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PRESIDENTIAL DECREE NO. 1981
PRESIDENTIAL DECREE NO. 1981 -
FURTHER AMENDING PRESIDENTIAL DECREE NO. 1146, AS AMENDED, OTHERWISE
KNOWN AS THE REVISED GOVERNMENT SERVICE INSURANCE ACT OF 1977
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WHEREAS,
the Government Service Insurance System (GSIS) was established to
guarantee the well-being of all government employees through the
effective and systematic administration of the laws granting social
security and insurance benefits to its members;chanroblesvirtualawlibrary
WHEREAS, Presidential Decree No. 1146 expanded and improved the social
security and insurance programs being implemented by the GSIS;chanroblesvirtualawlibrary
WHEREAS, there have been conflicting interpretations of certain
provisions of Presidential Decree No. 1146, particularly as to: whether
or not elective public officials are covered by the GSIS for the
duration of their term of office; whether or not a public officer or
employee who is separated for cause or considered resigned
automatically forfeits his retirement benefits; and whether or not
public officers and employees in the government service at the time
Presidential Decree No. 1146 took effect have the option of retiring
either under the said Decree or Commonwealth Act No. 186, as
amended; chanroblesvirtualawlibrary
WHEREAS, conflicting claims for benefits have invariably been filed
under the different laws administered by the GSIS, which have
oftentimes resulted in unnecessary litigation, delay and inconvenience
on the part of the GSIS and the rightful claimants;chanroblesvirtualawlibrary
WHEREAS, the continued tax exemption of the GSIS is vital to its
actuarial solvency;chanroblesvirtualawlibrary
WHEREAS, the GSIS Board of Trustees should be vested with powers and
authority necessary or proper to ensure a fair and profitable return of
the investments of the funds administered by the GSIS, and, for this
purpose, the GSIS Board of Trustees should be given the full and sole
responsibility of controlling and monitoring insurance investments
operations, and fixing and determining the terms and conditions of
financial accommodations to its members, including the power to
compromise or release any claim or settled liability to the
GSIS; chanroblesvirtualawlibrary
WHEREAS, it has thus become necessary to amend Presidential Decree No.
1146 to clarify some of its provisions to make it more responsive to
the needs of the members of the GSIS and to assure the actuarial
solvency of the Funds administered by the GSIS during these times of
grave economic crisis affecting the country;chanroblesvirtualawlibrary
NOW, THEREFORE, I, FERDINAND E. MARCOS, President of the Republic of
the Philippines, by virtue of the powers vested in me by the
Constitution, do hereby order and decree the following amendments to
Presidential Decree No. 1146:cralaw:red
Section 1. Sub-section (d) of Section 2 is hereby
amended to read as follows:cralaw:red
"(d) Employee. — Any person elected to public office
or extended a permanent appointment who receives compensation for his
service from an employer."
Section 2. Section 3 is hereby amended to read as
follows:cralaw:red
"Sec. 3. Compulsory Coverage. — Membership in the
System shall be compulsory for all employees as defined in this Act,
who are below 60 years of age at the time of their assumption to
office, and for the duration of their tenure: Provided, That, upon
approval by the President of the Philippines and subject to the
availability of funds, compulsory coverage may be extended to
non-permanent employees of national government agencies and local
governments, either simultaneously, in phases or by groups: Provided,
further, That non-permanent employees of government-owned and
controlled corporations may be covered upon approval by the System at
the request of their respective Governing Boards: Provided, finally,
That the coverage of temporary employees under R.A. No. 4968 shall
remain in force." chanroblesvirtualawlibrary
Section 3. Section 4 is hereby amended to read as
follows:cralaw:red
"Sec. 4. Effect of Separation from the Service. — A
member separated from the service shall continue to be a member, and he
shall be entitled to whatever benefits which shall have accrued or been
earned at the time of his separation in the event of any contingency
compensable under this Act: Provided, however, That if he is separated
for cause or considered resigned, he automatically forfeits said
benefits, unless the terms of his resignation or separation provide
otherwise. In case of forfeiture of benefits, the separated employee
shall still be entitled to receive one-half of the cash surrender value
of his life insurance."
