Employees Compensation and State Insurance
Fund
Employees Compensation Law
Presidential Decree No. 626
(took effect on January 1, 1975)
Title II, Book IV (Health, Safety and Social Welfare
Benefits) of the Labor Code
Policy
The State shall promote and develop a tax-exempt
employees’ compensation program whereby
employees and their dependents, in the event of
work-connected disability or death, may promptly
secure adequate income benefit, and medical or
related benefits.
Highlighted Terms
EMPLOYER means any person, natural or juridical,
employing the services of the employee.
• Public sector - covered by the GSIS,
comprising the national government,
including government-owned or
controlled corporations (GOCCs).
• Private sector - covered by the SSS,
comprising all other employers.
EMPLOYEE means any persons compulsorily
covered by the GSIS, including members of the
Armed Forces of the Philippines, and any person
employed as casual, emergency, temporary,
substitute or contractual; or any person
compulsorily covered by SSS.
DEPENDENTS means the legitimate, legitimated,
legally adopted or acknowledged natural child who
is unmarried, not gainfully employed, and not over
twenty-one (21) years of age or over twenty-one
(21) years of age provided he is incapacitated and
incapable of self-support due to a physical or
mental defect which is congenital or acquired
during minority; the legitimate spouse living with the
employee; and the parents of said employee wholly
dependent upon him for regular support.
BENEFICIARIES means the dependent spouse
until he/she remarries and dependent children, who
are the primary beneficiaries.
In their absence, the dependent parents and
subject to the restrictions imposed on dependent
children, the illegitimate children and legitimate
descendants who are the secondary beneficiaries;
• Provided, that the dependent
acknowledged natural child shall be
considered as a primary beneficiary
when there are no other dependent
children who are qualified and eligible
for monthly income benefit.
Compensable Work-related Injury
What gives rise to a compensation claim is either
injury or disease. But what is compensated is not
the injury or disease itself but the attendant loss or
impairment of earning capacity.
For the injury and the resulting disability or death to
be compensable, the injury must be the result of an
employment accident satisfying all of the following
grounds:
1. the employee must have been injured at
the place where his work requires him to
be;
2. the employee must have been
performing his official functions; and
3. if the injury is sustained elsewhere, the
employee must have been executing an
order for the employer. (Rule III,
Sec.1(a), IRR)
The employers’ contributions make up the State
Insurance Fund from which comes the
compensation to be paid to claimant employee or
the employee’s dependents in case the employee
suffers from a work-connected injury or disease.
Employees do not pay contributions for the
employees’ compensation program unlike in other
social security institutions such as GSIS, SSS,
PhilHealth, and Pag-IBIG. It is an employer-based
contribution.
Form of Compensation
Medical supplies and services and/or cash income
if the employee is unable to earn because of the
injury or disease. Death and funeral benefits are
also given.
Liberal Interpretation
The Employees’ Compensation Commission should
adopt a liberal attitude in favor of the employee in
deciding claims for compensability.
Coverage
Coverage is Compulsory:
(a) Employer
Effectivity: first day of operation but not
earlier than January 1, 1975
Registration:
a. GSIS
 If operating before January 1, 1975 -
not later than March 31, 1975
 If operating on or after January 1,
1975 - within 1 month from the first
day of operation
b. SSS
 Every employer not yet registered
shall register not later than the first
day of operation
(b) Employee - not over 60 years old and may
belong either to the public sector or the
private sector.
Effectivity: first day of employment
a. GSIS members and uniformed
personnel: from the first day of their
employment
b. SSS: All compulsory members of the
SSS with employer-employee
relationship
Registration:
a. GSIS: within one month from the first
day of employment
b. SSS: not later than the date of
employment;
- Only one registration is needed for
SSS and Employees’ Compensation
(c) An employee over 60 years of age shall be
covered if he had been paying contributions
to the System prior to age 60 and has not
been compulsorily retired.
Foreign Employment
- Filipinos working abroad for employers doing
business in the Philippines are covered by the
employees’ compensation law.
- The application of the rule on accreditation of
hospitals and physicians and the rule
requiring notice to employer is relaxed.
COMPENSABILITY
Grounds.
(a) Injury must be the result of an accident arising
out of and in the course of the employment.
(b) For an occupational disease and the resulting
disability or death to be compensable, all of the
following conditions must be satisfied:
(1) The employee’s work and/or the working
conditions must involve risk/s that caused
the development of the illness;
(2) The disease was contracted as a result of
the employee’s exposure to the described
risks;
(3) The disease was contracted within a
period of exposure and under such other
factors necessary to contract it;
(4) There was no deliberate act on the part of
the employee to disregard the safety
measures or ignore established warning or
precaution;.
Proof must be shown that the risk of contracting the administered by the System or by other
disease is increased by the working conditions. agencies of the government.

