HOME DEVELOPMENT MUTUAL FUND

Republic Act No. 9679

Pag-IBIG Law of 2009

Agrarian Law and Social Legislation

Submitted to:
Atty. Irvin Joseph M. Fabella

Submitted by:
Justine Renee Gervacio
Ralph Dominic V. Martinez
Chrisptopher Aldwin B. Miranda

2C
Martinez and Miranda
Agrarian Law and Social Legislation / 2C
HOME DEVELOPMENT MUTUAL FUND
Q: What is the Home Development
Mutual Fund Law of 2009 or the Pag-
IBIG Fund?
A: Replacing the Fund established under
Presidential Decree No. 1752, Republic
Act 9679 further strengthens the Home
Development Mutual Fund, providing for
the tax exemption status of the Fund and
an increased scope of its mandatory
membership coverage for private and
government employees and other earning
groups.
Q: What does Pag-IBIG stand for?
A: Pagtutulungan sa Kinabukasan: Ikaw,
Bangko. Industriya, at Gobyerno.
Q: What are the objectives of the Fund?
A: Being private in character, it aims to (1)
Improve the quality of life of its members
by promoting home ownership through the
extension of affordable housing loans, and
investing the savings of its members. (2)
Assisting the shelter industry through the
extension of developmental and
institutional financing by (3) providing
small and short-term loans, benefits, and
assistant programs.
Q: Who are the members of the Board
of Trustees?
A: a) The Chairperson of the Housing and
Urban Development Coordinating Council,
as the ex officio Chairman;
b) The Secretary of the Department of
Finance, as the ex officio Vice Chairman;
c) The Secretary of the Department of
Labor and Employment, or his/her duly
designated undersecretary, as ex officio
member;
d) The Secretary of the Department of
Budget and Management, or his/her duly
designated undersecretary, as ex officio
member;
HDMF (Pag-IBIG) Law of 2009
Rules II, V and X of the IRR
e) The Secretary of the Department of
Trade and Industry, or his/her duly
designated undersecretary, as ex officio
member;
f) The Chief Executive Officer of the Fund;
and
g) Five appointive members, two
representatives of private employees, two
representatives of private employers, and
one representative of government
employees.
Q: Are contributions under the Pag-
IBIG Fund taxable?
A: NO. All payments made by the Fund
shall not be liable to attachments,
garnishments, levy, or seizure by or under
any legal or equitable process, either
before or after the receipt thereto, except
to pay any debt of the member to the
Fund.
Q: Who has jurisdiction over claims
and disputes regarding matters relating
to rights and interest of the members?
A: The Fund, represented by its Chief
Executive Officer, shall have original and
exclusive jurisdiction over all claims and
disputes on any matter relative to the
implementation of the law and its IRR, with
which its decision shall be final and
executory, unless appealed to the Board,
after 30 days from receipt of such
decision. The decision of the Board shall,
unless appealed to a competent court,
become final and executory after 15 days
from receipt of such decision.
MEMBERSHIP/COVERAGE
MANDATORY
Q: Who are the employees
compulsorily covered by the Home
Development Mutual Fund Law?
Martinez and Miranda
Agrarian Law and Social Legislation / 2C
A: Coverage under the Fund shall be
mandatory for the following employees:
a) All employees compulsorily covered by
the SSS
b) All employees subject to mandatory
coverage by the GSIS
c) Uniformed members of the Armed
Forces of the Philippines, the Bureau of
Fire Protection, the Bureau of Jail
Management and Penology, and the
Philippine National Police
d) Filipinos employed by foreign-based
employers
Q: Who are the employers compulsorily
covered by the Home Development
Mutual Fund Law?
A: Coverage under the Fund shall be
mandatory for the following:
a) Employers of employees who are
compulsory covered by the SSS.
b) Employers of employees subject to
mandatory coverage by the GSIS.
c) The Armed Forces of the Philippines,
the Bureau of Fire Protection, the Bureau
of Jail Management and Penology and the
Philippine National Police.
Q: When shall the employer register
their employees in the Fund?
A: It shall be the duty of all employers to
register all their employees subject to
mandatory coverage within thirty (30) days
from the start of their business operations.
For newly hired employees, the employer
shall register them with the Fund within
thirty (30) days from the start of their
employment.
Q: When shall the Self-Employed
individuals register in the Fund?
A: The self-employed who are subject to
compulsory coverage shall register with
the Fund within 30 days from the date
he/she started to be self-employed.
Provided, that if the self-employed shall be
HDMF (Pag-IBIG) Law of 2009
Rule V of the IRR
required to obtain the necessary permits
and/or licenses, other than the license
required for practicing a particular
profession, prior to the practice of his/her
self-employment, he/she shall register with
the Fund prior to engaging in such.
Q: When shall the Mandatory coverage
of the employer and employee take
effect?
A: Mandatory coverage of the employer
shall take effect on the first day of his
business operation, and that of the
employee on the date of his or her
employment.
Q: When shall the Mandatory coverage
of Employers whose coverage had
been previously suspended or waived
for whatever reason under PD 1752
take effect?
A: Their coverage as well as that of their
employees shall take effect after the
expiration of their respective suspension
or waiver of coverage.
VOLUNTARY
Q: Who are voluntarily covered by the
Home Development Mutual Fund Law?
A: Persons who are at least 18 years old
but not more than 65 years old are not
subject to mandatory coverage may be
covered by the Fund on a voluntary basis,
subject to such terms and conditions
stated in these Rules or as the Board may
impose, and shall include, but not limited
to the following:
a) Spouses who devote full time to
managing the household and family
affairs, unless they also engage in another
vocation or employment which is subject
to
Martinez and Miranda HDMF (Pag-IBIG) Law of 2009
Agrarian Law and Social Legislation / 2C Rule V of the IRR

