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REPUBLIC ACT NO. 8291 AN ACT AMENDING PRESIDENTIAL DECREE NO.

1146, AS AMENDED, EXPANDING AND INCREASING THE COVERAGE AND BENEFITS OF THE GOVERNMENT SERVICE INSURANCE SYSTEM, INSTITUTING REFORMS THEREIN AND FOR OTHER PURPOSES. SECTION 1. Presidential Decree No. 1146, as amended, otherwise known as the "Revised Government Service Insurance Act of 1977" , is hereby further amended to read as follows: "S !"#$N 1. Title. %"he title of this &ct shall be: "T e Government Service Insurance S!stem Act of 1997." "A. DEFINITIONS "S !. '. "efinition of terms.% (nless the conte)t otherwise indicates, the followin* terms shall mean: "+a, GSIS% "he -o.ernment !ommonwealth &ct No. 1/60 Ser.ice #nsurance System created by

"+b, #oard% "he 1oard of "rustees of the -o.ernment Ser.ice #nsurance System0 "+c, Em$lo!er% "he national *o.ernment, its 2olitical subdi.isions, branches, a*encies or instrumentalities, includin* *o.ernment%owned or controlled cor2orations, and financial institutions with ori*inal charters, the constitutional commissions and the 3udiciary0 "+d, Em$lo!ee or %em&er% &ny 2erson recei.in* com2ensation while in the ser.ice of an em2loyer as defined herein, whether by election or a22ointment, irres2ecti.e of status of a22ointment, includin* baran*ay and San**unian officials0 "+e, Active %em&er% & member who is not se2arated from the ser.ice0 "+f, "e$endents% De2endents shall be the followin*: +a, the le*itimate s2ouse de2endent for su22ort u2on the member or 2ensioner0 +b, the le*itimate, le*itimated, le*ally ado2ted child, includin* the ille*itimate child, who is unmarried, not *ainfully em2loyed, not o.er the a*e of ma3ority, or is o.er the a*e of ma3ority but inca2acitated and inca2able of self%su22ort due

to a mental or 2hysical defect ac4uired 2rior to a*e of ma3ority0 and +c, the 2arents de2endent u2on the member for su22ort0 "+*, 'rimar! &eneficiaries% "he le*al de2endent s2ouse until he5she remarries and the de2endent children0 "+h, Secondar! &eneficiaries% "he de2endent 2arents and, sub3ect to the restrictions on de2endent children, the le*itimate descendants0 "+i, Com$ensation% "he basic 2ay or salary recei.ed by an em2loyee, 2ursuant to his election5a22ointment, e)cludin* 2er diems, bonuses, o.ertime 2ay, honoraria, allowances and any other emoluments recei.ed in addition to the basic 2ay which are not inte*rated into the basic 2ay under e)istin* laws0 "+3, Contri&ution% "he amount 2ayable to the -S#S by the member and the em2loyer in accordance with Section 6 of this &ct0 "+k, Current "ail! Com$ensation% "he actual daily com2ensation or the actual monthly com2ensation di.ided by the number of workin* days in the month of contin*ency but not to e)ceed twenty%two +'', days0 "+l, Avera(e %ont l! Com$ensation )A%C*% "he 4uotient arri.ed at after di.idin* the a**re*ate com2ensation recei.ed by the member durin* his last thirty%si) +76, months of ser.ice 2recedin* his se2aration5retirement5 disability5death by thirty%si) +76,, or by the number of months he recei.ed such com2ensation if he has less than thirty%si) +76, months of ser.ice: 'rovided+ "hat the a.era*e monthly com2ensation shall in no case e)ceed the amount and rate as may be res2ecti.ely set by the 1oard under the rules and re*ulations im2lementin* this &ct as determined by the actuary of the -S#S: 'rovided+ furt er+ "hat initially the a.era*e monthly com2ensation shall not e)ceed "en thousand 2esos +P18,888.88,, and 2remium shall be nine 2ercent +9:, and twel.e 2ercent +1':, for em2loyee and em2loyer co.erin* the &;! limit and below and two 2ercent +':, and twel.e 2ercent +1':, for em2loyee and em2loyer co.erin* the com2ensation abo.e the &;! limit0 "+m, Revalued avera(e mont l! com$ensation% &n amount e4ual to one hundred se.enty 2ercent +1<8:, of the first $ne thousand 2esos +P1,888.88, of the a.era*e monthly com2ensation 2lus one hundred 2ercent +188:, of the a.era*e monthly com2ensation in e)cess of $ne thousand 2esos +P1,888.88,0

"+n, ,um$ sum% "he basic monthly 2ension multi2lied by si)ty +68,0 "+o, 'ensioner% &ny 2erson recei.in* old%a*e 2ermanent total disability 2ension or any 2erson who has recei.ed the lum2 sum e)cludin* one recei.in* sur.i.orshi2 2ension benefits as defined in Section '8 of this &ct0 "+2, Gainful Occu$ation% &ny 2roducti.e acti.ity that 2ro.ided the member with income at least e4ual to the minimum com2ensation of *o.ernment em2loyees0 "+4, "isa&ilit!% &ny loss or im2airment of the normal functions of the 2hysical and5or mental faculty of a member which reduces or eliminates his5her ca2acity to continue with his5her current *ainful occu2ation or en*a*e in any other *ainful occu2ation0 "+r, Total "isa&ilit!% !om2lete inca2acity to continue with his 2resent em2loyment or en*a*e in any *ainful occu2ation due to the loss or im2airment of the normal functions of the 2hysical and5or mental faculties of the member0 "+s, 'ermanent Total "isa&ilit!% &ccrues or arises when reco.ery from the im2airment mentioned in Section ' +=, is medically remote0 "+t, Tem$orar! Total "isa&ilit!% &ccrues or arises when the im2aired 2hysical and5or mental faculties can be rehabilitated and5or restored to their normal functions0 "+u, 'ermanent 'artial "isa&ilit!% &ccrues or arises u2on the irre.ocable loss or im2airment of certain 2ortion5s of the 2hysical faculties, des2ite which the member is able to 2ursue a *ainful occu2ation. "B. MEMBERSHIP IN THE GSIS "S !. 7. Com$ulsor! %em&ers i$. - ;embershi2 in the -S#S shall be com2ulsory for all em2loyees recei.in* com2ensation who ha.e not reached the com2ulsory retirement a*e, irres2ecti.e of em2loyment status, e)ce2t members of the &rmed >orces of the Phili22ines and the Phili22ine National Police, sub3ect to the condition that they must settle first their financial obli*ation with the -S#S, and contractuals who ha.e no em2loyer and em2loyee relationshi2 with the a*encies they ser.e. " )ce2t for the members of the 3udiciary and constitutional commissions

who shall ha.e life insurance only, all members of the -S#S shall ha.e life insurance, retirement, and all other social security 2rotections such as disability, sur.i.orshi2, se2aration, and unem2loyment benefits. "S !. 4. Effect of Se$aration from t e Service. - & member se2arated from the ser.ice shall continue to be a member, and shall be entitled to whate.er benefits he has 4ualified to in the e.ent of any contin*ency com2ensable under this &ct. "C. SOURCES OF FUNDS "S !. 6. Contri&utions. - +a, #t shall be mandatory for the member and em2loyer to 2ay the monthly contributions s2ecified in the followin* schedule: "%ont l! Com$ensation 'ercenta(e of %ont l! Com$ensation 'a!a&le &! %em&er Em$lo!er &.era*e !om2ensation 9.8: 1'.8: ;a)imum

#.

