Jurisdiction and Procedures for Settlement of Claims (Section 5(a))
- Disputes regarding coverage, entitlements, collection, settlement of premiums, penalties, and related matters fall under Commission's jurisdiction.
- Cases are heard and decided by the Commission, any member, or authorized hearing officers within twenty days after evidence submission.
- Settlement governed by rules and regulations promulgated by the Commission.
Definitions and Clarifications of Terms Used in the Act (Section 8)
- Dependent: Legitimate spouse, unmarried legitimate/legitimated child under 21, parents wholly dependent on the employee.
- Employment: Any service performed by employee except services for foreign governments/international organizations; possible inclusion via agreement with Philippine Government.
- Beneficiaries: Designated by employee; includes spouse, children (legitimate, legitimated, natural), parents, brothers, sisters; or others designated if above absent.
- Payment Ratio: Ratio of monthly contributions paid over calendar months between the period from coverage up to second quarter before death/disability.
- Average Monthly Salary Credit: Computed from salary credits in 60-month or shorter coverage periods; various formulas based on timing of death/disability.
- Average Daily Salary Credit: Derived from six highest monthly salary credits in the 12-month period ending before sickness quarter.
- Basic Lump Sum Amount: Sum of twelve highest monthly salary credits over 36 months, or twelve times average monthly salary credit divided by payment ratio.
- Quarter: Defined as three consecutive calendar months ending March, June, September, December.
Effect of Employment Separation on Contributions and Benefits (Section 11)
- Employer contributions and employee's obligation for prior employment end at month of separation.
- Employee credited with all contributions made and entitled to benefits.
- Employee may continue voluntary payments to maintain full benefit rights under Commission rules.
Retirement Benefits (Section 12)
- Eligibility: Age 60 and minimum 120 monthly contributions; or total/permanent disability with at least 36 contributions.
- Monthly pension computed as 30% on first 300 pesos of average monthly salary credit plus 6% on excess, plus increment for contributions over 120.
- Special rule for members covered before 18 June 1962 who were 50 or older at coverage.
- Minimum monthly pension of 30 pesos.
- Members 60 years old not qualifying for pension receive lump sum of total contributions, if separated and not continuing contributions.
- Pension suspended if re-employed before age 65 with monthly compensation over 120 pesos or upon recovery from disability.
- Pension recomputed for members retired before 1 July 1966.
Death and Permanent Disability Benefits (Section 13(a))
- Benefits payable to employee or beneficiaries upon death/total permanent disability occurring before 36 contributions paid.
- Benefits include basic lump sum plus additional increments based on monthly contributions over 120.
- Conditions for full benefit: payment of 18 contributions in 36 months before incident or a payment ratio not less than 80%.
- Otherwise, benefits reduced proportionally.
- Minimum benefits equal total contributions but not less than 500 pesos.
- Immediate coverage minimum benefit for death/disability in month of coverage.
Sickness Benefits and Payment Procedure (Section 14)
- Covered employee with at least 12 contributions confined more than 5 days due to sickness or injury entitled to daily allowance.
- Allowance: 70% of average daily salary credit if employee has at least one dependent; otherwise 40%.
- Minimum payment per day of 2.50 pesos and maximum of 8 pesos.
- Maximum duration of 120 days per year; unused days not accumulated.
- Allowance payable after exhaustion of regular full-pay sick leave.
- Payment by employer each pay day or by System on 15th and last days monthly.
- Employer reimbursed 100% by System upon valid claim, adjudicated within 2 months.
- Late reimbursement earns 1% simple interest per month.
Non-transferability of Benefits and Representation of Beneficiaries (Section 15)
- Benefits paid only to entitled persons.
- Foreign beneficiaries residing in non-recognizing countries or that do not reciprocate not entitled.
- Minor or legally incapacitated beneficiaries represented and appointed by Commission, unless under custody of parents/spouse.
- Benefits are non-transferable; power of attorney for collection generally not recognized unless physical/legal inability to collect in person.
- Death benefits without designated beneficiary paid to legal heirs according to Philippine succession laws.
Employer Reporting Obligations and Records Confidentiality (Section 24)
- Employers to report employee data (names, ages, civil status, occupation, salary, dependents) within 30 days of employment.
- Failure to report subjects employer to pay damages equivalent to benefits if employee dies/suffers disability.
- Records submitted presumed correct and confidential; corrections must be made timely before claim rights accrue.
- Records are basis for claim adjudication, which is final.
Financial Administration and Expense Limits (Section 25)
- All contributions and earnings deposited, managed, and disbursed as public special funds under applicable law.
- Annual expense limit for salaries, wages, office expenses, and regional offices capped at 12% in fiscal 1966-67, decreasing 0.5% each year to minimum 7%.
- Unused expense allowance not carried over to succeeding years.
- Priority on decentralization of operations.
- Annual progress report to Congress mandated.
Investment Guidelines for Social Security Funds (Section 26(f))
- Investments must benefit the System, members, and public welfare.
- Investments to be made with prudence and diligence aiming for highest interest consistent with safety.
Effectivity Clause
- The amendments take effect upon approval.