SSS Guidelines on Employer Liability for Benefits

The Social Security System (SSS) has issued new guidelines concerning employer liability for damages when there is non-compliance with employer obligations. This circular, No. 2025-001, outlines the rules for situations where an employee's Social Security benefits are affected by an employer's failure to follow SSS regulations.

Employer Liability for Damages

An employer can be held liable for damages if they fail to meet certain obligations before an employee's date of contingency, such as sickness, maternity, retirement, disability, or death. These obligations include:

• Properly reporting the employee for compulsory SSS coverage.

• Reporting the employee's correct date of employment.

• Remitting the correct amount of contributions for the employee.

The amount of damages will be equivalent to the cash benefit the employee would have received if the employer had complied with these rules. However, if the employee's contingency occurs within 30 days of their employment date, the employer may be relieved of liability if the contribution has been paid.

How Liability is Computed

The calculation of the employer's liability for damages varies based on the specific non-compliance issue:

• For non-reporting of employees: The liability is the full amount of the benefit due. For pension benefits, this would be the full accumulated pension due or the five-year guaranteed pension, whichever is higher.

• For misrepresentation of employment date or non-remittance of contributions: The liability is the difference between the benefit amount the employee should have received and the amount payable based on the actual contributions remitted.

If multiple employers are liable, the liability will be computed proportionally based on the period of employment and contributions due from each.

Filing a Claim

The SSS will determine if a benefit claim is subject to employer liability for damages and will guide the employee or claimant on the necessary procedures. The claimant must submit proof of employment, including the employer's name, employment period, and monthly salary.

Once the required documents are verified, the SSS will send a billing letter to the employer for the unremitted contributions, penalties, and damages. The processing of the benefit claim will proceed once the employer has paid the minimum required contributions. If the employer fails to pay, the SSS may still process the claim after one year from the date the employer received the billing letter. The SSS will also take legal action against employers who fail to pay the total collectible amount.

Date of Coverage

For benefit payment purposes, an employee's date of coverage is considered their first day of employment. This is presumed to be the month of the first contribution remittance unless proven otherwise. Employees with no posted contributions are not eligible for any benefit claims under these guidelines.

These new guidelines will take effect fifteen days after publication in a newspaper of general circulation.

Reference: CI2025-001