;a)imum ;onthly +&;!, ?imit and 1elow $.er &;! ?imit %(2 &;! ?imit %#n &;! ?imit the

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to the ;a)imum 9.8: 1'.8: )cess '.8: of 1'.8: the

";embers of the 3udiciary and constitutional commissioners shall 2ay three 2ercent +7:, of their monthly com2ensation as 2ersonal share and their em2loyers a corres2ondin* three 2ercent +7:, share for their life insurance co.era*e. "+b, "he em2loyer shall include in its annual a22ro2riation the necessary amounts for its share of the contributions indicated abo.e, 2lus any additional 2remiums that may be re4uired on account of the ha@ards or risks

of its em2loyeeAs occu2ation. "+c, #t shall be mandatory and com2ulsory for all em2loyers to include the 2ayment of contributions in their annual a22ro2riations. Penal sanctions shall be im2osed u2on em2loyers who fail to include the 2ayment of contributions in their annual a22ro2riations or otherwise fail to remit the accurate5e)act amount of contributions on time, or delay the remittance of 2remium contributions to the -S#S. "he heads of offices and a*encies shall be administrati.ely liable for non%remittance or delayed remittance of 2remium contributions to the -S#S. "S !. 6. Collection and Remittance of Contri&utions. % +a, "he em2loyer shall re2ort to the -S#S the names of all its em2loyees, their corres2ondin* em2loyment status, 2ositions, salaries and such other 2ertinent information, includin* subse4uent chan*es therein, if any, as may be re4uired by the -S#S0 the em2loyer shall deduct each month from the monthly salary or com2ensation of each em2loyee the contribution 2ayable by him in accordance with the schedule 2rescribed in the rules and re*ulations im2lementin* this &ct. "+b, ach em2loyer shall remit directly to the -S#S the em2loyeeAs and em2loyerAs contributions within the first ten +18, days of the calendar month followin* the month to which the contributions a22ly. "he remittance by the em2loyer of the contribution to the -S#S shall take 2riority o.er and abo.e the 2ayment of any and all obli*ations, e)ce2t salaries and wa*es of its em2loyees. "S !. <. Interest on "ela!ed Remittances. % &*encies which delay the remittance of any and all monies due the -S#S shall be char*ed interests as may be 2rescribed by the 1oard but not less than two 2ercent +':, sim2le interest 2er month. Such interest shall be 2aid by the em2loyers concerned. "S !. /. Government Guarantee. % "he *o.ernment of the Be2ublic of the Phili22ines hereby *uarantees the fulfillment of the obli*ations of the -S#S to its members as and when they fall due. "D. BENEFITS "S !. 9. Com$utation of t e #asic %ont l! 'ension. % +a, "he basic monthly 2ension is e4ual to: "1, thirty%se.en and one%half 2ercent +7<.6:, of the re.alued a.era*e

monthly com2ensation0 2lus "', two and one%half 2ercent +'.6:, of said re.alued a.era*e monthly com2ensation for each year of ser.ice in e)cess of +16, years: 'rovided+ "hat the basic monthly 2ension shall not e)ceed ninety 2ercent +98:, of the a.era*e monthly com2ensation. "+b, "he basic monthly 2ension may be ad3usted u2on the recommendation of the President and -eneral ;ana*er of the -S#S and a22ro.ed by the President of the Phili22ines in accordance with the rules and re*ulations 2rescribed by the -S#S: 'rovided+ o.ever, that the basic monthly 2ension shall not be less than $ne thousand and three hundred 2esos +P1,788.88,: 'rovided+ furt er+ that the basic monthly 2ension for those who ha.e rendered at least twenty +'8, years of ser.ice after the effecti.ity of this &ct shall not be less than "wo thousand four hundred 2esos +P',488.88, a month. "S !. 18. Com$utation of Service. % +a, "he com2utation of ser.ice for the 2ur2ose of determinin* the amount of benefits 2ayable under this &ct shall be from the date of ori*inal a22ointment5election, includin* 2eriods of ser.ice at different times under one or more em2loyers, those 2erformed o.erseas under the authority of the Be2ublic of the Phili22ines, and those that may be 2rescribed by the -S#S in coordination with the !i.il Ser.ice !ommission. "+b, &ll ser.ice credited for retirement, resi*nation or se2aration for which corres2ondin* benefits ha.e been awarded under this &ct or other laws shall be e)cluded in the com2utation of ser.ice in case of reinstatement in the ser.ice of an em2loyer and subse4uent retirement or se2aration which is com2ensable under this &ct. ">or the 2ur2ose of this section, the term ser.ice shall include full%time ser.ice with com2ensation: 'rovided+ that 2art%time and other ser.ices with com2ensation may be included under such rules and re*ulations as may be 2rescribed by the -S#S. "SEPARATION BENEFITS "S !. 11. Se$aration #enefits. % "he se2aration benefits shall consist of: +a, a cash 2ayment e4ui.alent to one hundred 2ercent +188:, of his a.era*e monthly com2ensation for each year of ser.ice he 2aid contributions, but not less than "wel.e thousand 2esos +P1',888, 2ayable u2on reachin* si)ty

+68, years of a*e u2on se2aration, whiche.er comes later: 'rovided+ that the member resi*ns or se2arates from the ser.ice after he has rendered at least three +7, years of ser.ice but less than fifteen +16, years0 or "+b, a cash 2ayment e4ui.alent to ei*hteen +1/, times his basic monthly 2ension at the time of resi*nation or se2aration, 2lus an old%a*e 2ension benefit e4ual to the basic monthly 2ension 2ayable monthly for life u2on reachin* the a*e of si)ty +68,: 'rovided+ that the member resi*ns or se2arates from the ser.ice after he has rendered at least fifteen +16, years of ser.ice and is below si)ty +68, years of a*e at the time of resi*nation or se2aration. "S !. 1'. /nem$lo!ment or Involuntar! Se$aration #enefits. % (nem2loyment benefits in the form of monthly cash 2ayments e4ui.alent to fifty 2ercent +68:, of the a.era*e monthly com2ensation shall be 2aid to a 2ermanent em2loyee who is in.oluntarily se2arated from the ser.ice due to the abolition of his office or 2osition usually resultin* from reor*ani@ation: 'rovided+ "hat he has been 2ayin* inte*rated contributions for at least one +1, year 2rior to se2aration. (nem2loyment benefits shall be 2aid in accordance with the followin* schedules: "Contri&utions %ade #enefit "uration 7 years than 6 years than 9 years than 11 years years 6 months ' 7 4 6 months months months months

1 year but less than 7 or more years but less 6 or more years but less 9 or more years but less 11 or more years but less than 16

""he first 2ayment shall be e4ui.alent to two +', monthly benefits. & se.en% day +<, waitin* 2eriod shall be im2osed on succeedin* monthly 2ayments. "&ll accumulated unem2loyment benefits 2aid to the em2loyee durin* his entire membershi2 with the -S#S shall be deducted from .oluntary se2aration benefits. ""he -S#S shall 2rescribe the detailed *uidelines in the o2erationali@ation of this section in the rules and re*ulations im2lementin* this &ct. "RETIREMENT BENEFITS

"S !. 17. Retirement #enefits. % +a, Betirement benefits shall be: "+1, the lum2 sum 2ayment as defined in this &ct 2ayable at the time of retirement 2lus an old%a*e 2ension benefit e4ual to the basic monthly 2ension 2ayable monthly for life, startin* u2on e)2iration of the fi.e%year +6, *uaranteed 2eriod co.ered by the lum2 sum0 or "+', cash 2ayment e4ui.alent to ei*hteen +1/, months of his basic monthly 2ension 2lus monthly 2ension for life 2ayable immediately with no fi.e%year +6, *uarantee. "+b, (nless the ser.ice is e)tended by a22ro2riate authorities, retirement shall be com2ulsory for an em2loyee of si)ty%fi.e +66, years of a*e with at least fifteen +16, years of ser.ice: 'rovided+ "hat if he has less than fifteen +16, years of ser.ice, he may be allowed to continue in the ser.ice in accordance with e)istin* ci.il ser.ice rules and re*ulations. "S !. 17%&. Conditions for Entitlement. - & member who retires from the ser.ice shall be entitled to the retirement benefits enumerated in 2ara*ra2h +a, of Section 17 hereof: 'rovided+ "hat: +1, he has rendered at least fifteen years of ser.ice0 +', he is at least si)ty +68, years of a*e at the time of retirement0 and +7, he is not recei.in* a monthly 2ension benefit from 2ermanent total disability. "S !. 14. 'eriodic 'ension Ad0ustment. - "he monthly 2ension of all 2ensioners includin* all those recei.in* sur.i.orshi2 2ension benefits shall be 2eriodically ad3usted as may be recommended by the -S#S actuary and a22ro.ed by the 1oard in accordance with the rules and re*ulations 2rescribed by the -S#S. "PERMANENT DISABILITY BENEFITS "S !. 16. General Conditions for Entitlement. - & member who suffers 2ermanent disability for reasons not due to his *ra.e misconduct, notorious ne*li*ence, habitual into)ication, or willful intention to kill himself or another, shall be entitled to the benefits 2ro.ided for under Sections 16 and 1< immediately followin*, sub3ect to the corres2ondin* conditions thereof.

