2011 EFBWW Pension report

Transcription

1 2011 EFBWW Pension report Collective Bargaining Group Wood Furniture and Forestry

2 Contents Introduction... 3 Aim... 3 Content... 3 Conclusions and recommendations for a EFBWW strategy on pension... 4 Recommendations... 7 Results from the questionnaire... 8 Belgium... 9 Bulgaria Denmark Finland Italy Lithuania The Netherlands Norway Portugal Romania Spain Annex: Questionnaire and guidelines Collective Bargaining Working Group 2

3 Pension report 2011 EFBWW Standing Committee Wood/Furniture/Forestry Introduction Through the the EFBWW Standing Committee Wood/Furniture/Forestry has prepared questionnaires and reports regarding collective bargaining in the member countries. In connection with the presentation of a similar report in the autumn of 2010 the Committee decided to prepare a report on the pension systems in the member countries for presentation at the meeting of October 2011 and later at the EFBWW congress in December 2011 in Palermo, Italy. The CAO working group consisting of Lex Raadgever, the Netherlands, Katrien Van der Helst, Belgium, Sidse Buch, Denmark, William Van der Straeten, EFBWW and Flemming Andersen, Denmark, therefore prepared a questionnaire accompanied by guidelines. The working group has received answers from 11 member countries: Belgium, Bulgaria, Denmark, Finland, Italy, Lithuania, the Netherlands, Norway, Portugal, Romania and Spain. The report is intended as an open document ready to update with relevant changes. The 20 member countries not having answered can therefore remain part of the digital version. Aim The purpose of the report is to give an overview of the different pension regulations existing in the member countries of both national character and based on collective agreements 1. This information is intended to inspire the member organisations in their work and form the basis for discussions about the pension situation for the members now and in the future in the EFBWW Standing Committee Wood/Furniture/Forestry in order to develop common frameworks and strategies in the areas of collective bargaining. Content The report is structured with a concluding section supplemented by recommendations for a EFBWW strategy on pensions. The next section consists of tables for comparison supplemented by the response from each country in alphabetical order. Questionnaire and guidelines are attached in the Annex. Reading the tables it must be born in mind that there are huge differences in the construction, financing and benefit composition of the national systems. 1 To supplement the data collected 2008 data for all member countries in the OECD countries (Organisation for Economic Co operation and Development) may be found here: Collective Bargaining Working Group 3

4 Conclusions and recommendations for a EFBWW strategy on pension As a result of the survey the following conclusions may be drawn. In connection to each conclusion is added one or more recommendations for a EFBWW strategy on pension. The six recommendations are also listed at the end of the review. 1. In most countries the pension age increases Either together with and following the increase of life expectancy, or as a stepwise increase of for instance 1 month per quarter, 1 year per every five or from 65 now to 67 in Because of the aging of the labor force, in some countries is expected a shortage of workers, which threatens the development of the economy. This increases the pressure to further increase pension age and working time. EFBWW recommendation We do not support any increases of pension age or annual working time as long as the unemployment rates are high and as long as figures prove that companies do not engage elderly people. EFBWW recommendation Employers have to adapt to an aging workforce and create good working environment and conditions. They may: Invest time and money in educating the next generation of the workforce. Combine the demands of clients with the possibility for the workforce to combine flexible working hours and a family/social life. Establish and sustain a reduced working time for + 55 year olds as a bridge between being active and going on retirement. Create an environment where experience is appreciated and people are stimulated to share their knowledge and experience with the next generation of the workforce. Find other ways to keep elderly workers healthy and happy at work such as job rotation, vocational training and other investments in their skills, no overtime, no nightshifts, avoiding premature disability, etc. 2. In most countries life expectancy increases faster than pension age Meaning that the working part of life decreases compared to the part of life with no work (education, retirement, illness etc.). Education Working life Retirement In the future less will be working to support the not working part of the population. Collective Bargaining Working Group 4

5 A number of reports point out that the ratio between the working and not working part of the population will change from 2:1 today to 1:2 in the future. In other words, the population is aging: the % of elderly increases and the % of people of working age decreases. This is a threat to public pension systems which are based on repartition. EFBWW recommendation We wish to eliminate the risk of pension schemes of a specific generation solely being dependent of the economic cycles in the contribution period. Thus, the composition of the full pension income should be based on a combination of collective and individual schemes. The collective, joint public part forms the basis supplemented by an individual scheme for instance being a part of a collective agreement. 3. In some countries the conditions to be able to claim a public pension are tightened The amount of with demands for contributions is increased. Part time work is recalculated pro rata full time work. EFBWW recommendation Increasing job insecurity and flexicurity must not lead to lower pensions or decrease the right to claim a pension. 4. In many countries the average pension based on the public system decreases Pensions do not increase with the same pace (%) as inflation. Pensions do not increase as much as the average purchasing power of working people. Pension reforms in some OECD countries since the early 1990s have reduced future benefits on average by 20 % 2. EFBWW recommendation We must increase the value of pensions through: a) Increasing public pensions in order to uphold a descent standard of living. b) Fill the gap between a decreasing public pension through labour market pensions negotiated though collective agreements. 2 Source: OECD report Pensions at a glance 2011 ( Collective Bargaining Working Group 5