mandatory coverage. A: It shall commence on the actual date of

b) Filipino employees of foreign
government or international organization,
or their wholly-owned instrumentality
based in the Philippines, in the absence of
an administrative agreement with the
Fund;
c) Employees of an employer who is
granted a waiver or suspension of
coverage by the Fund under RA 9679;
registration.
Q: How long is the membership in the
Fund?
A: For a period of 20 years commencing
from the first day of the month to which the
member’s initial contribution to the Fund
applies; Provided, that the member shall
have contributed a total of 240 monthly
contributions at the time of maturity.

d) Leaders and members of religious Q: When is membership terminated?

group;
A: Anytime upon occurrence of:
e) A member separated from employment,
local or abroad, or ceased to be self- a) Membership Term Maturity
employed, but would like to continue
paying his or her personal contribution. b) Death
Such member may be a pensioner,
investor, or any other individual with c) Retirement
passive income or allowances.
d) Permanent Total Disability or Insanity
f) Public officials or employees who are
not covered by the GSIS, such as e) Permanent departure from the country
Barangay Officials, including Barangay
Chairman, Barangay Council Members, f) Termination from the service by reason
Chairman of the Sangguniang Kabataan, of health
and Barangay Secretaries and Treasurers
g) Other causes as may be provided for by
g) Such other earning groups as may be the Board of Trustees
determined by the Board by rules and
regulation. RETIREMENT

Provided, That any foreign government, Q: When shall a member compulsory

international organization, or their wholly- retire under the Fund?
owned instrumentality employing workers
in the Philippines or employing Filipinos A: Any member shall be compulsorily
outside of the Philippines, may enter into retired under the Fund upon reaching the
an agreement with the Fund for the age of sixty-five (65).
inclusion of their employees as members
of the fund; Provided further, That the Q: Can a member retire before reaching
terms of such agreement shall conform the age of sixty-five (65)?
with the provisions of RA 9679 and these
Rules on coverage and amount of A: Yes, upon the occurrence of any of the
payment contributions and benefits; following events, provided the member is
Provided finally, That the provisions of the not a member borrower:
said Act shall be supplementary to any a) Actual
such agreement. retirement from b) Retirement
the SSS or GSIS, under a separate
Q: When shall the voluntary coverage or from employer
take effect? government provident or
service by retirement plan;
provision of law; Provided that the
Martinez and Miranda HDMF (Pag-IBIG) Law of 2009
Agrarian Law and Social Legislation / 2C Rule V of the IRR

member is at physician and

least forty-five approved by the
(45) years of age Board
at the time of
retirement.

c) Upon reaching
the age of sixty
(60);

PERMANENT
TOTAL
DISABILITY

Q: What are the

disabilities
deemed total
and permanent
under the
Fund?

