Employment period confirmation for insurance pensions accrual simplified


Be Valeriya Sorokina

Commented by Elena Rybnikova, Head of Internal Audit, Expertise and Methodology Department, Intercomp

The Government of the Russian Federation has simplified the procedure for employment period confirmation for the purposes of insurance pensions accrual. The respective resolution has been published on the website of the Cabinet of Ministers.

Elena Rybnikova
Head of Internal Audit, Expertise and Methodology Department
The essence of the changes is that if a citizen claiming insurance pension has spent some time taking care of a disabled person with first disability group, a disabled child, or a person who has reached the age of 80, as well as taking care of able-bodied persons who have been awarded monthly compensation and/or monthly payment, it will be easier for such person to confirm such caretaking period for the calculation of his own pension. His individual (personal) record-keeping data will be sufficient.

“The compensation and monthly payments for care are broader than just monetary payments. If a citizen is taking care of a disabled person with first disability group, a person disabled since their childhood who has been assigned first disability group, an elderly citizen who has reached the age of 80, these periods of care are added to his employment period. His pension for these periods shall include pension credits - 1.8 points for every full year of such care. These measures are introduced for those who take care of sick persons and as such cannot work and, therefore, have insurance pension accumulated,” the press service of Russia’s Pension Fund (RPF) told Interfax-Russia.ru.

They clarified that, in order for those earlier periods to be added to the citizen’s employment period when defining his pension, it was necessary to submit additional supporting documents.

“Now, after the adoption of the Resolution of the Government, these periods will be added to the employment period (based on the results as of the end of the reporting year and for all previous periods) and pension points will be credited based on personal record-keeping data available to the Pension Fund,” the press service clarified.

As has been reported, this data - employment period and points - will be reflected in the individual accounts of citizens and taken into account for the purpose of determining a pension without additional confirmation.

“Thus, citizens will not have to collect and submit additional documents,” RPF officials emphasized.

Payment for taking care of disabled citizens is made as compensation for lost earnings to unemployed citizens who care for the disabled: disabled persons with first disability group, people who need other persons’ care, people over the age of 80. The amount of this payment is equal to 1200 roubles. 1.8 million people receive this payment.

Payment for taking care of children with disabilities is awarded as compensation for lost earnings to unemployed able-bodied citizens caring for disabled children and persons who have been disabled since their childhood. Its amount is 5500 roubles, and 514 thousand people receive this payment.

These changes simplify and supplement the procedure for confirmation of employment period for pension accrual, but still leave a number of issues unsolved, believes the head of service quality control and methodology of “Intercomp”, a company specializing in providing HR outsourcing services.

“When calculating insurance periods, now the periods of payment by persons of voluntary insurance contributions for themselves and for third persons are recorded. New edition of clause 2 of Resolution No. 1015 increases the number of insurance years of insurance contribution payer, but leaves a number of questions. Literally the amendment reads as follows: periods of payment of insurance contributions by individuals, who have voluntarily entered into a legal relationship for the purpose of paying insurance contributions for another individual,” she told Interfax-Russia.ru.

Taken literally, the expert noted, if citizen A pays insurance contributions for citizen B, Mr A is credited with an additional insurance period and what happens with citizen B’s insurance period remains undecided.

“Also, there remains the issue of tracking payments. For instance, according to article 45 of the Russian Tax Code, payment of tax (insurance contributions are included in the Russian Tax Code and are equated to tax payments) can be made by any person on behalf of an individual taxpayer. Therefore, payment for another individual “on one’s own initiative” and payment for another person “at their request” are of different in nature, causing difficulty in calculating insurance period. There are also restrictions: the duration of such periods cannot be more than half of the insurance period required for the assignment of insurance old-age pension,” she concluded.

The Resolution introduces a number of other changes, the insurance period will also include the periods when a citizen was unlawfully brought to criminal liability and later rehabilitated, or if such citizen was temporarily suspended from work, as well as periods when such citizen paid insurance contributions for himself or another person, for whom the policy holder failed to pay the contributions.

“These changes affected only the persons unlawfully brought to criminal liability and later rehabilitated, as well as persons who have voluntarily entered into legal relations for compulsory pension insurance with a view of payment of insurance contributions for themselves or for other individuals. For them, these changes are important as accounting of the above periods affects the amount of insurance period required for a pension (8 years since 2017, 15 years since 2024).

Previously, these periods were not included in insurance period,” Elena Kulakova, expert on pension accrual issues of the company SKB Kontur, told Interfax-Russia.ru.

The new order of calculating pensions and forming citizens’ pension rights was introduced in 2015. The insurance periods also included “non-insurance” periods, such as childcare leave (for a child under 1.5 years), periods of participation in paid public works, able-bodied citizens’ taking care of a person with first group disability, disabled child or a person over the age of 80, obtaining unemployment benefits and others. And the length of the insurance period required for entitlement to a retirement pension was increased from 5 to 15 years.

Starting from 2015, the pension amount is influenced both by the insurance period and the insurance contributions amount, and every employment/labour year is measured in individual pension coefficients, or points. It is the sum of the points that will make the pension capital which at retirement will be converted into the cash equivalent.

If you still have any questions as to the procedure of confirmation of your employment period for pension, please ask us in the Expert's Consulting Room section.