Question & AnswerQ&A (CIRCULAR NO. 2018-007)
The policy mandates that contributions payable under the Social Security Act, where an employer refuses, neglects, or fails to pay, shall be collected by the SSS in the same manner as taxes under the Tax Reform Act of 1997.
All delinquent or non-compliant employers subject to compulsory SS coverage under Section 9 of the SS Act who are legally obligated to deduct and remit both employee and employer shares of contributions against whom final assessment notices have been issued.
Contributions refer to the amount due and demandable from the employer, including penalties for delayed payments under the SS Act. A penalty of three percent (3%) per month continues to run from the date the contribution falls due until fully paid.
Damages are the amount assessed against an employer who misrepresents employment data or remits less than required contributions, resulting in reduced employee benefits, as provided under Section 24 of the SS Act.
An assessment becomes final and executory if the employer fails to comply with the Final Assessment Notice within the prescribed period and no written protest is filed, or no petition is filed before the Social Security Commission within fifteen days after denial of protest.
Actual Distraint refers to the physical seizure and possession of personal/movable properties of the delinquent employer, while Constructive Distraint involves listing the properties and directing the employer or person in control not to dispose of them without SSS authority, without actual physical seizure.
Warrants issuance authority depends on the amount of contribution delinquency: BO/LAD Division Heads for Php 2,000,000 and below; BO/LAD Group Heads for Php 2,000,000.01 to Php 5,000,000; BO/LAD Sector Heads or PCEO for Php 5,000,000.01 and above, excluding penalties and damages.
The employer may file a written Request for Reconsideration or Request for Reconciliation within fifteen days from receipt of the Final Assessment Notice before Seizure to protest or dispute the assessment.
The assessment becomes final and executory, and the SSS will proceed with the issuance of the appropriate warrant of distraint, levy, and/or garnishment for collection.
The SSS Officer must post notice of the sale in at least two public places including the Office of the Mayor, specifying time, place, and articles to be sold, with sale date not less than twenty days after notice. Sale is by public auction to highest bidder for cash or through licensed exchanges. Proceeds first satisfy contributions, penalties, damages, and expenses, with any residue returned to the owner.