Press Release
September 7, 2022

SENATE MINORITY LEADER AQUILINO "KOKO" PIMENTEL III SEEKS PROBE VS GSIS FOR ERRONEOUS STANCE ON "PORTABILITY LAW"

Senate Minority Leader Aquilino "Koko" Pimentel III has filed a resolution questioning the Government Service Insurance System for its anomalous and erroneous implementation of Republic Act No. 7699, otherwise known as Portability Law which may have deprived thousands of GSIS beneficiaries - retirees of their rightful claims.

In filing of Proposed Senate Resolution No. 122, Pimentel said there is a need for the Senate to intervene to rectify the flawed interpretation of the GSIS on the purpose and spirit of R.A. No. 7699 which was enacted to enable those from the private sector who transfer to the government service, or from the government service to the private sector to combine their years of service and contributions to entitle them to pension after retirement, disability, or survivorship.

Pimentel said the Portability Law was designed to ensure that the social security contributions of employees while they were in the private sector and those while they were in government service would be combined for the purpose of computing their number of contributions.

If a worker is not qualified to get benefits under the Social Security System or the GSIS because the periods of his/her creditable services or contributions fall short of the required period of contributions (POC), he/she could apply the "totalization" rule which adds their total length of service (TLS) in GSIS to augment their POC, excluding overlapping periods.

Totalization refers to the process of adding up the periods of creditable services or contributions under each of the Systems, either SSS or GSIS, for the purpose of eligibility and computation of benefits.

But Pimentel said the GSIS wrongly interpreted the application of the Portability Law when it promulgated its Policy and Procedural Guidelines (PPG) No. 315-17 on 04 September 2017 which provided "totalization" of services shall not apply if:

1. The total length of service (TLS) of the member with the GSIS is 15 years or more, making him or her eligible to retire under R.A. 8291 or the GSIS Law.

2. The period of contribution (POC) with SSS of the worker is 10 years or more, regardless of the number of years of the total length of service of the member with the GSIS, making him or her eligible to retire under R.A. 8282. Accordingly, he or she may be qualified for Cash Payment with the GSIS, provided that the TLS is 3 years or more but less than 15years; or

3. The sum of the TLS and POC, less overlapping periods, is less than 15 years. Accordingly, he or she may be qualified for Cash Payment with the GSIS, provided that the TLS is 3 years or more but less than 15 years.

"This restrictive language in the application of totalization cannot be found in the text of the law itself and is contrary to the purpose and spirit of the Portability Law and thus beyond the authority of the GSIS to implement. It is an erroneous and mistaken interpretation of the Portability Law which unduly denies the flexibility afforded by the same law for the benefit of the employee," Pimentel said in his resolution.

Pimentel said that because of this erroneous interpretation and implementation by the GSIS of the Portability Law, "many of its covered workers and members must have been denied the benefits of retiring under the Portability Law which could have been more advantageous and beneficial to them in their retirement."

"There is a need to inquire into the basis of this arbitrary interpretation by the GSIS and whether the law as presently worded is sufficient in expressing its original spirit or intent," Pimentel's resolution stated.

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