Section 4. Section 13 is hereby amended to read as
follows:cralaw:red
"Sec. 13. Retirement Option. — Employees who are in
the government service upon the effectivity of this Act shall, at the
time of their retirement, have the option to retire under this Act or
under Commonwealth Act No. 186, as amended, and their benefits and
entitlement thereto shall be determined in accordance with the
provisions of the law so opted: Provided, however, That in the event of
his re-employment, his subsequent retirement shall be governed by the
provisions of this Act: Provided, further, That the member may change
the mode of his retirement within one year from the date of his
retirement in accordance with such rules and regulations as may be
prescribed by the System." chanroblesvirtualawlibrary
Section 5. Section 24 is hereby amended to read as
follows:cralaw:red
"Sec. 24. Settlement of Disputes. — The System shall
have original and exclusive jurisdiction to settle any dispute arising
under this Act and any other laws administered by the
System. chanroblesvirtualawlibrary
"In case of conflicting claims for benefits payable under this Act or
Commonwealth Act No. 186, as amended, the claim shall be paid in
accordance with this Act.
"The Board may designate any member of the Board, or official of the
System who is a lawyer, to act as hearing officer to receive evidence,
make findings of fact and submit recommendations thereon. The hearing
officer shall submit his findings and recommendations, together with
all the documentary and testimonial evidence, to the Board within
thirty working days from the time the parties have closed their
respective evidence and filed their last pleading. The Board shall
decide the case within thirty days from receipt of the hearing
officer's findings and recommendations. The cases heard directly by the
Board shall be decided within thirty working days from the time they
are submitted by the parties for decision."
Section 6. The provisions of Section 33 of
Presidential Decree No. 1146 are hereby reiterated in full, and for the
purpose, a new second paragraph is hereby inserted in said Section 33,
the original second paragraph becoming the third paragraph, the new
second paragraph reading as follows"
Moreover, these exemptions shall not be affected by subsequent laws to
the contrary, such as the provisions of Presidential Decree No. 1931
and other similar laws that have been or will be enacted, unless this
section is expressly and categorically repealed by law and a provision
is enacted to substitute the declared policy of exemption from any and
all taxes as an essential factor for the solvency of the Fund."
Section 7. There is hereby incorporated a new
paragraph after the third paragraph of Section 36, which shall read as
follows:cralaw:red
"The Board of Trustees has the following powers and functions, among
others: chanroblesvirtualawlibrary
"(a) To formulate the policies, guidelines and
programs to effectively carry out the purposes and objectives of this
Act;chanroblesvirtualawlibrary
"(b) To promulgate such rules and regulations as may
be necessary or proper for the effective exercise of the powers and
functions as well as the discharge of the duties and responsibilities
of the System, its officers and employees;chanroblesvirtualawlibrary
"(c) Upon the recommendation of the President and
General Manager, to approve the annual and supplemental budget of
receipts and expenditures of the System, and to authorize such
operating and capital expenditures and disbursements of the System as
may be necessary or proper for the effective management, operation and
administration of the System;chanroblesvirtualawlibrary
"(d) Upon the recommendation of the President and
General Manager, to approve the System's organizational and
administrative structure and staffing pattern, and to establish, fix,
review, revise and adjust the appropriate compensation package for the
officers and employees of the System, with reasonable allowances,
incentives, bonuses, privileges and other benefits as may be necessary
or proper for the effective management, operation and administration of
the System. For the purpose of this and the preceding subsection, the
System shall be exempt from the rules and requirements of the Office of
the Budget and Management and the Office of the Compensation and
Position Classification;chanroblesvirtualawlibrary
"(e) To fix and periodically review and adjust the
rates of interest and other terms and conditions for loans and credits
extended to its members or other persons, whether natural or juridical;chanroblesvirtualawlibrary
"(f) The provisions of any law to the contrary
notwithstanding, to compromise or release, in whole or in part, any
claim or settled liability to the System, regardless of the amount
involved, under such terms and conditions as it may impose for the best
interest of the System; and
"(g) To do and perform any and all acts necessary,
proper or incidental to the attainment of the purposes and objectives
of this Act."
Section 8. There is hereby added a new sub-section to
Section 39, to be denominated as (c), which shall read as follows:cralaw:red
"(c) In order that the System can best achieve the
purposes and objectives of this Act, the insurance and investment
operations of the System shall be under its full and sole
responsibility, notwithstanding the provisions of Section 246 of the
Insurance Code, as amended."
Section 9. Any provision of laws, decrees,
ordinances, executive or administrative orders, letters of
instructions, rules and regulations, which is inconsistent with this
Decree is hereby repealed, amended, or modified accordingly.
Section 10. This Decree shall take effect immediately.
DONE in the City of Manila,
this 19th day of July, in the year of Our Lord, Nineteen Hundred and
Eighty-Five.
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