Supreme Court: Employers Must Remit SSS Contributions for the Illegal-Dismissal Period
An employer must remit SSS contributions for the whole period an employee was illegally dismissed, the Supreme Court has ruled. Paying backwages alone is not enough. In Lopez Sugar Corporation v. Perrin, Jr., et al. (G.R. No. 260447, February 5, 2026), the Third Division held that the employer’s duty to remit “did not cease with respect to the period during which [the workers] were illegally dismissed.” The decision was publicized in August 2026.
Key facts at a glance
| Item | Detail |
|---|---|
| Case | Lopez Sugar Corporation v. Perrin, Jr., et al., G.R. No. 260447 |
| Decided | February 5, 2026, Third Division; ponente Justice Singh |
| Result | Employer’s petition denied; Court of Appeals decision of October 14, 2020 affirmed |
| Core rule | Illegally dismissed employees are deemed never to have left their jobs, so SSS contributions keep accruing |
| Forum | The Social Security Commission (SSC) had jurisdiction over the contribution claim |
What happened
The workers were dismissed on September 25, 1995. The labor tribunals found the dismissal illegal and awarded backwages. The company paid the backwages but refused to remit the workers’ SSS contributions for the period they were out of work. The workers went to the Social Security Commission, which ordered remittance in a resolution dated October 5, 2016. The Court of Appeals affirmed, and the company brought the case to the Supreme Court.
What the Court decided
- Contributions continue during illegal dismissal. The Court said illegally dismissed employees “are deemed to have not left their employment” and are entitled to all rights and privileges that accrue from it, including SSS contributions.
- The SSC is the right forum. Disputes on coverage, benefits, contributions and penalties fall under the Social Security Commission, not the Labor Arbiter.
- No res judicata. The illegal-dismissal case and the SSS contribution case do not involve the same subject matter and cause of action.
- No waiver by accepting backwages. The Court held the workers “could not have intended to waive their right” to have contributions remitted when they accepted satisfaction of the backwages judgment.
- Penalties. Because the delinquency ran under the Social Security Act of 1997 (RA 8282), the 3% monthly penalty in that law applied. The current law, RA 11199, sets the penalty for late remittance at 2% a month from the date the contribution falls due until paid (Section 22(a)).
What to do now
If you won (or are pursuing) an illegal dismissal case
- Check your SSS contribution record in My.SSS for the months covered by your backwages.
- If those months are missing, write to your employer asking it to remit them, and keep a copy.
- If it refuses, file a petition with the Social Security Commission, or report the delinquency to your SSS branch. Bring the NLRC or court decision, proof that backwages were paid, and your contribution printout. See what to do about unremitted SSS contributions.
- Do not wait too long. Under Section 22(b) of the Social Security Act as amended by RA 11199, an action against the employer may be brought within 20 years from the time the delinquency is known or assessed by SSS, or from when the benefit accrues. Acting early makes records easier to find.
If you are an employer
- When you pay a backwages award, also compute and remit the employer and employee SSS contributions for the same period.
- Remitting late adds penalties under RA 11199, so settle the contributions together with the backwages.
- Keep proof of remittance with the settlement papers. Under this ruling, the worker’s acceptance of the backwages payment does not, by itself, waive the contribution claim.
Legal basis
Employers must deduct, withhold and remit contributions under Sections 18, 19 and 22 of the Social Security Act, now RA 11199 (Social Security Act of 2018). Reinstatement and full backwages for illegal dismissal come from Article 294 of the Labor Code; see Book Six of the Labor Code.
Sources
- Lopez Sugar Corporation v. Perrin, Jr., et al., G.R. No. 260447, February 5, 2026: facts, holdings, dispositive portion, penalty rate applied
- Republic Act No. 11199: current employer remittance duties and penalty
- Philstar: illegally dismissed workers entitled to backdated SSS contributions: publication of the ruling in August 2026
Sources rechecked as of: September 30, 2026. This update is general legal information, not legal advice on your specific facts.
