Former workers whose pension and disability insurance (PIO) contributions have not been paid because their employer has since closed down will receive a credit for their years of service from the Labor Fund so that they can retire.
Directors and management of defunct companies will not have this right.
The Labor Fund currently does not have data on the number of these companies and former employees, but they state that the 198.000 euros they have set aside for the payment of contributions for 2025 will be sufficient for now.
These are the novelties of the amendments to the Law on the Labor Fund, which the Ministry of Labor, Employment and Social Dialogue has put up for public debate until the end of March.
The goal, as stated, is to enable former workers to exercise their right to a pension and correct the injustice towards those who lost it - through no fault of their own.
"The amendments introduce several key institutes: The right to payment of unpaid contributions - employees who lack contributions to exercise the right to a pension, and whose employer has ceased to exist, may exercise the right to payment of these contributions through the Labor Fund; Contribution payment base - it is determined that the contribution payment base is the minimum wage in Montenegro on the date of submission of the application; Restrictions on rights - The director and members of the employer's management body cannot exercise this right, regardless of the period in which they performed these jobs; Procedure for exercising rights - deadlines and evidence required for exercising rights are determined, including the Fund's obligation to obtain certain data ex officio," the explanation of these amendments states.
50.000 per year for internship
It is stated that in the last three years, when outstanding contributions were paid only to former workers in bankrupt companies, the Labor Fund received about 100 requests, for which about 160.000 euros were paid. It was explained that they received 30 to 40 such requests annually and spent about 50.000 euros.
The explanation also points out that a large number of former workers will not suddenly acquire the right to pay PIO contributions, but rather the process will take place continuously, and former employees will acquire the necessary conditions for payment. It is added that 5,3 million euros were paid to the Fund in contributions last year.
This institution receives a special contribution from unemployment insurance, which is calculated on gross earnings at a rate of 0,2 percent, at the expense of the employer.
"Given that the amendments to the Law expand the jurisdiction of the Fund, i.e. the scope of persons who could potentially submit a request, to those whose employer has ceased to exist, and that at this moment there is no precise data on how many such companies no longer exist (and the cause of the cessation of existence is not bankruptcy), by an analogous comparison of these two grounds for the cessation of the existence of an employer, it can be predicted that this number will be approximately equal to the number of requests submitted by former bankrupts. The Fund's budget for 2025 has allocated 198.000 euros for the payment of missing contributions for linking work experience. Taking into account the dynamics of submitting requests for the payment of missing PIO contributions in previous years, the funds spent for these purposes and the funds allocated in the current year, the Fund fully covers all the aforementioned expenses from its own revenues and there is no need for any additional funds for the orderly and timely settlement of obligations under this jurisdiction," the explanation reads. In addition, companies with one employee that have filed for bankruptcy will not be entitled to contributions. It is noted that last year, a proposal to open bankruptcy proceedings was submitted to the Commercial Court for 525 companies, of which almost 370 had one employee. An exception has also been prescribed for former employees whose employer went bankrupt before the amendments came into force, which, it is said, ensures fairness in the application of the law.
The possibility has also been included that, in addition to the law, certain issues may also be regulated by the statute of the Fund, in order to provide flexibility in regulating internal organization and operations.
The law is up for public debate until March 26th.
Extensive documentation required
The amendments to the law also prescribe the evidence that employees must submit to the Labor Fund, as well as the Fund's obligation to obtain certain data ex officio.
Along with the request for exercising the right to payment of unpaid claims, the employee shall submit: an employment contract, or other document establishing the employee's employment relationship or data on the insured entered into the register of the Pension and Disability Insurance Fund; evidence that the employee's employment relationship has ended; evidence establishing the claim referred to in Article 2, paragraph 3, indent 2 of this Law, issued by the competent court, and evidence that the claims have not been paid in full or in part, issued by the competent court.
"Along with the request for exercising the right to payment of unpaid contributions for pension and disability insurance, persons who lack contributions to qualify for retirement, and whose employer has ceased to exist, shall submit proof of the employee's termination of employment or data on the insured entered into the register of the Pension and Disability Insurance Fund, a certificate of undisputed insurance years that are missing for exercising the right to a pension, issued by the authority that decides on the procedure for exercising the right to pension and disability insurance, as well as proof that the employer no longer exists," the draft amendments to this law state.
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