"S !. 16. 'ermanent Total "isa&ilit! #enefits. - +a, #f the 2ermanent disability is total, he shall recei.e a monthly income benefit for life e4ual to the basic monthly 2ension effecti.e from the date of disability: 'rovided+ "hat: +1, he is in the ser.ice at the time of disability0 or +', if se2arated from the ser.ice, he has 2aid at least thirty%si) +76, monthly contributions within the fi.e +6, year 2eriod immediately 2recedin* disability, or has 2aid a total of at least one hundred ei*hty +1/8, monthly contributions, 2rior to his disability: 'rovided+ furt er+ "hat if at the time of disability, he was in the ser.ice and has 2aid a total of at least one hundred ei*hty +1/8, monthly contributions, in addition to the monthly income benefit, he shall recei.e a cash 2ayment e4ui.alent to ei*hteen +1/, times his basic monthly 2ension: 'rovided+ finall!+ "hat a member cannot en3oy the monthly income benefit for 2ermanent disability and the old%a*e retirement simultaneously. "+b, #f a member who suffers 2ermanent total disability does not satisfy conditions +1, and +', in 2ara*ra2h +a, of this section but has rendered at least three +7, years of ser.ice at the time of his disability, he shall be ad.anced the cash 2ayment e4ui.alent to one hundred 2ercent +188:, of his a.era*e monthly com2ensation for each year of ser.ice he 2aid contributions, but not less than "wel.e thousand 2esos +P1',888.88, which should ha.e been his se2aration benefit. "+c, (nless the member has reached the minimum retirement a*e, disability benefit shall be sus2ended when: "+1, he is reem2loyed0 or

"+', he reco.ers from his disability as determined by the -S#S, whose decision shall be final and bindin*0 or "+7, he fails to 2resent himself for medical e)amination when re4uired by the -S#S. "+d, "he followin* disabilities shall be deemed total and 2ermanent: "+1, com2lete loss of si*ht of both eyes0
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"+', loss of two +', limbs at or abo.e the ankle or wrist0 "+7, 2ermanent com2lete 2aralysis of two +', limbs0

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"+4, brain in3ury resultin* in incurable imbecility or insanity0 and "+6, such other cases as may be determined by the -S#S. "S !. 1<. 'ermanent 'artial "isa&ilit! #enefits. - +a, #f the disability is 2artial, he shall recei.e a cash 2ayment in accordance with a schedule of disabilities to be 2rescribed by the -S#S: 'rovided+ "hat he satisfies either conditions +1, or +', of Section 16 +a,0 "+b, "he followin* disabilities shall be deemed 2ermanent 2artial: "+1, com2lete and 2ermanent loss of the use of: +i, any fin*er +ii, any toe +iii, one arm +i., one hand +., one foot +.i, one le* +.ii, one or both ears +.iii, hearin* of one or both ears +i), si*ht of both eyes "+', such other cases as my be determined by the -S#S. "TEMPORARY DISABILITY BENEFITS "S !. 1/. Tem$orar! Total "isa&ilit! #enefits. - +a, & member who suffers tem2orary total disability for reasons not due to any of the conditions enumerated in Section 16 hereof shall be entitled to se.enty%fi.e 2ercent +<6:, of his current daily com2ensation for each day or fraction thereof of tem2orary disability benefit not e)ceedin* one hundred twenty +1'8, days in one calendar year after e)haustin* all his sick lea.e credits and collecti.e bar*ainin* a*reement sick lea.e benefits, if any, but not earlier than the fourth day of his tem2orary total disability: 'rovided+ "hat: "+1, he is in the ser.ice at the time of his disability0 or "+', if se2arated, he has rendered at least three +7, years of ser.ice and has 2aid at least si) +6, monthly contributions in the twel.e% month 2eriod immediately 2recedin* his disability. "'rovided+ o.ever+ "hat a member cannot en3oy the tem2orary total

disability benefit and sick lea.e 2ay simultaneously: 'rovided+ furt er+ "hat if the disability re4uires more e)tensi.e treatment that lasts beyond one hundred twenty +1'8, days, the 2ayment of the tem2orary total disability benefit may be e)tended by the -S#S but not to e)ceed a total of two hundred forty +'48, days. "+b, "he tem2orary total disability benefit shall in no case be less than Se.enty 2esos +P<8.88, a day. "+c, "he notices re4uired of the member and the em2loyer, the mode of 2ayment, and the other re4uirements for entitlement to tem2orary total disability benefits shall be 2ro.ided in the rules and re*ulations to be 2rescribed by the -S#S. "S !. 19. Non-sc eduled "isa&ilit!. - >or in3uries or illnesses resultin* in a disability not listed in the schedule of 2artial5total disability 2ro.ided herein, the -S#S shall determined the nature of the disability and the corres2ondin* benefits therefor. "SURVIVORSHIP BENEFITS "S !. '8. Survivors i$ #enefits. - Chen a member or 2ensioner dies, the beneficiaries shall be entitled to sur.i.orshi2 benefits 2ro.ided in Sections '1 and '' hereunder sub3ect to the conditions therein 2ro.ided for. "he sur.i.orshi2 2ension shall consist of: +1, the basic sur.i.orshi2 2ension which is fifty 2ercent +68:, of the basic monthly 2ension0 and +', the de2endent childrenAs 2ension not e)ceedin* fifty 2ercent +68:, of the basic monthly 2ension "S !. '1. "eat of a %em&er. - +a, (2on the death of a member, the 2rimary beneficiaries shall be entitled to: +1, sur.i.orshi2 2ension: 'rovided+ "hat the deceased: +i, was in the ser.ice at the time of his death0 or +ii, if se2arated from the ser.ice, has at least three +7, years of ser.ice at the time of his death and has 2aid thirty%si) +76, monthly contributions within the fi.e%year 2eriod immediately 2recedin* his death0 or has 2aid a total of at least one hundred ei*hty +1/8, monthly contributions 2rior to his death0 or

+', the sur.i.orshi2 2ension 2lus a cash 2ayment e4ui.alent to one hundred 2ercent +188:, of his a.era*e monthly com2ensation for e.ery year of ser.ice: 'rovided+ "hat the deceased was in the ser.ice at the time of his death with at least three +7, years of ser.ice0 or +7, a cash 2ayment e4ui.alent to one hundred 2ercent +188:, of his a.era*e monthly com2ensation for each year of ser.ice he 2aid contributions, but not less than "wel.e thousand 2esos +P1',888.88,: 'rovided+ "hat the deceased has rendered at least three +7, years of ser.ice 2rior to his death but does not 4ualify for the benefits under item +1, or +', of this 2ara*ra2h. +b, "he sur.i.orshi2 2ension shall be 2aid as follows: +1, when the de2endent s2ouse is the only sur.i.or, he5she shall recei.e the basic sur.i.orshi2 2ension for life or until he5she remarries0
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+', when only de2endent children are the sur.i.ors, they shall be entitled to the basic sur.i.orshi2 2ension for as lon* as they are 4ualified, 2lus the de2endent childrenAs 2ension e4ui.alent to ten 2ercent +18:, of the basic monthly 2ension for e.ery de2endent child not e)ceedin* fi.e +6,, counted from the youn*est and without substitution0
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+7, when the sur.i.ors are the de2endent s2ouse and the de2endent children, the de2endent s2ouse shall recei.e the basic sur.i.orshi2 2ension for life or until he5she remarries, and the de2endent children shall recei.e the de2endent childrenAs 2ension mentioned in the immediately 2recedin* 2ara*ra2h +', hereof. +c, #n the absence of 2rimary beneficiaries, the secondary beneficiaries shall be entitled to: +1, the cash 2ayment e4ui.alent to one hundred 2ercent +188:, of his a.era*e monthly com2ensation for each year of ser.ice he 2aid contributions, but not less than "wel.e thousand 2esos +P1',888.88,: 'rovided+ "hat the member is in the ser.ice at the time of his death and has at least three +7, years of ser.ice0 or +', in the absence of secondary beneficiaries, the benefits under this 2ara*ra2h shall be 2aid to his le*al heirs. +d, >or 2ur2oses of the sur.i.orshi2 benefits, le*itimate children shall include le*ally ado2ted and le*itimated children.