A: a) Temporary
total disability
lasting
continuously for
more than one
hundred twenty
(120) days;

b) Complete loss
of sight of both
eyes;

c) Loss of two
limbs at or over
the ankle or
wrists;

d) Permanent
complete
paralysis of two
limbs;

e) Brain injury
resulting in
incurable
imbecility or
insanity; f.) Such
other cases
which are
adjudged to be
total and
permanent
disability by a
duly licensed
Gervacio
Agrarian Law and Social Legislation / 2C
CONTRIBUTIONS
Q: What is the basis of the contribution
of the employee and/or employer?
A: The basis is the monthly compensation
of the covered employee
Q: What is the rate of contribution of
covered employees and/or employers?
A: Ees earning not more than 1,500 pesos
per month = 1%; Ee’s earning more than
1,500 pesos per month = 2%; All
employers = 2%
Q: What is the maximum monthly
compensation to be used in computing
the employee and employer’s
contributions?
A: 5,000 pesos
Q: Can a member be allowed to
contribute more than what is required
should he/she so desires?
A: Yes
Q: What is the basis of the contribution
of the full-time spouse?
A: One-half of the monthly compensation
income of the employed spouse
Q: What will happen if a member has
multiple employers?
A: Such member shall contribute monthly
to the Fund a percentage of his or her
monthly compensation per employer
which shall be matched by the latter in
accordance with Sec 1 of Rule 6
Q: How is the monthly contribution of
members to the Fund collected?
A: It is collected through payroll
deductions by their respective employers,
who for this purpose shall act as agent
both of the Fund and the member.
Q: Who remits the contribution to the
Fund?
HDMF (Pag-IBIG) Law of 2009
Rules VI, VII and IX of the IRR
A: All employers shall remit to the Fund
their contributions and the contributions of
their covered employees as well as the
latter’s loan amortizations or payments to
the Fund
Q: When and how can the self-
employed and voluntary members
remit their contributions?
A: As regards employees, it is through
payroll deductions which would be
deducted by the employer who shall remit
the same to the Fund.
As regards self-employed/voluntary
members, they may remit their
contributions on a monthly or quarterly
basis.
Q: What would happen if the member-
saver is on leave without pay or is
suspended?
A: Member-saver's monthly contribution
together with his/her employer shall be
suspended for the duration of the leave
without pay or suspension from work
Q: What is the effect of the resignation
or separation from employment of the
member-saver?
A: The member-saver’s and his/her
employer’s MC to the Fund shall cease
BENEFITS
Q: Are the contributions collected and
all accruals thereto and income or
investment earnings therefrom
exempted from tax, assessment, fee,
charge, etc?
A: Yes
Q: Who shall be entitled to dividends?
Gervacio HDMF (Pag-IBIG) Law of 2009
Agrarian Law and Social Legislation / 2C Rules VII, IX and XII of the IRR

A: Only those members with outstanding with fraudulent intent to comply with
Total Accumulated Value (TAV) as of the provisions of RA 9679 and its
year-end Rules?

Q: When will a member be entitled to A: Fine of not less than but not more than
receive his/her TAV less any and all twice the amount involved; or
pending obligations with the Fund? imprisonment of not more than 6 years; or
both at the discretion of the court.
A: Upon termination of his/her
membership. In the event of death,
member’s heirs shall likewise receive the
same

Q: Who are eligible to apply for

housing loans?

A: A member of good standing taking into

account his/her ability to pay

Q: What would happen upon the death

of the member?

A: His/her beneficiaries shall be entitled to

the death benefits in an amount to be
determined by the Board in addition to the
TAV

PENALTIES

Q: What is the penalty for non-

payment/non-remittance of
contributions?

A: Such employer shall be charged a

penalty equivalent to 1/10 of 1% per day
of delay of the amount due starting on the
first day immediately following the due
date until the date of full settlement.

Q: What is the penalty if an employer

deducts from the salary of his
employee the latter's loan amortization
or payments to the Fund and does not
pay it to the fund?

A: Employer shall be liable for the

payment of said contributions and/or
payments, including all applicable
interests and penalties, as well as the
dividends that the contributions could
have earned had they been remitted on
time.

Q: What is the penalty for

refusal/failure without lawful cause or