Employers and trade unions have agreed on the rate of increase of the minimum wage and guaranteed minimum wage in 2024. Based on this, the former benefit will increase by 15 percent and the latter by 10 percent from December. Overall, the minimum wage will increase to HUF 266,800 gross, and the guaranteed minimum wage to HUF 326,000.
In several cases, the change in the amount of the minimum wage also entails changes in the provisions on pensions – draw attention on the portal Mrs Márta Balogh Molnár tb expert.
Agreement conclusion
The length of service is of decisive importance in terms of pension entitlement and the amount of the pension.
It is also possible to obtain service time by signing an agreement.
Pursuant to § 48 of the Act on persons entitled to social security benefits and the coverage of these benefits, the pension insurance administrative bodies:
- length of service entitling to pension and obtaining income forming the basis of a pension (in the absence of an insurance relationship or in the event of its suspension),
- recognition of the time of studies conducted in the framework of full-time education at a higher education institution (including doctoral training) as service time,
- obtaining the missing service time (up to five years) required for entitlement to a full old-age or partial old-age pension,
- recognition of the time of home care equal to the time of child care allowance (GYES) as service time for the year 1998
an agreement can be concluded for this purpose.
Based on the legal provisions, an agreement may be concluded by a domestic adult who is not a pensioner in his own right and is not in a legal relationship with an insurance obligation, or who is not covered by the insurance, and whose insurance is suspended – length of service entitling to pension benefits and earning income constituting a pension fund for the purpose of
The agreement can be concluded by another person or organization by taking over the payment of the contribution in favor of the beneficiary. In addition, in the three other cases defined above, an agreement can be concluded for the purpose of gaining seniority.
This amount must be paid at least on the basis of the minimum wage in the case of an agreement concluded for the purpose of obtaining an income that forms the basis of service time and pension, but it is possible to undertake the payment of the contribution even after a higher amount.
In 2024, at least in connection with the increase in the minimum wage
If the agreement was concluded for an amount higher than this, this amount, which is higher than the minimum wage, will be taken into account as the income forming the basis of the pension.
For the purpose of obtaining service time, an adult who wishes to make up for the period of full-time studies at a higher education institution or the missing service time for entitlement to a full or partial old-age pension can enter into an agreement not with a higher amount, but only with the minimum wage as a basis, for the purpose of obtaining service time, a maximum of five years. to be recognized from time to time.
Before January 1, 1998, the time of full-time higher education studies was considered service time, but from January 1, 1998, it was no longer the case for the old-age pension. By signing an agreement, you can obtain service time for the duration of your studies.
In order to obtain service time, based on the amount of child care allowance valid on the day of the conclusion of the agreement, by paying a 10 percent pension contribution, an agreement can be concluded for the year 1998, for a period of home care equal to the period of child care allowance. The contribution must be paid in one lump sum within 30 days after the conclusion of the agreement.
Proportionate service time
In the case of part-time employment, it is not uncommon for the salary to be lower than the minimum wage for full-time work, adjusted to the ratio of part-time work to eight hours of full-time work.
In that case, the social security contribution payment will also be of a smaller amount, which affects the duration of the service period.
According to § 39 of the Pension Act, in this case, when determining the amount of the pension, the length of service will be prorated according to the ratio of the actual earnings and the minimum wage, i.e. this period will count as full length of service for pension entitlement, but only partially for the amount of the pension.
Earnings limit in the case of working with pre-retirement benefits
In addition to pre-retirement benefits, you can only pursue a gainful activity up to a certain amount.
The relevant CLXVII of 2011. according to § 11 of the Act, if the earnings on which the social security contribution is based exceed eighteen times the monthly amount of the minimum wage valid on the first day of the current year, the benefit must be suspended from the first day of the following month until December 31 of the year, but at the latest until the retirement age is reached. If the excess occurs in December, the benefit will not be suspended, but the December amount must be repaid.
