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Obligations of Foreign EmployersWhen and where to register as a foreign employer – obligations in compliance with the Slovak legislation. The social security is in the territory of the Slovak Republic regulated by two special laws, namely by Act No. 461/2003 Coll. of laws on Social Insurance as amended by later regulations, and by Act No. 580/2004 Coll. of laws on Health Insurance as amended by later regulations.
Who is an employer and when should they register and deregister in the Social Insurance Agency? According to the Act on Social Insurance, in the area of social insurance all obligations in the area of social insurance are fulfilled by the employer. Among these obligations is the registration of the employer with the competent Branch Office of the Social Insurance Agency (SIA). The employer is
and which is obliged to provide the employee with income from dependent activity pursuant to article 5 section 1 letters a) to h) and m) and articles 2 and 3 of Act No. 595/2003, the Income Tax Act. An employer is also
and which is obliged to provide the employee with income from dependent activity pursuant to article 5 section 1 letters a) to h) and m) and articles 2 and 3 of the Income Tax Act. If neither the above natural person nor the above legal entity is the employer, the function of the employer shall be fulfilled by the payer of the income from dependent activity pursuant to article 5 section 2 of the Income Tax Act.” The employer must sign in to the Registry kept by the Branch Office concerned immediately after a day on which the first employee was subject to the Slovak legislation in compliance with coordination rules, or the relevant international agreement, and de-register immediately after a day on which no employee who would be subject to the Slovak legislation in compliance with coordination rules, or the relevant international agreement, is employed.
How should I determine territorially competent branch of the Social Insurance Agency? The employer registers with the competent SIA Branch Office according to the employee’s residence in the territory of Slovakia. In the event the employer has in time of registration with the Registry of Employers more than one employee, the competent Branch Office is the one according to the permanent stay of one of his insurees chosen by the employer. In the event the employee does not reside in the territory of Slovakia, the foreign employer registers with the Branch Office according to the place of activities pursued by the employee in the territory of Slovakia. In case the employee pursues activities at different places in Slovakia, the competent Branch Office for the registration of the foreign employer is SIA Branch Office Bratislava.
What documents need to be submitted when registering an employer and an employee? The form Registration Document of the Employer/Registračný list zamestnávateľa is designated for registering the employer. In order to register, the employer must submit also the “Extract from Register of Business Names” or some other registry based on which the activity of employer is licensed in the translation to the Slovak language. An official translation of this extract/statement is not required. It is sufficient if a foreign employer submits his / her own translation of the business register extract, or of another register - together with an affidavit (declaration of honour) of the translation into the Slovak language. The form of the affidavit is available here. After the registration of employer the competent SIA Branch Office allocates the “Identification number of Employer/Identifikačné číslo zamestnávateľa” (IČZ) to the employer. The employer is then obliged to register the employee for the compulsory social insurance. The form called Registration Document of the Natural person/Registračný list fyzickej osoby is designated to serve this purpose. Submitting the contract for employment of the employee is not required for the registration purpose.
How does an employee report an employee? The employer then accounts the employee via the form Monthly Record of Premium and Contributions/Mesačný výkaz poistného a príspevkov,or Record of Premium and Contributions/Výkaz poistného a príspevkov and accounts the premium on behalf of the employer as well as the employee. The monthly statement of premiums and contributions is to be submitted by the employer for the relevant calendar month for which the employer is paying premiums and old-age pension savings contributions (hereinafter referred to as “contributions”). The employer shall indicate the employee there, who has the status of an employee with regular monthly earnings from dependent activity. In the statement of premiums and contributions, the employer shall indicate the employee who has the right to an irregular income and submits it when the employee’s earnings from dependent activity are posted in the employer’s books. In this statement, the employer shall specify the period that is relevant for the proportion of the posted income as a assessment basis .
When should the employer deregister an employee from the Social Insurance Agency? After termination of the activity of employee in the territory of Slovakia, or after the cessation of the position of employee for the purpose of social insurance (e.g. termination of the contract for employment, etc.), deregistration of the employee from the social insurance is done by the employer. This is done via the same form as registration, i.e. Registration Document of the Natural person/ Registračný list fyzickej osoby. The list of Branch Office performing social insurance of employees is found on our web site.
