The Slovak Republic pays social security benefits to workers who meet the applicable eligibility standards, including minimum length‑of-coverage and other requirements. Under Article 7, the Slovak Republic will add the person's U.S. coverage to his or her Slovak Republic coverage, if necessary, to meet eligibility rules. If the person meets the requirements based on combined U.S. and Slovak Republic credits, the Slovak Republic will pay a partial benefit proportional to the amount of coverage credited under the Slovak Republic system.
SLOVAK REPUBLIC SOCIAL SECURITY BENEFITS
GENERAL
The Slovak Republic social security system is a three-pillar structure. It consists of a mandatory defined benefit pension financed on a pay-as-you-go basis, a fully funded second pillar invested in individual pension funds (mandatory for new entrants into the labor market, although an opt out to contribute to the first pillar system only is possible), and a voluntary third pillar, which is a tax-deductible savings scheme for employers and their employees. This Article applies to the first pillar system, which is a contributory program that covers almost all residents of the Slovak Republic. The Slovak Republic pays benefits under the first pillar in amounts that it bases primarily on the number of years of contributions, the amount of lifetime earnings and an actuarial coefficient designed to guarantee a constant replacement rate. The second and third pillars exist to supplement the basic benefit. Benefits and contributions under these schemes vary according to the funds in which an employee invests, and the government provides general oversight.
OLD-AGE BENEFITS
Retirement age in the Slovak Republic is in the process of transition. Prior to 2004, the retirement age for men was age 60 and, for women, as low as age 53. Starting in 2004, these ages began to increase. With each year, the retirement age increases by 9 months until it reaches the age of 62. For men, the retirement age is now 62. For women, the retirement age will be 62 by 2024. The Slovak Republic system requires a minimum of 15 years of coverage for entitlement to an old-age pension. A worker may retire early if he or she is no more than 2 years from retirement age, has at least 15 years of contributions, ceases all work activity and earns at least 1.2 times the legally defined subsistence wage. The Slovak Republic bases its benefit formula on a “points” system. It divides a person’s individual earnings by the average earnings for all workers during the same period. The Slovak Republic agency then multiplies this quotient by the total periods of coverage under the Slovak Republic system and an actuarial coefficient designed to ensure a constant replacement rate.
DISABILITY BENEFITS
The Slovak Republic system pays benefits to two classes of disability beneficiaries. Full disability benefits are available to those who have at least a 70 percent reduction in capacity to work. Partial disability benefits exist for workers suffering from a 41 – 69 percent reduction in work capacity. The Slovak Republic bases eligibility for these benefits on total periods of coverage under the Slovak Republic system. Progressively higher periods of coverage apply for individuals whose disability began at a later age; thus, a person whose disability began prior to age 20 needs less than 1 year of coverage, while a person aged 45 or older needs at least 15 years of coverage. The Slovak Republic system calculates the benefit amount for the full disability benefit in exactly the same manner as the old-age pension. For the partial disability benefit, the Slovak Republic agency pro-rates this same amount according to the degree of disability by the percentage of loss in work capacity.
SURVIVORS BENEFITS
Survivors’ benefits are payable to unmarried widow(er)s of the worker, surviving divorced spouses receiving alimony payments from the worker at the time of his or her death and to children under age 26. For survivors’ benefits to be payable, the worker must be receiving a benefit at the time of his or her death, or must meet all the factors of entitlement (except for age attainment) at the time of his or her death, or his or her death must be the result of a work related injury or disease. Widow(er)s receive 60 percent of the worker’s benefit amount at the time of the worker’s death (the benefit amount for surviving divorced spouses cannot exceed the amount of alimony payments at the time of the worker’s death), and children of the deceased qualify for 40 percent of the deceased worker’s pension. The maximum amount payable based on a worker’s record is 100 percent of his or her pension amount at the time of death. If the total benefits for all survivors exceed this, the benefits for all survivors decrease proportionately to meet the maximum.
COST-OF-LIVING ADJUSTMENTS
Benefits rise according to the Swiss Indexation method. This method uses a composite of changes in the consumer price index and changes in national wages to determine cost of living adjustments. While no statute requires periodic cost of living adjustments (COLAs), the minimum monthly salary increases annually.