REPORTERS:

Afidchao, Paul Sheacon

Arcilla, Jinky JaneAndamo, Phoebe MaxineLabilles, JettREPUBLIC ACT NO. 7742 AMENDING PRESIDENTIAL DECREE NO. 1752, EXECUTIVE ORDER NOS. 35 AND 90 OBJECTIVES1. To promote home ownership through the establishment of an affordable and adequate housing credit system for its members; 2. To invest the provident savings of its members taking into consideration profitability and safety of the funds as a means of providing them provident benefits upon termination of their membership in the Fund; 3. To provide small and short-term loans and other benefits to its members; and 4. To promote self-reliance and self-determination among workers through membership in an integrated nationwide savings system.WHAT IS HOME DEVELOPMENT MUTUAL FUND?It is a provident savings system for employees in the private and public sectors supported by matching contributions of their respective employers, with housing as primary investment. The system is also available to self-employed and other working groups. The Fund is private in character, owned wholly by the members, administered in trust and applied exclusively for their benefit. All personal and employer contribution shall be fully credited to each member, accounted for individually and transferable in case of employment. Provided however, that coverage of the employees whose monthly compensation is LESS THAN (P4,000.00) shall be VOLUNTARY; Provided further, that upon membership with the Fund, their employer shall contribute an amount in accordance with Section 1 of Rule VI hereof.

What if a member transfers to another employer or becomes self-employed?He carries with him his Total Accumulated Value. HDMF members who subsequently become self-employed or self-paying shall remit their contributions directly to the Fund. However, should they be member-borrowers, they shall also pay the employers counterpart. MEMBERSHIP TERM

20 years commencing from the first day of the month to which the members initial contribution to the Fund applies

MEMBERSHIP TERMINATION Membership Term Maturity; Death; Retirement; Permanent Total Disability or Insanity Departure from the Country permanently; Termination from the service by reason of health. RETIREMENT Compulsory Retirement 65 y/oEarly Retirement upon the occurrence of any of the following: 1. His actual retirement from the SSS, GSIS or separate employer provident/retirement plan, provided, however, that under the latter case, the member has at least reached age forty-five (45); 2. Notwithstanding his continued employment or service upon reaching age sixty (60); provided, he is not a member-borrower. REGISTRATION It shall be the DUTY of every EMPLOYER to register all his covered employees by submitting to the Fund all data and information the Fund may require in relation to their respective businesses and employees Voluntary Members shall be registered by his employer within thirty (30) days from the date he signifies in writing his intention to join the Fund. RATE OF CONTRIBUTIONSa. Employees earning NOT more than P1,500.00/ month 1%

b. Employees earning MORE THAN

P1,500.00 /month 2%

c. Employers 2%of the Monthly Compensation of the contributing member.

A member may be allowed to contribute MORE THAN what is required herein should he so desire. Employer is only mandated to contribute what is in subsection (c) . The contributions to the Home Development Mutual Fund shall be remitted through SSS and GSIS. NON-PAYMENT- subject the employer to penalty of 3%/month of the amount.COLLECTION Contributions of members shall be collected through payroll deductions by their respective employers, who for this purpose shall act as agent both of the Fund and the member. Employers Fiduciary Obligation The employer assumes a fiduciary relationship with both the Fund and the members concerned as regards the latters contribution and the required employer contribution, as well as the remittance thereof.SUSPENSION OF CONTRIBUTION

Resignation Laid-off Suspended from employmentWAIVER AND SUSPENSIONAn employer and/or employee group who has an existing housing plan as of the effectivity of Republic Act No. 7742 may apply with the Fund for waiver or suspension of coverage. It must NOT CONTRAVENE any effective collective bargaining or other existing agreement and that the features of the plan or plans are superior to the Fund and continue to be so. Distressed Employer An employer who suffered at least twenty-five (25%) percent capital impairment for the past taxable year immediately preceding the filing of his application for waiver or suspension of coverageRETURN OF CONTRIBUTIONSA member shall be entitled to receive his Total Accumulated Value upon termination of his membership. PROVIDED, he is free from any pending obligation with the Fund or any of its loan programs.In the event of his DEATH, his legal heir shall likewise receive the same free from any pending obligation with the Fund or any of its loan programs.OPTIONAL WITHDRAWAL after the 10th or 15th year of CONTINUOUS membership NO outstanding housing loan with the Fund at the time of withdrawal. exercised only ONCE NOT PREJUDICE his continuing membership in the Fund. RETURN OF CONTRIBUTIONSOTHER BENEFITS:

Dividend Benefits Death BenefitsADJUDICATION AND CLAIMS original and exclusive jurisdiction over all claims and disputes on any matter relative to the implementation of the provisions of Presidential Decree No. 1752 affecting the rights and interest of the membersDecision of the President of the Fund shall be final and unappealable after lapse of 30 days from receipt of notice by the aggrieved party of such decision and without him taking the appropriate remedies available to him to the Board of Trustees. Decision of the Board of Trustees shall, unless appealed to a competent court, become final and unappealable after 15 days from notice of such decision. INVESTMENT OF MONEY

No less than seventy (70%) percent of the Funds investible funds shall be invested in housing in support of the National Shelter Program as provided for under Executive Order No. 90.

SUBSTITUTE RETIREMENT PLAN A private employer shall have the option to treat the coverage of the Fund as a substitute retirement benefit for the employee concerned within the purview of the Revised Labor Code; Provided, such option does not in any way contravene any effective collective bargaining or other existing agreement.

CASESRomulo, Rabanta, Buenaventura, Sayoc and Delos Angeles v. HDMF use of phrase and/or An employer and/or employee group who has an existing provident or retirement plan as of the effectivity of Republic Act No. 7742 xxxChina Banking Corp. v. HDMF Waiver and Suspension of Fund Coverage