(c) Only injury or sickness that occurred on or after Liability of Third Persons
January 1, 1975 and the resulting disability or
death shall be compensable. - When disability or death is caused by a third
party, the disabled employee or the dependents
LIABILITY in case of his death shall be paid by the System
under the employee’s compensation program. In
The following cases are excluded from the case benefit is claimed and allowed, the System
coverage of the law: shall be subrogated to the rights of the disabled
(1) intoxication; employee or the dependents in case of his death
in accordance with existing laws.
(2) willful intention to injure or kill himself or
another; or - If there is any excess in the damages paid by
the third party, after deducting the cost of
(3) his notorious negligence. proceedings and expenses of the System, the
excess shall be delivered to the disabled
- A deliberate act of an employee to disregard employee or his dependents.
his own safety.
Administration
- Disobedience to rules and/or prohibition does
not in itself constitute notorious negligence if Employee’s Compensation Commission
no intention can be attributed to the injured to
end his life. - Policy making body of the Employee’s
Compensation Program
- Primary consideration for not finding
notorious negligence:  Appeal body

a. Lack of knowledge or awareness of • Ex- Officio members:

the peril or the seriousness of the • Secretary of Labor and Employment
existing danger – Chairman
b. The unexpectedness of the accident • GSIS General Manager – Vice
Extent of Liability. Chairman (alternate with SSS
Administrator)
(a) Unless otherwise provided, the liability of the
State Insurance Fund, shall be exclusive and in • SSS Administrator
place of all other liabilities of the employer to • Chairman of Philippine Medical Care
the employee or his dependents or anyone Commission
otherwise entitled to receive damages on
behalf of the employee or his dependents. • Executive Director of the ECC

