Can Ukrainian labour migrants count on European pensions?

Among those who have left Ukraine in recent years, young people predominate. However, there are also many people of pre-retirement age who find it difficult to find a decent job in their home country due to discrimination in the labour market. And the recent reforms make the prospect of taking a well-deserved retirement more distant. But can our labour migrants count on pensions from other countries?

What is happening with pensions in Ukraine

In 2017, Ukraine adopted a reform, according to which the length of service required for retirement has sharply increased. If before it was 15 years, then after the adoption of the reform - 25. In addition, it is growing annually and will reach 35 years by 2028. For a country where about a third of the population works illegally, this means that a significant part of the population will lose the right to pension and will receive social assistance, the maximum amount of which is now 1769 hryvnias (about 50 euros). However, the pensions themselves are low for most of their recipients - 63% or about 7 million of the total number of pensioners in 11 million receive less than 3 thousand hryvnias (90 euros).

In such conditions, the support in the form of a second pension from the EU becomes significant. For example, from 100 to 400 euros can be received by Ukrainians who have been legally working in Italy for at least 5 years. The media wrote about entire queues for such pensions.

Another significant change in the pension system, which forced some citizens to look abroad, is the increase in the retirement age for workers in professions with difficult conditions. For example, women employed in underground labour could receive a pension at the age of 45. However, in 2015, the length of service requirements increased by 5 years.

According to a worker at a mine in central Ukraine, this was the main reason for her move to Poland.

According to the legislation under which I entered the mine, a woman was supposed to have a total of 15 years of experience and 7.5 of them underground. From the age of 19 to 35 I worked on the surface, and from 35 to 45 I had to work underground, so that it would be exactly 10 years, that's for sure. And then sick days, holidays would be discarded. And the favourable pension would have been higher due to the "underground". And then they changed the legislation. In Ukraine in my 42 years, if I go somewhere to study, then at the age of 50 no one would have employed me," she said.

At the same time, according to her, the salary for labour underground was 6 thousand hryvnias.

I realised that I had no prospects here and I decided that I would go to another country and start my life with a clean slate", - stresses the former miner.

What is the retirement age in the EU countries?

In the European Union countries the retirement age is generally higher than in Ukraine. However, as well as life expectancy. In most cases, you can receive payments after reaching this age. For example, in Spain it is 67, in Germany it gradually increases from 65 to 67, in the Czech Republic the retirement age is 65 for men. For women it varies depending on the presence of children, but not more than 63 years. In Poland and Italy, however, the retirement age has been lowered in recent years. If earlier in Poland it was 67 years, then after 2017 it became 65 for men and 60 for women In Italy it was 66 years for women and 67 for men, and now with a length of service of 38 years - 62 years.

However, Ukrainian labour migrants are unlikely to boast such a length of service, so payments from this country they will receive later and in a smaller amount. As indicated, with pension contributions for 5 years you can count on a pension from 100 to 400 euros. The average pension in Italy is 800 euros.

It is noteworthy that it is in this country that the age of most of our labour migrants is approaching the retirement age. However, there is still no agreement between Ukraine and Italy on mutual enrolment of pensionable service. In this regard, pensions are paid in Italian consulates and not through the pension fund. There is no such treaty with many other countries either. For example, with Greece or the USA. In this case, the insurance record can simply disappear. Among the EU countries, the treaty is concluded with:

• Lithuania;
• Latvia;
• Estonia;
• Slovakia;
• Czech Republic;
• Bulgaria;
• Portugal;
• Poland;
• Germany;
• Spain.

For our migrants there is a procedure of mutual offsetting of labour experience, as there is an agreement between our countries. And minimum documents are required. Here all labour experience (only years with paid tax are taken into account) is recorded in the computer system, so there is no need to collect any papers. According to the documents from Ukraine, an official request is made to the pension fund or you can personally bring certified documents, but the request is still sent, - says Irina, who lives in Spain and intends to apply for a pension in this country.

At the same time, according to Tatiana, who worked in Poland and is now employed in Germany, the German system for calculating pensions is very complicated.

I tried to figure it out in my time, but I only realised that a lot depends on the composition of the family, the number of children, the risk group, the state of health, the number of years worked. Civil servants have their own scale, while workers have a completely different one. For example, an acquaintance has worked 47 years in a factory, work in the risk group, became disabled. He is paid more than 1200 euros, partly pays for his flat and utilities. He enjoys transport privileges and buys groceries in a special shop for the poor for a symbolic sum. There are so many nuances and calculations that it is necessary to deal with it specially. Our compatriots, if they have a residence permit, receive them in the general order," she says.

According to Tatiana, the Polish system is simpler and has three types of pension contributions - minimum, average and maximum.

As for me, it is better to add the Ukrainian insurance and pension record to the Polish one and retire under the Polish legislation. When officially employed, the total length of service in Ukraine or other post-Soviet countries is taken into account, added to the Polish and get a pension, - she says.

