retirement law revisited 091910 ppt97
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RETIREMENT LAWRETIREMENT LAWREVISITEDREVISITED
ATTY. ADA D. ABADATTY. ADA D. ABAD CEAPCEAPLEGAL COUNSELLEGAL COUNSEL
CEAP RETIREMENT FUNDCEBU WATERFRONT HOTEL
21 SEPTEMBER 2010, 4:00-5:30PM
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RETIREMENTRETIREMENTDEFINED:DEFINED:
A. w!"#$%w%& '$() (*+ (!(* ($ (//%!(*
($ '$() %/!+ w($* &'+B. T"+ +$(# (' % +$(* &'+ #$* w"/""+"+ *( &(*+$ w($*, ($ !"+/())+*/+)+*! (' !"%! +$(#.
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ENERAL RULEENERAL RULE: R.A. 6741
%.OPTIONAL %! 70 8+%$ w!" )*))5 8+%$ (' +$/+9.MANDATOR%! 75 8+%$, *(+$/+ $+;$+)+*!
E
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6CEAP RETIREMENT FUND LECTUREOF ATTY. ADA ABAD 092110
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ENERAL RULEENERAL RULE: R.A. 6741
>)(*!" '($ ++$8 8+%$ (' +$/+?+@%*#+# /(*/+!
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TWO OVERNIN LAWS ONTWO OVERNIN LAWS ON
RETIREMENT BENEFITS:RETIREMENT BENEFITS:
A.A.REPUBLIC ACT NO. 6741REPUBLIC ACT NO. 6741, otherwiseotherwise
known as the RETIREMENT PAY LAknown as the RETIREMENT PAY LAena!te" on #$ De!e%&er '$$(ena!te" on #$ De!e%&er '$$(
B.B.REPUBLIC ACT N(. 416REPUBLIC ACT N(. 416, whi!h a%en"s, whi!h a%en"s
the Nationa) Interna) Re*en+e Co"e onthe Nationa) Interna) Re*en+e Co"e onee%-tion ro% taes o retire%ent &eneitsee%-tion ro% taes o retire%ent &eneits
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COMPANIESCOMPANIESWITHOUTWITHOUT
RETIREMENTRETIREMENT
PLANPLANR.A. 6741R.A. 6741
COMPANIESCOMPANIESWITH AWITH A
RETIREMENTRETIREMENT
PLANPLAN
BUT LESSBUT LESSBENEFITBENEFIT
R.A. 6741R.A. 6741
COMPANIESCOMPANIESWITH AWITH A
RETIREMENTRETIREMENT
PLANPLANR.A. 416R.A. 416
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COMPANIESCOMPANIES
WITHOUTWITHOUTRETIREMENTRETIREMENT
PLANPLANRETIREMENT LAW TORETIREMENT LAW TO
APPLYAPPLY 10CEAP RETIREMENT FUND LECTURE
OF ATTY. ADA ABAD 092110
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COMPANIES WITH ACOMPANIES WITH A
COLLECTIVECOLLECTIVE
BARGAININGBARGAINING
AGREEMENT ORAGREEMENT OR
RETIREMENT PLANRETIREMENT PLANBUT SAME OR LESSBUT SAME OR LESS
BENEFITS THANBENEFITS THAN
MINIMUMMINIMUM 11CEAP RETIREMENT FUND LECTURE
OF ATTY. ADA ABAD 092110
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1.1. WHO MA BENEFITWHO MA BENEFIT
/ ALL EMPLOEES IN THE PRIVATE COMPAN,REARDLESS OF POSITION AND CLASSIFICATION.
They h!"" #$%"&'e (!)*+*#,e e,("-yeee,("-yee -/ e)#%e !$' -*he) - %-$*)!%*-)
!$' '-,e*#% he"(e) -) (e)-$ #$ (e)-$!"e)#%e -/ !$-*he).