6 c) Or a mix of the two systems: the labour market pensions are not as vulnerable to government s cut off s by law as the public schemes, and we have the opportunity to make specific pension systems for employees in branches with heavy work. 5. In half of the correspondent countries labour market pensions are a reality Some are not mandatory but optional. Except in two countries (DK, NL) the labour market pensions represent only a small fraction of the full pension income. The modest labour market pensions are usually paid by the company without contributions of the employees. The two exceptions with high labour market pensions (DK, NL) are paid by contributions of companies and employees. EFBWW recommendation Through collective bargaining at national level we aim at establishing a system of labour market pensions as a supplement to the public pensions in all member states. The aim is to reach at least 80% of the employee s net final wage when retiring. Collective Bargaining Working Group 6

7 Recommendations The Collective Bargaining Working Group recommends a strategy for the EFBWW Standing Committee Wood/Furniture/Forestry to be: 1. We do not support any increases of pension age or annual working time as long as the unemployment rates are high and as long as figures prove that companies don t engage elderly people. 2. Employers have to adapt to an aging workforce and create good working environment and conditions. They may: Invest time and money in educating the next generation of the workforce. Combine the demands of clients with the possibility for the workforce to combine flexible working hours and a family/social life. Establish and sustain a reduced working time for + 55 year olds as a bridge between being active and going on retirement. Create an environment where experience is appreciated and people are stimulated to share their knowledge and experience with the next generation of the workforce. Find other ways to keep elderly workers healthy and happy at work such as job rotation, vocational training and other investments in their skills, no overtime, no nightshifts, avoiding premature disability, etc. 3. We wish to eliminate the risk of pension schemes of a specific generation solely being dependent of the economic cycles in the contribution period. Thus, the composition of the full pension income should be based on a combination of collective and individual schemes. The collective, joint public part forms the basis supplemented by an individual scheme for instance being a part of a collective agreement. 4. Increasing job insecurity and flexicurity must not lead to lower pensions or decrease the right to claim a pension. 5. We must increase the value of pensions through: Increasing public pensions in order to uphold a descent standard of living. Fill the gap between a decreasing public pension through labour market pensions negotiated though collective agreements. Or a mix of the two systems: the labour market pensions are not as vulnerable to governments cut off s by law as the public schemes, and we have the opportunity to make specific pension systems for employees in branches with heavy work. 6. Through collective bargaining at national level we aim at establishing a system of labour market pensions as a supplement to the public pensions in all member states. The aim is to reach at least 80% of the employee s net final wage when retiring. Collective Bargaining Working Group 7

8 Results from the questionnaire Country Retirement age Real retirement age Optional early retirement Purchasing power Belgium Between Between yes * from 56 40% Bulgaria 60 (F) 63(M) 50 plus unemployment no 55% Denmark 65 63,9 yes * from 60 56% Finland Between ,6 yes * at 62 48% Italy 60 (F) 65(M) / yes * 70% max Lithuania 60 (F) 62,5(M) / yes * 5 earlier 40% Netherlands yes * from 60,5 28% Norway 67 63,1 yes * from 62 60% Portugal 65 / yes * from 55 see formula Romania 63 (F) 65(M) / yes * 5 earlier 47,20% Spain 65 63,8 no * conditionally Country Pension based on CAO Amount paid to CAO pension scheme Financing of the CAO pension scheme Supplement to purchasing power Belgium yes 0,80% Employer modest Bulgaria Clause in branch col. Agreement Denmark yes 12% Finland law based 22,40% Italy voluntary 2,40% Lithania no Netherlands yes Furniture: 22,1% of annual salary minus franchise of ) Norway yes 1,40% Employer Portugal no Romania Spain no no Employer (2/3), Employee (1/3) 15% Employer (16,4 17,7%), Employee (4,7 6,0 %) Employer (50%), Employee (50%) 42% 60% (public and private) Collective Bargaining Working Group 8

