Cumulative pension-salary, prohibited for most state employees: who can continue to receive the full pension and what are the exceptions

The Bolojan government launched in public consultation the draft law that prohibits the cumulation of pension with salary for public sector employees, targeting in particular service pensions and military pensions.

Cumulative pension-salary, prohibited PHOTO: Archive, Adevărul

The document was published on the website of the Ministry of Labor and clearly sets out the applicable conditions and exceptions.

According to Article VI of the project, “staff paid from public funds, including employees of autonomous kings established by the state, national companies or with majority state capital, as well as regulatory authorities, who have been issued the decision to retire from the public pension system or the decision regarding the service pension or military pension, may continue their activity with the annual approval of the loan officer/employer, until reaching the age of 70”.

Also, “persons receiving service pensions or military pension can be maintained in activity only if they accept the reduction of the amount of the pension by 85%”. This provision also applies in the case of re-employment based on a new employment or service relationship.

According to the project, “within 15 days from the entry into force of the law, the credit orderers/employers have the obligation to terminate the employment contracts or service relationships of pensioners who have not expressed their option to continue the activity with the pension reduction”.

After choosing the option, the pension houses will issue recalculation decisions, with the application of the new amount from the first day of the month following the submission of the application. Resumption of the non-penalized pension right can be done later, based on the request and the document certifying the termination of the employment relationship.

The project also provides for important exceptions. “Persons elected to public positions, those appointed by decisions of the Parliament, those with mandates provided for in the Constitution during the exercise of the mandate, as well as persons appointed by the President of Romania through decisions of the Supreme Council of Defense of the Country can accumulate the pension with the salary for the duration of the mandate”, the document shows.

Thus, the project significantly limits the possibility of pension-salary cumulation for state employees, but allows certain categories to continue to benefit from both incomes legally.

Prime Minister Ilie Bolojan explained, in an interview with ProTV News, that this measure represents one of “the basic elements of reducing personnel expenses”which represents an objective of the Bolojan Government.

“One of the basic elements of the reduction of personnel expenses is also the adoption of the ban on the cumulation of the pension with salary. Because we have at least 15,000 positions where we have people who are practically retired, who have re-employed immediately after retirement in the public sector. Or, at the moment when this ban is in place, a good part of these people who are employed would opt out, in one way or another, and very likely would give up the position in the public sector. Those positions become vacant, they can no longer be filled. And so a reduction in personnel expenses also means this method, it does not mean salary cuts, so that we understand each other very well“said the prime minister.