The Social Security Act of 2018 is a law designed to strengthen financial security for workers and retirees.
It ensures better pensions, expanded benefits, and improved fund sustainability for future generations.
The law adjusts contributions, introduces new benefits, and expands membership, particularly for self-employed individuals and overseas workers.
If you are an employee, self-employed, or an Overseas Filipino Worker (OFW), this law affects how you contribute, claim benefits, and secure your retirement.
It does come with a cost—higher monthly contributions—but these adjustments allow the system to increase pensions and provide new benefits, such as unemployment insurance.
Higher Contributions, Bigger Benefits
One of the most significant changes is the gradual increase in SSS contributions.
Before the law, the contribution rate was 11%.
With the new law, it started at 12% in 2019, increasing by 1% every two years, reaching 15% by 2025.
This increase ensures that pensions and benefits keep up with inflation and that the fund remains stable.
Employers and employees share the cost, while self-employed individuals and voluntary members pay the full rate.
The law also raised the maximum Monthly Salary Credit (MSC), allowing higher earners to receive bigger retirement pensions and other benefits.
For many, this means more financial security in retirement and during unexpected life events.
Mandatory SSS Coverage for OFWs
One of the most impactful provisions is compulsory SSS coverage for OFWs.
Previously, many OFWs were excluded from SSS membership, leaving them without pension or social security benefits.
Now, all land-based and sea-based OFWs below 60 years old are required to contribute.
If no bilateral agreement exists with their host country, OFWs must pay the entire contribution as self-employed members.
This ensures that millions of workers abroad can now build their pensions and access benefits, such as maternity, sickness, disability, and death benefits.
Unemployment Insurance: A First in SSS History
Losing a job can be financially devastating.
For the first time, the law introduced an Unemployment Benefit to help members who lose their jobs involuntarily.
Members who have paid at least 36 months of contributions—with at least 12 months paid in the 18 months before losing employment—can claim up to two months of cash assistance.
This benefit is equal to 50% of their average monthly salary credit.
For example, if your average salary credit is ₱16,000, you can receive ₱8,000 per month for two months.
This provides a temporary financial cushion while job-hunting, offering relief during an otherwise stressful period.
Provident Fund for Long-Term Savings
A new feature of the law is the Workers’ Investment and Savings Program (WISP).
This is a mandatory provident fund for members earning above ₱20,000 per month.
Unlike the regular SSS pension, WISP acts like a personal savings and investment fund.
A portion of a member’s contributions is placed into this program, growing over time with interest.
Upon retirement, members receive this additional fund as a lump sum or annuity, supplementing their pension.
This ensures that higher-earning individuals have a stronger financial safety net in their later years.
Stronger Fund Management and Compliance
The law also gave the Social Security Commission (SSC) greater flexibility to adjust contributions and benefits as needed.
Previously, these adjustments required Congress approval, causing delays.
Now, the SSC can implement changes based on actuarial studies, ensuring that the SSS remains financially stable.
It also introduced penalty condonation programs, allowing employers with past-due contributions to settle debts without excessive fines.
This approach encourages compliance while helping sustain the fund.
What This Means for You
If you are an employee, expect higher contributions but bigger pensions and stronger social protection.
If you are self-employed, you must continue contributing, but with improved access to benefits and retirement savings.
If you are an OFW, membership is now mandatory, ensuring you have a pension and financial security when you return home.
If you are an employer, you must adjust payroll contributions but also benefit from lower penalty rates and compliance flexibility.
If you are a pensioner, while no immediate increase was granted, this law ensures the SSS fund remains financially sustainable for future pension adjustments.
Frequently Asked Questions
- Will my pension increase because of this law?
Not immediately. However, the higher contribution rates will allow future pension adjustments and ensure continued payments.
- Can I opt out of the mandatory OFW coverage?
No. If you are an OFW under 60, you are required to contribute. However, you can choose your contribution amount within the salary credit range.
- How do I apply for the Unemployment Benefit?
You must have at least 36 contributions and provide a DOLE certification confirming involuntary separation.
- How do I check my WISP contributions?
You can view your WISP savings and balance through the My.SSS online portal or by visiting an SSS branch.
Recent Updates
Key Reforms in SSS for 2025
SSS will implement major reforms in 2025. These include enhanced services for pensioners, lower interest rates on salary and calamity loans, and expanded coverage for self-employed professionals. SSS is reviewing the Annual Confirmation of Pensioners (ACOP) program to improve convenience for pensioners. The agency is also analyzing compliance methods like home visits for those aged 80 and above. SSS plans to reduce interest rates on loans and improve collection compliance among self-employed professionals, aligning with its commitment to service excellence and financial sustainability. (PhilStar Global)
Video: Your SSS Journey Begins with Republic Act 11199
The Social Security Act of 2018, also known as Republic Act 11199, is the foundation of your SSS journey.
This law rationalizes and expands the powers and duties of the Social Security Commission.
It aims to ensure the long-term viability of the Social Security System (SSS).
The Act promotes social justice through savings and provides meaningful social security protection.
It covers hazards such as disability, sickness, maternity, old age, and death.
The law also emphasizes the value of “work, save, invest, and prosper.”
Conclusion
The Social Security Act of 2018 is a long-term investment in financial security for workers, retirees, and their families.
While it requires higher contributions, the trade-off is better benefits, stronger fund management, and greater sustainability.
Understanding these changes allows you to plan ahead, maximize your benefits, and ensure a more stable future.
By keeping up with your contributions and staying informed, you take an active role in securing your retirement and overall financial well-being.