9 Belgium Organisation: Sector: Algemene centrale ABVV/ Centrale génerale FGTB Furniture 1. National pension rules by law a. Retirement age Pension age is the same for men and women and is flexible: between 60 and 65 b. Actual retirement age People leave the labour market between 55 and 60 c. Rules regarding retirement Early retirement Bridge pension Bridge pension = early retirement = a bridge between employment and retirement Bridge pension is not a right, the employer has to be willing to let a worker go Bridge pension = unemployment fee + fee from the company - from 56 on (if one has worked for minimum 40 ) - from 60 on (if one has worked for minimum 37 ) Exeptions The Collective agreement regarding stressful jobs offers the possibility of a bridge pension from 56 on. The conditions are: minimum age 56, a career of minimum 33 of which 20 in a system with nightshifts included. Credit Time is a system open to everyone from 55 on and is the possibility to reduce working time from 1/5 th until 1/2 off a full time (for this part of Credit Time one receives a financial benefit from the national social security) d. Purchasing power Average pension Belgium : 925 gross/month Average pension is 42 % of an average wage (an average pension has a replacement ratio = 60% for low income and 25% for high income) As a pensioner the purchasing power calculated in per cent of an average adult blue collar worker salary within the trade amounts to 40%. 2. Labour market pension conditions according to collective agreements a. There is a pension scheme based on a collective agreement. b. 0,8% of the total annual gross salary is paid into the pension sceme. c. The system is entirely financed by employer. d. The labour market pension has a limited role as supplement to the purchasing power. 3. Old age pension and disability systems based on collective agreements a. Bridge pension is possible from 58 on (if one has a career of 38 minimum with at least 15 seniority in the sector. Collective Bargaining Working Group 9

10 4. Demographic development Age amount of blue collar workers 4th quarter 2010 % total Assumption of the age composition seen in the light of birth rates Population, Age composition and dependency rates elderly (65 and older) Belgium 0 to to and older to 14, in % to 64, in % yeras and older, in % Dependency elderly (+ 65 : 15 to 64 ) 25,53 25,94 26,05 30,26 37,25 42,22 43,90 45,32 Collective Bargaining Working Group 10

11 Bulgaria Organisation: Federation of Trade Union Organizations in Forestry and Woodworking Industry Sectors: Woodworking, Forestry and Furniture 1. National pension rules by law a. Retirement age The most common retirement age is, according to the current legislation and in particular to the Social Security Code rights, 60 for women and 63 for men. Insurance practice is 34 for women and 37 for men. From 31 December 2011 the insurance practice increase from the first day of each calendar year with 4 months for both women and men until reaching 37 for women and 40 for men. In case people are not entitled to pension for insurance practice and age up to 31 December 2020 they acquire rights at the age of 65 for women and men and not less than 15 actual insurance practice. From 31 December 2020 age will increase from first day of every following year with 6 months in order to reach the age of 67. Rights of pension are acquired under certain conditions: Workers insured for labour accident and occupational disease, also those insured for disability, due to sickness, old age and death. b. Actual retirement age There are no exact figures for the most common age to leave the labour market, but the most common reasons for retirement in these sectors are redundancies and unemployment over age 50, due to structural changes, respectively reduction of the numbers of working places in general. c. Rules regarding retirement According to the current legislation the workers in these sectors do not respond to the conditions for early retirement or other withdrawal systems, except of a limited number of civil servants in forestry. d. Contribution to the pension schemes According to the pension scheme in 2010 for Forestry approximately BGN 107 is paid every month or slightly over 20 % of the salary of the average adult worker. In Woodworking approximately BGN 132 is paid every month or slightly over 20.5 % of the salary of the average adult worker. And in Furniture BGN 82 or 20.5% of the salary of the average adult worker is paid every month. Resources in the state public insurance Pension fund come from: a. Contributions from insurers (employer) b. Contributions from insured persons (employee) c. Transfers from state budget d. Other sources Collective Bargaining Working Group 11

12 Example: Social Security contributions in 2010 are 20,5% of the salary of an average adult worker, including 11.6% paid by employer and 8.9% by employee. e. Purchasing power as a pensioner is approximately 55 % of the amount of gross wage of the average adult worker 2. Labour market pension conditions according to collective agreements There is no pension scheme based on a collective agreement, although the branch collective agreement includes a clause that gives such an opportunity. 3. Old age pension and disability systems based on collective agreements There are no developed and acting systems for disability and old age pensions based on collective agreements in the sectors. 4. Demographic development a. b. Age composition in the country in general: Age composition in percent < > Total % c. Assumption of the age composition seen in the light of birth rates < Age composition in percent > Total % Collective Bargaining Working Group 12

