Article 89Labor and Agrarian Laws and Social Legislation, p. 89

LABOR LAWS AND SOCIAL LEGISLATION SPECIAL LAWS AND IMPLEMENTING RULES AND REGULATIONS

into an agreement with the Fund for the inclusion of their

employees as members of the Fund: Provided, further,

That the term of such agreement conform with the

provisions of this Act.

(h) "Fund" — the fund created under this Act which is

a government financial institution involved in mobilizing

provident funds primarily for shelter finance.

(i)

"GSIS"

—

the

Government

Service

Insurance

System created under Commonwealth Act No. 186 , as

amended.

(j) "Investible Funds" — shall mean funds available

after

deducting

cost

of

operations

and

expenses,

administrative and general expenses, reserves for benefit

claims, provisions for a sinking fund for the return of the

members' equity upon maturity and provision for reserve

for loan repayments.

(k) "Member" — an employee coverable under this

Act and pays the mandated contributions.

(l) "Membership Term" — a period of twenty (20) years

commencing from the first day of the month to which

the member's initial contribution to the Fund applies:

Provided, That he shall have contributed a total of two

hundred forty (240) monthly contributions at the time of

maturity.

(m) "Net Fund Asset" — the total assets of the Fund

less current liabilities.

(n) "Permanent Total Disability" — loss or impairment

of a physical and mental function resulting from injury or

sickness which completely incapacitates a member to

perform

any

work

or

engage

in

any

business

or

occupation as determined by the Fund.

(o) "SSS" — the Social Security System created under

Republic Act No. 1161 , as amended.

SECTION

5.

Fund

System.

—

To carry out the

purposes of this Act, there is hereby created the Home

Development Mutual Fund of 2009, also referred to

herein as the Fund, a mutual provident savings system for

private and government employees and other earning

groups, supported by matching mandatory contributions

of their respective employers with housing as the primary

investment.

The Fund shall be a body corporate, with principal

office in Metro Manila, and shall replace the Home

Development

Mutual

Fund

established

under

Presidential Decree No. 1752 .

SECTION 6. Fund Coverage. — Coverage in the Fund

shall be mandatory upon: (a) all employees covered by

the SSS and the GSIS, and their respective employers,

notwithstanding

any

waiver

of

coverage

previously

issued, including the 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; (b) Filipinos employed by

foreign-based employers; and (c) 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 mandatory coverage,

may be covered by the Fund on a voluntary basis

adopting as a basis of contributions one-half (1/2) of the

monthly compensation income of the employed spouse.

Coverage may also be extended to other working

groups, with or without employer contributions, as may

be determined by the Board of Trustees.

SECTION 7. Fund Generation and Contributions . —

The money of the Fund shall be generated by the

provident

savings

that

the

covered employees shall

contribute for the purpose every month, and the equal

amounts

that

their

respective

employers

shall

mandatorily contribute.

Covered employees and employers shall contribute to

the Fund based on the monthly compensation of covered

employees as follows:

Employees earning not more than One thousand five

hundred pesos (P1,500.00) per month — one percent (1%).

Employees earning more than One thousand five

hundred pesos (P1,500.00) per month — two percent (2%).

All employers — two percent (2%) of the monthly

compensation of all covered employees.

The maximum monthly compensation to be used in

computing employee and employer contributions shall

not

be

more

than

Five

thousand

pesos

(P5,000.00): Provided, That this maximum may be fixed

from time to time by the Board of Trustees through rules

and regulations adopted by it, taking into consideration

actuarial calculations and rates of benefits.

Notwithstanding any contract to the contrary, an

employer shall not deduct, directly or indirectly, from the

compensation of its employees covered by the Fund, or

otherwise

recover

from

them,

the

employer's

contribution with respect to such employees.

SECTION 8. Membership Term. — Membership in

the Fund shall be for a period of twenty (20) years, except

when

earlier

terminated

by

reason

of

retirement,

disability, insanity, death, departure from the country or

other causes as may be provided for by the Board of

Trustees: Provided, That those who become members of

the Fund after the effectivity of this Act may withdraw the

total accumulated value of their contributions to the

Fund

after

the

fifteenth

(15th)

year

of

continuous

membership: Provided, further, That said members have

no outstanding housing loans with the Fund: Provided,

finally, That this option shall not prejudice the member's

continuing membership in the Fund.

Resignation, lay-off or suspension from employment

may not necessarily constitute a ground for membership

termination, except for suspension of contributions.

SECTION 9. Waiver or Suspension of Coverage. —

Coverage of the Fund and/or the payment of monthly

contribution to the same may, by rules or resolutions of

the Board of Trustees, be waived or suspended by reasons

of nature of employment, condition of business, ability to

make contributions and other reasonable considerations.

SECTION 10. Provident Character. — The Fund shall

be private in character, owned wholly by the members,

administered in trust and applied exclusively for their

benefit. All the personal and employer contributions shall

be

fully

credited

to

each

member,

accounted

for

individually

and

transferable

in

case

of

change

of

employment.

They

shall

earn

dividends

as

may be

provided for in the implementing rules. The said amounts

shall constitute the provident fund of each member, to be

paid to him, his estate or beneficiaries upon termination

of membership, or from which peripheral benefits for the

member may be drawn.

SECTION 11. Housing Features. — A member of good

standing shall be eligible to apply for housing loans,

under such terms and conditions as may be authorized

by the Board of Trustees, taking into account ability to

pay. The Board of Trustees shall institute policies to

ensure that lower-income members obtain such housing

loans.

SECTION 12. Implementing Body. — The Home

Development Mutual Fund created under this Act, shall

implement the provisions hereof.

SECTION 13. Powers and Functions of the Fund. —

The Fund shall have the powers and functions specified

in this Act and the usual corporate powers:

(a) To formulate, adopt, amend and/or rescind such

rules and regulations as may be necessary to carry out

the provisions and purposes of this Act, as well as the

effective exercise of the powers and functions, and the

discharge of duties and responsibilities of the Fund, its

officers and employees;

(b) To adopt or approve the annual and supplemental

budget of receipts and expenditures including salaries

and allowances of the Fund personnel, to authorize such

© Compiled By RGL

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