"S !. ''. "eat of a 'ensioner. - (2on the death of an old%a*e 2ensioner or a member recei.in* the monthly income benefit for 2ermanent disability, the 4ualified beneficiaries shall be entitled to the sur.i.orshi2 2ension defined in Section '8 of this &ct, sub3ect to the 2ro.isions of 2ara*ra2h +b, of Section '1 hereof. Chen the 2ensioner dies within the 2eriod co.ered by the lum2 sum, the sur.i.orshi2 2ension shall be 2aid only after the e)2iration of the said 2eriod. "FUNERAL BENEFITS "S !. '7. 1uneral #enefits. - "he amount of the funeral benefits shall be determined and s2ecified by the -S#S in the rules and re*ulations but shall not be less than "wel.e thousand 2esos +P1',888.88,: 'rovided+ "hat it shall be increased to at least i*hteen thousand 2esos +P1/,888.88, after fi.e +6, years and shall be 2aid u2on the death of: +a, an acti.e member as defined under Section ' +e, of this &ct0 or +b, a member who has been se2arated from the ser.ice, but who may be entitled to future benefit 2ursuant to Section 4 of this &ct0 or +c, a 2ensioner, as defined in Section ' +o, of this &ct0 or +d, a retiree who at the time of his retirement was of 2ensionable a*e under this &ct but who o2ted to retire under Be2ublic &ct No. 1616. "LIFE INSURANCE BENEFITS "S !. '4. Com$ulsor! ,ife Insurance. - &ll em2loyees e)ce2t for ;embers of the &rmed >orces of the Phili22ines +&>P, and the Phili22ine National Police +PNP, shall, under such terms and conditions as may be 2romul*ated by the -S#S, be com2ulsorily co.ered with life insurance, which shall automatically take effect as follows: +1, for those em2loyed after the effecti.ity of this &ct, their insurance shall take effect on the date of their em2loyment0 +', for those whose insurance will mature after the effecti.ity of this &ct, their insurance shall be deemed renewed on the day followin* the maturity or e)2iry date of their insurance0 +7, for those without any life insurance as of the effecti.ity of this &ct, their insurance shall take effect followin* said effecti.ity. "S !. '6. "ividends. - &n annual di.idend may be *ranted to all members of the -S#S whose life insurance is in force for at least one +1, year in accordance with a di.idends allocation formula to be determined by the

-S#S. "S !. '6. O$tional Insurance. - Sub3ect to the rules and re*ulations 2rescribed by the -S#S, a member may a22ly for insurance and5or 2re%need co.era*e embracin* life, health, hos2itali@ation, education, memorial 2lans, and such other 2lans as may be desi*ned by the -S#S, for himself and5or his de2endents. &ny em2loyer may likewise a22ly for *rou2 insurance co.era*e for its em2loyees. "he 2ayment of the 2remiums5installments for o2tional insurance and 2re%need 2roducts may be made by the insured or his em2loyer and5or any 2erson acce2table to the -S#S. "S !. '<. Reinsurance. - "he -S#S may reinsure any of its interests or 2art thereof with any 2ri.ate com2any or reinsurer whether domestic of forei*n: 'rovided+ "hat the -S#S shall submit an annual re2ort on its reinsurance o2erations to the #nsurance !ommission. "E. ADJUDICATION OF CLAIMS AND DISPUTES "S !. '/. 'rescri$tion. - !laims for benefits under this &ct e)ce2t for life and retirement shall 2rescribe after four +4, years from the date of contin*ency. "S !. '9. 1acilit! of 'a!ment. - "he -S#S shall 2rescribe rules and re*ulations to facilitate 2ayment of benefits, 2roceeds, and claims under this &ct and any other laws administered by the -S#S. Payments made by the -S#S 2rior to its recei2t of an ad.erse claim, to a beneficiary or claimant subse4uently found not entitled thereto, shall not bar the le*al and eli*ible reci2ient to his ri*ht to demand the 2ayment of benefits, 2roceeds, and claims from the -S#S, who shall, howe.er, ha.e a ri*ht to institute the a22ro2riate action in a court of law a*ainst the ineli*ible reci2ient. "S !. 78. Settlement of "is$utes. - "he -S#S shall ha.e ori*inal and e)clusi.e 3urisdiction to settle any dis2utes arisin* under this &ct and any other laws administered by the -S#S. "he 1oard may desi*nate any member of the 1oard, or official of the -S#S who is a lawyer, to act as hearin* officer to recei.e e.idence, make findin*s of fact and submit recommendations, to*ether with all documentary and testimonial e.idence to the 1oard within thirty +78, workin* days from the time the 2arties ha.e closed their res2ecti.e e.idence and filed their last 2leadin*. "he 1oard shall decide the case within thirty +78, days from the recei2t of the hearin* officerAs findin*s and recommendations. "he cases heard directly by the 1oard shall be decided within thirty +78, workin* days

from the time they are submitted by the 2arties for decision. "S !. 71. A$$eals. - &22eals from any decision or award of the 1oard shall be *o.erned by Bules 47 and 46 of the 199< Bules of !i.il Procedure ado2ted by the Su2reme !ourt on &2ril /, 199< which will take effect on Duly 1, 199<: 'rovided+ "hat 2endin* cases and those filed 2rior to Duly 1, 199< shall be *o.erned by the a22licable rules of 2rocedure: 'rovided+ furt er+ "hat the a22eal shall take 2recedence o.er all other cases e)ce2t criminal cases when the 2enalty of life im2risonment or death or reclusion $er$etua is im2osable. "he a22eal shall not stay the e)ecution of the order or award unless ordered by the 1oard, by the !ourt of &22eals or by the Su2reme !ourt and the a22eal shall be without 2re3udice to the s2ecial ci.il action of certiorari when 2ro2er. "S !. 7'. E2ecution of "ecision. - Chen no a22eal is 2erfected and there is no order to stay by the 1oard, by the !ourt of &22eals or by the Su2reme !ourt, any decision or award of the 1oard shall be enforced and e)ecuted in the same manner as decisions of the Be*ional "rial !ourt. >or this 2ur2ose, the 1oard shall ha.e the 2ower to issue to the city or 2ro.incial sheriff or its a22ointed sheriff such writs of e)ecution as may be necessary for the enforcement of such decision or award, and any 2erson who shall fail or refuse to com2ly with such decision, award, writ or 2rocess after bein* re4uired to do so shall, u2on a22lication by the -S#S, be 2unished for contem2t. "S !. 77. Oat s+ 3itnesses+ and 'roduction of Records. - Chen authori@ed by the 1oard, an official or em2loyee of the -S#S shall ha.e the 2ower to administer oath and affirmation, take de2osition, certify to official acts, and issue su&$oena ad testificandum and su&$oena duces tecum to com2el the attendance of witnesses and the 2roduction of books, 2a2ers, corres2ondences, and other records deemed necessary as e.idence in connection with any 4uestion arisin* under this &ct. &ny case of contumacy shall be dealt with in accordance with the 2ro.isions of Section 6/8 of the Be.ised &dministrati.e !ode. "F. FUNDS OF THE GSIS "S !. 74. 1unds. - &ll contributions 2ayable under Section 6 of this &ct to*ether with the earnin*s and accruals thereon shall constitute the -S#S Social #nsurance >und. "he said fund shall be used to finance the benefits

