Press Release
January 4, 2021

Villanueva files bill seeking to defer SSS contribution hike

Senator Joel Villanueva has filed a bill seeking to defer the implementation of the Social Security System (SSS) one-percent hike on the members' monthly contribution this month, citing the economic hardships already faced by both workers and employers due to the COVID-19 pandemic.

Villanueva, chair of the Senate labor committee, said he filed the bill Monday which, if enacted promptly by Congress, would amend Republic Act No. 11199, also known as the Social Security Act of 2018, and thus temporarily stop the implementation of the SSS monthly contribution increase for members by one-percent this year.

In his bill, Villanueva said the current economic difficulties brought about by the pandemic to both workers and employers should be reason enough for the SSS not to impose additional burdens on the Filipino people.

"Given the current employment situation of the country as a result of the COVID19 pandemic, there is a need to ensure that workers and companies are able to fully recover and have enough resources to do so," Villanueva said in his bill.

The bill, he added, "seeks to provide a reprieve to our battle-weary workers and employers through the suspension of the mandated increase in social security contribution rate in the event of a pandemic."

Villanueva said deferring the implementation of the SSS contribution hike would provide businesses and employees with much needed income to survive and recover during a pandemic.

"Securing employment and incomes of workers to enable them to keep body and soul together should take precedence over SSS collections," Villaneuva said. "The SSS after all is not without remedy to ensure the viability of the Fund, it can aggressively diversify investments."

Earlier, the SSS said it would implement the contribution hike as provided in for in the Social Security Act of 2018 which was enacted by the 17th Congress three years ago to restructure its rates and ensure the financial long-term viability of the social security program for the private sector.

Villanueva said the economic impact of the COVID-19 pandemic severely affected the lives of Filipino workers and has caused the country's unemployment rate to increase to 8.7 percent, or equivalent to around 3.8 million jobless. Filipinos.

"This is significantly higher than the unemployment rate in October 2019, which was only at 4.6 percent," Villanueva added. He cited an SWS survey report in August last year which showed "a bleaker picture on the country's employment crisis, with around 27.3 million Filipinos or 45.5 percent of the labor force losing their jobs during the pandemic."

"This is due to companies deciding to downsize and retrench their workforce to cushion the blow from government quarantine restrictions in light of the pandemic," Villanueva added. "Workers who have managed to retain employment are also not as fortunate. Some of these workers are forced to receive lower take-home pay and compensation."

The senator noted that several companies have decided to implement alternative work arrangements, such as reduction of workdays and forced leaves to reduce expenses and sustainably maintain operations.

"Some companies also decided to temporarily close operations, leaving workers to wait without any pay until operations resume when quarantine measures ease, Villanueva said.

Citing Department of Labor and Employment (DOLE) figures, Villanueva said some 3,023,601 workers were affected due to the implementation of flexible work arrangements and temporary closures.

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