President Ferdinand R. Marcos Jr. has issued an order directing government agencies to facilitate voluntary payroll deductions for contract of service (COS) and job order (JO) personnel, granting non-regular state workers direct access to government-mandated social security benefits.
Under Administrative Order No. 43, signed on June 3, state offices are instructed to establish mechanisms allowing COS and JO personnel to voluntarily contribute to the Social Security System (SSS), Philippine Health Insurance Corp. (PhilHealth) and the Home Development Mutual Fund (Pag-IBIG Fund). Prior to the directive, government contractual workers had to independently manage and remit their contributions as self-employed or voluntary members.
“All covered government agencies are hereby directed to facilitate the voluntary deduction of prescribed SSS, PhilHealth, and Pag-IBIG Fund contributions from the compensation of COS and JO workers, subject to the prior consent of the worker and in accordance with RA Nos. 11199, 11223, and 9679,” the President’s order stated.
The nationwide directive applies across all executive departments, agencies, bureaus, offices and instrumentalities of the national government, including government-owned or -controlled corporations (GOCCs) and state universities and colleges (SUCs). Local government units (LGUs) are also encouraged to adopt the order’s provisions.
Under AO 43, concerned agencies are tasked with securing written consent from personnel, providing transparent information regarding available coverage options and entering into formal agreements with social security institutions to guarantee that payments are remitted directly and on schedule.
The order explicitly clarifies that processing these voluntary deductions and remittances will not alter, amend or modify the existing contractual status of COS and JO workers, maintaining their non-regular employment classification.
To help offset the cost of contributions, government agencies may grant non-regular personnel a financial premium of up to 20 percent on top of their base compensation, as authorized under Joint Circular No. 1 (series of 2025) issued by the Civil Service Commission (CSC), Commission on Audit (COA) and Department of Budget and Management (DBM).
“For this purpose, agencies shall ensure that appropriate mechanisms are in place to enable participation and shall provide COS and JO workers with the necessary information on available social protection coverage,” the order added.
President Marcos has instructed the DBM, CSC, COA, SSS, PhilHealth and Pag-IBIG Fund to jointly draft and issue the necessary rules, guidelines, and accounting procedures to oversee the execution of the order across the public sector.