(b) Simultaneous recovery of benefits under the • Two Appointive Members

Employee’s Compensation Program does not
bar the recovery of benefits as provided for in - Shall have at least 5 year experience in
Section 699 of the Revised Administrative workmen’s compensation or social
Code, Commonwealth Act numbered 186, as security programs
amended, Republic Act numbered 1161, as
- one who shall represent employees
amended, Republic Act numbered 610, as
amended, Republic Act numbered 4864, as - one who shall represent employers
amended, and other laws whose benefits are
 • Term of Office: 6 Years
• Quorum: presence of 4 members
• Entitled to per diem of 200 pesos every
meeting actually attended by him,
exclusive of actual, ordinary, and
necessary travel and representation
expenses
• Any member may designate an official
of the institution he serves on full time
basis as his representative to act on his
behalf
Settlement of claims
 shall have original and exclusive
jurisdiction to settle any dispute respect
to
o coverage,
o entitlement to benefits,
o collection and payment
contributions
o and penalties
o or any other matter related thereto,
 subject to appeal to the Commission, which
shall decide appealed case within twenty (20)
working days from the submission of the
evidence
Review
- Decisions, orders or resolutions by the
Commission may be reviewed on certiorari by
the Supreme Court only on questions of law
upon petition of an aggrieved party within ten
days from notice thereof.
Enforcement of decisions
(a) Any decision, order or resolution of the
Commission
- shall become final and executory if no
appeal is taken
- within ten days from notice thereof.
o All awards granted by the Commission in
cases appealed from decisions of the System
shall be effected within fifteen days from
receipt of notice.
(b) In all other cases, decisions, orders and
resolutions of the Commission which
have become final and executory
- shall be enforced and executed in the same
manner as decisions of the Court of First
Instance
- Commission shall have the power to issue to
the city or provincial sheriff or to the sheriff
whom it may appoint such writs of execution
as may be necessary for the enforcement of
such decisions, orders or resolutions
- -any person who shall fail or refuse to
comply therewith shall, upon application by
the Commission, be punished by the proper
court for contempt.
3 Components of ECC
1. Preventive
of
- to minimize and control hazards in the
working environment
- Two agencies involved:
(a) Bureau of Working Conditions of the DOLE-
inspects the work premises
(b) Occupational Safety and Health Center –
trains safety engineers, tests safety
equipment and undertakes research work
2. Compensative
- ECC, through the GSIS or the SSS pays
benefits to government and private sector
workers who suffer work-connected
contingencies
3. Curative
- does not only take responsibility for the
benefits due to the workers, but also the
treatment of sickness or injury that a worker
may suffer in line of duty as well as
rehabilitation of those who are disabled
State Insurance Fund
 SSS – private sector
 GSIS – public sector
  All revenues collected for the Employee’s
Compensation Program shall accrue to
Separate State Insurance Fund
Contributions
- Shall be paid in their entirety by the employer
- Obligation of employer to remit EC
contribution starts within the first 10 calendar
days following the month when said
contributions are due and demandable
- Any contract or device for the deduction of
any portion to the salary or wage of the
employee shall be void.
Rate and Amount
 For a covered employee in the public sector:
- his employer shall remit to the GSIS a
monthly contribution equivalent to one
percent of the basic salary or One
hundred pesos (P 100) per month per
employee whichever is lower. (as
provided under Board Resolution No. 02-
04235, dated April 11, 2002)
 For a covered employee in the private sector
- his employer shall remit to the SSS a
monthly contribution equivalent to one
percent of his monthly salary credit as
of the last day of the month, in
accordance with the following schedule:
Range of Monthly Salary Employer’s
Compensation Credit Contribution
P 900- P 14, 749 P 1, 000- P 14, P 10.00
500
P 14, 750- over P 15, 000 and P 30.00
above
 When a covered employee dies during
employment, or is separated from
employment
o his employer’s obligation to pay the
monthly contribution arising from that
employment shall cease on the last day of
the month of contingency
 When a covered employee becomes disabled
during employment
o his employer’s obligation to pay the
monthly contribution arising from that
employment shall be suspended during
such months that he is not receiving
salary or wages.
 No refund of contribution shall be allowed
under these Rules
Remittance
- Contributions shall start in January 1975 and
every month thereafter for as long as the
employee has earnings
- The initial contribution for the month of
January 1975 shall be remitted by the
employer to the System in February 1975,
unless some other arrangement has been
agreed by the System and the employer.
Penalty
1. Any employer who is delinquent in his
contributions shall be liable to the System for
the benefits which may have been paid to his
employees or their dependents, and any benefit
and expenses to which such employer is liable
- shall constitute a preferred lien on all his
property, real or personal, over any credit
except taxes
2. The payment by the employer of the lump sum
equivalent of such liability
- shall absolve him from the payment of the
delinquent contributions due and payable
during the calendar year of the
contingency and penalty thereon with
respect to the employee concerned, but
said employer shall be subject to criminal
liability
3. In case of such delinquency the employer or
responsible official who committed the violation
- punished with a fine of not less than
P1,000 nor more than P10,000 and/or
imprisonment for the duration of the
violation or non-compliance or until such
 time that a rectification of the violation has
been made, at the Court’s discretion
4. If any contribution is not paid to the SSS as
prescribed under these Rules
- employer shall pay besides the
contribution a penalty thereon of 3 percent
a month from the date of the contribution
falls due until paid.
Monthly salary credit
- wage base for contributions or the actual
salary
- If earnings are derived from more than one
employment, it shall be determined on the
basis of the aggregate earnings from all
employments, but not exceeding P1,000 in
the case of SSS and P3,000 in the case of
GSIS.
Average monthly salary credit
A.) In the case of the SSS:
= sum of the monthly salary credits in the 60 - month
period immediately preceding the semester of
death, or permanent disability, injury or sickness /
number of months of coverage in the same period
Except:
 Where death or permanent disability falls
within 18 months from the month of
coverage
- it is the result obtained by dividing the sum of
all monthly salary credits paid prior to the
month of death or permanent disability by the
number of calendar months of coverage in the
same period
 Where death or permanent disability falls
