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HDMF PAG-IBIG Penalty Condonation Program
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HDMF PAG-IBIG Penalty Condonation Program

Why is there a Penalty Condonation Program for Unregistered/Delinquent Employers?

Pag-IBIG Membership Coverage is now Universal under Republic Act 9679 or the Home Development Mutual Fund Act of 2009. Every employed Filipino should be a Pag-IBIG Member and enjoy its benefits. It was, however, found that a large number of employers continue to remain unregistered with the Fund since the new Law took effect in January 2010.

Since they have not registered and collected contributions from their employees, these employers have incurred penalties. There are also those employers, who despite the mandatory nature of membership to the Fund, have continuously failed to comply with the Law.

The penalty condonation program seeks to protect the interest of Pag-IBIG Members as well as provide employers a practicable means to settle their arrears. The program also seeks to compel unregistered/delinquent employers to register their employees to the Fund and provide them access to the Pag-IBIG Benefits they rightfully deserve.

Ang membership sa Pag-IBIG Fund ay mandatory na para sa lahat. Ito ay bunga ng bagong batas na naging epektibo nuong January 2010. Ngunit marami pa ding kumpanya at maliliit na negosyo ang ‘di pa nakakapagrehistro at nakakapaghulog ng kontribusyon ng kanilang mga empleyado. Dahil dito, nagkaroon na ng malalaking penalties ang mga di naihulog na kontribusyon at nagiging hadlang ito upang sila ay magrehistro sa Pondo.

Sa pamamagitan ng Penalty Condonation Program na ito, wala nang dahilan ang mga nasabing employers upang ‘di irehistro ang kanilang mga empleyado sa Pondo.

Who can avail of this program?

The program covers unregistered and delinquent employers, as well as employers who have Pag-IBIG coverable employees from whom they did not collect membership contributions.

Employers who have deducted but did not remit membership contributions and/or short term loan amortizations from their employees are disqualified from this penalty condonation.

Ito ay bukas para sa mga di pa rehistradong employers pati sa mga delinkwenteng employers na di nakapagkaltas at nakapagbayad ng mga kontribusyon ng kanilang empleyado. Bukas din ito para sa employers na di nakaltasan ng hulog ang kanilang mga empleyadong sakop na rin ng Pondo.

Ngunit, kung ang isang employer ay nagdeduct ng kontribusyon at/o loan amortization mula sa kanyang mga empleyado at ‘di ito ibinayad sa Pondo, hindi sila maaaring makinabang sa Penalty Condonation.

If an employer has availed of penalty condonation from Pag-IBIG in the past, can it still avail of this program?


When will the program be implemented?

The program is ongoing and will run until June 30, 2012 only. So avail of this Penalty Condonation program now!

Tumatanggap na ng aplikasyon ang aming 37 branches nationwide ng aplikasyon para sa Penalty Condonation. Hanggang Hunyo 30 lamang ang programang ito kaya’t mag-apply na!

What are the requirements to Apply for Penalty Condonation?

To apply for Penalty Condonation, employers are required to submit the Application Form for Penalty Condonation with Sworn Declaration, documents indicating the start of their business operations and payroll records.

The application form and sworn declaration is available through our website and at our 37 branches nationwide. To show start of business operations, employers must submit:
  1. Mayor’s Permit and
  2. DTI/SEC/CDA Certificate of Registration.
In the absence of Payroll Records, employers may submit SSS R3s (Contributions List) as basis. Pag-IBIG may also require additional documentation when deemed necessary.

Employers must also register and remit the contributions of their employees for the current month and onwards.

Para makinabang sa PenCon, kailangan ng employer na magsumite ng Application for Penalty Condonation na makukuha mula sa aming website o sa alinmang Pag-IBIG Fund Branch. Kailangan ding magsubmit ng mga patunay ng kanyang negosyo, pati na din ng lahat ng talaan ng kanyang payroll.

Ang mga dokumentong magpapatunay ng kanyang negosyo at magsasabi kung kailan ito nagsimula ay ang kanyang Mayor’s Permit at SEC/DTI/CDA Certificate of Registration.

Dapat ding irehistro na ng employer ang kanilang mga empleyado para sa kasalukuyang buwan at patuloy na maghulog Pag-IBIG Contributions para sa kanyang mga empleyado.

