EXECUTIVE ORDER NO. 102
EXECUTIVE ORDER NO. 102 - FURTHER
AMENDING CERTAIN SECTIONS OF REPUBLIC ACT NO. 1161, AS AMENDED,
OTHERWISE KNOWN AS THE “SOCIAL SECURITY LAW”
WHEREAS,
the Social Security System was created pursuant to the policy under
Republic Act No. 1161, as amended, in order to “(p)rovide to covered
employees and their families protection against the hazards of
disability, sickness, old age, and death, with a view of promoting
their well-being in the spirit of social justice;”
WHEREAS, present economic conditions make it necessary that certain
sections or provisions of the Social Security Law be further amended to
upgrade the base of contributions and to adjust the benefit structure
provided for thereunder so that the amounts of the benefits would be
more meaningful and responsive to the needs of its members and their
families;
WHEREAS, it is also necessary to effect changes in the Social Security
System and its operations considering that it performs an important
role in the social and economic development programs of the government;
NOW, THEREFORE, I, CORAZON C. AQUINO, President of the Philippines, do
hereby order.
Section 1. Sec. 3(a) of Republic Act No. 1161, as
amended, is hereby further amended to read as follows:
“Sec.
3. Social Security System. — (1) to carry out of the
purposes of this Act, the Social Security System with the principal
place of business in Metro Manila, Philippines, is hereby created. The
SSS shall be directed and controlled by a Social Security Commission
composed of the Minister of Labor and Employment, the SSS Administrator
and six appointive members, two of whom shall represent the labor
group, two, the management group and two, the general public, to be
appointed by the President of the Philippines. The Chairman of the
Commission shall be designated by the President from among its members.
The term of the appointive members shall be three years: Provided, That
the terms of the first six appointive members shall be one, two and
three years for every two members, respectively. All vacancies, except
through the expiration of the term, shall be filled for the unexpired
term only. The appointive members of the Commission shall receive seven
hundred pesos per diem for each meeting actually attended by them:
Provided, That no compensation shall be paid for more than eight
meetings a month. Members of the Commission who hear cases pending
before the Commission shall also receive a per diem of seven hundred
pesos.”
Sec. 2. Sec. 4(c) of Republic Act No. 1161, as
amended, is hereby further amended to read as follows:
“(c)
To require the actuary to submit a valuation report on the SSS benefit
program every five (5) years, or more frequently may be necessary, and
to undertake the necessary actuarial studies and calculations
concerning increases in the benefits and the financial stability of the
SSS and to provide for the feasible increases in the benefits and the
addition of new ones under such rules and regulations as the Commission
may adopt subject to the approval of the President. Provided, That the
actuarial soundness of the reserve fund shall be guaranteed: Provided,
further, That such increases in benefits shall not require any increase
in the rate of contribution.”
Sec. 3. Sec. 8, paragraph (f) and (n) of
Republic Act No. 1161, as amended, are hereby further amended to read
as follows:
“(f)
Compensation. — All actual remuneration for employment, including the
mandated cost of living allowance, as well as the cash value of any
remuneration paid in any medium other than cash except that part of the
remuneration in excess of three thousand pesos received during the
month.”
“(n) Average
daily salary credit. — The result obtained by dividing the sum of the
six highest monthly salary credits in the twelve month period
immediately preceding the semester of contingency by one hundred
eighty.”
Sec. 4. Section 12 (b) of Republic Act No. 1161,
as amended, is hereby further amended to read as follows:
“(b)
The monthly pension shall in no case be less than two hundred pesos nor
paid in an aggregate amount of less than sixty times the monthly
pension except to a secondary beneficiary: Provided, That the monthly
pension of surviving pensioners as of December 31, 1986 shall be
increased by twenty percent.”
Sec. 5. Section 12-B paragraph (d), of Republic
Act No. 1161, as amended, is hereby further amended to read as follows:
“(d)
Upon the death of the retired employee pensioner, his primary
beneficiaries as of the date of his retirement shall be entitled to
eighty percent of the monthly pension and his dependents to the
dependents’ pension: Provided, That if he has no primary beneficiaries
and he dies within sixty months from the start of his monthly pension,
his secondary beneficiaries shall be entitled to a lump sum benefit
equivalent to the bigger of (1) twenty times the monthly pension or (2)
the difference of sixty times the monthly pension and the total monthly
pensions paid by the SSS excluding the dependents’ pension.”
