Press Release
January 7, 2010

SSS Condonation Law signed

Government condoned the penalties for delinquent Social Security System (SSS) policy contributions with the Social Security Condonation Act signed yesterday in the Calauan Housing Project in Brgy. Dayap, Calauan, Laguna, according to Majority Leader Juan Miguel Zubiri, one of its main proponents.

Republic Act No. 9903, authored by Senator Zubiri allowed erring employers to remit their employees' delinquent payments without paying penalties incurred from late payments.

"The SSS Condonation Act breaths news life to small and medium scale enterprises by condoning all the penalties and arrears, and just concentrating on the balance of the employers' contributions to the workers SSS," the senator said.

He added that "the new milestone measure will likewise help alleviate the economic difficulties face by many small and medium enterprises that were forced to shut down under threats of lawsuits and penalties by the SSS."

Zubiri explained that "erring employers would also get a reprieve needed at these tight financial times as RA 9903 also provides that pending cases filed against the employer shall be withdrawn without prejudice to the refilling of the case in the event the employer fails to remit in full the required delinquent contributions."

Zubiri said "the grant of amnesty for the penalties would redound to the benefit of the hundreds of thousands of workers whose employers have not been paying their contributions to SSS, using the same for other corporate financial requirements."

"Congress did not want to add any more burden to all sectors so we provided that employers could also submit an installment proposal to pay his delinquencies following the implementing rules and regulations of the Social Security Commission and other conditions, as follows: payment of at least five percent (5%) of its total delinquency; and, the balance shall be paid in equal monthly installments within and not exceeding 48 months from the date of approval of the installment payment proposal."

However, if the employer fails to remit payments in full or missed an installment within the availment period, the penalties shall be deemed re-imposed.

To secure the interests of workers and employers alike, the employers who settled their arrears in contributions before the effectivity of RA 9903 shall also benefit from the waiver of their accrued penalties.

"As workers and employers are both cash-strapped, this law has been eagerly awaited. Employers would only have to pay the basic contributions while employees would then be free to avail of SSS services, such as salary loans and medical reimbursements."

To date, the SSS has a total of P107 billion in collection arrears. Of the amount, P95 billion is the principal amount while P12 billion comprise the penalties to be condoned once the bill becomes a law.

"I am optimistic that the SSS Condonation Law will also be appreciated and lauded by the hundreds of thousands of workers that are having problems with their SSS contributions due to the non-compliance of their employers," Zubiri said.

"Because of SSS Condonation Law the employees will now have a chance to reconcile the past delinquency and therefore secure a safe and solid future for their families," he added.

Zubiri also thanked Senator Richard Gordon, principal sponsor and another author of the law, for the timely passage and brilliant steering of the bill in the Senate.

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