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CIRCULAR NO.

2011-002
Series of 2011
TO:

ALL EMPLOYERS

SUBJECT: REVISED GUIDELINES IN THE INSTALLMENT PAYMENT SCHEME


FOR EMPLOYERS
The Social Security Commission in its Resolution No. 976-s.2010 dated 08 December 2010
approved the Revised Guidelines in the Installment Payment Scheme for Employers, as
follows:
SECTION 1. Who may avail the Program. - Any employer, including household employer,
who is delinquent or has not remitted all contributions and salary/calamity loan amortizations for
at least six (6) months, including penalties, due and payable to the SSS.
SECTION 2. How to avail of the Program. - The employer shall submit an
accomplished Application for Installment Proposal and file with the servicing Branch Office.
An employer shall be given thirty (30) days upon receipt of the final demand letter to submit a
proposal to settle its liabilities, otherwise, the SSS shall file a case of non-remittance of SS
contribution and loan amortization against the employer.
SECTION 3. Supporting documents. - The employer shall submit the following documents to
support its application:
For Corporation and Partnership

Collection Lists for Contributions (R-3) and/or Loans (ML-2). The monthly installment shall
be divided equally over the term of installment.
Articles of Incorporation or Articles of Partnership
Secretarys Certificate authorizing the President or Secretary or Treasurer to sign the
promissory note (PN) in behalf of the company:
Duly notarized Promissory Note
Duly notarized undertaking by the company's managing head(s), director(s) or partner(s),
binding himself/themselves to the SSS, in their personal capacities to fulfill the obligations
of the company.

The personal undertaking may be waived, subject to the approval by the SSS President and
CEO.
In case the company has been closed/terminated, any of its former managing head, director or
partner shall sign the application and the promissory note.
For Single Proprietorship
Collection Lists for Contributions (R-3) and/or Loans (ML-2)
Duly notarized Promissory Note
SECTION 4. Employers with pending cases. - In the event there is an existing collection
case against the employer, the SSS may nevertheless accept the proposal and the employer

may move for the provisional dismissal of the case without objection from the SSS. However,
this is without prejudice to the re-filing of the same in the event the employer fails to remit in
full its delinquency or defaults in the payment of up to two (2) monthly installments, and/or
non-payment of current contribution/salary/calamity loan amortization, and/or non-compliance
with any of the other terms and conditions of the installment payment proposal
SECTION 5. Installment proposal. - The branch which received the Application shall screen
the completeness of the documents submitted. The Branch Head shall give due course to
approve the proposal subject to the following:
a) The contribution delinquency shall be subject to the three percent (3%) penalty per
month for late payment in accordance with Section 22(a) of the SS Law, as amended, and
the salary/calamity loan delinquency to the one percent (1%) penalty per month for late
payment until full payment in accordance with the approved payment plan.
b) The total delinquency shall be payable in accordance with the schedule of monthly
installment, as follows:

Total Amount of Delinquency

Maximum Number of Monthly Installment

Not over P2,000,000

Twenty-four (24) months

Over P2,000,000 but not over


P5,000,000

Thirty-six (36) months

P5,000,000 and over

Forty-eight (48) months

c) Upon submission of the installment proposal, the employer shall be required to pay at
least five percent (5%) of the total delinquency as down payment.
d) The employer shall not be allowed to re-apply for another installment proposal. An
exemption may be granted on a case to case basis, subject to the approval by the SSS
President and CEO.
e) The employer shall issue, within five (5) working days from receipt of Notice of Approval,
all the post-dated checks (PDCs) corresponding to the months covered by the installment.
PDCs issued by the employer shall be in the custody of the Tellering Section of the
concerned branch, except in branches with no tellering facility, in which case, the PDCs
shall be in the custody of the Tellering Section of the cluster branch.
f) An employer may be allowed to replace or cancel the post dated checks prior to due dates
in case of change in its authorized signatory or closure of bank account, subject to the
recommendation and approval of the officials who recommended and approved the
installment proposal.
g) The employer with an approved installment plan shall also remit current contributions and
salary/calamity loan amortizations every month as they fall due.
SECTION 6. Grounds for termination of approved proposal. - In the event of default in the
payment of up to two (2) monthly installments, and/or non-payment of current
contribution/salary/calamity loan amortization, and/or non-compliance with any of the other
terms and conditions of the installment payment proposal, the employer's total obligations shall
become due and demandable and the SSS shall collect the delinquency pursuant to Section 22