However, here, according to Tatyana, problems may arise due to the unscrupulousness of employers or intermediaries.

For example, I lost 3 years due to ignorance and dishonest work of one of the firms. Even at a minimum, if you count it, you have already lost quite a substantial amount of money. A lot depends on the employer," says Tatiana.

According to her, many intermediary firms engaged in recruitment in Ukraine, draw up fictitious contracts.

Due to this they offer "good" salaries, but often cheat and fine without grounds. Many women receive fines and deportation because of non-payment of taxes and fictitious documents. But where the minimum is paid, the pension is still higher than in Ukraine," says Tetyana.

As noted, to start minimum payments, which rather correspond to our social benefits for those who have not completed the required length of service, you need to officially work in Italy for 5 years, and in Poland and the Czech Republic - a year. However, most of our migrants continue to work illegally. In Poland, less than 500 thousand Ukrainians were registered in the relevant funds in 2019, while the total number of labour migrants is about one million, in Germany as of 2018 there were 43 thousand working Ukrainians registered, in the Czech Republic - 70 thousand.

How labour migrants will not be left without a pension

The Pension Fund of Ukraine recognises that quite often workers face the problem of losing the right to a pension in Ukraine.

This happens in the following cases: either people worked in another state unofficially, or worked in a country with which Ukraine has not concluded an agreement on social guarantees, or worked legally in a state that has an agreement with Ukraine, but did not take care of the necessary documents, - says the fund.

As indicated, if a person plans to return after working abroad in Ukraine, the first thing he should remember is the insurance record. It is it will be necessary to confirm it in order to receive a pension under Ukrainian laws. Such agreements, as mentioned, are concluded with 10 EU countries, as well as with the states of the former Soviet Union. The agreements with the CIS countries are made on the territorial principle, and with the rest - on the proportional principle.

The territorial principle stipulates that the length of service, which a person has acquired while working in these countries, is added in Ukraine as well. The essence of the proportional principle, according to which Ukraine co-operates with other states, is that Ukraine separately calculates a person's pension for "Ukrainian" length of service in accordance with its legislation, and the other state calculates a pension for part of "its" length of service under its laws. To determine a person's right to a pension, the length of service of the other state will be taken into account. And if the pensioner resides in Ukraine, the other state will transfer to him its part of the funds in Ukraine, and vice versa - if the pensioner lives in another country, Ukraine will transfer to him the funds at his place of residence. As a result, you should have enough length of service for the appointment of a pension, - informs the Fund.

To confirm their length of service in these countries, you need to have the appropriate documents, and the bodies of the Pension Fund help future pensioners in obtaining them by sending requests.

Before travelling to work abroad, the Pension Fund recommends to find out your pensionable service record - it can be done online.

You should also ask whether there is an agreement with the country where you will have to work, and if so, whether it is territorial or proportional. In addition, it is necessary to find out the conditions for calculating the length of service and pension assignment in this country and find out how you can check and control your employer, - says the fund.

At the same time, as experts emphasise, the system of crediting pension contributions from other countries is not yet properly established. And often the control and responsibility falls on the shoulders of the workers themselves.

Ukrainian labour migrants have the right to receive a pension in a foreign country if they officially work there for the period specified by local legislation. As a rule, not less than 10 years of total length of service with regular payments to the pension fund. In addition, Ukraine has signed agreements with many countries on accounting of pension payments of our citizens who worked abroad. That is, when a Ukrainian has worked, for example, in Poland for one year, his pension payments should be transferred to Ukraine and credited to his pension account. But, unfortunately, this system still does not work properly, as these agreements are not implemented. This means that Ukrainian labour migrants now need to solve the issues related to what kind of pension they want to receive in the future and from the state, - says Vasyl Voskoboynyk, president of the All-Ukrainian Association of International Employment Companies.

The question of whether Ukrainians will receive pensions remains open even for those who have never left the country. With the distancing of the state, control over the integrity of employers is shifted to employees. In Ukraine, it is possible to check online whether the head pays contributions to the Pension Fund. Otherwise, he may face criminal liability. It may be problematic to do something similar abroad. However, the stricter legislation of the EU countries removes this necessity in case of official employment. The main thing, as Tatiana's experience indicates, is to make sure that the employment relationship is legal.

As soon as you are legally employed and deductions are made - that's it, you are already registered in the pension fund and you have the right to some "minimum wage", I have thought many times about returning to Ukraine. But to come back and sit? Even if they give you a pension. That's why I need to earn money here first. Perhaps, so that there would be Polish payments. I have this question. I'm starting to study the laws," says the former mine worker who moved to Poland.

Tatiana came to the same conclusion.

At the moment I have asked the management to calculate the maximum contributions. Yes, the salary will be lower, but the pension will be decent. Besides, you can additionally use the services of non-state structures. If you follow the rules, you can have a good pension. It will be decent in Ukraine in your old age, too," she emphasises.