13 Denmark Organisation: Sectors: 3F Wood, Forestry and Furniture 1. National pension rules by law a. Retirement age The normal pension age is currently 65 but will be increased gradually to age 67 in the period Full public old age pension requires 40 residence in Denmark. Shorter periods qualify for a prorated benefit. b. Actual retirement age On average people leave the labour market at the age of 63,9 based on figures from the life insurance company of the industrial workers in Denmark (Industriens Pension). c. Rules regarding retirement Public Pension There is a public basic scheme ( folkepension ) which consists of a basis amount and an income tested pension supplement. A means tested supplementary pension benefit is paid to the financially most disadvantaged pensioners. ATP There is also a scheme based on individuals contribution records, the ATP (the Danish labour market supplementary pension). Voluntary early retirement system Then there is a voluntary early retirement system linked with unemployment insurance, which pays benefits between 60 (gradually increased to age 62 in the period ) and until the normal pension age. To qualify, individuals must have been members of the unemployment insurance fund for at least 25 within the last 30 and have paid voluntary early retirement contributions during this period. The benefit amount corresponds to the unemployment rate, subject to a limit of 91 % of the maximum rate if you retire before the age of 62. It is possible to gradually retire combining work with the early retirement. In this case the benefit will be decreased on an hour by hour basis. People who defer the take up of voluntary early retirement benefits for at least two after they have become entitled to the benefit and are still working receive a higher rate of voluntary early retirement benefit that is equivalent to the maximum rate of unemployment benefit. For three full time work when an individual qualifies for voluntary early retirement or the equivalent, a tax free lump sum is paid up to a maximum of Dkr. ( ). Early retirement pension It is possible to obtain early retirement pension from the age of 18, if: i. The work ability is permanently reduced. Collective Bargaining Working Group 13

14 ii. The work ability is reduced to such degree that providing for oneself is impossible. iii. All options to improve the work ability have been tested. The amount of the early retirement pension corresponds to approx. 65% of an average salary within the wood and furniture industry. Flexible job Persons, who neither by reassignment nor rehabilitation are able to find employment or hold on to employment on normal terms, can be offered a flexible job, which is a job on special terms. The following standards should be met: i. There must be a permanent reduction in the work ability, caused by physical, mental or social reasons. ii. It is not allowed to obtain or to maintain employment on normal terms on the labour market. iii. You have to be under the pension age The flexible job can be adjusted to each person s work ability and wishes regarding working hours and salary. The employer can obtain a salary compensation from the public authorities of 1/2 or 2/3 depending on the work ability of the employee. d. Purchasing power Purchasing power as a single pensioner with only the public pension calculated in per cent of an average adult blue collar worker salary within the trade is about 56 %. This percentage may rise for the poorest pensioners who have the opportunity to receive government grants for housing, medicine/health treatment, TV license, heating, housekeeping, dentist, glasses etc. For a married pensioner the corresponding figure is 45%. 2. Labour market pension conditions according to collective agreements b. There is a pension scheme based on a collective agreement from 1993, which cover about 90% of the full time employed workforce. c. 12 % of the salary is paid into the pension scheme per year. d. The labour market pension is financed with 2/3 by the employer and 1/3 by the employee. e. For a single pensioner leaving the labour market in 2011 the labour market pension adds 15% to the purchasing power amounting to 71% of an average adult blue collar worker salary, while for a married pensioner the corresponding figure amounts to 59%. A single pensioner that starts to pay contributions of 12% at the age of 25, can with a conservative estimate look forward to a purchasing power of about 77%. 3. Old age pension and disability systems based on collective agreements In case of disability the labour market pension provides a one off payment of approx. 1/3 of the salary plus a yearly supplement to the public disability pension of approx. 20% of the salary up till the age of 67. Agreement on shorter work hours without salary compensation can be entered. The agreement can also be entered if the person is on early retirement pension. A deduction will consequently be made in the voluntary early retirement benefit (see item 1.c. third dot). Collective Bargaining Working Group 14

15 4. Demographic development Age composition: The country in general Industry in general Wood/Furniture Forestry < 26 30% 10% 4% 13% % 17% 13% 20% % 30% 24% 15% % 25% 29% 29% % 16% 29% 22% 65 > 17% 2% 1% 1% Total 100% 100% 100% 100% Compared to the figures from the industry in general the work force in the wood and furniture sector has an overweight of elderly people. This is also the case in forestry, though here there also is an overweight of youngsters. In the 1980 es the birth rates were 20 30% lower than in the 1970 es while increasing a bit in the 1990 es, see later. This development is already evident from the figures for the wood and furniture industry. Unfortunately the sector has not been very successful in recent in the competition to attract young people. The development will undoubtedly have an impact on the age composition in all the sectors in the coming. Live births Birthrates Collective Bargaining Working Group 15