administered by the -S#S under this &ct. #n addition, the -S#S shall administer the o2tional insurance fund for the insurance co.era*e described in Section '6 hereof, the m2loyeesA !om2ensation #nsurance >und created under P.D. 6'6, as amended, -eneral #nsurance >und created under &ct No. 666, as amended, and such other s2ecial funds e)istin* or that may be created for s2ecial *rou2s or 2ersons renderin* ser.ices to the *o.ernment. "he -S#S shall maintain the re4uired reser.es to *uarantee the fulfillment of its obli*ations under this &ct. "he funds of the -S#S shall not be used for 2ur2oses other than what are 2ro.ided for under this &ct. ;oreo.er, no 2ortion of the funds of the -S#S or income thereof shall accrue to the -eneral >und of the national *o.ernment and its 2olitical subdi.isions, instrumentalities and other a*encies includin* *o.ernment%owned and controlled cor2orations e)ce2t as may be allowed under this &ct. "S !. 76. "e$osits and "is&ursements. - &ll re.enues collected and all accruals thereto shall be de2osited, administered and disbursed in accordance with the law. & ma)imum e)2ense loadin* of twel.e 2ercent +1':, of the yearly re.enues from all sources may be disbursed for administrati.e and o2erational e)2enses e)ce2t as may be otherwise a22ro.ed by the President of the Phili22ines on the basis of actuarial and mana*ement studies. "S !. 76. Investment of 1unds. - "he funds of the -S#S which are not needed to meet the current obli*ations may be in.ested under such terms and conditions and rules and re*ulations as may be 2rescribed by the 1oard: 'rovided+ "hat in.estments shall satisfy the re4uirements of li4uidity, safety5security and yield in order to ensure the actuarial sol.ency of the funds of the -S#S: 'rovided+ furt er+ "hat the -S#S shall submit an annual re2ort on all in.estments made to both Eouses of !on*ress of the Phili22ines, to wit: +a, in interest%bearin* bonds or securities or other e.idence of indebtedness of the -o.ernment of the Phili22ines0

chanroble s.irtualawlibrary

+b, in interest%bearin* de2osits or securities in any domestic bank doin* business in the Phili22ines: 'rovided+ "hat in the case of such de2osits, there shall not e)ceed at any time the unim2aired ca2ital and sur2lus or total 2ri.ate de2osits of the de2ository bank, whiche.er is smaller: 'rovided+ furt er+ "hat the said bank has 2rior desi*nation as a de2ository for the 2ur2ose by the ;onetary 1oard of the !entral ;onetary &uthority0

chanrobles.irtualawlibrary

+c, in direct housin* loans to members and *rou2 housin* 2ro3ects secured by first mort*a*e, *i.in* 2riority to the low income *rou2s and in short and medium term loans to members such as salary, 2olicy, educational, emer*ency stock 2urchase 2lan and other similar loans: 'rovided+ "hat no less than forty 2ercent +48:, of the in.estible fund of the -S#S Social #nsurance >und shall be in.ested for these 2ur2oses0 +d, in bonds, securities, 2romissory notes or other e.idence of indebtedness of educational or medical institutions to finance the construction, im2ro.ement and maintenance of schools and hos2itals0
chanrobles.irtualawlibrary

chanrobles.irtualawlibrary

+e, in real estate 2ro2erty includin* shares of stocks in.ol.in* real state 2ro2erty and in.estments secured by first mort*a*es on real estate or other collaterals acce2table to the -S#S: 'rovided+ "hat such in.estment shall, in the determination of the 1oard, redound to the benefit of the -S#S, its members as well as the *eneral 2ublic0 +f, in debt instruments and other securities traded in the secondary markets0
chanrobles.irtualawlibrary

chanroble s.irtualawlibrary

+*, in loans to, or in bonds, debentures, 2romissory notes or other e.idence of indebtedness of any sol.ent cor2oration created or e)istin* under the laws of the Phili22ines0 +h, in common and 2referred stocks of any sol.ent cor2oration or financial institution created or e)istin* under the laws of the Phili22ines listed in the stock e)chan*e with 2ro.en track record of 2rofitability o.er the last three +7, years and 2ayment of di.idends at least once o.er the same 2eriod0

chanroble s.irtualawlibrary

chanrobles.irtualawlibrary

+i, in domestic mutual funds includin* in.estments related to the o2erations of mutual funds0 and +3, in forei*n mutual funds and in forei*n currency de2osits or forei*n currency%denominated debts, non%s2eculati.e e4uities and other financial instruments or other assets issued in accordance with e)istin* laws of the countries where such financial instruments are issued: 'rovided+ "hat these instruments or assets are listed in bourses of the res2ecti.e countries where these instruments or assets are issued: 'rovided+ furt er+ "hat the issuin* com2any has 2ro.en track record of 2rofitability o.er the last three +7, years and 2ayment

of di.idends at least once o.er the same 2eriod. "S !. 7<. Records and Re$orts. % "he -S#S shall kee2 and cause to kee2 such records as may be necessary for the 2ur2ose of makin* actuarial studies, calculations and .aluations of the funds of the -S#S includin* such data needed in the com2utation of rates of disability, mortality, morbidity, se2aration and retirement amon* the members and any other information useful for the ad3ustment of the benefits of the members. "he -S#S shall maintain a22ro2riate books of accounts to record its assets, liabilities, income, e)2enses, recei2ts and disbursement of funds and other financial transactions and o2erations. "S !. 7/. E2amination and 4aluation of t e 1unds. - "he -S#S shall make a 2eriodic actuarial e)amination and .aluation of its funds in accordance with acce2ted actuarial 2rinci2les. "S !. 79. E2em$tion from Ta2+ ,e(al 'rocess and ,ien. - #t is hereby declared to be the 2olicy of the State that the actuarial sol.ency of the funds of the -S#S shall be 2reser.ed and maintained at all times and that contribution rates necessary to sustain the benefits under this &ct shall be ke2t as low as 2ossible in order not to burden the members of the -S#S and their em2loyers. "a)es im2osed on the -S#S tend to im2air the actuarial sol.ency of its funds and increase the contribution rate necessary to sustain the benefits of this &ct. &ccordin*ly, notwithstandin* any laws to the contrary, the -S#S, its assets, re.enues includin* all accruals thereto, and benefits 2aid, shall be e)em2t from all ta)es, assessments, fees, char*es, or duties of all kinds. "hese e)em2tions shall continue unless e)2ressly and s2ecifically re.oked and any assessment a*ainst the -S#S as of the a22ro.al of this &ct are hereby considered 2aid. !onse4uently, all laws, ordinances, re*ulations, issuances, o2inions or 3uris2rudence contrary to or in dero*ation of this 2ro.ision are hereby deemed re2ealed, su2erseded and rendered ineffecti.e and without le*al force and effect. ";oreo.er, these e)em2tions shall not be affected by subse4uent laws to the contrary unless this section is e)2ressly, s2ecifically and cate*orically re.oked or re2ealed by law and a 2ro.ision is enacted to substitute or re2lace the e)em2tion referred to herein as an essential factor to maintain or 2rotect the sol.ency of the fund, notwithstandin* and inde2endently of the *uaranty of the national *o.ernment to secure such sol.ency or liability. ""he funds and5or the 2ro2erties referred to herein as well as the benefits, sums or monies corres2ondin* to the benefits under this &ct shall be e)em2t from attachment, *arnishment, e)ecution, le.y or other 2rocesses issued by the courts, 4uasi%3udicial a*encies or administrati.e bodies includin*

!ommission on &udit +!$&, disallowances and from all financial obli*ations of the members, includin* his 2ecuniary accountability arisin* from or caused or occasioned by his e)ercise or 2erformance of his official functions or duties, or incurred relati.e to or in connection with his 2osition or work e)ce2t when his monetary liability, contractual or otherwise, is in fa.or of the -S#S. "G. ADMINISTRATION "S !. 48. Im$lementin( #od!. % "he -o.ernment Ser.ice #nsurance System as created under !ommonwealth &ct No. 1/6 shall im2lement the 2ro.isions of this &ct. "S !. 41. 'o.ers and 1unctions of t e GSIS. - "he -S#S shall e)ercise the followin* 2owers and functions: +a, to formulate, ado2t, amend and5or rescind such rules and re*ulations as may be necessary to carry out the 2ro.isions and 2ur2oses of this &ct, as well as the effecti.e e)ercise of the 2owers and functions, and the dischar*e of duties and res2onsibilities of the -S#S, its officers and em2loyees0 +b, to ado2t or a22ro.e the annual and su22lemental bud*et of recei2ts and e)2enditures includin* salaries and allowances of the -S#S 2ersonnel0 to authori@e such ca2ital and o2eratin* e)2enditures and disbursements of the -S#S as may be necessary and 2ro2er for the effecti.e mana*ement and o2eration of the -S#S0 +c, to in.est the funds of the -S#S, directly or indirectly, in accordance with the 2ro.isions of this &ct0