Sec. 6. Section 13-A, paragraph (c), of Republic
Act No. 1161, as amended, is hereby further amended to read as
follows:
“(c)
Upon the death of the permanent total disability pensioner, his primary
beneficiaries as of the date of disability shall be entitled to eighty
percent of the monthly pension and his dependents to the dependents’
pension: Provided, That if he has no primary beneficiaries and he dies
within sixty months from the start of his monthly pension, his
secondary beneficiaries shall be entitled to a lump sum benefit
equivalent to the bigger of (1) twenty times the monthly pension or (2)
the difference of sixty times the monthly pension and the total monthly
pensions paid by the SSS excluding the dependents pension”
Sec. 7. Section 13-B of Republic Act No. 1161, as
amended, is hereby further amended to read as follows:
“Sec. 13-B. Funeral Benefits. — A funeral grant of
two thousand pesos shall be paid to help defray the cost of funeral
expenses upon the death of a covered member, permanently totally
disabled employee or retiree.”
Sec. 8. Section 14, paragraph (a) (1) of Republic
Act No. 1161, as amended, is hereby further amended to read as follows:
“(1)
In no case shall the total amount of such daily allowance be less that
seven pesos and fifty centavos nor exceed seventy five pesos nor paid
longer than one hundred twenty days in one calendar year; nor shall any
unused portion of the one hundred twenty days of sickness benefit
granted under this section be carried forward and added to the total
number of compensable days allowable in the subsequent year;”
Sec. 9. Section 18 (a) of Republic Act No. 1161,
as amended, is hereby further amended to read as follows:
“Sec.
18. Employee’s contribution. — (a) Beginning as of
the last day of the calendar month when an employee’s compulsory
coverage takes effect and every month thereafter during his employment,
the employer shall deduct withhold from such employee’s monthly salary,
wage, compensation or earnings, the employee’s contribution in an
amount corresponding to his salary, wage, compensation, or earnings
during the month in accordance with the following schedule effective on
January 1, 1987:
SALARY BRACKET RANGE OF
MONTHLY
SALARY
NUMBERS COMPENSATION
CREDIT
I 1
— 149.00 125.00
II 150 — 199.99 175.00
III 200 —
249.99 225.00
IV 250
— 349.99 300.00
V 350
— 499.99
425.00
VI 500 — 699.99 600.00
VII 700 — 899.99 800.00
VIII
900 —
1099.99 1000.00
IX 1100 —
1399.99 1250.00
X 1400 —
1749.99 1500.00
XI 1750 —
2249.99 2500.00
XII 2250 —
2749.99 2000.00
XIII 2750 —
over 3000.00
MONTHLY CONTRIBUTION
EMPLOYER EMPLOYEE
TOTAL
6.40
4.10 10.50
9.10 5.70 14.70
11.40 7.50 18.90
15.20 10.00 25.20
21.60 14.10
35.70
30.40 20.00 50.40
40.50 26.70 67.20
50.70 33.30 84.00
63.30 41.70 105.00
76.30 50.00 126.00
101.30 66.70 168.00
126.70 83.30 210.00
152.00 100.00 252.00
The tabulated schedule for the
monthly contributions of the self-employed and voluntary members
effective January ,; 1987 shall be as follows:
SALARY MONTHLY
BRACKET
RANGE OF
SALARY MONTHLY
NUMBER COMPENSATION CREDIT
CONTRIBUTION
I 1.00
—
149.99
125.00 10.00
II 150.00
— 199.99 175.00 14.00
III 200.00 —
249.00 225.00 18.00
IV 250.00 —
349.00 300.00 24.00
V 350.00
—
499.99 425.00
34.00
VI 500.00 — 699.99
600.00 48.00
VII 700.00 — 899.99
800.00 64.00
VIII 900.00
— 1,099.99
1,000.00 80.00
IX
1,100.00 —
1,399.99 1,250.00 100.00
X 1,400.00 —
1,749.99 1,500.00 120.00
XI 1,750.00 —
2,249.99 2,000.00 160.00
XII 2,250.00 —
2,749.99 2,550.00 200.00
XIII 2,750.00 —
over
3,000.00 240.00
“The
maximum covered earnings or compensation of all SSS members shall be
limited to three thousand pesos per month as provided in the foregoing
schedules unless otherwise provided by the Social Security Commission
through rules and regulations taking into consideration actuarial
calculations and rate of benefits.”
Sec. 10. Sec. 25 of Republic Act No. 1161, as
amended, is hereby further amended to read as follows:
“Sec.