(b) in relation to Section 22 (c) of the SS Law by issuing a warrant to the sheriff of any city or
province commanding him to levy upon and sell any real or personal property of the employer,
or filing the necessary civil/criminal action pursuant to Section 22 (a) in relation to Section 28
(e) of the SS Law, as amended, against the employers or persons responsible for violation of the
SS Law.
SECTION 7. Restoration of loan privileges. - Upon approval of the installment proposal of
the employer, the short-term loan privileges of its employees shall be restored. Provided, that
the said employees comply with other requirements of their loan applications, provided further,
that said privileges shall again be suspended in the event of violation of any of the terms and
conditions set hereof.
SECTION 8. Right to benefits of employees. - Should the settlement of contributions
through installment result in additional benefits for contingencies that have occurred prior to the
date of settlement or shall occur within the installment period, the employer shall pay the SSS
damages in accordance with the provisions of Section 24(b) of R.A. 1161, as amended.
SECTION 9. Application of payments. The monthly installment shall be applied as follows:
a) For loan repayment, the monthly installment shall be applied first to the penalty, then to
the interest, and finally to the principal until the delinquency is fully paid.
b) For contribution payments, the monthly installment shall be applied to the amount of the
contributions and penalty as computed and specified in the payment form.
c) Only the actual payments made by the employer shall be posted to the account of the
employees.
SECTION 10. Recommending and Approving Officials. - The Branch Head shall approve the
installment proposal upon the recommendation of the Head of the Inspectorate Section. In the
absence of the Branch Head, the next higher official shall assume the responsibility.
SECTION 11. Repealing clause. - All other Circulars, rules and regulations, and other
issuances or parts thereof, which are inconsistent with the provisions of this Circular are hereby
repealed or modified accordingly.
SECTION 12. Effectivity. - This Circular shall take effect immediately.
Approved by:
THE SOCIAL SECURITY COMMISSION
(sgd)
JUAN B. SANTOS
Chairman
16 February 2011

(sgd)
EMILIO S. DE QUIROS
President and CEO

SEC. 22. Remittance of Contributions.


a) The contribution imposed in the preceding
section shall be remitted to the SSS within the
first ten (10) days of each calendar month
following the month for which they are applicable
or within such time as the Commission may
prescribe. Every employer required to deduct and
to remit such contributions shall be liable for their
payment and if any contribution is not paid to the
SSS as herein prescribed, he shall pay besides the
contribution a penalty thereon of three percent
(3%) per month from the date the contribution
falls due until paid. If deemed expedient and
advisable by the Commission, the collection and
remittance of contributions shall be made
quarterly or semiannually in advance, the
contributions payable by the employees to be
advanced by their respective employers:
Provided, That upon separation of an employee,
any contribution so paid in advance but not due
shall be credited or refunded to his employer.
b) The contributions payable under this Act in cases
where an employer refuses or neglects to pay the
same shall be collected by the SSS in the same
manner as taxes are made collectible under the
National Internal Revenue Code, as amended.
Failure or refusal of the employer to pay or remit
the contributions herein prescribed shall not
prejudice the right of the covered employee to
the benefits of the coverage.
The right to institute the necessary action against
the employer may be commenced within twenty
(20) years from the time the delinquency is
known or the assessment is made by the SSS, or
from the time the benefit accrues, as the case
may be.
c) Should any person, natural or juridical, defaults in
any payment of contributions, the Commission
may also collect the same in either of the
following ways:
1. By an action in court, which shall hear and
dispose of the case in preference to any
other civil action; or
2. By issuing a warrant to the Sheriff of any
province or city commanding him to levy
upon and sell any real and personal
property of the debtor. The Sheriff's sale
by virtue of said warrant shall be
governed by the same procedure

prescribed for executions against


property upon judgments by a court of
record
d) The last complete record of monthly
contributions paid by the employer or the
average of the monthly contributions paid during
the past three (3) years as of the date of filing of
the action for collection shall be presumed to be
the monthly contributions payable by and due
from the employer to the SSS for each of the
unpaid month, unless contradicted and overcome
by other evidence: Provided, That the SSS shall
not be barred from determining and collecting
the true and correct contributions due the SSS
even after full payment pursuant to this
paragraph, nor shall the employer be relieved of
his liability under Section Twentyeight of this Act.

SEC. 28. Penal Clause.


(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 thousand pesos (P5,000.00) nor more than
Twenty thousand pesos (P20,000.00), or imprisonment
for not less than six (6) years and one (1) day nor more
than twelve (12) years or both, at the discretion of the
court: Provided, That where the violation consists in
failure or refusal to register employees or himself, in case
of the covered selfemployed, or to deduct contributions
from the employees' compensation and remit the same to
the SSS, the penalty shall be a fine of not less than Five
thousand pesos (P5,000.00) nor more than Twenty
thousand pesos (P20,000.00) and imprisonment for not
less than six (6) years and one (1) day nor more than
twelve (12) years.

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