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Government Contributions Your Employers are Mandated to Cover
Working In The Philippines

Government Contributions Your Employers are Mandated to Cover

By Braulio Giron, Jr. on October 4, 2019

Along with your salary, these payments are what you should ensure your current or potential employers are and will be covering on a timely basis each month

Although aspects such as flexible work schedules and nearby office locations have emerged as preferences for many Filipino employees, compensation remains the most significant consideration when looking for work or deciding on whether or not to remain long-term with a company.

Now while compensation is often centered on salary, jobseekers and employees must also remember to take employee benefits into account. Indirect and non-cash payments that complete a compensation package, employee benefits may vary between companies and industries, although there are also those which employers are mandated by law to provide.

So whether you’re a professional who has just landed a job, or a fresh graduate now looking to enter the world of the employed, it is highly recommended to have a full grasp of the individual contributions you are, or will be, entitled to as full-time employees to avoid instances of unfair or under-compensated employment.

The following are the government contributions and associated benefits which, as per the most recent Handbook published by the Bureau of Working Conditions (BWC) Department of Labor and Employment (DOLE), should be automatically deducted from your regular employee salary and paid by your employer.

 

Social Security Systems (SSS) Benefits

An insurance program mandated by the Philippine government for all income earners or workers in the private sector, SSS benefits are designed to supplement the income lost as a result of death, disability, sickness, maternity, and old age. 

Among the benefits that members receive from the SSS, as per Republic Act (RA) 1161:

  • Sickness - A daily cash allowance paid for the number of days a member is unable to work due to sickness or injury. 

  • Maternity - Maternity leave benefit of 60 days in case of normal delivery or miscarriage, or 78 days in case of Caesarian section delivery, with benefits equivalent to 100-percent of the average daily salary credit of the employee as defined under the law.*

  • Disability - Cash benefit paid to a member who becomes permanently disabled, either partially or totally.

  • Retirement - Cash benefit paid to a member who can no longer work due to old age.

  • Death & Funeral - The death benefit is a cash paid to the beneficiaries of a deceased member.

**House Bill (HB) No. 4113 or the proposed 100-Day Maternity Leave Law, when eventually signed into law, is expected to supersede RA 1161. In a nutshell, HB No. 4113 aims to extend the current 60-day leave by another 40 days and would also give female employees the option to extend their maternity leave by another 30 days without pay. 

In order to receive any of the aforementioned benefits, you must make sure that first: you are a registered SSS member, and second: you are duly paying your monthly SSS contributions.

To get a general idea of what your employer should and will be remitting to the SSS on your behalf, you can refer to the current Contribution Table directly lifted from SSS’s official website:

For more information on your SSS membership, contributions, or benefits, you can visit SSS’s official government website.

 

Pag-IBIG Benefits

As per RA 9679, the Home Development Mutual Fund, otherwise known as the Pagtutulungan sa kinabukasan: Ikaw, Bangko, Industriya at Gobyerno (Pag-IBIG) Fund is a mutual provident savings system for private and government employees and other earning groups. Supported by matching mandatory contributions made by members’ respective employers, housing is the primary investment of the program.

Membership in Pag-IBIG entitles you to avail of housing loans, calamity loans, and multi-purpose loans, where the repayment is covered by both you and your employer, with your share duly deducted from your salary and processed in addition to your employer’s portion of the payment.

Similar to SSS, you, by way of your employer, will have had to have made at least 24 of your required monthly contributions before being able to avail of a housing loan or multi-purpose loan from Pag-IBIG. To get a general perspective of how much contributions you and your employer must make, the following is the official contribution table of Pag-IBIG:

 

PAG-IBIG CONTRIBUTION TABLE

Monthly Compensation

Contribution Rate (% of Monthly Compensation)

Employee Share

Employer Share

Php1,500 and below

1%

2%

Over Php 1.500

2%

2%

 

For more information on your Pag-IBIG membership, contributions, or benefits, you can visit the Pag-IBIG Fund’s official government website.

 

PhilHealth Benefits

The Philippine Health Insurance Corporation, or PhilHealth, is the mandated administrator of what was formerly known as the Medicare program, but is now the National Health Insurance Program (NHIP).

Under the National Health Insurance Act of 1995, or RA 7875, the NHIP is defined as “a health insurance program for SSS members and their dependents whereby the healthy subsidize the sick who may find themselves in need of financial assistance when they get hospitalized.”