What will happen if an employer’s application for Penalty Condonation is Approved?

Employers with approved PenCon applications shall have the penalties on their contributions condoned. They will thus be required to pay their membership contribution arrears free from penalties.

How will the Employer with an Approved PenCon Application settle his Arrears?

Upon approval of the employer’s penalty condonation application, the employer shall be given an option to pay his arrears in full or via installment through a plan of payment.

What Comprises Arrears under an Approved Pencon?

The arrears of employers with approved penalty condonation applications shall include the following:
  1. Membership Contributions
  2. Dividends that should have been earned by these contributions
Interest shall also be included in the event an employer pays arrears via installment thru a plan of payment.

What will happen if an employer’s application for Penalty Condonation is Disapproved?

Employers whose applications are disapproved will be required to pay all membership contribution arrears including applicable penalties, interests, and deprived dividends, if any. Otherwise, corresponding legal action will be carried out against them.

Para sa mga employers na di nag-qualify for PenCon, kailangan nilang bayaran ng buo ang mga kontribusyon ng kanilang mga empleyado, kasama ang karampatang dividends at penalties. Kung hindi, sasampahan sila ng kaso ng Pag-IBIG Fund.

How will an employer propose a Plan of Payment?

Qualified Employers who cannot pay their arrears (contributions and deprived dividends that should have been earned by the contributions) in full are allowed to submit a Plan of Payment.

The proposed payment plan shall be approved by the concerned Pag-IBIG Fund Branch.

Approved Payment Plans may extend to up to a maximum of 24 months for employers with at least 100 employees at the time of application. Approved Payment Plans may extend up to 60 months for employers with less than 100 employees. This was done by the Pag-IBIG Fund in order to assist these employers in settling their arrears with the Fund.

Payment Plans will be charged an interest of half-a-percent (0.5%) per month on the remaining membership contributions.

Employers shall be required to submit the corresponding PDCs to cover their approved plan of payment. They shall also submit a list of all the employees for whom the remittance is being made for corresponding periods covered.

What will happen if an employer fails to comply with the payment plan?

Employers who fail to comply with their payment plans shall have all their penalties reimposed and shall have to pay all unpaid employer counterpart arrearages, dividends and penalties. Appropriate legal action shall immediately commence.

Further, any violation of the terms of the Penalty Condonation Program shall result in reimposition of penalties against the employer. Appropriate legal action shall immediately commence.

If an employer does not qualify for PenCon, what must he/she do?

Employers who do not qualify for Penalty Condonation must settle their arrears, dividends and penalties with the Fund. Otherwise, appropriate legal action shall be taken against them.

For all other concerns on this Penalty Condonation Program,
please contact any of our Pag-IBIG Fund Branches nationwide.
You may also email us at employerpencon@pagibigfund.gov.ph or contact our
Call Center at 724-4244 (Metro Manila).

Technical Details:

Registration Details:
  1. Employers will have to register with the Fund through its Online Registration System prior to applying for penalty condonation.
  2. Upon application for penalty condonation, employers will have to remit the contributions of their current employees, together with the employer’s counterpart contributions for the current remittance period and every month thereafter.
  3. Once their application for penalty condonation is approved, all penalties will be condoned. Employers will have to pay all employer counterpart arrears as of approval of application, as well as dividends that those arrears could have earned. Remittance will have to be made within 30 days from approval of application, otherwise the approval will be forfeited.
What other action can an employer take if it cannot pay the arrears in full even after its application is approved?

The employer may submit a plan of payment within seven days from approval of application. The plan of payment will be subject to the Fund’s approval.

What recourse can an employer resort to if it initially signified to pay the arrears in full but later found that it cannot comply with this commitment? Can the employer still opt to submit a plan of payment?

Yes, the employer may submit a plan of payment not later than the 25th day from the date of approval of its application. Otherwise, the earlier approval will be forfeited.

If an employer has an existing plan of payment prior to the approval of the guidelines, can it still avail of penalty condonation under these guidelines?

Yes, the employer may avail of penalty condonation for the remaining term of the said plan of payment. The penalties it has already paid however, will not be refunded or reversed. New PDCs for the recomputed monthly payment shall also be issued together with a revised MCRF.

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