25. Deposit and disbursement. — All money paid to or
collected by the SSS every year under this Act, and all accruals
thereto shall be deposited, administered and disbursed in the same
manner and under the same conditions and requirements as provided by
law for other public special funds: Provided, That not more than twelve
percent (12%) of the total yearly contributions plus three percent (3%)
of other revenues shall be disbursed for salaries and wages, purchases
of office equipment and materials, operational expenses and the
maintenance of regional offices of the SSS: Provided, further, That if
the expenses in any year are less than the maximum amount permissible,
the difference shall be not be availed of as additional expenses in the
following years.”
Sec. 11. The opening paragraph and paragraphs (d)
and (e) of Sec. 26 of Republic Act No. 1161, as amended, are hereby
further amended to read as follows:
“Sec.
26. Investment of reserve funds. — All revenues of
the SS that are not needed to meet the current administrative and
operational expenses incidental to the carrying out of this Act shall
be accumulated to a fund to be known as the “Reserve Fund.” Such
portions of the Reserve Fund as are not needed to meet the current
benefit obligations thereof shall be invested to earn an average annual
income of at least nine percent and shall be known as the “Investment
Reserve Fund” which shall be invested in any or all the
following:
xxx
xxx
xxx
(d)
In direct housing loans to covered employees and group housing project,
giving priority to the low-income groups, up to a maximum of ninety
percent of the appraised value of the properties to be mortgaged by the
borrowers and in loans for the construction and the maintenance of
hospitals and institutions for the sick, aged and infirm members and
their families, referred to in Section four (j) of this Act: Provided,
That such investment shall not exceed thirty percent of the Investment
Reserve Fund.
(e) In short
and medium term loans to covered employees such as salary, educational,
calamity and emergency loans; Provided, That not more than ten percent
of the Investment Reserve Fund at any time shall be invested for this
purpose.
Sec. 12. Sec. 26 of Republic Act No. 1161, as
amended, is hereby further amended by adding thereto new paragraphs
(i), (j), and (k), to read as follows:
(i)
In bonds, debentures or other evidences of indebtedness of any solvent
corporation or institution created or existing under the laws of the
Philippines: Provided, That the issuing, assuming or guaranteeing
entity or its predecessors shall not have defaulted in the payment of
interest of any of its securities and that during each of any three
including the last two of the five fiscal years next preceding the date
acquisition by the SSS of such bonds, debentures, or other evidence of
indebtedness, the net earnings of the issuing, assuming or guaranteeing
institution available for its fixed charges, as hereinafter defined,
shall have been not less than one and one-quarter times the total of
its fixed changes for such year: Provided, further, That such
investment shall not exceed ten percent of the Investment Reserve Fund.
As used in this section, the
term “net earnings available for fixed charges” shall mean not income
after deducting operating and maintenance expenses, taxes other than
income taxes, depreciation and depletion, but excluding extraordinary
non-recurring items of income or expense appearing in the regular
financial statement of the issuing, assuming or guaranteeing
institution. The term “fixed charges” shall include interest on funded
and unfunded debt, amortization of debt discount, and rentals for lease
properties.
(j) In
preferred stocks of any solvent corporation or institution created or
existing under the laws of the Philippines: Provided, That the issuing,
assuming, or guaranteeing entity or its predecessors has paid regular
dividends upon its preferred or guaranteed stocks for a period of at
least three years next preceding that date of investment in such
preferred or guaranteed stocks: Provided, further, That if the stocks
are guaranteed, the amount of a stocks to guaranteed is not in excess
of fifty per centum of the amount of the preferred or common stocks, as
the case may be, of issuing corporations: Provided, furthermore, That
if the corporation or institution has not paid dividends upon its
preferred stocks, the corporation or institution has sufficient
retained earnings to declare dividends for at least two years on such
preferred stocks: Provided, finally, That such investment shall not
exceed ten percent of this Investment Reserve Fund.
(k) In common
stocks of any solvent corporation or institution created or existing
under the laws of the Philippines listed in the stock exchange with
proven track record of profitability and payment of dividends over the
last three years: Provided, That such investment shall not exceed ten
percent of the Investment Reserve Fund.”
Sec. 13. All laws, orders, issuances, rules and
regulations or parts thereof inconsistent with this Executive Order are
hereby repealed or modified accordingly.
Sec. 14. This Executive Order shall take effect on
January 1, 1987.
Done in the City of Manila,
this 24th day December, in the year of Our Lord, nineteen hundred
eighty-six.
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