16 Finland Organisations: Sectors: Trade Union Pro and Wood and allied workers union (Puuliitto) Forestry, Wood and Furniture 1. National pension rules by law a. Retirement age According to the general pension legislation the most common retirement age at present time is 63 68, i.e. an individual may choose the retirement time between these age limits. b. The actual average retirement age is 59,6 (2010) c. Rules regarding retirement Part time retirement Persons born in 1953 or later may retire for part time at the age of 60, older persons at the age of 58. Two conditions have to be met: First, one has had to work full time for at least 12 months during the last 18 months. Second, it is necessary that the level of one s wages has been sufficiently high during the last 15, reaching a threshold value that is calculated using a specific formula. Transfer to part time work will reduce earnings and working hours 30 70% of your full time salary and work time. Part time pension is 50% of the difference between full time and part time earnings. Early old age retirement Persons at the age of 62 may take early retirement and/or retirement at the age of 63. In that case the pension will permanently be decreased by 0,6% for each month by which he retires early, i.e. 7,2% at the maximum. Disability pension When persons under the age of 63 become disabled and the disability remains reduced for at least one year, they are entitled to a disability pension. If the work ability has been reduced by at least 60%, they qualify for a full disability pension. If they still can cope with part time work or lighter tasks and the disability has been reduced at least 40 %, they may be granted a partial disability pension. If the disability concerns a work related accident or disease the level of the pension is higher than in the case of normal disability pension. Unemployment pension Persons born before 1950, who have received the maximum amount (being 500 work days) of unemployment allowance, who have been in gainful employment at least 5 during the last 15 and who are registered as an unemployed jobseeker may get unemployment pension at the age of 60. Persons born 1950 or later are entitled to get unemployment fund until their old age retirement even when the general maximum time 500 days has run out, if they have been at least 59/60 old at the Collective Bargaining Working Group 16

17 end of the 500 days. They are also entitled to get the early old age pension at the age of 62 without any decrease to the pension amount. d. Purchasing power Sector specific information is not available on this issue, but the median pension of all the pensioners in Finland who receive an income related pension is 48% of the median income of all employees and entrepreneurs. e. Contributions to the national pension schemes The pension is financed by both employees and employers. The average pension insurance contribution is in total 22.4 % of income. Employees under 53 pay 4.7 % and employees of age 53 or more pay 6 %. The rest of the pension insurance contribution is paid by the employer. 2. Labour market pension conditions according to collective agreements a. There is no pension scheme based on a collective agreement, only one based on legislation. 3. Old age pension and disability systems based on collective agreements a. There are no disability systems and old age pensions based on collective agreements. 4. Demographic development Age composition < > Total The country in general 30% 13% 12,5% 14% 14,5% 16% 100 % Furniture (TUP) 0,5% 13% 28% 32% 26% 0,5% 100 % Furniture (Puuliitto) 8% 18% 21% 26% 20% 8% 101% Wood (TUP) 0,1% 14% 26% 34% 26% 0% 100,1% Wood (Puuliitto) 6% 17% 21% 25% 19% 12% 100% Manual forestry 2% 3% 7% 30% 34% 24% 100% Mechanical forestry 15% 23% 22% 24% 15% 1% 100% In 2010 Finland s population (tot persons) grew by persons. Migration gained from abroad contributed more to the increase of population than natural growth. Headcount of age groups has decreased rapidly (average alive headcount in age groups 0 25 is , in age groups , age groups , age groups and age groups it is persons/year). Therefore we may estimate that the economic and political situation will have a remarkable impact to the population growth in future number of migrant persons depends strongly on these matters. We assume that in any case population growth will be modest in future and that the older age groups will Collective Bargaining Working Group 17

18 be much bigger than the younger ones. If the population growth will continue as seen today, population of Finland will be 6 million in year Number of deaths will be bigger than number of births starting from year 2034 but net immigration (if assumed to be on today s level, about per year) is forecast to sustain population growth even after this. The proportion of persons aged over 65 in the population is estimated to rise from present 16 % to 27 % by year 2040 and to 29 % by The number of persons of working age started to fall in 2010 when the large post war baby boom generations reach the retirement age. Collective Bargaining Working Group 18

19 Italy Organisations: Sectors: FENEAL UIL, FILCA CISL, FILLEA CGIL Forestry, Wood and Furniture 1. National pension rules by law The public social security system is the same for all employees of the private sector and is regulated by the Central Government a. Retirement age The right to old age pension is acquired at the age of 65 for men and 60 for women. Recent changes The latest law established that the worker will receive the pension cheque 1 year after having acquired the right to old age pension consequently the real retirement age is 66 for old age pensions and those who have already paid the maximum contribution period of 40 will have to work 1 year more. Future The law established a ratio between average life expectancy and retirement age starting from 2015 : an increase of three months (thus the pension will start from 66 and three months). Required career The right to the contribution based pension is obtained by adding the age of the worker to the of contributions paid. Sum of 96 in 2011 (35 of contributions + 61 of age, or 36+60), sum of 97 from 2013 ( ). This means that with 40 of contributions it is possible to retire regardless of the age. b. Rules regarding retirement There are no laws governing early retirement. Exceptions Invalidity By law, workers with an invalidity degree of at least 80% are allowed to access their old age pension at the age of 61 for men and 56 for women Stress full jobs The law regarding stressful jobs provides for the right to early retirement. It is linked to the contributions based pension with at least 35 of contributions, and is applicable to employees, who work in shifts, provided that: they work for at least three hours between midnight and 5 in the morning for the entire working year, or for at least 78 nights in a year. For workers with less than 78 nights per year, the benefit will accrue at a reduced rate: 2 for those who work from 72 to 77 nights per year; 1 year for those working from 64 to 71 nights per year. Collective Bargaining Working Group 19