2.2. WHO MA NOT BENEFITWHO MA NOT BENEFIT
/OVERNMENT EMPLOEES/EMPLOEES OF RETAIL AND ARICULTURALESTABLISHMENTS EMPLOIN TEN OR LESSEMPLOEES
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3.3. PARAMETERS FOR AVAILMENTPARAMETERS FOR AVAILMENT
/ MANDATOR AT 75 EARS OF AE, NOSERVICE REUIREMENT
/ OPTIONAL AT AE 70, WITH FIVE ?5 EARSSERVICE REUIREMENT
/ IF COMPLIED WITH, BENEFITS ARE TA
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4.4. HOW MUCH IS THE BENEFITHOW MUCH IS THE BENEFIT
4.1 FOR THOSE PAID REULARL -- ONE-HALFMONTH SALAR COMPUTED AT 22.5 DAS PERCAPITOL WIRELESS VS. CONFESOR CASE.?REITERATED IN STA. CATALINA SCHOOL VS. NLRC 2003 CASE
/ Components of one-h!f months!"#
15 #%8 @ &%!+! %&%$8 +$ #%8 5 #%8 &+%+ @ &%!+! %&%$8 +$ #%8 112(' 13!")(*!" %8 A&& (!"+$ 9+*+'! !"%! !"+ +)&(8+$ %*#+)&(8++ )%8 %$++ (* !"%! "( 9+ */+#
* !"+ /()!%!(* (' !"+ +)&(8++= $+!$+)+*!%8. 14CEAP RETIREMENT FUND LECTURE
OF ATTY. ADA ABAD 092110
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NOTE: T"+ ''!++* ?15 #%8 %&%$8 ('
!"+ +)&(8++ !"%! 9%+# (* "&%!+!&%!+! %&%$8 $%!+.
E@/+!01a2 !ost o )i*in3 a))owan!es
1&2 -roit4sharin3 -a5%ents
1!2 other %onetar5 &eneits whi!h are not
!onsi"ere" as -art o or inte3rate" into there3+)ar sa)ar5 o the e%-)o5ees.
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4.2 FOR THOSE PAID B THE RESULTS
AND DO NOT HAVE FI
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5.5. IS THE RETIREMENT PA UNDERIS THE RETIREMENT PA UNDER
RA 6741 TA
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7.7. REUIREMENTS FOR TA
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CEAP RETIREMENT FUND LECTUREOF ATTY. ADA ABAD 092110
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COMPANIES WITH ACOMPANIES WITH ACOLLECTIVECOLLECTIVE
BARGAININGBARGAININGAGREEMENT ORAGREEMENT OR
RETIREMENT PLANRETIREMENT PLANRETIREMENT PLAN TO APPLYRETIREMENT PLAN TO APPLYTA$-E$EMPT SUB%ECT TOTA$-E$EMPT SUB%ECT TO
CON&ITIONS UN&ER RA '()*20CEAP RETIREMENT FUND LECTURE
OF ATTY. ADA ABAD 092110
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1.1. WHO MA BENEFITWHO MA BENEFIT
AVAILMENT WILL INDUBITABLDEPEND UPON THEPARAMETERS IVEN B THERETIREMENT PLAN ITSELF
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CEAP RETIREMENT FUND LECTUREOF ATTY. ADA ABAD 092110
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CEAP RETIREMENT PLAN+
ARTICLE ),SEC ). THE NORMALRETIREMENT &ATE UN&ER CEAP
RETIREMENT PLAN IS AGE /,
/ LAST &AY OF THE SEMESTERDURIN IC E ATTAIN AE 60
/IF BIRTDAY I OUTSI&EOF A
EMETER UMMER BREA: OR EM
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CEAP RETIREMENT FUND LECTUREOF ATTY. ADA ABAD 092110
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SEC 0. OPTIONAL ORSEC 0. OPTIONAL OR
EARLYEARLYRETIREMENT &ATERETIREMENT &ATE
/ LAT DAY OF TEEMETER AFTER E ARENDERED TWENTY 10,2
YEARS OF CONTINUOUSSERVICE< OR
/ IF TE LAT DAY OF TET
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CEAP RETIREMENT FUND LECTUREOF ATTY. ADA ABAD 092110
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SEC 3. SEPARATIONSEC 3. SEPARATION
PRIOR TOPRIOR TORETIREMENTRETIREMENT