How does the employer communicate with the Social Insurance Agency? The employer shall communicate with the Social Insurance Agency electronically – the necessary forms, such as the natural person’s registration forms, statements of insurance premiums and contributions should be submitted by the employer through the Electronic Services System (SES). In their applications, notifications and submissions addressed to the Social Insurance Agency, legal entities and natural persons shall be obliged to indicate social security identification number of a natural person. The birth number is the social security identification number. Aliens with no birth number will get identification number assigned by the Social Insurance Agency. The employer shall register the alien employee on the Registration Form of a natural person in the paper form. Subsequently the Social Insurance Agency will assign him the social security identification number, to be used by the employer for social insurance purposes. The following rule applies in the case of the Employer's Registration Sheet: If the employer registers employees for the first time, the employer shall submit his Employer's Registration Sheet in the paper form. If the employer has been registered in the previous period, the employer shall submit the Employer's Registration Sheet either in the paper form or electronically via the SES. In justified cases, the employer may file an application at the relevant branch of the Social Insurance Agency for an exemption from the submission of the said forms in electronic form.
Who is considered to be an employee? For the purposes of the sickness, old-age and unemployment insurances, an employee is a natural person in a legal relationship that establishes his or her right to regular monthly income from dependent activity. Only for the purposes of the old-age insurance, an employee is a natural person in a legal relationship that establishes his or her right to irregular monthly income from dependent activity.
Who pays insurance premiums, for what types of insurance, and how much? Employees shall pay the following insurance premiums:
Employers shall pay the following insurance premiums:
What is the assessment basis? Assessment basis, from which the employee and the employer pay the premiums is the income earned by the employee from his or her dependent activity, except for income which is not subject to tax or is exempt under the Income Tax Act or according to the laws of the State under which that income is taxed. The assessment basis for the payment of insurance premiums in the case of settling the employee's income with irregular income over the duration of his or her old-age insurance shall be determined as follows: the income shall be calculated proportionally for each calendar month of this insurance in the last calendar year, except for the month in which the income was settled (except of the situation, when the income has been settled for the current calendar month, at the same time in the same current calendar month), except for the period for which compulsorold-age insurance premiums have been paid out of the maximum assessment basis. The assessment basis for the payment of insurance premiums is limited by the maximum amount applicable in the given calendar year. The maximum assessment basis is always changed as of 1 January of the calendar year and is valid until the end of the calendar year. For 2018, the monthly assessment basis is EUR 6 384 per month. The employer's assessment basis for the payment of accident insurance premiums is not limited to the maximum height. The assessment basis as well as specific amounts of insurance premiums for specific types of insurance shall be rounded down to the nearest euro cent. The Social Insurance Act sets out the conditions that divest the employer and the employee of payment of accident insurance and/or unemployment insurance premiums. That conditions are included in the part Social Insurance Premium Contribution Rates valid as of January 1 2018.
How should be paid premiums for multiple activities? Social insurance premiums are payable by employees, persons with compulsory sickness and old-age insurance – e.g. traders (self-employed persons –SZČO), voluntarily insured person. Under the Social Insurance Act, if a person is insured as an employee as a self-employed person (SZČO), or as a voluntarily insured person, he or she shall be obliged to pay social insurance premiums for each insurance separately. However, in the case of the simultaneous activities of an employee, a self-employed person (SZČO), and/or a voluntarily insured person, the Act stipulates the obligation to pay monthly premiums from their performance not more than the maximum assessment basis that is in force in the given calendar year. For example, if an employee simultaneously carries out the activity of a self-employed person (SZČO) with compulsory insurance, the insurance premium for the sickness insurance and the old-age insurance shall be paid him or her preferentially always from the assessment basis reached from the employee's performance. As a self-employed person (SZČO) with compulsory insurance, the self-employed person (SZČO) will pay insurance premium for the sickness insurance and old-age insurance from the assessment basis for this category, but not more than the amount of the difference between the maximum monthly assessment basis and the assessment basis from the employment.
Example: A natural person is an employee for the purposes of the sickness, old-age and unemployment insurances and the same person is also obliged to be insured as a self-employed person (SZČO). As the self-employed person (SZČO), his or her assessment basis from his or her business equals to the minimum assessment basis that is 456 eur in 2018. From the performance of the employee's activities in June 2018, his income (that is the assessment basis) will be EUR 6,000. The maximum monthly assessment basis from which premiums are paid is € 6,384 in 2018. As a person with compulsory insurance, the self-employed person (SZČO) will pay insurance premiums for the sickness insurance and old-age insurance for the respective month only from the assessment basis in the amount of EUR 384 (not EUR 456). In addition, the same person shall pay the insurance premium to the Solidarity Reserve Fund, but from the established assessment basis of 456 eur. The reason is that he or she does not pay the insurance premium to the Solidarity Reserve Fund as an employee.