within the month of coverage
- it is the actual salary received during the
calendar month or its corresponding monthly
salary credit
B.) In the case of the GSIS
- the quotient after dividing the aggregate
compensations received by the member or
employee for the last three years immediately
preceding his death, permanent disability,
injury or sickness, by the number of months he
received said compensation, or three thousand
pesos, whichever is smaller
 Day of injury or sickness which caused the
disability - reckoning date for the purpose of
computing the average monthly salary credit
Average daily salary credit
(a) In the case of the SSS
- result obtained by dividing the sum of
the 6 highest monthly salary credits in
the 12-month period immediately
preceding the semester of sickness by
180, except for the following cases
(1) Where the injury falls within 12 calendar
months from the month of coverage
- result obtained by dividing the sum of all
monthly salary credits by 30 and by the
number of months of coverage,
excluding the month of injury; and
(2) Where the injury falls within the month of
coverage
- actual salary received during the
calendar month or its corresponding
monthly salary credit divided by 30
(b) In the case of the GSIS
(1) If the salary or wage is based on an hourly
rate
- hourly rate times the number of hours
required to work during the month of
contingency divided by 22.
(2) If the salary or wage is based on a daily rate
- daily rate times the number of days
required to work per month divided by
22.
(3) If the salary or wage is based on a monthly
rate,
- monthly rate divided by 22.
(4) If the employee has worked for less than one
month,
- daily salary credit is the actual daily
wage or salary of the monthly wage or
salary divided by the actual number of
 days worked during the month of
contingency
Replacement ratio
In the case of the SSS
- sum of the twenty percent and the quotient
obtained by dividing three hundred by the
sum of three hundred forty and the average
monthly salary credit.
Credited years of service
For a member covered prior to January 1975,
nineteen hundred seventy five minus the calendar
year of coverage, plus the number of calendar years
in which six or more contributions have been paid
from January 1975 up to the calendar year
containing the semester prior to the contingency.
For a member covered in or after January 1975, the
number of calendar years in which six or more
contributions have been paid from the year of
coverage up to the calendar year containing the
semester prior to the contingency.
Monthly income benefit
(a) In the case of the SSS
- the amount equivalent to one hundred
fifteen percent of the sum of: The
average monthly salary credit multiplied
by the replacement ratio and one and a
half percent of the average monthly
salary credit for each credited year of
service in excess of ten years: Provided,
That the monthly income benefit shall in
no case be less than P250. Provided,
However, That the monthly pension of
surviving pensioners shall be increased
automatically and simultaneously to the
extent that 15% difference in monthly
income benefit between EC and GSIS,
be maintained. (LOI 1286) (ECC
Resolution No. 2799, July 25, 1984).
(b) In the case of the GSIS
- the monthly income benefit shall be the
basic monthly pension as defined in PD
1146 plus twenty percent thereof, but
shall not be less than P250, nor more
than the actual salary at the time of
contingency. (ECC Resolution No. 2799,
July 25, 1984).
TYPES OF BENEFITS
 Medical services, appliances and supplies;
 Rehabilitation services;
 Temporary total disability benefit;
 Permanent total disability benefit;
 Permanent partial disability benefit;
 Death benefit; and
 Funeral benefit.
 Carer’s Allowance
Medical services, appliances and supplies
Condition to Entitlement - Any employee shall be
entitled to such medical services, appliances and
supplies as the nature of his disability and the
progress of his recovery may require, subject to the
following conditions:
 He has been duly reported to the System;
 He sustains an injury or contracts sickness;
and
 The System has been duly notified of the
injury or sickness.
Period of Entitlement - The medical services,
appliances and supplies shall be provided to the
afflicted employee beginning on the first day of the
injury or sickness, during the subsequent period of
his disability, and as the progress of his recovery
may require
Accreditation
The following hospitals and physicians are
automatically deemed accredited by the
Commission:
a. Government and Private hospitals duly licensed
by the Department of Health (DOH) and
accredited by the Philippine Health Insurance
Corporation (Philhealth) ; and
b. Physicians duly licensed by the Professional
Regulation Commission (PRC).
Conditions on accredited hospitals or
rehabilitation facilities and physicians or
rehabilitation specialist:
(a) An accredited hospital or rehabilitation facility
binds itself:
 not to collect from the patient any
amount for ward services;
 to provide adequate services on a non-
discriminating basis;
 to limit charges for ward rates approved
by the Commission, including, but not
limited to, laboratory ward rates,
laboratory facilities, x-rays, stools,
drugs, medical attendance and the
Relative Value Scale (RVS) for surgical
procedures, etc.;
 to abide by these rules on accreditation;
 to have its house rules conform to the
requirements of the Commission;
 to subject its facilities to inspection at
any time by duly authorized
representatives of the Commission or
the System.
(b) An accredited physician binds himself:
 not to collect from the patient any amount
for ward services,
 to provide adequate services on a non-
discriminating basis; and
 to abide by these rules on accreditation.
Violation of conditions and requirements,
penalties
 An accredited hospital or physician shall be
disaccredited for violation of any of the
conditions and requirements
 The cancellation or invalidation of
accreditation of a physician or hospital shall
be effective on the date of notice of the
disaccreditation.
 In case of disaccreditation, the physician or
the hospital shall carry the disqualification
wherever its physical identity is found. Mere
change of legal personality shall not defeat
the disqualification imposed.
 Disaccreditation shall be lifted only on
application and upon showing of good
cause and effective upon approval by the
Commission. As soon as accreditation is
duly restored, the hospital or physician
concerned shall be allowed to participate in
the Employees’ Compensation Program.
Types of Medical Benefits
A. Medical services
(a) An employee who sustains an injury or
contracts sickness shall be entitled to:
 Ward services during confinement in an
accredited hospital;
 The subsequent domiciliary care by an
accredited physician; and
 Medicines.
(b) Ambulatory services in an accredited
hospital shall be allowed only in case of
injury.
B. Ward services
(a) They cover all of the services an in-patient
would ordinarily receive in a hospital such
as:
 Bed in a ward (6 beds in a room);
 All meals, including special diets,
 Regular nursing services;
 Medicines furnished by the hospital;
 Radiology service such as X-rays,