/ EMPLOYEE REIN/ EMPLOYEE I TERMINATED
FOR REAON OTER TAN
DIMIAL FOR CAUEATTRIBUTABLE TO TE FAULTOF MEMBER
1E$AMPLE. RETRENCHMENT+ RE&UN&ANCY+
INSTALLATION OF LABOR SAVING
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CEAP RETIREMENT FUND LECTUREOF ATTY. ADA ABAD 092110
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WHAT BENEFITS ARE THEYWHAT BENEFITS ARE THEY
ENTITLE& TO4ENTITLE& TO4
/ RETURN OF TOTALCONTRIBUTION OF
EMPLOYEE
/ INCOME ACCRUED FROM I
CONTRIBUTION UNDER TETRUT FUND
/PECIFIED PROPORTION OF
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2.2. PARAMETERS FOR AVAILMENT OFPARAMETERS FOR AVAILMENT OF
TA< E
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3.3. REUIREMENTS FOR TA
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4.4. HOW MUCH IS THE BENEFITHOW MUCH IS THE BENEFIT
/ IF THE RETIREMENT PLAN IVESBETTER RETIREMENT BENEFITS
THAN THE MINIMUM PROVIDED BLAW ?12 MONTH E
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RECONCILIATIONRECONCILIATIONOFOF
TA$ E$EMPTIONTA$ E$EMPTIONUN&ERUN&ER
RA */') AN& RARA */') AN& RA'()*'()*
PER BIR OPINIONPER BIR OPINION DA-151-2004, M%$/" 31, 2004.30CEAP RETIREMENT FUND LECTURE
OF ATTY. ADA ABAD 092110
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SITUATION ONE:
/COMPAN DOES NOT
HAVE ANRETIREMENT PLAN
/EMPLOEE OPTSFOR EARLRETIREMENT UNDERREP. ACT NO. 6741, 70
EARS PLUS AT LEAST5 EARS SERVICE
EFFECT:EFFECT: RETIREMENT BENEFIT IS TA
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SITUATION TWO:
/EMPLOEE WILL RETIRE
UNDER COMPANRETIREMENT PLAN
/COMPAN RETIREMENT
PLAN IS EUAL TO ORLESS THAN THATPROVIDED B REP. ACTNO. 6741
EFFECT:EFFECT: RETIREMENT BENEFIT IS TA
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SITUATION THREE:
/EMPLOEE WILL RETIREUNDER COMPANRETIREMENT PLAN
/COMPAN RETIREMENTPLAN BENEFIT IS MORETHAN THAT PROVIDED BREP. ACT NO. 6741
EFFECT:EFFECT: RETIREMENT BENEFIT WILL BE TA
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REUIREMENTS FOR TA
or ta ee%-tion.
The Retire%ent P)an R+)es an" Re3+)ations o the
!o%-an5 %a5 -ro*i"e that the nor%a) retire%ent "ate or
ear)5;o-tiona) retire%ent "ate &e %ore than what isre:+ire" &5 the Ta Co"e. Conse:+ent)5, in !ase o !on)i!t
&etween the Ta Co"e an" the Retire%ent P)an R+)es an"
Re3+)ations, it is the )atter that sho+)" -re*ai). 1BIR No.
#9(4(###, O!to&er @#, (###2
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CEAP RETIREMENT FUND LECTUREOF ATTY. ADA ABAD 092110 54
SEPARATION BENEFIT IS ADISTINCT E
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CEAP RETIREMENT FUND LECTUREOF ATTY. ADA ABAD 092110 55
I* /%+ (' %/($($%!(* $(#*'($ +%$&8 $+!$+)+*!$($%) !( !"+$
+)&(8++, (*+ "(#+!+$)*+ ' /" w%% $+!$+)+*! &%* ($ %
+%$%!(*$+!$+*/")+*! $($%).
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CEAP RETIREMENT FUND LECTUREOF ATTY. ADA ABAD 092110 56
IF %$! (' $+!$+)+*! &%*,!"+$+ % *++# !( ( !"$("!"+ $+;$+)+*! $(#+# *!"+ T%@ C(#+ ($ !"+ $+!$+)+*!&%* * ($#+$ !( 9+ !%@ +@+)!.
IF ! )&8 % +%$%!(* ($$+!$+*/")+*! $($%), !"( %!'8 $+;$+)+*!*#+$ S+/!(* 32 ?B ?7 ?9, --+%$%!(* '($ /%+ 9+8(*#/(*!$(& (' !"+ +)&(8++.
