What is Unemployment Insurance And How Can I Claim It?

7 min read By Kevin Joshua Ng on July 8, 2020

With the COVID-19 pandemic affecting the economy, and consequently, job security, many Filipinos experienced job loss due to companies closing down or laying off employees to keep them afloat.

As per the latest update from Rappler, unemployment skyrocketed to an all-time high of 7.3-M jobless Filipinos amidst the enhanced community quarantine. That’s equivalent to 17.7%, more than three times the unemployment rate at the beginning of this year.

The sudden upsurge set the government on alarm. That’s why the Department of Labor and Employment (DOLE), together with the Social Security System (SSS) and Government Service Insurance System (GSIS), mounted a response in aid of involuntarily separated workers: Unemployment insurance or involuntary separation/unemployment benefit.

What does unemployment insurance mean?

Unemployment insurance or involuntary separation benefit is a cash assistance grant provided by the Social Security Act of 2018 (RA No. 11199) for SSS members and GSIS Act of 1997 (RA No. 8291) for GSIS members.

Read: 10 Labor Code Provisions Every Employee Must Know

SSS vs GSIS: How do they differ?

SSS

SSS members can avail of unemployment benefits if they are displaced because of redundancy, installation of labor-saving devices, retrenchment, closure or cessation of operation, and disease or illness.

GSIS

The unemployment benefit is paid when permanent government employees are involuntarily separated from the service as a result of the abolition of their office or position, usually resulting from reorganization.

Since the unemployment benefit is not a loan, there’s no need to pay it back to the respective agency.

Where does unemployment insurance come from?

According to SSS President and CEO Aurora Cruz Ignacio, unemployment benefits from SSS will be coming from the state-run pension fund. They prepared a budget for two scenarios: a minimum of ₱660 million for the current projection (60,000 workers) and ₱1.2 billion under a worst-case projection.

As for GSIS unemployment benefit, sources of funds will be based on contributions, as outlined in Section 5 of the GSIS Act of 1997. Contributions consist of the mandatory monthly deduction from the member and the matching monthly contribution from the employer.

And as an added “insurance,” in Section 8, the GSIS Act mentions what is called a “Government Guarantee,” where the government is obligated by the Constitution to fulfill the obligation of GSIS to its members when they fall due.

How does unemployment insurance work?

While the law provides a separate legal framework for the unemployment benefits of both SSS and GSIS members, there are a lot of similarities between the two, mainly for those who are laid-off or retrenched, with or without notice.

Who are eligible for an unemployment insurance?

Are you eligible to avail of these benefits? We’ll lay it out per agency.

SSS

• All eligible SSS-member employees, including kasambahay and OFWs who were involuntary separated
• Not exceeding 60 years of age when laid off, except for underground or surface mineworkers (not exceeding 50 years old), and racehorse jockeys (not exceeding 55 years of age)
• With total of 36 months contribution, 12 of which should be made within 18 months before the incident (lay-off or retrenchment)
• Haven’t received any unemployment benefit from SSS within the last three years
• Loss of employment because of the following reasons:
  • Legal reasons under Article 298 and 299 of the Labor Code of the Philippines (PD No. 442)
  • Installation of labor-saving devices
  • Redundancy
  • Retrenchment
  • Company closure or cessation of operation
  • Disease or illness that can affect working environment
  • Provisions under Article 300 of the Labor code that enumerates grossly unfair treatment of an employer
  • Economic failure
  • Natural calamities

However, employees become ineligible for the SSS unemployment benefit if they’re found to have committed the following:

• Corrupt activities
• Gross negligence of company rules and regulation
• Gross negligence of job responsibilities
• Criminal offense

GSIS

• Permanent employee at the time of separation
• Separation was involuntary due to the abolition of office, position resulting from reorganization
• Paying contributions for at least one year prior to separation

If a member has rendered at least 15 years of service, they are entitled to the separation benefits described in RA 8291, instead of unemployment benefit.

Application for unemployment benefit must be filled within 4 years from date of unemployment, as provided for under RA 8291.

Read: 10 Profitable Business Ideas In The Philippines Amid The Lockdown

Which unemployment insurance should I get and how do I claim it?

