G.R. No. L-19254; March 31, 1964
BENGUET CONSOLIDATED, INC., petitioner, vs. SOCIAL SECURITY SYSTEM, respondent.

FACTS

Petitioner Benguet Consolidated, Inc. paid its employee, Lamberto Foroson, disability benefits under the Workmen’s Compensation Act for an injury sustained during employment. Subsequently, the Social Security System (SSS) demanded that the petitioner also pay social security sickness benefits for the same period of disability. The petitioner objected, invoking Section 5 of the Workmen’s Compensation Act, which states that compensation under said Act “shall exclude all other rights and remedies accruing to the employee… under the Civil Code and other laws, because of said injury.” Benguet argued that complying with the SSS demand would force it to pay benefits twice for the same injury.
The Social Security Commission dismissed Benguet’s petition and ordered it to pay the sickness benefits. The Commission reasoned that the Social Security Act, being a later law, was not contemplated by the exclusivity provision of the Workmen’s Compensation Act and that benefits under both laws complement rather than negate each other. Benguet appealed this decision to the Supreme Court.

ISSUE

Whether an employee who has received disability benefits under the Workmen’s Compensation Act is also entitled to receive sickness benefits under the Social Security Act for the same period of incapacity.

RULING

The Supreme Court affirmed the Social Security Commission’s resolution, ruling that the employee could recover benefits under both laws simultaneously. The Court clarified that Section 5 of the Workmen’s Compensation Act only prohibits double recovery from the same employer for the same injury under different laws. The provision was designed to prevent an employee from seeking additional compensation from the employer under other statutes like the Civil Code.
The legal logic distinguishes the nature and source of the benefits. Workmen’s compensation is a unilateral employer liability for work-connected injuries. Social security benefits, however, are paid from a fund created by contributions from both employers and employees, functioning as social insurance against various hazards including sickness, regardless of whether the cause is employment-related. When an employer advances sickness benefits as required by the Social Security Act, it acts merely as a conduit for the System; it is subsequently reimbursed 80% by the SSS. The 20% retained by the employer is not compensation for the injury but an administrative cost to deter fraudulent claims. Therefore, allowing social security benefits does not constitute a double recovery against the employer under the Workmen’s Compensation Act’s exclusivity clause. The systems are separate, with the later-enacted Social Security Act providing distinct, accumulable coverage.