Just a few days ago, the Social Security System (SSS) went into second gear as they boosted their efforts in their Run After Evaders Campaign (RACE). In their first sprint, they caught up with 36 non-compliant evaders in Batangas, and they are eager to capture more.
The main goal of the SSS RACE is to put a stop to those who are intentionally (and unintentionally) violating the SSS law on remitting the proper contribution amount of the employees.
Employers who are found guilty of improper or non-remittance of SSS contributions are issued with warrants of distraint, levy and garnishments (WDLG), in accordance with Section 2 of Social Security Law, also referred to as the Republic Act No.8282.
What is WDLG?
According to the SSS, WDLG is a collection system that mimics those of the Bureau of Internal Revenue (BIR). It allows them to seize the personal and commercial real estate, and/or bank accounts of the employer as payment for the unpaid contributions and the accrued penalties and interests, if any.
“With this new policy, SSS can now seize their personal and real properties as well as credits and other properties in the hand of the third party as payments to the delinquency owed by them,” according to SSS President and CEO Emmanuel Dooc.
Per Dooc, the idea behind using the WDLG method is to make it difficult or impossible for employers to get rid of their assets to skip out on paying the employee monthly contribution.
How does WDLG work?
Once the SSS identifies a non-compliance issue upon inspection, a Letter of Authority and Preliminary Assessment Notice (PAN). The letter shows the total amount that the business owner needs to pay due to the delinquency.
Fifteen days after the Letter and PAN were issued, the Final Assessment Notice Before Seizure (FANS) will be sent out to the business owner. FANS indicates the amount to be paid and instructions on how to pay for it.
In case that the business owner is in disagreement with FANS, he or she may protest by filing a Request for Reconsideration or a Request for Reconciliation within 15 days after the receipt of FANS.
“The employers must file a protest within the prescribed period at the SSS office or Large Accounts Department (LAD) that issued the FANS. Failure to protest the FANS will result in the issuance of the WDLG by SSS authorized signatories,” per Dooc.
Any seized properties are put in public sales within a 20 day period. In the case of when the delinquency amount could not be covered by the amount collected from the selling of the seized properties and bank accounts, SSS may continue collecting from the business owner.
The delinquent business owners may still save their property if they were able to pay the delinquent amount in full including the incurred penalties, expenses, and damages before the public sale.
However, if the employer has no properties or if there no properties to be found, the case is endorsed to the Legal Enforcement Group of SSS, where the business owner may face criminal charges.
“Employers who violated the SS law could be sentenced to a maximum of 12 years imprisonment. The Court will also require them to settle the total amount of delinquencies and pay penalties,” said Dooc.
Who the SSS is Targeting
The SSS is on the lookout for erring employers who disregarded the directives on paying statutory contributions for the employees, whether it is intentional or not.
The employer is responsible for abiding by the SSS regulations, and being oblivious to the law does not exempt one from any liability. Below are a few questions to ask:
- Have you reported all your employees to the SSS within 30 days when they started to work in your company?
- Are you paying for the contribution of your employees?
- Are you remitting the contribution on time?
- Are you using the latest SSS schedule contribution table?
- If applicable, have you paid the penalties, interest, or fines?
If the answer to any of the questions above is a “No,” chances are there is a violation that needs to be addressed and fixed immediately.
How to Stay Off the RACE Radar
The simplest and the best way not to be hounded by the Social Security System for delinquency is to comply with the SSS statutory regulations. There is no workaround for being a straight arrow, and here are some tips on how to be one:
- Fully-accept the law that states that it is the duty of the employer to report their employees to the SSS and remit their contributions in a timely manner.
- Ensure that the contribution amount that is paid is accurate. The employer may visit the nearest SSS office or call in and get a consultation in the case that there are any doubts, or simply double-check if the remittance is correct.
- Keep the SSS documents in check. Organize and safeguard any documents for easy viewing and understanding when the SSS do a spot inspection.
- Be open to employees who have doubts or complaints against the SSS contributions that the employer is paying. As employees may report if there are discrepancies, it is advisable for employers to discuss with the employee after verifying if their concerns or complaints are credible.
- Keep your SSS member information updated at all times.
- When processing payroll manually, use the latest SSS schedule of contributions.
As of last week, the SSS has accrued P309,515.11 from their first RACE campaign, which is a small dent from their target of collecting P5.3 billion from delinquent employers. The projected target amount is part of the harsh reality that many employers are purposefully or negligently cheating their employees out of a proper SSS remittance.
While we all have our struggles in making money, there is no reason in the world that justifies stealing someone else’s earnings or SSS contribution in this matter. Paying the right contribution amount of an employee is not only fair, but it also indemnifies employers from running into legal actions.
Timely SSS payments and accurate contributions don’t have to be complicated… After all, it’s JustPayroll.
Discover how easy payroll can be by choosing us, simply give us a call at +63 (02) 808-4707 or fill out the form below to get in touch with our payroll customer care.
Need to know how to register for a PRN from the SSS? Read about it here: SSS Website for PRN Registration is Now Open for Businesses & Others