 Medical supplies such as splints and casts,
  Use of appliances and equipment furnished
by the hospital such as wheelchair, crutches
and braces; (8) Anesthetic services;
 Operating room charges,
 Surgery; and
 Doctor's services.
(b) Ward services do not include:
 The extra charge for more comfortable
accommodations such as private and semi-
private rooms;
 Personal comfort or convenience such as
charges for the use of a telephone, radio or
television;
 Private duty nurses;
(c) If a patient receives services more expensive
than ward services, payment by the System
shall be made only for the ward services.
However, private or semi-private room
accommodations when medically necessary
because the contagious disease or his condition
requires him to be isolated, or there is no
available ward bed and the emergency nature of
the injury or disease requires him to be
immediately accommodated, shall be paid by
the System after satisfying itself as to the
reasonableness thereof, and at no cost
whatsoever to the patient. The continued
accommodation of the patient in a private or
semi-private room when a ward bed is available
and the emergency or contagion no longer
exists shall be paid by the System as ward
services.
(d) Only necessary and relevant services shall
be paid by the System. Laboratory and/or
radiology services and medicines shall be kept
to a level considered by the physician
reasonably necessary and relevant to the
particular illness or injury.
C. Hospital confinement
 The benefits for each day of confinement in
an accredited hospital shall be only for ward
services.
 The benefit in case of injury shall not
exceed the actual cost of ward services in
an accredited hospital.
 The benefit in case of sickness shall not
exceed the actual cost of ward services in
an accredited hospital equipped with
facilities necessary for the treatment of the
disease.
 Confinement shall be counted in units of a
full day, with the day of admission counted
as a full day but not the day of discharge.
D. Professional fees
The professional fee for the first visit is One hundred
pesos (P 100.00) for the General Practitioner and
One hundred Fifty pesos (P 150.00) for the
Specialist. For succeeding visits, the Professional
fee is Eighty pesos (P 80.00) for the General
Practitioner and One hundred pesos (P 100.00) for
the Specialist. (as provided under Section 3 of
Executive Order (EO) No.135, dated April 23, 2013 )
E. Surgical expense benefit
(a) A qualified employee who has undergone a
surgical procedure in an accredited hospital
shall be entitled to a surgical expense
benefit, which shall consist of:
 A surgeon's fee according to the ECC
Relative Value Study
 An anesthesiologist's fee ordinarily not
exceeding one-third of the surgeon's fee.
(b) The surgeon's fee shall be paid to the
surgeon who performed the operation, and
the anesthesiologist's fee to the
anesthesiologist, subject to the following
conditions:
 Only one surgeon shall be paid for each
operation;
 Only one anesthesiologist, if any shall be
paid for each operation; and
 Local anesthesia, other than regional nerve
block anesthesia, shall not be compensable.
  The operating room fee shall be paid by the
System only for surgical procedure done in
the operating-diagnostic therapy room
complex of the accredited hospital.
Extent of Services - The employee is entitled to the
benefits only for the ward services of an accredited
hospital and accredited physician. However, if the
employee chooses accommodations better than
ward services the excess of the total amount of
expenses incurred over the benefits provided shall
be borne by the employee.
Rehabilitation Services
Condition of Entitlement
 Coverage under this rule shall be voluntary.
 Entitlement to rehabilitation services shall
be upon approval of the EC claim for
disability benefits by the Systems
Period of Entitlement.
 Rehabilitation services shall be provided
during the period of the disability as the
nature and progress of the recovery of the
PWRDs(Person With Work-Related
Disability) may require as determined by the
rehabilitation experts.
 Rehabilitation services shall be suspended
or terminated upon refusal of the PWRD to
continue rehabilitation.
Extent of Rehabilitation Services.
 Medical-surgical management;
 Hospitalization;
 Necessary appliances and supplies;
 Physical restoration;
 Psychosocial counseling;
 Psychiatric evaluation;
 Skills training;
 Entrepreneurship training;
 Hearing impairment rehabilitation;
 Visual impairment rehabilitation.
Program Partners - The Commission shall enter
into an agreement with any government or private
hospitals/institutions for purposes of utilizing their
service facilities for rehabilitation.
Limitations of Liability - The System shall not be
responsible for the payment of rehabilitation
services when the injury, sickness, disability or
death during the rehabilitation period of the PWRD
is occasioned by any of the following:
 Intoxication;
 Willful intent to injure oneself or another;
 Notorious negligence (It is the deliberate act
of the employee to disregard his own
personal safety.)
Monitoring of Activities and Progress of PWRDs
- The Secretariat shall establish a mechanism to
monitor the activities and progress of PWRDs. For
this purpose, the Secretariat may conduct home
visits for the successful implementation of the
delivery of services/projects of the rehabilitation
program of the Commission.
DISABILITY BENEFITS
 Disability" means loss or impairment of a
physical or mental function resulting from
injury or sickness
 There is disability when there is a loss or
diminution of earning power because of the
actual absence from work due to the injury
or illness arising out of and in the course of
employment
 Basis of compensation: Reduction of
earning power
TEMPORARY TOTAL
 A total disability is temporary if as a result of
the injury or sickness, the employee is
unable to perform any gainful occupation for
a continuous period not exceeding 120 day
Conditions
1. He has been duly reported to the System;
2. He sustains the temporary total disability as
a result of the injury or sickness, and
3. The System has been duly notified of the
injury or sickness which caused his
disability
Period of Entitlement
 The income benefit shall be paid beginning
on the first day of such disability
 If caused by an injury or sickness, it shall
not be paid longer than 120 consecutive
days
 Exception: Where such injury or sickness
still requires medical attendance beyond
120 days but not to exceed 240 days from
onset of disability in which case benefit for
temporary total disability shall be paid
 The System may, however, declare the
total and permanent status at any time after
120 days of continuous temporary total
disability as may be warranted by the
degree of actual loss or impairment of
physical or mental functions as determined
by the System.
 Relapse
- The period covered by any relapse he
suffers, or recurrence of his illness shall
be considered independent of, and
separate from, the period covered by
the original disability:
1. After an employee has fully recovered
from an illness as duly certified to by
the attending physician; and
2. Such results in disability and is
determined to be compensable