Unemployment insurance claims depend on which agency you’re remitting contributions to. If you contribute to both SSS and GSIS, then you can claim unemployment benefits from them as long as you’re eligible.

If you’re going to apply for an unemployment benefit from SSS, you can do it in two ways: online and personal application. Here howL

Online application

1. Log-in to your My.SSS account (https://www.sss.gov.ph/)*
2. Select the E-Services tab
3. Click “Apply for unemployment benefit claim”
4. Complete all applicable fields with pertinent information
5. Read the certification then click “Submit”
6. SSS will send an email requiring a few documents such as:
   • Department of Labor and Employment (DOLE) Certification or Philippine Overseas Labor Office (POLO) Certification for OFWs
   • Notice of termination from employer or affidavit of termination from employment, whichever is applicable
7. SSS will send a notice through email regarding your unemployment benefit application

Personal application

1. File for a DOLE certification at the field or provincial office where your employer is based. For OFWs, you can go to the Philippine Overseas Labor Office (POLO) or DOLE office near your residence.
2. Submit these requirements:
   • Notice of termination of employment or affidavit of termination of employment
   • 1 valid ID
   • UMID-ATM card or
   • UBP bank card or bank statement with the member’s name, savings account number, bank branch and address
   • If neither is available, you can apply for these first at any SSS branch
3. Once you have the DOLE/POLO certificate, go to any SSS branch and bring the document along with the original and a photocopy of any of these valid IDs:
   • UMID Card
   • SSS card
   • Alien Certificate of Registration (ACR)
   • Driver’s License
   • Firearm Registration
   • License to Own and Possess Firearms
   • NBI clearance
   • Passport
   • Permit to Carry Firearms Outside of Residence
   • Postal ID
   • Seafarer’s ID and record book
   • Voter’s ID
4. If any of these are unavailable, bring the original and photocopy of two IDs with your picture and affixed signature
5. Submit your documents to the SSS unemployment benefit officer-in-charge
6. Wait for their instructions as to when your unemployment benefit claim will be deposited to either your UMID-ATM or UBP card. If the following channels are available, the claim will also be available through PESONet bank transfer and non-bank cash pick-up.

Unemployment benefit amount is equivalent to a half of your average monthly salary credit (AMSC) for a maximum of two months, with a maximum claimable monthly salary credit of ₱20,000.

You can refer to this contribution table (updated as of April 2019) to know more about your monthly salary credit, the unemployment benefit amount you’re qualified for.

For more information on the SSS Unemployment Benefit, you can download their brochure online.

*TheSSS online portal is under maintenance during the time of writing this article. In the meantime, you may call reach them through the following means:

• SSS Hotline 81455
• Interactive Voice Response System 7917-7777
• Text SSS 2600
• member_relations@sss.gov.ph, onlineserviceassistance@sss.gov.ph. prnhelpline@sss.gov.ph, ofwrelations@sss.gov.ph
• Domestic toll-free number 1-800-102255777

If you’re a GSIS member, here’s how you can claim your unemployment benefit:

1. Download a Declaration of Pendency/Non-Pendency of Case (view it here) and have it notarized.
2. Download and print the GSIS Application for Unemployment Benefits (get it here)
3. Fill-in the necessary information.
4. Submit application form and Declaration of Pendency/Non Pendency of case to the nearest GSIS/Handling Office.

The benefit is in the form of monthly cash payments equivalent to 50% of the average monthly compensation (AMC). The duration of the benefit depends on the length of service and ranges from two months to a maximum of six months.

The unemployment benefit shall be paid in accordance with the following schedule:

• If the contributions have been made for a period of one year but less than three years, the benefit duration is for two months;
• If the contributions have been made for a period of three or more years but less than six years, the benefit duration is for three months;
• If the contributions have been made for a period of six years or more but less than nine years, the benefit duration is for four months;
• If the contributions have been made for a period of nine years or more but less than 11 years, the benefit duration is for five months; and
• If the contributions have been made for a period of 11 years or more but less than 15 years, the benefit duration is for six months.