20 The law provides for other activities considered to be stressing and which allow an early retirement, such as the case of workers employed in an assembly line type production process. c. Purchasing power There are two calculation systems: The salary based calculation system Applies to workers with at least 18 of work as at Is linked to the worked and to the gross retirement salary, re valued, received in the last 10. The amount of the pension is equal to 2% for each year of contribution (e.g., 70% with 35 of contributions) of the re valued average salary of the last at work (not more than 10 ). The contribution based calculation system Applies to those workers who started working after or who had less than 18 of contributions in 1995 and who opt for such system. The amount of pension is linked to the contributions paid during the entire working life and at the retirement age. The contribution credited during the entire working life, known as "montante, is arrived at by summing the contributions of each year, appropriately re valued based on the annual discount rate resulting from the five average variation of the GDP (gross domestic product) determined by Istat; the "montante" is then multiplied by the transformation ratio, which varies based on the age of the worker upon retirement. For those workers who had less than 18 of contribution in 1995, and who do not opt for the salary based system, the amount of pension is arrived at by summing two amounts: salary based calculation for the work performed up until 1995, and contributions based calculation for the subsequent working periods. Purchasing power: Conclusion for the future Based on the current ratios (which will be further reduced review every three ) and the number of worked being the same, the worker who falls under the contributionbased system will receive, on average, approximately 10% of the monthly salary less than the salary based system. 2. Labour market pension conditions according to collective agreements The National Collective Labour Agreement provides for the creation of a supplementary pension fund named ARCO. Workers may access the fund on a voluntary basis (for wood, forestry and furniture sectors). The companies pay monthly an amount equal to 1.2% of the salary, and the same percentage is paid by the workers themselves. (From 1st January 2013, the percentage will be set at 1.3%) Collective Bargaining Working Group 20

21 The employees severance indemnity, equal to 6.91%, is also allocated to the supplementary pension fund. 3. Old age pension and disability systems based on collective agreements a. There are no disability systems and old age pensions based on collective agreements. 4. Demographic development M stand for Males/Men, F stands for Females/Women Data broken down by gender and total by age bracket Age composition for Italy > > Total M F Tot % M F Tot % M F Tot % M F Tot % M F Tot % M F Tot % 100 % Tot % Total men ,5% Total women ,5% Total Italy % Nowadays, at the age of 65, the life expectancy is of 18.2 for men and of 21.7 for women. * Source: ISTAT Collective Bargaining Working Group 21

22 Lithuania Organisation: Sectors: Lithuanian Forest and Wood trade union s federation Wood, Forestry and Furniture 1. National pension rules by law a. Retirement age The normal pension age is currently 60 year for women and 65 for men b. Actual retirement age In case of unemployment a possibility is foreseen, by law, to retire 5 earlier. c. Purchasing power As a pensioner the purchasing power calculated in per cent of an average adult blue collar worker salary within the trade amounts to 40%. 2. Labour market pension conditions according to collective agreements No such practice exists in the collective agreements. 3. Old age pension and disability systems based on collective agreements No such practice exists in the collective agreements. 4. Demographic development Age composition < > Total Lithuania in general 9% 79% 11% 1% 100 % The data provided in the table show the labour force for the year Data for 2009 and 2010 are not available. As a result of the decline in the number of births and due to economic migration to foreign countries, the population of Lithuania is decreasing. The number of young people aged 25 or less continued to decline, while the number of people older than 55 continued to grow. General remarks The period of recession which began in late 2008 has had a major impact on the state of the country s economy. Rising unemployment, decreasing income of households and companies and fewer possibilities of lending to business have drastically reduced consumption and investment. The situation has been made far more difficult by the essential national saving oriented fiscal stability representing one of the key strategic goals of the Government in public finance. Taking into consideration the fact that solidarity and social peace of the entire Lithuania are necessary for attaining these goals, on 28 October2009, a National Agreement was signed between the Government of the Republic of Lithuania and social partners: the largest trade unions, business and employers as Collective Bargaining Working Group 22

23 well as pensioner s organizations. Under this Agreement, the Government undertook to implement measures for financial consolidation, including a temporary and differentiated reduction in all pensions, pursuing the essential objective to pay social benefits on time, so that recipients of the smallest pensions would be protected and recipients of bigger pensions and other income would jointly assume a heavier burden of reduction. The year 2009 can be called a year of saving, new challenges and new opportunities. Bigger or smaller changes took place in many areas of the country s life, including the social insurance scheme. The year 2009 was a period of `test for the social insurance scheme, since it was necessary to immediately address issues of financial security in the current period and prepare for deliberations of a future model of social security which would be financially sustainable. Collective Bargaining Working Group 23