Being a member of Philhealth, and subsequently being included in the NHIP, means having the benefit of the following categories of personal health services:

 

Inpatient hospital care, which includes:

  • Room and board

  • Services of health care professionals

  • Diagnostic, laboratory, and other medical examination services

  • Use of surgical or medical equipment and facilities

  • Prescription drugs and biologicals, subject to the limitations described by law (Section 37 of RA 7875)

  • Inpatient education packages.

Outpatient care, which includes:

  • Services of health care professionals

  • Diagnostic, laboratory, and other medical examination services

  • Personal preventive services

  • Prescription drugs and biologicals, subject to the limitations described in by law (Section 37 of RA 7875)

  • Emergency and transfer services

 

Like SSS and Pag-IBIG, receipt of the aforementioned benefits requires membership in PhilHealth, which is initiated and sustained through contributions. As a full-time employee, you employer is mandated to process the payment on your behalf each month, with half other contribution covered by them, and the other covered by your salary. Based on the latter, the following is the present rate for monthly Philhealth premiums:

 

PHILHEALTH PREMIUM CONTRIBUTION TABLE

Salary Bracket

Salary Range

Salary Base

Total Monthly Premium

Employee Share*

Employer Share

1

8,999.99** and below

8,000.00

200

100

100

2

9,000.00 - 9,999.99

9,000.00

225

112.5

112.5

3

10,000.00 - 10,999.99

10,000.00

250

125

125

4

11,000.00 - 11,999.99

11,000.00

275

137.5

137.5

5

12,000.00 - 12,999.99

12,000.00

300

150

150

6

13,000.00 - 13,999.99

13,000.00

325

162.5

162.5

7

14,000.00 - 14,999.99

14,000.00

350

175

175

8

15,000.00 - 15,999.99

15,000.00

375

187.5

187.5

9

16,000.00 - 16,999.99

16,000.00

400

200

200

10

17,000.00 - 17,999.99

17,000.00

425

212.5

212.5

11

18,000.00 - 18,999.99

18,000.00

450

225

225

12

19,000.00 - 19,999.99

19,000.00

475

237.5

237.5

13

20,000.00 - 20,999.99

20,000.00

500

250

250

14

21,000.00 - 21,999.99

21,000.00

525

262.5

262.5

15

22,000.00 - 22,999.99

22,000.00

550

275

275

16

23,000.00 - 23,999.99

23,000.00

575

287.5

287.5

17

24,000.00 - 24,999.99

24,000.00

600

300

300

18

25,000.00 - 25,999.99

25,000.00

625

312.5

312.5

19

26,000.00 - 26,999.99

26,000.00

650

325

325

20

27,000.00 - 27,999.99

27,000.00

675

337.5

337.5

21

28,000.00 - 28,999.99

28,000.00

700

350

350

22

29,000.00 - 29,999.99

29,000.00

725

362.5

362.5

23

30,000.00 - 30,999.99

30,000.00

750

375

375

24

31,000.00 - 31,999.99

31,000.00

775

387.5

387.5

25

32,000.00 - 32,999.99

32,000.00

800

400

400

26

33,000.00 - 33,999.99

33,000.00

825

412.5

412.5

27

34,000.00 - 34,999.99

34,000.00

850

425

425

28

35,000.00 and up

35,000.00

875

437.5

437.5

*Employee share represents half of the total monthly premium while the other half is shouldered by the employer.

**For Kasambahay helper receiving a wage of less than Five Thousand Pesos (P5,000.00) per month, the employer will shoulder both the employee and employer share based on the premium schedule.

 

For more information on PhilHealth memberships, contributions, or benefits, visit Philhealth’s official government website.

 

It is every employee’s right and responsibility to be mindful of the mandatory contributions and associated benefits provisioned by the Department of Labor and Employment, where doing so will help ensure that you are not only lawfully employed, but are also receiving everything you are entitled to as you embark on your career.

Disclaimer: While a great deal of care and effort had been exerted in the research and writing of this article, it in no way serve as an official guide to government contributions in Philippines.

As such it is always best to consult directly with DOLE, SSS, Pag-IBIG, and PHilHealth, or the certified professionals working within your company’s Human Resources department, for greater technical and legal context regarding your employee contributions and benefits.

 

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