- Such period shall not be added to the
period covered by his original disability
in the computation of his income benefit
for temporary total disability (TTD).
Amount of Benefit
 Shall be paid an income benefit equivalent
to 90 percent of his average daily salary
credit, subject to the following conditions:
1. The daily income benefit shall not be less
than P10.00 or more than P200.00
2. Must not be paid longer than 120 days for
the same disability
- Unless the injury or sickness requires
more extensive treatment that lasts
beyond 120 days, but not to exceed
240 days from onset of disability
- In which case he shall be paid benefit
for temporary total disability during the
extended period
PERMANENT TOTAL
 A disability is total and permanent if as a
result of the injury or sickness the employee
is unable to perform any gainful occupation
for a continuous period exceeding 120 days
 Incapacity to perform gainful work which is
expected to be permanent
Instances considered total and permanent
1. Temporary total disability lasting
continuously for more than 120 days, except
as otherwise provided for in Rule X hereof
2. Complete loss of sight of both eyes;
3. Loss of two limbs at or above the ankle or
wrist;
4. Permanent complete paralysis of two limbs.
5. Brain injury resulting in incurable imbecility
and insanity, and
6. Such cases as determined by the System
and approved by the Commission
Conditions
1. He has been duly reported to the System;
 2. He sustains the permanent total disability
as a result of injury or sickness; and
3. The System has been duly notified of the
injury or sickness which caused his
disability
Period of Entitlement
 The full monthly income benefit shall be
paid for all compensable months of
disability.
 After the benefit under the Employees'
Compensation shall have ceased and if
the employee is otherwise qualified for
benefit for the same disability under
another law administered by the
System, he shall be paid a benefit in
accordance with the provisions of that
law. This paragraph applies to
contingencies which occurred prior to
May 1, 1978.
 Except as otherwise provided for in
other laws, decrees, orders or letters of
instructions, the monthly income benefit
shall be guaranteed for 5 years and
shall be suspended under any of the
following conditions:
1. Failure to present himself for examination at
least once a year upon notice by the
System;
- Compliance with the said requirement
shall lift the suspension
- The obligation of the System to return
the suspended benefits automatically
arises
2. Failure to submit a quarterly medical report
certified by his attending physician as
required under Sec. 5 of Rule IV hereof;
3. Complete or full recovery from his
permanent disability, or
4. Upon being gainfully employed.
Amount of Benefit
 In the case of the SSS
- Any employee entitled to permanent
total disability benefit shall be paid by
the System a monthly income benefit
as defined in Sec. 9 (a), Rule VI of
these Rules.
 The number of months of paid
coverage shall be the number of
monthly contributions remitted to the
System including contributions other
than for Employees' Compensation if
paid before March 31, 1975.
 The full monthly income benefit shall be
paid for all compensable months of
disability.
 The first day preceding the semester of
temporary total disability shall be
considered for purposes of computing
the monthly income benefit for
permanent total disability
Amount of benefit for dependent children
 10% of the monthly income benefit of the
employee
 Shall pertain to each dependent child, but
not exceeding five, counted from the
youngest and without substitution
Entitlement to the new income benefit under PD
1641
 The new amount of the monthly income
benefit computed under these amended
Rules shall be applicable to all
contingencies occurring on or after January
1, 1980.
 However, for contingencies which occurred
before May 1, 1978, the limitation of P12,
000 or 5 years, whichever comes first, shall
be enforced.
 In the case of the SSS, the present monthly
income benefit of current pensioners shall
 be increased by 20 percent effective
January 1, 1980.
 In case of the GSIS, the monthly income
benefit of current pensioners shall be
adjusted and recomputed to reflect the 20
percent increase over the benefit under PD
1146 effective January 1, 1980.
Aggregate monthly benefit payable.
 Except the benefit to dependent children,
the aggregate monthly benefit payable, in
the case of the GSIS, shall in no case
exceed the monthly wage or salary actually
received by the employee as of the date of
his permanent total disability.
PERMANENT PARTIAL
 A disability is partial and permanent if as a
result of the injury or sickness, the
employee suffers a permanent partial loss
of the use of any part of his body
 Distinguished from Permanent Total
- Permanent Total results in an
employee’s loss of work or inability to
perform his usual work
- Permanent Partial occurs when an
employee loses the use of any
particular anatomical part of his body
which disables him to continue his
former work
- Test whether the employee suffers from
permanent total disability: Showing of
the capacity of the employee to
continue performing his work
notwithstanding the disability he
incurred
- Thus, if by reason of the injury or
sickness, the employee is unable to
perform his customary job for more
than 120 days and he does not come
within the coverage of Rule X of the
Amended Rules on Employees’
Compensability (which describes what
constitutes temporary total disability in
a more detailed manner), then the said
employee suffers from permanent
partial disability regardless whether or
not he loses the use of any part of his
body
Condition to entitlement
An employee shall be entitled to an income
benefit of permanent partial disability if all of
the following conditions are satisfied:
1. He has been duly reported to the System;
2. He sustains the permanent partial disability
as a result of the injury or sickness; and
3. The System has been duly notified of the
injury or sickness which caused his
disability.
 His employer shall be liable for the benefit if
such injury or sickness occurred before the
employee is duly reported for coverage to
the System
 For purposes of entitlement to income
benefits for permanent partial disability, a
covered employee shall continue to receive
the benefits provided thereunder even if he
is gainfully employed and receiving his
wages or salary.
Period of entitlement
 The income benefit shall be paid beginning
on the first month of such disability, but
not longer than the designated number of
months in the following schedule:
Complete and permanent No. of
loss of the use of Months
One thumb 10
One index finger 8
One middle finger 6
One ring finger 5
One little finger 3
One big toe 6
Any toe 3
One arm 50
 One hand 39  Otherwise, the System may pay income
One foot 31 benefit in lump sum or in monthly pension
One leg 46
One ear 10  In case of permanent partial disability less
than the total loss of the member
Both ears 20
Hearing of one ear 10 - The same monthly income shall be paid
Hear of both ears 50 for a portion of the period established
Sight of one eye 25 for the total loss of the member

