FURTHER AMENDING CERTAIN SECTIONS OF REPUBLIC ACT NUMBERED ELEVEN HUNDRED AND SIXTY-ONE, OTHERWISE KNOWN AS “THE SOCIAL SECURITY LAW,” AS AMENDED

WHEREAS, on the 19th day of October, 1972, Presidential
Decree No. 24, amended certain Sections of Republic Act No. 1161, as
amended, otherwise known as “The Social Security Law”; and

WHEREAS, in order to bring about a more effective
implementation of the law and make the SSS even more responsive to the
needs of its members, it is necessary to further amend the Social
Security Law;

NOW, THEREFORE, I, FERDINAND E. MARCOS, President of the
Philippines, by virtue of the powers in me vested by the Constitution as
Commander-in-Chief of all the Armed Forces of the Philippines, and
pursuant to Proclamation No. 1081, dated September 21, 1972, and General
Order No. 1, dated September 22, 1972, as amended, do hereby order and
decree that the Social Security Law be amended to bring about a more
effective implementation of the law and make the Social Security System
more responsive to the needs of its members as follows:

SECTION 1. Section 8(k) of the Social Security Law, as
amended, is hereby further amended to read as follows:

“(k) Beneficiaries. — Those designated as such by the
covered employee from among the following:

“The legitimate spouse, the legitimate, legitimated,
acknowledged natural children, natural children by legal fiction, and
other illegitimate children, and their legitimate descendants, and the
legitimate parents.

“In the absence of any of the foregoing, any other person
designated by him.”

SEC. 2. Section 9 of the same Act is hereby further amended
by designating the present provision as paragraph (a) and adding
thereto paragraph (b) to read as follows:

“SEC. 9. Compulsory Coverage. — (A) Coverage in
the SSS shall be compulsory upon all employees not over sixty years of
age and their employers: Provided, That any benefit already
earned by employees under private benefit plans existing at the time of
the approval of this Act shall not be discontinued, reduced or otherwise
impaired: Provided, further, That private plans which are
existing and in force at the time of compulsory coverage shall be
integrated with the plan of the SSS in such a way where the employer’s
contribution to his private plan is more than that required of him in
this Act he shall pay to the SSS only the contribution required of him
and he shall continue his contribution to such private plan less his
contribution to the SSS so that the employer’s total contribution to his
private benefit plan and to the Social Security System shall be the
same as his contribution to his private plan before the compulsory
coverage: Provided, further, That any changes, adjustments,
modifications, eliminations or improvements in the benefits to be
available under the remaining private plan, which may be necessary to
adopt by reason of the reduced contribution thereto as a result of the
integration, shall be subject to agreements between the employers and
employees concerned: Provided, further, That the private
benefit plan which the employer shall continue for his employees shall
remain under the employer’s management and control unless there is an
existing agreement to the contrary: Provided, finally, That
nothing in this Act shall be construed as a limitation on the right of
employers and employees to agree on and adopt benefits which are over
and above those provided under this Act.

“(B) Filipinos recruited in the Philippines by foreign-based
employers for employment abroad may be covered by the SSS on a voluntary
basis under such rules and regulations as the Commission may
prescribe.”

SEC. 3. Section 12 (a) and (c) are hereby further amended
to read as follows:

“SEC. 12. Retirement benefits. — (a) A covered
employee who (3) has paid at least one hundred twenty monthly
contributions to the SSS, has reached the age of sixty years and is
separated from employment or, if still employed, is receiving less than
two hundred fifty pesos monthly compensation, or (2) has paid at least
one hundred twenty monthly contributions and has reached the age of
sixty-five years, or (3) has paid at least thirty-six monthly
contributions and has become permanently totally disabled, shall be
entitled for as long as he lives but in no case for less than five years
to a monthly pension amount to be computed as follows:

Forty-five percent of the first three hundred pesos of the
average monthly salary credit or fraction thereof; plus

Twenty-five percent of the next three hundred pesos of the
average monthly salary credit or fraction thereof; plus

Nine percent of each succeeding one hundred pesos of the
average monthly salary credit or fraction thereof; plus

One-tenth of one percent of the average monthly salary credit
for each monthly contribution in excess of one hundred twenty and paid
as of the last day of the second quarter preceding the quarter of
retirement: Provided, That a member of the SSS covered prior to
June 18, 1962 and who was fifty years of age or over on the date of his
coverage shall be entitled to the benefits hereunder if he has paid a
number of monthly contributions equivalent to the number of calendar
months of coverage at age sixty, but in no case less than twenty-four: Provided,
further. That the monthly pension shall in no case be less than
forty-five pesos: Provided, finally, That the foregoing
schedule shall take effect on January 1, 1974.

“(c) The monthly pension shall be suspended —

1. Upon the re-employment of a retired employee who is less
   than sixty-five years old if he receives from his employment a monthly
   compensation of two hundred fifty pesos or more; or
2. Upon the recovery of an employee retired due to permanent
   total disability, or his failure to present himself for examination at
   least once a year upon notice by the SSS.”

