In the Philippine employment landscape, the mandatory remittance of social security and housing fund contributions is not merely a corporate responsibility; it is a statutory obligation. When an employer deducts these amounts from an employee’s salary but fails to remit them to the Social Security System (SSS) and the Home Development Mutual Fund (Pag-IBIG), they violate fundamental labor laws.

I. The Legal Obligation

Under the Social Security Act of 2018 (R.A. 11199) and the Home Development Mutual Fund Law of 2009 (R.A. 9679), employers are mandated to:

Register all employees.
Deduct the employee’s share of contributions from their monthly compensation.
Remit both the employee’s share and the employer’s counterpart to the respective agencies within the prescribed period.

Note: The failure of an employer to remit contributions does not prejudice the right of the employee to the benefits. However, in practice, non-remittance often leads to the denial of loan applications or delays in benefit processing.

II. Administrative and Legal Remedies

1. Verification and Evidence Gathering

Before taking legal action, the employee must secure proof of non-payment.

Payslips: These serve as evidence that the deductions were actually made.
Contribution Records: Obtain an updated Statement of Contributions from SSS (via the My.SSS portal) and Pag-IBIG (Virtual Pag-IBIG).
Demand Letter: While not strictly required, sending a formal letter to the employer or the HR department demanding the update of contributions is a prudent first step.

2. Filing a Formal Complaint with the Agencies

The SSS and Pag-IBIG have their own investigative arms to handle delinquent employers.

SSS Complaint: You may visit the SSS branch with jurisdiction over the employer’s place of business. The Member Assistance Center will assist in filing a formal complaint. The SSS can then conduct an audit and issue a "Letter of Authority" to inspect the employer’s books.
Pag-IBIG Complaint: Similarly, a formal report can be lodged with the Pag-IBIG Fund’s enforcement division.

3. Filing a Case with the National Labor Relations Commission (NLRC)

If the non-remittance is part of a larger labor dispute (e.g., illegal dismissal or underpayment of wages), the employee can include the "claim for unremitted contributions" in a Single Entry Approach (SEnA) conference or a formal position paper before a Labor Arbiter.

III. Penalties for Delinquent Employers

The law treats the non-remittance of collected contributions with extreme severity, often categorizing it similarly to Estafa.

Criminal Liability

SSS Law: Employers who fail to remit contributions can be punished with a fine of ₱5,000 to ₱20,000 and/or imprisonment ranging from 6 years and 1 day to 12 years.
Pag-IBIG Law: Violators may face imprisonment of not more than 6 years or a fine of not less than, but not more than double, the amount involved.

Civil Liability and Interest

Monthly Penalties: Employers are liable for a penalty of 2% per month (for SSS) and 1/10 of 1% per day (for Pag-IBIG) on the amount due from the date the remittance should have been made.
Presumption of Intent: The law states that if an employer deducts the contribution but fails to remit it within 30 days from the date it was due, it is prima facie evidence of embezzlement or misappropriation.

IV. The Role of Corporate Officers

Under the principle of piercing the corporate veil in a statutory sense, the liability for non-remittance is not limited to the corporation as an entity.

Key Rule: If the employer is a corporation, the penalty shall be imposed upon the Managing Head, Directors, or Officers who are responsible for the violation. They can be held personally and criminally liable for the failure to remit.

V. Summary of Actions for Employees

Step	Action	Objective
1	Audit	Check My.SSS and Virtual Pag-IBIG accounts for gaps.
2	Document	Compile payslips showing the specific deductions.
3	Demand	Issue a written demand to the employer to rectify the deficiency.
4	Escalate	File a formal complaint with the SSS/Pag-IBIG Legal Department.
5	Litigate	Include the violation in an NLRC case if concurrent with other labor issues.