24 The Netherlands Organisation: FNV Meubel en Hout mede namens CNV vakmensen Sectors: Wood and Furniture 1. National pension rules by law a. Retirement age The most common age of retirement is 65 at the moment. b. Actual retirement age About 25% of the people between the age of 55 and 65 have a paid job. The age of 62 is for the most the age they do retire. c. Rules regarding retirement There are several systems for early voluntary retirement. Employees, born before 1950, can retire at 60,5. They get a pension of 70% of their average salary. Employees, born after 1949, may retire at 60,5 62 conditionally. At they have to had worked at least 20 in the sector, they were working in the sector at and are working in the sector till retirement. They get a pension of 70% of their average salary. d. Purchasing power The purchasing power as a pensioner is 28% of the gross average wage of the adult worker (public pension). 2. Labour market pension conditions according to collective agreements a. There is a labour market pension, supplementary on the national pension by law. The national pension and the labour market pension together is 70% of the average salary of the employee. b. Based on the collective agreements the following is paid into the pension scheme: Woodworking sector: old age pension 20,9%, the early retirement pension workers born before % and supplementary pension workers born after ,2% of the salary minus a franchise of Maximum salary is Furniture: old age pension 21,6%, the early retirement pension workers born before ,05% of the salary minus a franchise of Maximum salary is c. The labour market pension is financed like this: In the woodworking industry the employers pay 2/3 and the employees 1/3. In the furniture industry the employers pay 50% and the employees 50%. Collective Bargaining Working Group 24

25 d. To the old age pension (from age 65) the labour market pension adds in average 42% to the purchasing power (70 % including the national pension by law). 3. Old age pension and disability systems based on collective agreements Besides the pension schemes mentioned under point 2, fully disabled workers do not have to pay to the pension fund, while the construction of their pension is continued. There are no other pension sytems based on the collectieve agreement. 4. Demographic development Age composition: < > Total The country in general 25% 13% 13% 12% 11% 12% 86% Furniture 17% 11% 29% 24% 9% 90% Forestry 15% 11% 28% 25% 11% 90% Collective Bargaining Working Group 25

26 Norway Organisations: Sectors: The Norwegian United Federation of Trade Unions (Fellesforbundet) and Industi Energi Forestry, wood and furniture 1. National pension rules by law a. Retirement age The most common retirement age at present time is 67. b. Actual retirement age On average people leave the labour market at the age of 63,1. c. Rules regarding retirement It is possible to draw a retirement pension from the age of 62, if you have earned enough pension rights. d. Purchasing power 60% 2. Labour market pension conditions according to collective agreements a. There is a pension scheme based on a collective agreement called the contractual early retirement pension (AFP) covering both the private and public sectors. b. For Fellesforbundet, the system is entirely financed by the employer, who in 2011 pays 1,4 % of the employees' salary between Nkr and Nkr For Industri Energi the system is financed by both the employer and the employee with a total of 1,4 %. 3. Old age pension and disability systems based on collective agreements Based on local agreements at company level it is possible to enter into part time regulation, light duties and senior settlements. 4. Demographic development Age composition in the country in general: Age compsition < > Total Norway in general 33 % 13 % 15 % 13 % 12 % 14 % 100 % Age compsition < > Norway in general 26 % 13 % 14 % 14 % 13% 10% 10% Collective Bargaining Working Group 26

27 Portugal Organisations: Sectors: Construction, Public Works and Related Services Trade Union (SETACCOP) Forestry, Wood and Furniture 1. National pension rules by law a. Retirement age The normal retirement age is currently 65. b. The actual average retirement age There are no statistics available on this subject. c. Rules regarding retirement Early retirement is permitted by law for: Active employees, who are aged 55 or older, have completed the required period of 15 calendar of contributions and who, on the date on which they turn 55, have made 30 calendar of relevant contributions for the calculation of their pension. However, there will be a penalty system in place for these workers, depending on the respective percentage values for the number of of early retirement they are taking, compared to retiring at 65. The penalty may be reduced depending on the number of of earnings registered at the age of 55. Long term unemployed people, aged 62 and older, once the period in which unemployment benefit can be claimed comes to an end and where, at the time of unemployment, they are aged 57 or older. Long term unemployed people may take early retirement at the age 57 where they are aged 52 or older at the time of unemployment and have a history of contributions of at least 22 consecutive calendar. General remarks It should be noted that deductions will be made from the statutory value of pensions (after the latter has been calculated in accordance with the general rules mentioned) as a result of the application of a sustainability index linked to average life expectancy. It should also be noted that the pensions of long term unemployed people who become unemployed because their employment contracts were terminated by mutual agreement will incur an additional penalty; said penalty will continue to be applied until the pensioner turns 65 of age. Collective Bargaining Working Group 27