When do the employee and employer have excluded their obligation to pay insurance premiums? The Social Insurance Act lays down periods during which the employee is not obliged to pay insurance premiums but his or her social insurance is still running during such a period. Employees shall not be required to pay sickness, pension,, and unemployment insurance premiums in the following cases:
During this period, nor the employer is obliged to pay premiums for individual types of social insurance. The obligation to pay insurance premiums for accident insurance continues.
When will be the employee’s insurance suspended? During the period of the suspension of the employee’s insurance neither the employee nor the employer are obliged to pay the insurance premiums. In any case, during such suspension the insurance is not running, because the period of suspension of the insurance has the same consequences as the termination of the insurance. The employee’s compulsory insurance shall be suspended in the following periods:
The employee’s compulsory insurance shall be suspended from the 11th day of the need of personal and full-time nursing of a sick child, a spouse, sick spouse, sick parent or sick parent of a spouse, whose health condition (as confirmed by the competent physician) necessarily requires treatment by another natural person. This also applies in the case of a day nursing for a child up to 10 years of age under the legal conditions until the termination of the treatment or the nursing and from the day following the expiration of 52 weeks of temporary incapacity until its end. The employer shall be obliged to notify the Social Insurance Agency also of the beginning and end of the suspension of the insurance. This should be done on the form Registration Sheet of a Natural Person, with indication of the suspension. Such notification should be done within the period of 8 days from such beginning or end of the suspension. Under the Social Insurance Act, the employer shall be obliged to notify the Social Insurance Agency of the beginning and end of drawing maternity leave or parental leave within 8 days of the beginning and end of such drawing of the maternity leave or parental leave. Employers shall be also obliged to fulfill other obligations, which are specified in the Social Insurance Act (Article 231).
How should be insurance premiums paid and delivered and when are the insurance premiums due? The employer who is obliged to pay the insurance premiums is obliged to deliver the insurance premiums. Employee's insurance premiums should be delivered by his or her employer. The employer shall deduct the insurance premium that should be paid by the employee. The insurance premiums should be paid to the account of the Social Insurance Agency for the previous calendar month. When paying the insurance premiums, the employer shall be obliged to identify the respective payments and to indicate the corresponding variable symbol and specific symbol. The variable symbol will be assigned to the employer by the Social Insurance Agency. The specific symbol is a numerical designation of the relevant calendar month and year. Numbers of accounts of branches of the Social Insurance Agency are included in the part Numbers of Accounts of Branches of the Social Insurance Agency. If the employee was insured only during a part of a calendar month, the insurance premium shall be payable only for that part. The insurance premiums should be paid by wire transfer, postal money order or cash at the Social Insurance Agency. The premiums that are to be paid and delivered by the employer shall be due on the payout day. If no such day is defined, the insurance premiums shall be due on the last day of the calendar month following the month for which the premium is paid. If the insurance premiums are due on Saturday or Sunday, the insurance premiums shall be due on the next business day thereafter. Insurance premiums from an assessment basis of an employee with irregular income shall be payable until the 8th day of the calendar month following the calendar month in which the income was paid.
When will be insurance premiums, contributions and penalties prescribed by the Social Insurance Agency? Insurance premiums and contributions shall be prescribed by the Social Insurance Agency to the employer who is obliged to pay the premiums, if he has not delivered them at all or if he has not delivered them in the correct amount. If the amount of the insurance premium and contributions in total is less than EUR 3.32, the owed amount shall not be prescribed by the Social Insurance Agency. If an employer, who is obliged to pay premiums and contributions, has not paid the insurance premiums and contributions for the relevant calendar month in due time or has transferred them in a lower amount, the Social Insurance Agency shall prescribe him a penalty in the amount of 0.05% of the amount due for each day of delay from the date of payment of the premiums and contributions to the day when the amount due was credited to the account of the Social Insurance Agency in the State Treasury, or paid in cash, or paid to the executor, or until the date of commencement of the audit, unless the Social Insurance Act provides otherwise. The prescribed penalty may not exceed the amount of premiums and contributions due in the reviewed period. No penalty shall be prescribed by the Social Insurance Agency if it is not higher than EUR 3.32 for the period under review.
