Social security contributions by both employers and employees were raised to 15 percent effective Jan. 1, 2025. This completes the implementation of a three percent increase in contributions, two percent of which is shouldered by employers, and one percent by employees. These increases are mandated by the implementing rules and regulations of Republic Act No. 11199 or the Social Security Act of 2018 that took effect in June 2019.
From a baseline of 12 percent in 2019 — eight percent shouldered by employers and four percent by employees — the contribution rate has been increased to 15 percent in 2025, of which 10 percent and five percent, are the employers’ and employees’ shares, respectively. To cushion the impact, the implementation was carried out on a staggered basis. Hence, the two-percent increment in employers’ share and the one-percent uptick in employees’ share, were done over a four-year period from the time the implementing rules were promulgated in 2021.
Since the inception of the Social Security System (SSS) in 1957, successive administrations have endeavored to broaden the increase in coverage and benefits to include self-employed and domestic employees, as well as overseas Filipino workers (OFWs). Prior to the latest law, the governing statute was Republic Act 8282 passed during the administration of President Fidel V. Ramos. Owing to the wide scope of coverage and the predominance of medium- and small-scale enterprises in the country, the government has sought to calibrate the increases in contribution rates as these have an impact on the take-home pay of covered workers, as well as the viability of fledgling enterprises.
The SSS provides death, funeral, maternity leave, permanent disability, retirement, sickness and involuntary separation as well as unemployment benefits. In 1975, the Employees' Compensation (EC) Program was launched, providing double compensation to workers who had illness, accident during work-related activities, or died. EC benefits are granted only to members with employers other than themselves. Other members’ benefits include salary loans calculated based on a member’s particular monthly salary credit, and calamity loans in instances when the government has declared a state of calamity in the member’s place of residence in the aftermath of natural disasters such as floods, earthquakes, and volcanic eruptions.
The increases in contributions, as provided for in RA No. 11199, are aimed at enhancing the actuarial viability of the SSS fund. The SSS announced in December 2022 that “an additional 22 years have been added to the fund life with the help of contribution rate increases since 2019.” It was explained that “after implementing the additional ₱1,000 pension benefit in 2017, the SSS fund life would have lasted until 2032 only; however, with the help of gradual contribution rate increases mandated by Republic Act No. 11199 or the Social Security Act of 2018, the fund life was extended by another 12 years or until 2044.” Moreover, according to the SSS, due to the agency’s efforts to boost its membership and coverage, the projected fund life has been extended further until 2054.
These robust projections depend significantly on the actual realization of projected members’ contributions in the aftermath of the successive increases that have been gradually implemented since 2021. The current SSS administration appears determined to ensure that millions of Filipinos will enjoy the full benefits from their industry and hard work to secure a better future for their families.