Employer's Failure to Remit Government Contributions: Legal Steps to Protect Your Rights

Dear Attorney,

I am currently employed and noticed that my employer deducts government contributions (e.g., SSS, PhilHealth, Pag-IBIG) from my salary regularly. However, I recently discovered that these deductions have not been remitted to the respective government agencies, leaving my accounts with them unpaid. What is the best course of action I can take to address this issue and protect my rights?

Sincerely, Concerned Employee

Insights

In the Philippines, it is mandatory for employers to deduct and remit contributions for government-mandated benefits such as the Social Security System (SSS), Philippine Health Insurance Corporation (PhilHealth), and Home Development Mutual Fund (Pag-IBIG) on behalf of their employees. Failing to do so is not only a breach of trust but also a violation of several laws that protect the rights of workers.

Legal Framework
Under the Social Security Act of 2018 (Republic Act No. 11199), the National Health Insurance Act of 2013 (Republic Act No. 7875 as amended by RA 11223), and the Home Development Mutual Fund Law of 2009 (Republic Act No. 9679), employers are required to remit the corresponding contributions of their employees to the respective agencies. The failure to remit these contributions is subject to legal penalties, including fines and imprisonment.

Steps to Take

1. Document Everything: Start by gathering all evidence of the deductions from your payslips, employment contracts, and any other relevant documentation. This will be crucial if you need to escalate the issue.

2. Internal Resolution: Initially, you may want to bring the issue to the attention of your employer, preferably in writing. This provides a formal record of your grievance and gives your employer the opportunity to correct the issue.

3. Filing a Complaint: If your employer fails to take corrective action, you have the right to file a complaint with the appropriate government agencies:

   • SSS, PhilHealth, or Pag-IBIG: You can file a complaint directly with these agencies. They have enforcement divisions that handle such violations and can initiate an investigation.
   • Department of Labor and Employment (DOLE): You can also file a complaint with DOLE, which oversees labor practices and can impose sanctions on non-compliant employers.

4. Legal Recourse: If the issue remains unresolved, you may consider taking legal action. This could involve filing a case for estafa under the Revised Penal Code, as the non-remittance of contributions despite deductions constitutes fraud. Additionally, you could pursue civil remedies to recover damages.

5. Seek Legal Advice: Given the complexity of labor laws and the potential need for court action, consulting with a lawyer who specializes in labor law is advisable. They can guide you through the process, ensuring that your rights are fully protected.

Conclusion
Employers are legally obligated to remit your government contributions, and failure to do so is a serious violation of your rights. By taking the appropriate steps, you can ensure that your contributions are properly credited, and your benefits are secured. Should the issue persist, legal avenues are available to hold your employer accountable and seek justice.

By addressing this concern promptly, you protect not only your future benefits but also reinforce the importance of compliance with labor laws, which is essential for the welfare of all employees.