Obligations of a foreign employer, whose employees are subject to the social security legislation of the Slovak RepublicA foreign employer is obliged to register in the Register of Employers, kept by the Social Insurance Agency, by an Employer Registration Form (RLZ) in case he has employed at least one employee, who is a subject to the social security legislation of the Slovak Republic. The employer is also obliged to register this employee for social insurance by the Natural Person Registration Form (RLFO) in the Register of Insured and Savers of Pension funds prior to the commencement of insurance, not later than before the start of employment. In applications, notifications and submissions addressed to the Social Insurance Agency, a foreign employer is obliged to state the social security identification number of a natural person. Social Security ID is the birth number. A foreigner, who does not have a birth number assigned, will this number be assigned by the Social Insurance Agency. The Employer shall register the foreign employee by RLFO into the Social Insurance Agency in paper form, followed by the Social Insurance Agency´s issue of Social Security ID, which then will be used for purposes of social insurance. The forms required for employer registration (RLZ) and employee registration (RLFO) are available on the website of Social Insurance Agency www.socpoist.sk, in the „Forms“ – Formuláre / Forms. In general, the employer is obliged to communicate with the Social Insurance Agency electronically- the necessary forms, such as RLZ, RLFO, monthly insurance reports, premium statements and contributions are all submitted through the Electronic Services System (SES). In case of RLZ, if the employer is registering for the first time, he must submit the RLZ in paper form, if already registered in the previous period, RLZ will be sent either in paper form or electronically through SES. The Employee may, in justified cases, write a request to the Social Insurance Agency to be exempt from the obligation to send requested materials electronically. The employer shall submit a written request for exemption to the local branch concerned personally or using postal services. The employer is obliged to submit to the local branch of Social Insurance Agency a monthly statement of premiums and contributions (as of January 1st 2011 also for employees with irregular income) divided into individual employees and individual types of social insurance. You will find the forms here: Formuláre / Forms. The belonging to certain local branch of Social Insurance Agency for a foreign employer is determined by the permanent residence of the employee. In case the employee as a foreigner has no permanent or temporary residence in Slovakia, the location of branch will be determined by the place of employment of the employee in Slovakia. When calculating the income of an employee in a currency other than Euro, the conversion rate published by the European Central Bank shall be used to determine the base for the payment of social security contributions. The employer uses the conversion rate published the day, when he calculates the base payment and insurance. The conversion rate is published twice daily- in the morning and in the afternoon. The employer uses the rate of the current time of calculation of the payment base and insurance.
Insurance payment The employer, who is obliged to pay insurance, is obliged to pay premiums. Employee´s insurance premium is paid by the employer. The employer deducts the premium that the employer is obliged to pay. Insurance with premiums is payed to the account of Social Insurance Agency for a calendar month backward. When paying the insurance premium, the employer is obliged to identify the payment and to give it a variable symbol and a specific symbol. The variable symbol is given by the Social Insurance Agency. The specific symbol is the numerical designation of the relevant calendar month and year. The Social Insurance Agency branch office account numbers are on the Social Insurance Agency's website under Insurance - Branch Account numbers. If the employee´s insurance only lasted a part of a calendar month, only this part will be paid for. Insurance is paid by online transfer, check or in cash at the Social Insurance Agency. The premium and insurance paid by the employer are due on pay-day. If that day is not stated, the premium is payable on the last day of the calendar month following the month for which the premium is paid. If the insurance premium pay-day falls on Saturdays and Sundays, the premium is payable on the next business day thereafter. The insurance from employee with irregular income is due the 8th calendar day of the month following the month for which the income was cleared. More information on insurance and premium payments are available on the webpage of Social Insurance Agency (Obligations of foreign employers) in English (or Pflichten der auslandischen arbeitgeber in German language).
Prescription of premiums by Social Insurance Agency and penalties The Social Insurance Agency prescribes premiums and contributions to employer obliged to pay insurance in case he has failed to do so or has paid the incorrect amount. Employers obliged to pay contributions and premiums, who have failed to do so, or have paid the incorrect amount, the Social Insurance Agency grants a penalty of 0.05% from amount due for each day of delay starting the due-day to the day when the amount due is credited to the account of the Social Insurance Agency at the State Treasury, paid in cash, to the executor or until the day of the beginning of audit, unless legislation states otherwise. The prescribed penalty may not exceed the amount of premiums and contributions due for the period under review. After the termination of employee´s status for social insurance (e.g. termination of contract) cancellation from compulsory social insurance of the employee is submitted by the employer. The same form applies as for the registration- RLFO. Submitting a cancellation form RLZ- an employer may de-register from the Register of Employers in eight days following the day, when no employee is employed by the employer. |
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