chanrobles.irtualawlibrary

chanroble s.irtualawlibrary

chanrobles.irtualawlibrary

+d, to ac4uire, utili@e or dis2ose of, in any manner reco*ni@ed by law, real or 2ersonal 2ro2erty in the Phili22ines or elsewhere necessary to carry out the 2ur2oses of this &ct0 +e, to conduct continuin* actuarial and statistical studies and .aluations to determine the financial Fcondition of the -S#S and takin* into consideration such studies and .aluations and the limitations herein 2ro.ided, re%ad3ust the benefits, contributions, 2remium rates, interest rates or the allocation or re%allocation of the funds to the contin*encies co.ered0

chanrobles.irtualawlibrary

chanrobles.irtualawlibrary

+f, +*,

to to

ha.e

the sue

2ower and

of be

succession0 sued0

chanroble s.irtualawlibrary

chanrobles.irtualawlibrary

+h, to enter into, make, 2erform and carry out contracts of e.ery kind and descri2tion with any 2erson, firm or association or cor2oration, domestic or forei*n0 +i, to carry on any other lawful business whatsoe.er in 2ursuance of, or in connection with the 2ro.isions of this &ct0

chanrobles.irtualawlibrary

chanrobles.irtualawlibrary

+3, to ha.e one or more offices in and outside of the Phili22ines, and to conduct its business and e)ercise its 2owers throu*hout and in any 2art of the Be2ublic of the Phili22ines and5or in any or all forei*n countries, states and territories: 'rovided+ "hat the -S#S shall maintain a branch office in e.ery 2ro.ince where there e)ists a minimum of fifteen thousand +16,888, membershi20 +k, to borrow funds from any source, 2ri.ate or *o.ernment, forei*n or domestic, only as an incident in the securiti@ation of housin* mort*a*es of the -S#S and on account of its recei.ables from any *o.ernment or 2ri.ate entity0 +l, to in.est, establishment, own or otherwise firm 2artici2ate or in e4uity in any entity0

chanrobles.irtualawlibrary

chanrobles.irtualawlibrary

chanroble s.irtualawlibrary

+m, to a22ro.e a22ointments in the -S#S e)ce2t a22ointments to 2ositions which are 2olicy determinin*, 2rimarily confidential or hi*hly technical in nature accordin* to the !i.il Ser.ice rules and re*ulations: 'rovided+ "hat all 2ositions in the -S#S shall be *o.erned by the com2ensation and 2osition classification system and 4ualifications standards a22ro.ed by the -S#S 1oard of "rustees based on a com2rehensi.e 3ob analysis and audit of actual duties and res2onsibilities: 'rovided+ furt er+ "hat the com2ensation 2lan shall be com2arable with the 2re.ailin* com2ensation 2lans in the 2ri.ate sector and shall be sub3ect to the 2eriodic re.iew by the 1oard no more than once e.ery four +4, years without 2re3udice to yearly merit re.iews or increases based on 2roducti.ity and 2rofitability0 +n, to desi*n and ado2t an arly Betirement #ncenti.es Plan + B#P, and5or financial assistance for the 2ur2ose of retirement for its own 2ersonnel0
chanroble s.irtualawlibrary

chanroble s.irtualawlibrary

+o, to fi) and 2eriodically re.iew and ad3ust the rates of interest and

other terms and conditions for loans and credits e)tended to members or other 2ersons, whether natural or 3uridical0

chanroble s.irtualawlibrary

+2, to enter into a*reement with the Social Security System or any other entity, enter2rise, cor2oration or 2artnershi2 for the benefit of members transferrin* from one system to another sub3ect to the 2ro.isions of Be2ublic &ct No. <699, otherwise known as the Portability ?aw0 +4, to be able to float 2ro2er instrument to li4uefy lon*%term maturity by 2oolin* funds for short%term secondary market0

chanrobles.irtualawlibrary

chanrobles.irtualawlibrary

+r, to submit annually, not later than Dune 78, a 2ublic re2ort to the President of the Phili22ines and the !on*ress of the Phili22ines re*ardin* its acti.ities in the administration and enforcement of this &ct durin* the 2recedin* year includin* information and recommendations on board 2olicies for the de.elo2ment and 2erfection of the 2ro*rams of the -S#S0

chanroble s.irtualawlibrary

+s, to maintain a 2ro.ident fund, which consists of contributions made by both the -S#S and its officials and em2loyees and their earnin*s, for the 2ayments of benefits to such officials and em2loyees or their heirs under such terms and conditions as it may 2rescribe0

chanroble s.irtualawlibrary

+t, to a22ro.e and ado2t *uidelines affectin* in.estments, insurance co.era*e of *o.ernment 2ro2erties, settlement of claims, dis2osition of ac4uired assets, 2ri.ati@ation or e)2ansion of subsidiaries, de.elo2ment of housin* 2ro3ects, increased benefit and loan 2acka*es to members, and the enforcement of the 2ro.ision of this &ct0

chanrobles.irtualawlibrary

+u, any 2ro.ision of law to the contrary notwithstandin*, to authori@e the 2ayment of e)tra remuneration to the officials and em2loyees directly in.ol.ed in the collection and5or remittances of contributions, loan re2ayments, and other monies due to the -S#S at such rates and under such conditions as it may ado2t: 'rovided+ "hat the best interest of the -S#S shall be obser.ed thereby0 +., to determine, fi) and im2ose interest u2on un2aid 2remiums due from em2loyers and em2loyees0

chanroble s.irtualawlibrary

chanroble s.irtualawlibrary

+w, to ensure the collection or reco.ery of all indebtedness, liabilities and5or accountabilities, includin* un2aid 2remiums or contributions in fa.or of the -S#S arisin* from any cause or source whatsoe.er, due from obli*ors, whether 2ublic or 2ri.ate. "he 1oard shall demand

2ayment or settlement of the obli*ations referred to herein within thirty +78, days from the date the obli*ation becomes due, and in the e.ent of failure or refusal of the obli*or or debtor to com2ly with the demand, to initiate or institute the necessary or 2ro2er actions or suits, criminal, ci.il or administrati.e or otherwise, before the courts, tribunals, commissions, boards, or bodies of 2ro2er 3urisdiction within thirty +78, days reckoned from the e)2iry date of the 2eriod fi)ed in the demand within which to 2ay or settle the account0 +), to desi*n and im2lement 2ro*rams that will 2romote and mobili@e sa.in*s and 2ro.ide additional resources for social security e)2ansion and at the same time afford indi.idual members a22ro2riate returns on their sa.in*s5in.estments. "he 2ro*rams shall be so desi*ned as to s2ur socio%economic take%off and maintain continued *rowth0 and +y, to e)ercise such 2owers and 2erform such other acts as may be necessary, useful, incidental or au)iliary to carry out the 2ro.isions of this &ct, or to attain the 2ur2oses and ob3ecti.es of this &ct.

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"S !. 4'. T e #oard of Trustees5 its Com$osition5 Tenure and Com$ensation. - "he cor2orate 2owers and functions of the -S#S shall be .ested in and e)ercised by the 1oard of "rustees com2osed of the President and -eneral ;ana*er of the -S#S and ei*ht +/, other members to be a22ointed by the President of the Phili22ines, one +1, of whom shall be either the President of the Phili22ine Public School "eachers &ssociation +PPS"&, or the President of the Phili22ine &ssociation of School Su2erintendents +P&SS,, another two +', shall re2resent the leadin* or*ani@ations or associations of *o.ernment em2loyees5retirees, another four +4, from the bankin*, finance, in.estment, and insurance sectors, and one +1, reco*ni@ed member of the le*al 2rofession who at the time of a22ointment is also a member of the -S#S. "he "rustees shall elect from amon* themsel.es a !hairman while the President and -eneral ;ana*er of the -S#S shall automatically be the .ice%chairman. "he "rustees, e)ce2t the President and -eneral ;ana*er who shall cease as trustee u2on his se2aration, shall hold office for si) +6, years without rea22ointment, or until their successors are duly a22ointed and 4ualified. Gacancy, other than throu*h the e)2iration of the term, shall be filled for the une)2ired term only. "he members of the 1oard shall be entitled to a 2er diem of "wo thousand fi.e hundred 2esos +P',688.88, for each board meetin* actually attended by them, but not to e)ceed "en thousand 2esos +P18,888.88, a month and reasonable trans2ortation and re2resentation allowances as may be fi)ed by the 1oard.

