The government provides Filipinos social welfare services in the private sector through the Social Security System (SSS), the Home Development Mutual Fund (Pag-IBIG), and the Philippine Health Insurance Corporation (PhilHealth). To ensure that everyone has access to these services, employers and employees’ benefits are required by law to contribute to these agencies through salary deductions as specified in the Philippine Labor Code.
Filipinos who are not formally employed in the private or public sector may apply as voluntary members. Provided that they qualify to the membership requirements to avail themselves of the benefits as well. While you are required to regularly pay your contribution to these social services. Then you might as well know the employees’ benefits that you can avail.
SSS is a social insurance program that aims to provide protection to its members and beneficiaries. While GSIS serves as the counterpart social insurance program for those who work in government. SSS members can avail of maternity, sickness, disability, retirement, funeral, and death benefits. SSS also allows qualified members to take up salary, housing, business, educational loans.
The SSS contribution is 11% of an employee’s monthly salary1. The employer required to shoulder 7.37% of the total 11% contribution. While the remaining 3.63% is shoulder by the employee. Based on the SSS contribution schedule, the minimum salary credit is 1,000, while the maximum is 20,000. Thus, the minimum contribution per month could range from ₱120.00 to ₱2,400.00 depending on the person’s salary.
To illustrate, an average employee earns ₱31,253.332 monthly. In this case, the monthly salary credit is 16,000, which is the maximum amount. The employer is require to shoulder ₱1,178.70 and ₱581.30 will deduct from the employee’s salary every month. For voluntary members, they may choose a comfortable monthly contribution. But they will shoulder the entire 11% of their reported monthly income.
The HDMF, commonly known as Pag-IBIG (Pagtutulungan sa kinabukasan: Ikaw, Bangko, Industriya, Gobyerno) Fund, was establish to provide a national savings program and an affordable house financing for Filipinos. Aside from housing programs, it also offers savings programs and multi-purpose loans that qualified members can avail.
Pag-IBIG fund has a fixed monthly contribution of ₱200.00. For employed individuals, ₱100.00 will be shoulder by the employer. While the remaining ₱100.00 will deduct from the monthly salary of the employee.
PhilHealth implements the National Health Insurance Program that aims to provide Filipinos with financial assistance and access to affordable health services. It covers hospital costs, subsidies for room and boarding, medicine, and professional services.
The compensation of the employee has a corresponding salary base which will be the basis of the PhilHealth contributions. The employer is require to shoulder half of the contribution and the remaining 50% will deduct monthly from the salary of the employee. The minimum salary base is ₱10,000 and the maximum is ₱50,000, which is equivalent to the minimum contribution of ₱275.00 and the maximum is ₱1,375.00 per month.
To illustrate, an average employee earns ₱31,253.334 monthly. Base on the PhilHealth contribution schedule, the monthly salary grade based on the PhilHealth contribution table is 31,000. The total monthly contribution of the employee is ₱775.00 to PhilHealth. The employer will be shoulder ₱387.50 Pesos and the remaining ₱387.50 will deduct monthly from the employee’s salary.
Other Employees Benefits
The services and employees’ benefits from SSS, PhilHealth, and Pag-IBIG are just part of the social safety net provided by the government. As such, the basic purpose of these agencies is to allow people access to economic or social support from the government so that they can attain or remain above the minimum standard of living”.
To assess whether these government benefits are enough greatly depends on your financial goal. It is beneficial to have a better understanding of how social safety nets such as the services offered by SSS, PhilHealth, and Pag-IBIG work. In most cases, these employees’ benefits only serve as a supplement just to get by.
For retirement, some people count on the SSS pension to be the sole source of their retirement income. The maximum basic monthly pension a retiree can receive is ₱10,900 provided that he or she has at least 30 years of credit service.
With the rising cost of living and additional expenses to maintain good health as people age. The maximum pension provided by SSS may not be enough to cover the costs of medical care, maintenance medicines, and basic living expenses.
Aside from preparing for retirement, if owning a house is part of your adulting goals, you could avail of a housing loan from Pag-IBIG.
A qualified Pag-IBIG member could get up to ₱6 Million for a home loan. The amount could be enough if you plan on getting a property in the province where property rates are considerably lower. In urban areas like Quezon City, properties could cost as much as ₱9,792,519 Million. This means that if you’re looking to procure property in an urban area. Then you would definitely need more than just the maximum loanable amount provided by Pag-IBIG.