President, Managing Director, or the responsible officers of the company.
III. How to File a Complaint
If you discover that your employer has not been remitting your contributions despite deducting them from your pay, you have several avenues for recourse:
1. Internal Inquiry
First, verify your records through the My.SSS Portal or the SSS Mobile App. If there is a discrepancy, request a clarification from your HR or Accounting department. Keep copies of your pay slips as evidence of deduction.
2. Filing a Formal Complaint with SSS
If the employer refuses to rectify the situation, visit the nearest SSS branch and approach the Member Services Section or the Legal Department.
- Requirements: Pay slips, employment contract, and any proof of the company's non-payment.
- Action: The SSS will conduct an audit of the employer. They may issue a "Letter of Authority" to inspect the company's books.
3. SSS "Run After Contribution Evaders" (RACE) Program
The SSS frequently conducts the RACE program, which targets delinquent employers through operations and the posting of notices on their premises to compel compliance.
4. Department of Labor and Employment (DOLE)
Since non-remittance is a labor violation, you can also file a complaint for "Money Claims" or "Non-compliance with Statutory Benefits" through the Single Entry Approach (SEnA) of DOLE for mediation.
IV. Summary of Employer Liability
| Type of Liability | Consequence |
|---|---|
| Financial | 2% monthly penalty + the principal amount of unremitted contributions. |
| Criminal | 6 to 12 years imprisonment under the SSS Act; potential Estafa charges. |
| Administrative | Issuance of a warrant of distraint/levy or garnishment of company assets. |
V. Important Note on Prescription
The SSS has a twenty (20) year prescriptive period to collect unpaid contributions and penalties. This means the SSS can legally pursue an employer for unpaid dues spanning two decades.
Employees are encouraged to be proactive. Regularly checking your SSS contribution history is the most effective way to ensure your future benefits remain secure and that your employer is fulfilling their legal obligations.
Would you like me to draft a formal demand letter that you can send to an employer regarding unremitted SSS contributions?