"S !. 47. 'o.ers and 1unctions of t e #oard of Trustees. % "he 1oard of "rustees shall ha.e the followin* 2owers and functions: "+a, to formulate the 2olicies, *uidelines and 2ro*rams to effecti.ely carry out the 2ur2oses of this &ct0

chanrobles.irtualawlibrary

"+b, to 2romul*ate such rules and re*ulations as may be necessary or 2ro2er for the effecti.e e)ercise of the 2owers and functions as well as the dischar*e of the duties and res2onsibilities of the -S#S, its officers and em2loyees0

chanrobles.irtualawlibrary

"+c, u2on the recommendation of the President and -eneral ;ana*er, to a22ro.e the annual and su22lemental bud*et of recei2ts and e)2enditures of the -S#S, and to authori@e such o2eratin* and ca2ital e)2enditures and disbursements of the -S#S as may be necessary or 2ro2er for the effecti.e mana*ement, o2eration and administration of the -S#S0

chanrobles.irtualawlibrary

"+d, u2on the recommendation of the President and -eneral ;ana*er, to a22ro.e the -S#S or*ani@ational and administrati.e structure and staffin* 2attern, and to establish, fi), re.iew, re.ise and ad3ust the a22ro2riate com2ensation 2acka*es for the officers and em2loyees of the -S#S and reasonable allowances, incenti.es, bonuses, 2ri.ile*es and other benefits as may be necessary or 2ro2er for the effecti.e mana*ement, o2eration and administration of the -S#S, which shall be e)em2t from Be2ublic &ct No. 6<6/, otherwise known as the &ttrition ?aw0 "+e, to fi) and 2eriodically re.iew and ad3ust the rates of interest and other terms and conditions for loans and credits e)tended to its members or other 2ersons, whether natural or 3uridical0

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chanroble s.irtualawlibrary

"+f, the 2ro.ision of any law to the contrary notwithstandin*, to com2romise or release, in whole or in 2art, any claim or settle liability to the -S#S, re*ardless of the amount in.ol.ed, under such terms and conditions as it may im2ose for the best interest of the -S#S0 "+*, to a22ro.e and ado2t *uidelines affectin* in.estments, insurance co.era*e of *o.ernment 2ro2erties, settlement of claims, dis2osition of ac4uired assets, de.elo2ment of housin* 2ro3ects, increased benefit and loan 2acka*es to members, and the enforcement of the 2ro.isions of this &ct0

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chanrobles.irtualawlibrary

"+h, to determine, fi), and im2ose interest u2on un2aid or unremitted 2remiums and5or contributions0 and "+i, to do and 2erform any and all acts necessary, 2ro2er or incidental to the attainment of the 2ur2oses and ob3ecti.es of this &ct. "S !. 44. A$$ointment+ 6ualifications+ and Com$ensation of t e 'resident and General %ana(er and of ot er 'ersonnel. - "he President and -eneral ;ana*er of the -S#S shall be its !hief )ecuti.e $fficer and shall be a22ointed by the President of the Phili22ines. Ee shall be a 2erson with mana*ement and in.estments e)2ertise necessary for the effecti.e 2erformance of his duties and functions under this &ct. ""he -S#S President and -eneral ;ana*er shall be assisted by one or more e)ecuti.e .ice%2residents, senior .ice%2residents and mana*ers in addition to the usual su2er.isory and rank%and%file 2ositions who shall be a22ointed and remo.ed by the President and -eneral ;ana*er with the a22ro.al of the 1oard, in accordance with the e)istin* !i.il Ser.ice rules and re*ulations. "S !. 46. 'o.ers and "uties of t e 'resident and General %ana(er. - "he President and -eneral ;ana*er of the -S#S shall, amon* others, e)ecute and administer the 2olicies and resolutions a22ro.ed by the 1oard and direct and su2er.ise the administration and o2erations of the -S#S. "he President and -eneral ;ana*er, sub3ect to the a22ro.al of the 1oard, shall a22oint the 2ersonnel of the -S#S, remo.e, sus2end or otherwise disci2line them for cause, in accordance with the e)istin* !i.il Ser.ice rules and re*ulations, and 2rescribe their duties and 4ualifications to the end that only com2etent 2ersons may be em2loyed. "S !. 46. Auditor. - +a, "he !hairman of the !ommission on &udit shall be the e2 officio auditor of the -S#S, and the necessary 2ersonnel to assist said re2resentati.e in the 2erformance of his duties. "+b, "he !hairman of the !ommission on &udit or his authori@ed re2resentati.es, shall submit to the 1oard soon after the close of each calendar year, an audited statement showin* the financial condition and 2ro*ress of the -S#S for the calendar year 3ust ended. "S !. 4<. ,e(al Counsel. - "he -o.ernment !or2orate !ounsel shall be the le*al ad.iser and consultant of the -S#S, but the -S#S may assi*n to the $ffice of the -o.ernment !or2orate !ounsel +$-!!, cases for le*al action or trial, issues for le*al o2inions, 2re2aration and re.iew of contracts5a*reements and others, as the -S#S may decide or determine from time to time: 'rovided+ o.ever+ "hat the 2resent le*al ser.ices *rou2

in the -S#S shall ser.e as its in%house le*al counsel. ""he -S#S may, sub3ect to a22ro.al by the 2ro2er court, de2uti@e any 2ersonnel of the le*al ser.ice *rou2 to act as s2ecial sheriff in the enforcement of writs and 2rocesses issued by the court, 4uasi%3udicial a*encies or administrati.e bodies in cases in.ol.in* the -S#S. "S !. 4/. 'o.ers of t e Insurance Commission. - "he #nsurance !ommissioner or his authori@ed re2resentati.es shall make an e)amination of financial condition and methods of transactin* business of the -S#S at least once e.ery three +7, years and the re2ort of said e)amination shall be submitted to the 1oard of "rustees and co2ies thereof be furnished the $ffice of the President of the Phili22ines and the two houses of the !on*ress of the Phili22ines within fi.e +6, days after the close of e)amination: 'rovided+ o.ever+ "hat for each e)amination, the -S#S shall 2ay the office of the #nsurance !ommissioner an amount e4ual to the actual e)2enses incurred by the said office in the conduct of e)amination, includin* the salaries of the e)aminers and of the actuary of such e)amination for the actual time s2ent. "H. GENERAL PROVISION "S !. 49. "is$ensation of Social Insurance #enefits. - +a, "he -S#S shall 2ay the retirement benefits to the em2loyee on his last day of ser.ice in the *o.ernment: 'rovided+ "hat all re4uirements are submitted to the -S#S within a reasonable 2eriod 2rior to the effecti.e date of the retirement0 "+b, "he -S#S shall discontinue the 2rocessin* and ad3udication of retirement claims under B.&. No. 1616 e)ce2t refund of retirement 2remium under B. &. No. 918. #nstead, all a*encies concerned shall 2rocess and 2ay the *ratuities of their em2loyees. "he 1oard shall ado2t the 2ro2er rules and 2rocedures for the im2lementation of this 2ro.ision. "S !. 68. "evelo$ment and "is$osition of Ac7uired Assets. - "he -S#S shall ha.e the ri*ht to de.elo2 and dis2ose of its ac4uired assets obtained in the ordinary course of its business. "o add .alue to, im2ro.e 2rofitability on, and5or enhance the marketability of an ac4uired asset, the -S#S may further de.elo25reno.ate the same either with its own ca2ital or throu*h a 3oint .enture arran*ement with 2ri.ate com2anies or indi.iduals. ""he -S#S may sell its ac4uired assets in accordance with e)istin* !ommission on &udit +!$&, rules and re*ulations for an amount not lower

