Pension Recalculation for Former Internal Affairs Officers
A former employee of the internal affairs bodies who was receiving a pension for years of service learned that changes in legislation entitled him to a recalculation of his pension. In September 2017, he therefore applied to the Pension Fund of Ukraine requesting a recalculation that would include the relevant allowances and bonuses in his monetary allowance. He also requested payment of the pension amounts that he had not received, arguing that his right to recalculation had arisen in January 2016.
However, the Pension Fund refused to recalculate the pension, claiming that the applicable legislation did not provide the pensioner with such a right.
The pensioner challenged the Pension Fund’s refusal before the court.
The courts established that the claimant had been receiving a pension since 2014 under the special legislation governing pension provision for former employees of the internal affairs bodies.
Legislative changes that took effect in January 2016 affected the rules applicable to the recalculation of pensions for this category of pensioners. In particular, the relevant monetary allowance used for pension recalculation could include components of remuneration established for police officers, including certain additional allowances and bonuses.
In 2017, the Ministry of Internal Affairs provided the Pension Fund with a certificate concerning the claimant’s monetary allowance. The information contained in that certificate confirmed the grounds for recalculating his pension from the date on which the relevant right had arisen.
The Constitution of Ukraine guarantees citizens the right to social protection, including pension provision in the cases prescribed by law. In disputes concerning pensions granted under special legislation, the amount of monetary allowance and the components included in that allowance may directly affect the amount of the pension payable.
The legislation governing pensions for former internal affairs officers provides mechanisms for pension recalculation where the relevant monetary allowance changes or where new monthly additional components of monetary allowance, including allowances, supplements, increases and bonuses, are introduced in accordance with the applicable rules.
An important issue in such disputes is the date from which the recalculated pension must be paid. Where the statutory grounds for recalculation arose earlier than the date on which the Pension Fund actually carried out the recalculation, it is necessary to determine when the pensioner acquired the relevant right and whether the delay resulted from the actions or inaction of the competent state authorities.
If, following recalculation, the newly calculated pension amount would be lower than the pension previously received, the pensioner generally retains the previously established amount in accordance with the guarantees provided by the applicable legislation.
The procedure for recalculating pensions of former internal affairs officers also involves cooperation between the competent authorities. The Ministry of Internal Affairs and its authorised bodies prepare certificates of monetary allowance containing the information necessary for pension recalculation and provide them to the Pension Fund in accordance with the applicable procedure.
Such a certificate is an important document because the Pension Fund generally calculates the pension on the basis of the information concerning monetary allowance officially provided by the authorised body.
In the case concerned, the necessary conditions for recalculation had been satisfied, and the competent authority had provided the relevant monetary allowance certificate. Consequently, there were no sufficient legal grounds for the Pension Fund to refuse to recalculate the pension.
The case demonstrates that former internal affairs officers may be entitled to a pension recalculation where the components of monetary allowance relevant to their pension have changed. Allowances, bonuses and other statutory components of monetary allowance may affect the pension calculation where the applicable legislation requires them to be taken into account.
Therefore, where the Pension Fund refuses to recalculate such a pension despite the existence of a proper monetary allowance certificate and the relevant statutory grounds, the refusal may be challenged before an administrative court. It may also be necessary to determine whether the pensioner is entitled to payment of pension arrears from the date on which the right to recalculation arose.
