Hundreds of citizens left without salary and pension
Discrepancy between the Law on Gross Salary, Law on Civil Procedure, Law on Enforcement and the Law on Mandatory Insurance could leave hundreds of citizens in Macedonia without pensions because instead of paying salaries and contributions separately, as until 2009, now they must make integrated payment of all costs per employee. Inbox 7 investigated this legal impasse in which all involved claim to work according to the laws
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Stuck between different laws and institutional mazes, Danko L. is one of the hundreds of citizens in Macedonia, who, although having met the conditions, cannot retire. The problems of this sixty-four-year man from Kumanovo began in the company where he worked, and which a few years back had not paid the mandatory contributions. When he decided to exercise his right to a pension, he faced a problem that will neither be easily solved, nor in a short time. The knot is tied due to a discrepancy between laws and legal ambiguities.
The discrepancy between the four laws: Law on Gross Salary, Law on Civil Procedure, Law on Enforcement and Law on Mandatory Insurance could leave hundreds of citizens in Macedonia without pensions because instead of paying salaries and contributions separately, as until 2009, now they must make integrated payment of all costs per employee.
Justice stuck in conflict of laws
A glimmer of hope arose when the Basic Court in Kumanovo ruled in his favor, and the enforcement agent collected money from the company where Danko had worked. But instead of money to be paid into the Pension and Disability Insurance Fund (PDIF), it is still stuck in the bank account of the enforcement agent from Kumanovo.
“I have informed the Ministry of Finance and the Public Revenue Office (PRO). But the PRO asked me to submit a tabulation of contributions for pension and disability insurance, health insurance, additional health insurance, employment and personal income salary for the period from January to November 2009. The judgment must include these data to fit the concept of integrated payment pursuant to the Law on Gross Salary which has been applied exactly since 2009. From the regional Office in Skopje they urged to change the judgment which is final and enforceable, but it is impossible”, Danko complains.
PDIF, PRO, the courts and the Chamber of enforcement agents (KIRM) do agree that there is a problem, but each of these institutions explains that it operates under its laws that must not deviate from.
“The system of integrated payment of PRO for calculation and collection of contributions was so created that all data for all contributions must be individually entered including salary, health insurance contributions and additional health insurance, as well as taxes that employers pay for employees. But the courts, often by fault of the parties, deliver partial verdict which adjudicate only collection for pension and disability insurance, but not for other duties. There is a conflict between the Law on Gross Salary and the Law on Civil Procedure, says Gordan Stankovic, member of the Managing Board of KIRM.
Because of this, he explains, in the enforcement agents’ accounts for years there have been collected money for contributions that they cannot pay to PRO, thus violating the Law on Enforcement. Under this law, in the enforcement agents’ accounts collected money must not stay more than 15 days.
PRO explained that based on a request submitted by an enforcement agent, and based on a verdict, they prepare calculations and an order for payment by the gross salary system. Under this system, all contributions for mandatory social insurance, personal income tax from salary and payment of net salary are paid at once so it is impossible contributions to be paid separately.
From the Basic Court Kumanovo, however, they say that even if they want to judge otherwise, they cannot, because it would be contrary to the Law on Civil Procedure.
“According to the law, the court must not go beyond the requirements requested by the parties in the lawsuit. As for the lawsuits from the employment or payment of contributions, according to the priority position of the Supreme Court, the employee may submit claims only for contributions to pension and disability insurance, but not for other contributions. So, if an employee requires payment of other contributions, the court in that part turns down the request because the Health Insurance Fund (HIF) has the right to file a lawsuit for unpaid health insurance and the Public Revenue Office (PRO) for unpaid personal income tax”, they say from the Kumanovo Court.
Who is allowed and who must not sue employers?
From PDIF they explain that they have no legal authority to sue non-payers, so if the payment of contributions is not voluntary then they can just block the employer’s bank account.
“Neither with the former Law on PDI, neither the existing, nor the Law on Contributions for Mandatory Social Insurance, PDIF has never had a legal ability to file lawsuits against employers who do not pay contributions for pension and disability insurance. The only possibility is the Fund to block the taxpayer’s bank account if the contributions are not timely paid and only for contributions by the end of 2008″, says Zanija Asanoski, chief of the department for control of data on contributions in PDIF.
And the PRO says that according to their rules of work, it only determines contributions and taxes and collects them voluntarily or involuntarily.
Only the Health Insurance Fund (HIF) has court battles with employers who do not pay contributions for workers.
“HIF before the competent courts runs several types of procedures such as procedures for claims for unpaid contributions from debtors for which a bankruptcy or liquidation proceedings are opened. Then, we have lawsuits for unpaid contributions and procedures for compensation for the costs of health care and salary compensation in the event of absence from work in many circumstances. In 2013 there were 646 procedures. The total claims of the fund amounted to 140.4 million denars and about 4.6 million denars have been collected”, they say from HIF.
Of 646 procedures, most (200) were against employers of whom the Fund required more than 5.5 million denars, and was able to collect less than half (2.5 million denars). Against companies involved in a bankruptcy or liquidation procedure, which did not pay contributions to the workers, there was a total of 247 procedures requesting over 133 million denars, and collecting about 520 thousand denars.
There is a solution, only goodwill is necessary
All competent institutions recognize that the problem is in discrepancy between laws and that just because of that they all along held meetings where they concluded that the problems with collection of contributions must be solved.
“There are several cases in which executives, lawyers and insurers have come to me to talk and seek help to resolve this problem. Among other things, I told them that the collection system has been taken over by PRO and in the system there is a possibility of making orders by a court judgment. The Fund is still using this opportunity for collection of contributions by the end of 2008. I could not answer why PRO does not do this. At the same time I told them that the non-enforcement of court judgments is bad for the Fund, because we as an institution cannot collect the contributions”, says Asanoski.
Enforcement agent Stankovic locates responsibility in government and parliament because, as he says, it takes a long time to eliminate the irregularities in laws. According to him, the best solution for legal inconsistencies in the exercise of the workers’ right to pension is workers to pay contributions themselves.
“Why not allowing workers themselves to pay the money for contributions? Later, the employee can sue the employer and ask for his money back. But until then contributions will be paid, and workers will have no problem to realize the right to a pension”, Stankovic proposes.
Editor: Stojanka Mitreska