In the Philippine public sector, the classification of workers significantly dictates their entitlement to social security benefits. Among these classifications, Job Order (JO) and Contract of Service (COS) workers occupy a unique, and often precarious, legal space regarding mandatory contributions to the Home Development Mutual Fund (HDMF), commonly known as Pag-IBIG Fund.
1. The General Rule: Employer-Employee Relationship
Under Republic Act No. 9679 (The Home Development Mutual Fund Law of 2009), coverage is mandatory for all employees who are covered by the Social Security System (SSS) or the Government Service Insurance System (GSIS).
The crux of the employer's obligation to share in the contribution rests on the existence of an employer-employee relationship. In traditional government service (permanent, coterminous, or temporary appointments), this relationship is clear, and the government agency is legally required to remit the employer’s share (currently capped at ₱200, following the 2024 contribution hike).
2. The Status of Job Order (JO) Personnel
By legal definition—specifically under Civil Service Commission (CSC) Resolution No. 020790 and various COA-DBM-CSC Joint Circulars—Job Order and COS workers are engaged for a specific piece of work or intermittent jobs of short duration.
The law explicitly states:
“Services rendered under Job Order and Contract of Service do not create an employer-employee relationship between the agency and the worker.”
Because there is no recognized employer-employee relationship in the eyes of civil service law, JO workers are not covered by the GSIS. Consequently, government agencies are not legally mandated to provide the employer’s share for Pag-IBIG contributions for these individuals.
3. Voluntary Membership and the "Individual Payor" Scheme
Since JO workers are not "formally" employed by the government for social security purposes, they are classified by the Pag-IBIG Fund as Voluntary Members or Individual Payors.
- Responsibility for Contributions: In this setup, the worker is responsible for the full amount of the contribution.
- Amount: To earn dividends and qualify for short-term loans or housing loans, the JO worker must pay the member’s share. Since there is no employer share, the worker may choose to pay only the minimum required (currently ₱200) or double it to simulate the combined share for faster savings growth.
4. Recent Shifts: The GSIS-SSS-Pag-IBIG Enrollment Drives
While the legal requirement for an employer share does not exist, the Philippine government has recognized the lack of social protection for the hundreds of thousands of JO workers.
Joint Circulars (e.g., CSC-COA-DBM Joint Circular No. 1, s. 2017 and subsequent extensions) have encouraged government agencies to facilitate the enrollment of JO workers into the Pag-IBIG Fund. However, these circulars typically clarify that:
- Enrollment is encouraged for the welfare of the worker.
- The agency may act as a collecting agent (deducting the amount from the JO's salary/stipend and remitting it to Pag-IBIG).
- No government funds shall be used to pay the employer's share unless a specific law or executive order is passed to authorize such expenditure.
5. Implications of Using Government Funds for JO Employer Shares
Under current auditing rules by the Commission on Audit (COA), any government agency that uses its budget to pay for the employer's share of a JO worker's Pag-IBIG contribution may face disallowance. Such a payment is considered an "unauthorized expenditure" because there is no legal basis (law or appropriation) that classifies JOs as employees entitled to such benefits.
6. Summary Table
| Feature | Permanent/Regular Employee | Job Order (JO) / COS Worker |
|---|---|---|
| Employer-Employee Relationship | Yes | No (per CSC rules) |
| Membership Category | Mandatory | Voluntary / Individual Payor |
| Employer Share Obligation | Mandatory for the Agency | None |
| Deduction Mechanism | Automatic Payroll Deduction | Voluntary Payroll Deduction (if agreed) |
| Service Credit | Counted as Government Service | Not counted as Government Service |
Conclusion
As of the current legal landscape in the Philippines, Job Order employees are treated as independent contractors rather than regular government employees. Therefore, the government agency is not required, nor is it legally allowed, to pay the employer’s share of Pag-IBIG contributions. JO workers wishing to avail of Pag-IBIG benefits must bear the full cost of membership as individual payors, though they may request their agencies to facilitate the remittance via salary deduction for convenience.