- In accordance with the proportion that

 A worker who sustained work-related the partial loss bears to the total loss
injuries that resulted to functional loss
and/or physical loss of any part of his body - If the result is a decimal fraction, the
shall be granted Temporary Total Disability same shall be rounded off to the next
(TTD) and Permanent Partial Disability higher integer
(PPD) benefits successively
 In case of simultaneous loss of more
 Any earlier compensation for TTD that may than one member or a part
have been paid to an injured worker shall
- The same monthly income shall be paid
not be deducted from the PPD benefit that
for a period equivalent to the sum of the
may be later granted to him.
periods established for the loss of the
Loss of the: Shall be member or part thereof but not
considered loss of exceeding 75
the:
- If the result is a decimal fraction, the
Wrist Hand
same shall be rounded off to the higher
Elbow Arm
integer
Ankle Foot
Knee Leg  The new amount of the monthly income
More than one Whole finger or toe benefit computed under these amended
joint Rules shall be applicable to all
Only the first One-half of the contingencies occurring on or after
joint whole finger or toe January 1, 1980

 However, for contingencies which

 Degree of permanent disability shall be
equivalent to the ratio that the designated
number of compensability bears to 75
Amount of benefit
 Any employee entitled to permanent partial
disability benefit shall be paid by the System
a monthly income benefit for the number of
months indicated in the table provided in the
Period of entitlement.
 If the indicated number of months exceed
twelve, the income benefit shall be paid in
monthly pension
occurred before May 1, 1978, the
limitation of P12,000 or 5 years,
whichever comes first, shall be
enforced
 In the case of the SSS, the present
monthly income benefit of current
pensioners shall be increased by 20
percent effective January 1, 1980.
 In the case of the GSIS, the monthly
income benefits of current pensioners
shall be adjusted and recomputed to
reflect the 20 percent increase over the
 benefit under PD 1146 effective
January 1, 1980
Unlisted injuries and illnesses
 In cases of injuries or illnesses not listed in
the schedule under Section 2 hereof, the
benefit shall be an income benefit
equivalent to the percentage of the
permanent loss of the capacity for work.
(Non-Scheduled Disabilities)
Conversion from Permanent Partial Disability to
Permanent Total Disability
 There is nothing in the law that prohibits
the conversion of PPD to PTD benefit if
it is shown that the employee’s ailment
qualifies as such. Furthermore, the
grant of PTD benefit to an employee
who was initially compensated for PPD
but is found to be suffering from PTD
would not be prejudicial to the
government to give it reason to deny
the claim (Austria vs. Court of Appeals
and Employees’ Compensation
Commission [Social Security System],
G.R. No. 146636, August 12, 2002)
 A person’s disability may not manifest
fully at one precise moment in time but
rather over a period of time. It is
possible that an injury which at first was
considered to be temporary may later
on become permanent or one who
suffers a partial disability becomes
totally and permanently disabled from
the same cause (GSIS vs Court of
Appeals, G.R. No. 116015, July 31,
1996)
 Disability should not be understood
more on its medical significance but on
the loss of earning capacity (Ibid.)
IS EARNING CAPACITY “IMPAIRED” IF
EARNING IS HIGHER AFTER THE INJURY?
 Salary would not necessarily affect the
laborer’s claim
 An injured laborer’s incapacity for work is
not to be measured solely by the wages he
receives, or his earning, after the injury,
since the amount of such wages or
earnings may be affected by various
extraneous matters or factors (Central
Azucarera Don Pedro vs. C. de Leon, in his
capacity as Workmen’s Compensation
Commissioner and L. Alla, No. L-10036,
December 28, 1957)
 There are number of possible explanations
of the fact that an employee who receives
higher wages after an injury than what he
earned before may still have suffered an
impairment of earning capacity.
 Thus, it may indicate:
1. That the employee is the beneficiary of a
mere gratuity and does not actually earn
his wages;
2. That the employee, by education and
training, has fitted himself for more
remunerative employment;
3. That the employee works longer hours than
he did before his injury, his hourly
remuneration having increased;
4. That the general change in wage scales
has taken place for the type of work or in
the industry;
5. That the new wages are intended as an
inducement to him to refrain from pursuing
a claim;
6. That the employee, before his injury, was
younger or a minor;
7. That the employment in which the
employee was employed after the injury
was of uncertain duration
Death Benefits
MEANING OF “DEATH”
- In the context of the Employees’
Compensation Program, the term “death”
 means loss of life resulting from an injury or
sickness.
Compensable Death – Death which is the result of
a work-related injury or sickness.
Condition to Entitlement
A. The beneficiaries of a deceased employee shall
be entitled to an income benefit if all of the
following conditions are satisfied:
 The employee has been duly reported to the
System;
 He died as a result of an injury or sickness;
and
 The System has been duly notified of his
death, as well as the injury or sickness which
caused his death.
 His employer shall be liable for the benefit if
such death occurred before the employee is
duly reported for coverage to the System.
B. If the employee has been receiving monthly
income benefit for permanent total disability at
the time of his death, the surviving spouse must
show that the marriage has been validly
subsisting at the time of his disability.
Period of Entitlement
A. For Primary Beneficiaries
(a) The income benefit shall be paid beginning
at the month of death and shall continue to
be paid for as long as the beneficiaries are
entitled thereto.
With respect to the surviving legitimate spouse,
the qualification is that he/she has not remarried.
For the dependent children, the qualifications are:
1. Unmarried
2. Not gainfully employed; and
3. Over 21 years of age provided he/she is
incapable of self-support due to a physical
or mental defect which is congenital or
acquired during minority.
(b) The monthly income benefit shall be
guaranteed for five years which in no case
shall be less than fifteen thousand pesos
(P15,000.00). Thereafter, the beneficiaries
shall be paid the monthly income benefit for
as long as they are entitled thereto. (ECC
Resolution No. 2799, July 25, 1984).
B. For Secondary Beneficiaries
a) The income benefit shall be sixty (60) times
the monthly income 50 benefit of a primary
beneficiary which in no case be less than
P15,000.00, which shall likewise be paid in
monthly pension. (ECC Resolution No.
2799, July 25, 1984).
Amount of Benefit
a) In the case of primary beneficiaries, the
monthly income benefit shall be equivalent
to the monthly income benefit for permanent
total disability, which shall be guaranteed for
five years, increased by ten percent for
each dependent child but not exceeding 5,
beginning with the youngest and without
substitution:
Provided That, the aggregate monthly benefit
payable in the case of the GSIS shall in no case
exceed the monthly wage or salary actually
received by the employee at the time of his death;
and
Provided Further, That the minimum income
benefit shall not be less than Fifteen Thousand
Pesos (P15,000.00). The death benefit shall be
