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July 24, 2020
Employers express support for law making pensions portable
March 19, 2021 - Bianca Angelica D. Anago
EMPLOYERS Confederation of the Philippines President Sergio R. Ortiz-Luis, Jr. said he supports a proposal to make pensions transferable as workers change jobs.
Speaking before the Committee on Banks and Financial Intermediaries Wednesday, Mr. Ortiz-Luis said House Bill 8938, which creates Employee Pension and Retirement Income (EPRI) accounts that stay with the worker regardless of job-switching, will “rationalize pensions, and this is a good way to do it. We will wait for other developments like the IRR (Implementing Rules and Regulations) to make suggestions,” Mr. Ortiz-Luis said.
Capital Market Development Council Co-Chair Benedicta Du-Baladad said the bill intends to make pensions “fully-funded, and adequate for retirees to have sufficient funds for their daily lives.”
Pension reform will introduce an element of choice in pension plans, and help grow the country’s pension assets, Finance Secretary Carlos G. Dominguez has said.
Labor Undersecretary Benjo Santos M. Benavidez said the benefits under the bill are separate from those provided by the Social Security System and will represent an amendment of Republic Act 7641 or the Labor Code of the Philippines.
He added that once the bill is signed into law, employees will be given a choice to stay with their current pension account or convert it into an EPRI account.
University of the Philippines School of Economics Assistant Professor Renato E. Reside, Jr. said he estimates EPRI to require a deduction of P300 a month from minimum wage earners.
The Department of Trade and Industry has called on the business sector to support the bill, which will address the growing trend of job-hopping among younger workers.
Ms. Du-Baladad cited a study which estimated that young workers change jobs about 12 times over a 40-year working life, putting them at risk of reaching retirement with little or no pension savings.
The current law on retirement recognizes as eligible for pensions, employees with five years of service at their last company upon reaching 60 years of age. — Bianca Angelica D. Anago
PHILSTAR
Speaking before the Committee on Banks and Financial Intermediaries Wednesday, Mr. Ortiz-Luis said House Bill 8938, which creates Employee Pension and Retirement Income (EPRI) accounts that stay with the worker regardless of job-switching, will “rationalize pensions, and this is a good way to do it. We will wait for other developments like the IRR (Implementing Rules and Regulations) to make suggestions,” Mr. Ortiz-Luis said.
Capital Market Development Council Co-Chair Benedicta Du-Baladad said the bill intends to make pensions “fully-funded, and adequate for retirees to have sufficient funds for their daily lives.”
Pension reform will introduce an element of choice in pension plans, and help grow the country’s pension assets, Finance Secretary Carlos G. Dominguez has said.
Labor Undersecretary Benjo Santos M. Benavidez said the benefits under the bill are separate from those provided by the Social Security System and will represent an amendment of Republic Act 7641 or the Labor Code of the Philippines.
He added that once the bill is signed into law, employees will be given a choice to stay with their current pension account or convert it into an EPRI account.
University of the Philippines School of Economics Assistant Professor Renato E. Reside, Jr. said he estimates EPRI to require a deduction of P300 a month from minimum wage earners.
The Department of Trade and Industry has called on the business sector to support the bill, which will address the growing trend of job-hopping among younger workers.
Ms. Du-Baladad cited a study which estimated that young workers change jobs about 12 times over a 40-year working life, putting them at risk of reaching retirement with little or no pension savings.
The current law on retirement recognizes as eligible for pensions, employees with five years of service at their last company upon reaching 60 years of age. — Bianca Angelica D. Anago
PHILSTAR
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