Question & AnswerQ&A (EXECUTIVE ORDER NO. 35)
The main purpose of Executive Order No. 35 is to amend certain provisions of Presidential Decree No. 1752, which concerns the Home Development Mutual Fund, to reduce the burden on lower-income earners and to increase their benefits while strengthening the powers of the Fund for efficient and effective discharge of its functions.
Contributions are based on the Monthly Fund Salary of covered employees. Employees earning not more than P1,500.00 per month contribute 1%, those earning more than P1,500.00 contribute 2%, and all employees contribute 2% of their Monthly Fund Salary. The Monthly Fund Salary includes basic monthly pay plus Cost of Living Allowances (COLA), with a maximum of P5,000.00 used for computation.
No, under the amended law, the employer's contribution cannot be deducted from the wages or remuneration of the employee, nor can the employer recover this amount from the employee in any manner.
A member of good standing is eligible to apply for a housing loan under terms authorized by the Board of Trustees, which should consider the member's ability to pay. The Board is also tasked to ensure that lower-income members obtain housing loans.
The Board of Trustees must submit an annual report to the President of the Philippines not later than March 15, detailing the Fund's activities and status for the previous year, along with information and recommendations for its development. They must also provide each member a Statement of Accumulated Fund Value at least once a year.
Employers must remit the required contributions through the Social Security System and Government Service Insurance System or a mechanism approved by the President. Failure to pay results in a penalty of three percent per month on the amount due from the contribution's due date until paid. However, non-payment does not affect the employee's right to benefits.
The Fund or its authorized representatives may inspect premises, books of accounts, and records of any person or entity covered by the Act at any time, require regular report submissions, and take action on violations of the Act's provisions.
Yes, certain aspects of the Fund's administration may be subject to supervision, visitation, or verification by appropriate government agencies designated and authorized by the President of the Philippines.
The Executive Order took effect on August 1, 1986.
No, the employer's failure or refusal to pay or remit contributions does not prejudice the covered employee's right to the benefits under the Act.