SEC. 4. Section 13 of the same Act is further amended to
read as follows:

“SEC. 13. Death and permanent disability benefits.
— (a) Upon the covered employee’s death, his beneficiaries shall be
entitled to the basic lump sum amount, plus five-twelfths of one percent
of the basic lump sum amount for each monthly contribution in excess of
one hundred twenty and paid as of the last day of the second quarter
preceding the quarter of death: Provided, That any of the
following conditions is satisfied at the time of death:

“1. He shall have paid eighteen monthly contributions within
the thirty-six calendar month period ending on the last day of the
second quarter preceding the quarter of death.

“2. His payment ratio is not less than eighty percent.”

“Provided, further, That if none of the foregoing
conditions are satisfied, his death benefit shall be the above amount
multiplied by one and one-fourth times his payment ratio: Provided,
finally, That the death benefit shall not be less than the total
contributions paid by him and his employer in his behalf to the SSS nor
less than five hundred pesos: Provided, however, That the covered
employee who dies in the month of coverage shall be entitled to the
minimum benefit.”

SEC. 5. Section 14(b) of the same Act is further amended to
read as follows:

“(b) The payment of such allowances shall be promptly made by
the employer every regular pay day or on the fifteenth and last day of
each month in the case of direct payment by the SSS for as long as such
allowances are due and payable: Provided, That such allowance
shall begin only after all current sick leaves of absence with full pay,
if any, to the credit of the employer shall have been exhausted.”

SEC. 6. Section 22(e) of the same Act is further amended
to read as follows:

“(e) For purposes of this Section, any employer who is
delinquent or has not remitted all the monthly contributions due and
payable may within six (6) months from approval of this amendatory Act
remit said contributions to the SSS and submit corresponding collection
lists therefor without incurring the prescribed three percent penalty.
In case the employer, fails to remit to the SSS the said contributions
within the six months grace period, the penalty of three percent shall
be imposed from the time the contributions first became due as provided
in paragraph (a) of this Section: Provided, however, That the
administrator, may in meritorious cases, allow employers who have
submitted a payment plan, on or before April 19, 1973, to pay their
contributions due and payable up to December 31, 1973 without incurring
the prescribed three percent penalty.”

SEC. 7. Section 26(g) of the same Act is further amended to
read as follows:

“(g) As part of its investment operations the SSS shall act as
insurer of all or part of its interests on properties mortgaged to the
SSS or on the lives of mortgagors whose properties arc mortgaged to the
SSS in accordance with such rules and regulations prescribed by the
Social Security Commission. For this purpose, the SSS shall establish a
separate account to be known as the ‘Mortgagors Insurance Account.’ All
amounts received by the SSS in connection with the aforesaid insurance
operations shall be placed in the Mortgagors’ Insurance Account. The
assets and liabilities of the Mortgagors’ Insurance Account shall at all
times be clearly identifiable and distinguishable from the assets and
liabilities in all other accounts of the SSS. Notwithstanding any
provision of law to the contrary, the assets held in the Mortgagors’
Insurance Account shall not be chargeable with the liabilities arising
out of any other business the SSS may conduct but shall be held and
applied exclusively for the benefit of the owners or beneficiaries of
the insurance contracts issued by the SSS under this paragraph.

“The SSS may insure any of its interests or part thereof with
any private company or reinsurer.

“The Insurance Commission or its authorized representatives
shall make an examination into the financial condition and methods of
business transactions of the SSS at least once in two years but such
examination shall be limited to the insurance operation of the SSS as
authorized under this Section and shall not embrace the other operations
of the SSS; and the report of said examination shall be submitted to
the SSC and a copy thereof shall be furnished the Office of the
President of the Philippines within a reasonable time after the close of
the examination: Provided, That, for each examination the SSS
shall pay to the Insurance Commission an amount equal to the actual
expenses of the Insurance Commission in the conduct of the examination,
including the salaries of the examiners and of the actuary of the
Insurance Commission who have been assigned to make such examination for
the actual time spent in said examination.

“The general law on insurance promulgated thereunder shall have
suppletory application insofar as it is not in conflict with the SSS Law
and its rules and regulations.”

SEC. 8. Section 28(a) and (e) are hereby further amended to
read as follows:

“SEC. 28. Penal Clause. — (a) Whoever, for the
purpose of causing any payment to be made under this Act, or under an
agreement thereunder, where none is authorized to be paid, shall make or
cause to be made false statement or representation as to any
compensation paid or received, or whoever makes or causes to be made any
false statement of a material fact in any claim for any benefit payable
under this Act or application for loan with the SSS, or whoever makes
or causes to be made any false statement, representation, affidavit, or
document, in connection with such claim shall suffer the penalties
provided for in Article One Hundred Seventy-Two of the Revised Penal
Code.”

“(e) Whoever fails or refuses to comply with the provisions of
this Act or with the rules and regulations promulgated by the
Commission, shall be punished by a fine of not less than five hundred
pesos nor more than five thousand pesos or imprisonment for not less
than six months nor more than one year, or both at the discretion of the
court: Provided, That, where the violation consists in failure
or refusal to register employees, or to deduct contributions from
employee’s compensation and remit the same to the SSS, the penalty shall
be a fine of not les than five hundred pesos nor more than five
thousand pesos and imprisonment for not less than six months nor more
than one year.”

SEC. 9. This Decree shall form part of the law of the land
and shall take effect immediately.

Done in the City of Manila,
this 23rd day of April, in the year of Our Lord, nineteen hundred and
seventy-three.