28 d. Purchasing power There is no set formula for calculating pensions. However, the pension does not depend on the salary rate laid down in the collective agreement. The pension formation rate is 2% for recipients with 20 of contributions or less and is set at a percentage value of between 2% and 2.30% for those recipients with 21 or more of recorded contributions. This rate is regressive, i.e. it decreases with the increasing value of the reference remuneration, calculated using the formula TR/(nx14) where TR is the total of the revalued annual earnings (in accordance with the officially published rates) for the entirety of the worker s contribution history and n is the number of calendar with recorded contributions, up to a maximum of 40. These complex calculation formulas are different again for beneficiaries who registered with the Social Security system after 1 January 2002 or who were enrolled until 31 December Labour market pension conditions according to collective agreements The collective agreement does not lay down conditions for granting or calculating pensions. 3. Old age pension and disability systems based on collective agreements The applicable systems are stipulated by law (see paragraph 1c) since the collective agreement does not lay down rules on disability or old age pensions. 4. Demographic development There is no known data available on the subject of demographic development which would enable us to provide an accurate answer to this question. Collective Bargaining Working Group 28

29 Romania Organisation: Sector: Federation of Free Trade Union in the Wood Industry (FSLIL) Wood and Furniture 1. National pension rules by law a. Retirement age The most common retirement age is: For men: 65 For women: 63 A complete contribution to the pension scheme consists of 35 of work for both women and men. c. Rules regarding retirement Pension calculation The pension is calculated by multiplication of the annual medium score achieved by the insured with the value of a pension point (733 lei) The annual medium score is determined by the division of the number of points resulted from the summing of the insured s annual points to the number of of pension contribution according to standard ages in both women and men s cases. In the public pension system, the following people can cumulate the pension with various incomes from situations in which the insurance is mandatory: People who can benefit from old age pension People who are blind Pensioners with a 2 nd degree of disability and children, survivor s pension The surviving spouse if he/she does not exceeds 35% of the medium gross income There is no other pension scheme besides the national public scheme. In the current pension scheme, in Romania, the employer finances the pension scheme: Under normal working conditions with 31.3% Under particular conditions 36.3% Under special conditions 41.3% The salary contribution is 10.5% Early retirement For people who have contributed with at least 8 more than the above mentioned amount of time, according to the current pension law, they can benefit from an early retirement with up to 5 earlier than the most common retirement age (old age pension). When trying to determine the amount of pension contribution needed for an early retirement, the following are not being taken into account: Disability pension University day courses Collective Bargaining Working Group 29

30 Full or reduced military service People who benefited between 1 April from social security allowances People who benefited since 1 January 2005 from disability leave caused by work related accidents and work related diseases. People who benefited since 1 January 2006 from parental leave, taking care of a child that is no older than 2, or if the child has a disability/handicap no older than 3. Partial early retirement Partial early retirement is granted, with no more than 5 before the old age pension to the people who have a complete contribution to the pension system and also to those who have contributed more than that, up to 8. When trying to determine the amount of contribution needed for granting the partial early retirement, the same conditions are applied as in the early retirement scheme. The amount of the partial early retirement is being set by the amount of the old age pension diminished by 0.75% per each month until the conditions for the old age pension are fulfilled. Disability pension Disability pension is being granted to the people who have lost total or at least half of their ability to work, the causes being work related accidents and diseases (according to the law). Students and apprentices who have lost total or at least half of their ability to work because of work related accidents or diseases caused by work environment are also eligible for pension. Depending on the work capacity there are various disability degrees: 1 st degree of disability is characterised by total loss of ability to work and ability to look after oneself 2 nd degree of disability is characterized by total loss of ability to work but not the ability to look after oneself 3 rd degree of disability is characterized by the loss of at least half of the ability to work, the person in question can perform the required tasks up to half of the normal work time. The criteria and rules on which a person can qualify for the 1 st, 2 nd and 3 rd degrees are being set by the government together with the Ministry of Work, Family and Social Services. People belonging to the 1 st degree of disability have a right to an allowance for a personal care assistant (besides the actual pension), the amount given is 80% of the value of a pension point (733 lei) Survivor s pension The survivor s pension is available to the children and surviving spouse if the deceased was a pensioner or was eligible for retirement. Children have a right to a survivor s pension up until they re 16, and if they choose to continue their education then they are still entitled to receive the pension but only until they re 26 old. The remaining spouse has the right to the survivor s pension until he/she is eligible for old age pension, but only if the marriage lasted for at least 15. If the marriage was less than 15, but at least 10, the amount of the survivor s pension is diminished by 0.5% per month and 6% per each year. The remaining spouse has the right to a survivor s pension regardless of his/her age if he/she has a disability (1 st or 2 nd degree) and he/she has been married for at least one year. Collective Bargaining Working Group 30