A member of one of the HR online communities I managed sent a Q via private message.
We have an employee that is currently on her maternity leave. Now the Accountant is asking if we wanted to continue deducting SSS contribution (and other government mandated benefits) of this employee. When I asked our sister company, they don’t deduct any since the person is on ML. Moreover, for 13th month, these 2 months of being on a maternity leave will not be included in the computation as well. What is the right process for this?
I replied and gave her my advise. But I also sought permission to post her Q on the group (minus her identity) to seek the collective wisdom of the community. Here’s the gist of the responses we received from compensation and benefits gurus:
Since employee has no salary, there is nothing to deduct for SSS contribution and other statutory benefits. A Maternity leave not only affect the 13th month pay, leave credits and other company benefits tied to attendance, but also computation to future SSS pension and loanable amount.
However, for humanitarian reason, companies have taken a proactive approach on this concern, and discusses the following options to employee for her consent and/or proper action.
- Employer will pay for both employer and employee share for the SSS contribution during the affected maternity period. But employee share will be deducted from her salary as soon as she returned from maternity leave.
- Employer advises employee of the effects of maternity leave to her salary, compensation and benefits, specially the gap on SSS contribution. Thus, encourage her to temporarily change SSS membership to “voluntary” (during the maternity period) and pay for the SSS contribution. As soon as employee reports back for work, membership will be reverted back to “employed”.
UPDATE: accountant friends advised that the earning of 13th month (and other benefits tied to attendance) should not be affected if the company will not reflect the maternity leave of the employee.
Are you involve in payroll and accounting, what other approaches can you suggest?