than the current market .alue of the 2ro2erty. >or this 2ur2ose, the -S#S shall conduct an annual a22raisal of its 2ro2erty or ac4uired assets to determine its current market .alue. &ll notices of sale shall be 2ublished in news2a2ers of *eneral circulation. "No in3unction or restrainin* order issued by any court, commission, tribunal or office shall bar, im2ede or delay the sale and dis2osition by the -S#S of its ac4uired assets e)ce2t on 4uestions of ownershi2 and national or 2ublic interest. "S !. 61. Government Assistance to t e GSIS. - "he -S#S may call u2on any em2loyer for such assistance as may be necessary in the dischar*e of its duties and functions. "I. PENAL PROVISIONS "S !. 6'. 'enalt!. - +a, &ny 2erson found to ha.e 2artici2ated directly or indirectly in the commission of fraud, collusion, falsification, or misre2resentation in any transaction with the -S#S, whether for him or for some other 2ersons, shall suffer the 2enalties 2ro.ided for in &rticle 1<' of the Be.ised Penal !ode. "+b, Choe.er shall obtain or recei.e any money or check in.okin* any 2ro.ision of this &ct or any a*reement thereunder, without bein* entitled thereto with the intent to defraud any member, any em2loyer, the -S#S, or any third 2arty, shall be 2unished by a fine of not less than >i.e thousand 2esos +P6,888.88, nor more than "wenty thousand 2esos +P'8,888.88, or by im2risonment of not less than si) +6, years and one +1, day to twel.e +1', years, or both, at the discretion of the court. "+c, Choe.er fails or refuses to com2ly with the 2ro.isions of this &ct or with the rules and re*ulations ado2ted by the -S#S, shall be 2unished by a fine of not less than >i.e thousand 2esos +P6,888.88, nor more than "wenty thousand 2esos +P'8,888.88, or im2risonment of not less than si) +6, years and one +1, day to twel.e +1', years, or both, at the discretion of the court. "+d, "he treasurer, finance officer, cashier, disbursin* officer, bud*et officer or other official or em2loyee who fails to include in the annual bud*et the amount corres2ondin* to the em2loyer and em2loyee contributions, or who fails or refuses or delays by more than thirty +78, days from the time such amount becomes due and demandable, or to deduct the monthly contributions of the em2loyee shall, u2on con.iction by final 3ud*ment,

suffer the 2enalties of im2risonment from si) +6, months and one +1, day to si) +6, years, and a fine of not less than "hree thousand 2esos +P7,888.88, but not more than Si) thousand 2esos +P6,888.88,, and in addition, shall suffer absolute 2er2etual dis4ualification from holdin* 2ublic office and from 2racticin* any 2rofession or callin* licensed by the *o.ernment. "+e, &ny em2loyee or member who recei.es or kee2s fund or 2ro2erty belon*in*, 2ayable or deli.erable to the -S#S and a22ro2riates the same, or takes or misa22ro2riates or uses the same for any 2ur2ose other than authori@ed by this &ct, or 2ermits another 2erson to take, misa22ro2riate or use said fund or 2ro2erty by e)2ressly consentin* thereto, or throu*h abandonment or ne*li*ence, or is otherwise *uilty of the misa22ro2riation of said fund or 2ro2erty, in whole or in 2art, shall suffer the 2enalties 2ro.ided in &rticle '1< of the Be.ised Penal !ode, and in addition, shall suffer absolute 2er2etual dis4ualification from holdin* 2ublic office and from 2racticin* any 2rofession or callin* licensed by the *o.ernment. "+f, &ny em2loyee who, after deductin* the monthly contribution or loan amorti@ation from a memberAs com2ensation, fails to remit the same to the -S#S within thirty +78, days from the date they should ha.e been remitted under Section 6+a,, shall be 2resumed to ha.e misa22ro2riated such contribution or loan amorti@ation and shall suffer the 2enalties 2ro.ided in &rticle 716 of the Be.ised Penal !ode, and in addition, shall suffer absolute 2er2etual dis4ualification from holdin* 2ublic office and from 2racticin* any 2rofession or callin* licensed by the *o.ernment. "+*, "he heads of the offices of the national *o.ernment, its 2olitical subdi.isions, branches, a*encies and instrumentalities, includin* *o.ernment%owned or controlled cor2orations and *o.ernment financial institutions, and the 2ersonnel of such offices who are in.ol.ed in the collection of 2remium contributions, loan amorti@ation and other accounts due the -S#S who shall fail, refuse or delay the 2ayment, turno.er, remittance or deli.ery of such accounts to the -S#S within thirty +78, days from the time that the same shall ha.e been due and demandable shall, u2on con.iction by final 3ud*ment, suffer the 2enalties of im2risonment of not less than one +1, year nor more than fi.e +6, years and a fine of not less than "en thousand 2esos +P18,888.88, nor more than "wenty thousand 2esos +P'8,888.88,, and in addition, shall suffer absolute 2er2etual dis4ualification from holdin* 2ublic office and from 2racticin* any 2rofession or callin* licensed by the *o.ernment. "+h, "he officers and5or 2ersonnel referred to in 2ara*ra2h +*, of this section shall be liable not only criminally but also ci.illy to the -S#S or to the

em2loyee or member concerned in the form of dama*es, includin* surchar*es and interests. "+i, >or the char*es or com2laints referred to in 2ara*ra2h +*, of this section, the liabilities therein set forth shall be construed as wai.er of the State of its immunity from suit, hence, the abo.e%mentioned officials and5or 2ersonnel may not in.oke the defense of non%suability of the State. "+3, >ailure of the ;embers of the -S#S 1oard, includin* the chairman and the .ice%chairman, to com2ly with the 2ro.isions of 2ara*ra2h +w, of Section 41 hereof, shall sub3ect them to im2risonment of not less than si) +6, months nor more than one +1, year or a fine of not less than >i.e thousand 2esos +P6,888.88, nor more than "en thousand 2esos +P18,888.88, without 2re3udice to any ci.il or administrati.e liability which may also arise therefrom. "+k, !riminal actions arisin* from .iolations of the 2ro.isions of this &ct may be commenced by the -S#S or by the a**rie.ed member, either under this &ct or, in a22ro2riate cases, under the Be.ised Penal !ode. "S !. 67. Im$lementin( Rules and Re(ulations. - "he im2lementin* rules and re*ulations to carry out the 2ro.isions of this &ct shall be ado2ted and 2romul*ated by the -S#S not later than ninety +98, days after the a22ro.al of this &ct. "S !. 64. Non-im$airment of #enefits+ 'o.ers+ 8urisdiction+ Ri( ts+ 'rivile(es+ 1unctions and Activities. - Nothin* in this &ct shall be construed to re2eal, amend or limit any 2ro.ision of e)istin* laws, Presidential Decrees and ?etters of #nstructions, not otherwise s2ecifically inconsistent with the 2ro.isions of this &ct. "S !. 66. E2clusiveness of #enefits. - Chene.er other laws 2ro.ide similar benefits for the same contin*encies co.ered by this &ct, the member who 4ualifies to the benefits shall ha.e the o2tion to choose which benefits will be 2aid to him. Eowe.er, if the benefits 2ro.ided by the law chosen are less than the benefits 2ro.ided under this &ct, the -S#S shall 2ay only the difference. "S !. 66. A$$ro$riations. - "he amount necessary to carry out the 2ro.isions of this &ct shall be included in the res2ecti.e bud*ets of the a*encies in the national *o.ernment obli*ation 2ro*ram of the year followin* its enactment into law and thereafter."

SEC. 9. Se$ara&ilit! Clause. - Should any 2ro.ision of this &ct or any 2art thereof be declared in.alid, the other 2ro.isions, so far as they are se2arable from the in.alid ones, shall remain in force and effect. SEC. :. Re$ealin( Clause. - &ll laws and any other law or 2arts of law s2ecifically inconsistent herewith are hereby re2ealed or modified accordin*ly: 'rovided+ "hat the ri*hts under the e)istin* laws, rules and re*ulations .ested u2on or ac4uired by an em2loyee who is already in the ser.ice as of the effecti.ity of this &ct shall remain in force and effect: 'rovided+ furt er+ "hat subse4uent to the effecti.ity of this &ct, a new em2loyee or an em2loyee who has 2re.iously retired or se2arated and is reem2loyed in the ser.ice shall be co.ered by the 2ro.isions of this &ct. SEC. ;. Effectivit!. - "his &ct shall take effect fifteen +16, days after its 2ublication in the $fficial -a@ette or in at least two +', news2a2ers of *eneral circulation. "his &ct, which is a consolidation of Senate 1ill No. '817 and Eouse 1ill No. /661, was finally 2assed by the Senate and the Eouse of Be2resentati.es on ;ay '9, 199< and ;ay '/, 199<, res2ecti.ely. &22ro.ed: ;ay 78, 199<

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