Pension Recalculation for Working Pensioners in Ukraine
Every citizen has the right to a fair pension that provides an adequate standard of living. In Ukraine, the amount of an old-age pension depends on several factors, including the coefficient of the person’s insurance record, individual earnings, and the average salary in Ukraine used for pension calculation purposes.
After retirement, some pensioners continue to work. This may be because they are willing and able to remain employed or because their pension payments are insufficient to cover their needs. At the same time, continued employment may result in an increase in the pension through a subsequent pension recalculation for working pensioners.
Ukrainian legislation provides working pensioners with the right to a pension recalculation after acquiring an additional period of insurance record. As a general rule, recalculation may be carried out automatically or upon the pensioner’s application. Automatic recalculation is generally conducted from 1 April for persons who have acquired the required additional insurance record as of 1 March of the relevant year.
In particular, a pensioner who has accumulated at least 24 months of insurance record after the pension was granted or previously recalculated may qualify for recalculation. If the required period has not been accumulated by the date relevant for automatic recalculation, the pensioner may have to wait until the next automatic recalculation. However, once the necessary insurance record has been acquired, the pensioner may submit an application to the Pension Fund of Ukraine without waiting for the next automatic recalculation, subject to the requirements of applicable pension legislation.
Ukrainian legislation also provides different options for the recalculation of pensions for working pensioners. First, the pension may be recalculated on the basis of the additional insurance record acquired after retirement. This means that the additional period of employment is taken into account when determining the new pension amount.
Second, under certain conditions, the pension may also be recalculated taking into account the salary earned during the additional period of employment. Whether this option is beneficial depends on the pensioner’s individual salary indicators. Therefore, before requesting a recalculation based on both additional insurance record and earnings, it may be advisable to calculate whether this will actually result in a higher pension.
The rules governing pension recalculation may also depend on the total insurance record accumulated by the pensioner and the circumstances of the previous pension calculation. Therefore, when a working pensioner acquires additional insurance record or stops working, it is advisable to check whether there are grounds for an immediate pension recalculation after employment and whether submitting an individual application to the Pension Fund of Ukraine would be beneficial.
Thus, continued official employment after retirement may increase a person’s insurance record and consequently create grounds for a higher pension. Working pensioners should periodically check their insurance record and pension calculation to determine whether the Pension Fund of Ukraine has correctly carried out the recalculation and included all periods of employment.