paid during the entire period for which they are
entitled thereto.
If the employee has been receiving income benefits
for permanent total disability at the time of his
death, the primary beneficiaries shall be paid the
monthly income benefit equivalent to eighty percent
(80%) plus the dependent's pension equivalent to
10 percent (10%) thereof for every dependent child
but not exceeding five (5) counted from the
youngest and without substitution.
b) In the case of secondary beneficiaries, the
income benefit is payable in monthly
pension which shall not exceed the period
 of 60 months and the aggregate income
benefit shall not be less than P15, 000.00.
If the employee has been receiving monthly income
benefit for permanent total disability at the time of
his death, the secondary beneficiaries shall be paid
the monthly pension, excluding the dependent's
pension of the remaining balance of the five-year
guaranteed period. (ECC Resolution No. 2799, July
25, 1984).
Entitlement to the New Income Benefit Under
PD 1641
The new amount of the monthly income benefit
computed under these amended Rules shall be
applicable to all contingencies occurring on or after
January 1, 1980. However, for contingencies which
occurred before May 1, 1978, the limitation of
P12,000 or 5 years, whichever comes first, shall be
enforced.
In the case of the SSS, the present monthly income
benefit of current pensioners shall be increased by
20 percent effective January 1, 1980.
In the case of the GSIS, the monthly income benefit
of the current pensioners shall be adjusted and
recomputed to reflect the 20 percent increase over
the benefit under PD 1146 effective January 1,
1980.
The new amount of lump sum benefit computed
under these Amended Rules shall be applicable to
all contingencies occurring on or after May 1, 1980,
otherwise entitlement thereto shall be governed by
the immediately preceding Section.
Death Benefits, Not Part of the Estate of the
Deceased
The death benefits being paid under the law are not
part of the deceased’s estate. They are not I the
nature of inheritance. They are granted by
operation of law ass financial compensation and aid
for the death of the employee.
It must be noted that the dependents mentioned in
the law are not referred to as the “heirs” but rather
as “beneficiaries.” It may be further observed that
the dependents are not necessarily the “heirs” of
the deceased, as this term is understood in civil
law.
Presumptive Death
In 2014, ECC Board Resolution No. 14-07-20 [July
28, 2014], was issued promulgating the Guidelines
on the Grant of EC Benefits Due to Calamity or
Fatal Event Amending for this Purpose, Paragraph
5 of Board Resolution No. 93-08-0068 [August 5,
1993].
Paragraph 5 of Board Resolution No. 93-08-0068
“5. Presumptive death
5.1. If one is declared presumptively dead after he
had been reported missing for sometime, payment
of death benefits shall be reckoned from the date
he was declared presumptively dead by proper
authority, in accordance with law; except when the
declaration of death specified another date, in such
case, payment of death benefits shall start from the
latter date; and
5.2. “In spite of the fact that the body of a missing
person had not been recovered, and that no burial
activities had been undertaken, the beneficiaries
shall still be entitled to funeral benefits, as provided
for under the law;
The said paragraph now read as follows:
5. Guidelines on the Grant of EC benefits for the
Beneficiaries of Missing Persons while in the
Performance of Duty during Calamity or Fatal
Events
5.1. Coverage.
These guidelines shall apply to all covered workers
or employees’ and uniformed personnel who had
been reported missing while they were in the
performance of their duties during calamities or
fatal events such as, but not limited to, police or
military operation, earthquake, typhoon, and
volcanic eruption.
5.2. Period of Filing.
The beneficiaries may file their claims for EC death
with funeral benefits within three year-prescriptive
period from the time the missing person has been
presumed dad after the lapse of four years from the
occurrence of the incident.
In lieu of Death Certificate, the System may require
the submission of certification from any concerned
government institution showing that the concerned
employee or uniformed personnel has been
included in the list of missing persons due to a
calamity or fatal event and/or has been missing for
a period of four years.
5.3. Grant of EC funeral benefits
EC funeral benefits shall be provided to the
qualified beneficiaries despite the absence of burial
ceremony.
5.4. Non-Refund of EC benefits
If the missing employee appears or without
appearing his/her existence is proved, the EC
death with funeral benefits which have been
previously provided shall no longer be returned by
the concerned beneficiaries to the System.
Prescriptive Period
 The claim for the compensation should be
filed with the system within 3 years from the
time the cause of action accrued.
 Sickness – from the time the employee lost
his earning capacity
 Injury – form the time it was sustained
 Death – from the time of death of the
covered employee
 Presumptive Death – Claims for EC +
Funeral benefits within the 3-year
prescriptive period from the time the missing
person has been presumed dead after the
lapse of 4 years from the occurrence of the
incident
 Permanent Total Disability (PTD) – From
the time the employee was terminated from
his employment due to illness
 Temporary Total Disability (TTD) –
Multiple confinements for the same illness
should be counted from the last
confinement or from the last time the
employee was unable to report for work due
to the same illness, whichever is applicable.
 Disability or Death Benefits (under SSS
or GSIS) – the claim for the same benefits
under the EC Law should be considered as
filed. The filing of disability or death benefits
either under the SSS law or the GSIS law
within three years from the time the cause
of action accrued would stop the running of
the prescriptive period under P.D. 626, as
amended.
A. Income Benefit
Filed directly with the system by any of the following:
 Employee
 EE’s dependents
 EE’s employer on his behalf
Failure to claim the benefits within 3 years from the
time cause of action accrued shall bar the right to
the benefits.
SSS
MIB = MSC (Replacement Ratio)(1.5% of the AMSC
for each CYS in excess of 10 years)
- MIB should be above P250
- The monthly pension of surviving pensioners
shall be increased automatically and
simultaneously to the extent that 15%
difference in monthly income benefit between
EC and GSIS, be maintained
GSIS
MIB = Basic monthly pension as defined in PD 1146
+ 20% thereof
- Not less than P250
- Not more than the actual salary at the time of
contingency
 B. Funeral Benefit

- P20,000 shall be paid upon the death of a

covered employee or permanently totally
disabled pensioner to one of the ff:

o Surviving spouse

o Legitimate child who spent for the funeral

services

o Any person who can show incontrovertible

proof or proof of his having borne the
funeral expenses

Granted after the SSS or GSIS has declared the

following in the evaluation of claims for the EC death
benefits:

1. Death due to sickness – casual relationship

between the death and the working
conditions of the covered employer

2. Death due to injury – casual relationship

between the death and the work-related
accident.

3. Death of EC PPD or PTD Pensioner – the

cause of death is a complication or natural
consequence of previously compensated
PPD or PTD.