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CEAP RETIREMENT FUND LECTUREOF ATTY. ADA ABAD 092110 57
IF EMPLOYEE OF TEN YEARSSERVICE RESIGNS UN&ERCEAP RETIREMENT PLAN+ ISTHIS TA$-E$EMPT4
SINCE THIS IS NOTRETIREMENT+ AN& NEITHER IS
IT A SEPARATION &UE TO&EATH+ SIC
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CEAP RETIREMENT FUND LECTUREOF ATTY. ADA ABAD 092110 58
RA '()*+ Se;t7on )A$y ()-##-$-/ "! *- *he %-$*)!)y
$-*#*h*!$'#$ *he RETIREMENTBENEFITS )e%e#e' y -%#!" !$'e,("-yee -/ ()#!*e G), he*he)#$'##'&!" -) %-)(-)!*e #$ !%%-)'!$%e#*h ! )e!-$!"e ()#!*e e$eG*("!$ ,!#$*!#$e' y *he e,("-ye)
h!"" e e@e,(* /)-, !"" *!@e HHHft e"s of e t the
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CEAP RETIREMENT FUND LECTUREOF ATTY. ADA ABAD 092110 59
Provided, further,Th!* *he e$eG*
)!$*e' &$'e) *h# A%* h!"" e !!#"e' -/y !$ -%#!" -) e,("-yee -$"y -$%e?
Provided, nally,Th!* #$ %!e of
sep"t7on of n o@;7! o" emp!o#eef"om the se"67;e of the emp!o#e" 8:e
to 8eth+ s7;ness o" othe"
ph#s7;! 87s97!7t# o" fo" n#;:se 9e#on8 the ;ont"o! of thes78 o@;7! o" emp!o#ee !$y!,-&$* )e%e#e' y h#, -) y h# he#) /)-, *he
e,("-ye) ! ! %-$e&e$%e -/ &%h e(!)!*#-$
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CEAP RETIREMENT FUND LECTUREOF ATTY. ADA ABAD 092110 60
WHAT IS THERECONINPERIOD FORPURPOSES OFCOMPUTATIONOF BENEFITS
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CEAP RETIREMENT FUND LECTUREOF ATTY. ADA ABAD 092110 61
I* $+/(** !"+ &+*!" (' +$/+, !"++$(# (' +)&(8)+*! w!" !"+ %)++)&(8+$ 9+'($+ !"+ +''+/!!8 #%!+ ('
!"+ &%w (* %*%$8 6, 13 "( 9+*/+#. ?#+&*+ '($ !"+ E''+/!+I)&+)+*!%!(* (' R.A. 6741, T"+ R+!$+)+*! P%8L%w, 24 O/!(9+$ 17
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CEAP RETIREMENT FUND LECTUREOF ATTY. ADA ABAD 092110 62
T"+ )*)) &+*!" (' +$/+ * %*
+!%9&")+*! ($ w!" %* +)&(8+$ ('%! &+%! '+ ?5 8+%$ $+;$+# '($ !"++*!!&+)+*! !( $+!$+)+*! %8 "%&&
*/+ %!"($Q+# %9+*/+ %*#*/+ %!"($Q+# %9+*/+ %*#%/%!(*, $+&%$ "(%8 %*#%/%!(*, $+&%$ "(%8 %*#)%*#%!($8 '&'&&)+*! (' % )&!%$8 ($)%*#%!($8 '&'&&)+*! (' % )&!%$8 ($
// #!8// #!8 e%*#-$ 4 R&"eI,("e,e$*#$ *he Ne Re*#)e,e$* L!;
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CEAP RETIREMENT FUND LECTUREOF ATTY. ADA ABAD 092110 63
ARE ALLOWANCES,ARE ALLOWANCES,
COMMISSIONS ANDCOMMISSIONS ANDOTHER BENEFITSOTHER BENEFITSINCLUDED IN THEINCLUDED IN THE
COMPUTATION OFCOMPUTATION OFTHE RETIREMENTTHE RETIREMENTBENEFITSBENEFITS
ENERAL RULE: THESEARE E
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CEAP RETIREMENT FUND LECTUREOF ATTY. ADA ABAD 092110 64
IF THE COMPAN PLAN
PROVIDES FOR ITS E
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THAN< YOUVERY MUCHFOR THE
OPPORTUNITYTO BE OFSERVICE TO
YOU
HAVE A GOO&EVENING