The Russian Federation has a system of obligatory social insurance. Employers pay insurance premiums in amounts set by law from the moment the employment contract is concluded. The following facts are recognised as insured events: reaching retirement age, disability, the loss of a breadwinner, illness, injury, an industrial accident or occupational disease, pregnancy and childbirth, plus maternity and paternity leaves until the child is 1.5 years, among others. When an insured event occurs, the insured persons receive insurance coverage from the relevant state non-budgetary fund (Social Insurance Fund, Obligatory Health Insurance Fund and Pension Insurance Fund).
Healthcare and Insurances
Russian employers pay insurance premiums to the Obligatory Health Insurance Fund, which finances the obligatory health insurance for all nationals, from birth. Employers also pay premiums to the Social Insurance Fund to cover the risk of industrial accidents. Quite many companies provide additional medical coverage to employees for the term of employment; in some companies this coverage is extended to family members.
Holidays and Annual Leave
Each employee has the right to annual paid leave of at least 28 calendar days. Extended annual paid leave is provided to specific categories of workers, e.g. employees working in the Northern regions, or in a harmful workplace, or having “irregular working hours”. Annual leave should be provided in the year it accrues, and if some days remain unused they roll over to subsequent years without limitation. Receiving monetary compensation for unused days during employment is limited, while at termination, compensation is due for all of the unused leave entitlement.
Maternity and Paternity Leave
There are two types of maternity leave in Russia: pregnancy and childbirth leave starts 70 calendar days (84 in the case of a multiple pregnancy) before childbirth and lasts 70 calendar days (86 in case of birth complications and 110 in case of a multiple birth) after childbirth, with payment of the state-funded allowance in the amount set by law; and childcare leave can last until the child is 3 years old. This leave can be taken by the mother, father or any other relative or guardian who actually takes care of the child. The state allowance is envisaged for the period until the child is 1.5 years old.
Sickness and Disability Leave
For periods of sick leave (to be confirmed by a medical certificate), an allowance is paid to the employee instead of her salary; the allowance is paid at the expense of the Social Insurance Fund, with the exception of the first three days, which are paid for by the employer.
The amount of the temporary disability allowance depends on the length of service of the insured person and may be 60%, 80% or 100% of the average wage on which insurance premiums are calculated (but cannot exceed the legal maximum). Russian law does not operate a separate concept of ‘disability leave’, which is instead handled as a succession of ordinary sick leave until the employee recovers or is qualified as permanently disabled.
Other Required or Typically Provided Leave(s)
There are numerous cases when certain categories of employees are entitled to additional forms of annual leave (fully paid), such as: employees of Northern regions (entitled to 8, 16 or 24 days of additional paid leave, depending on the region); employees with ‘irregular working hours’ are entitled to 3 extra days; employees in harmful workplaces are entitled to 7 extra days; etc. There are also cases which provide an entitlement to additional paid or unpaid days off (e.g. 4 paid days off per month for a caretaker of a disabled child; paid days off for medical check-ups;…). Many employers enhance the statutory guarantees; the most popular involve providing additional paid leave on 1 September for parents whose children go to school, and paying for days off taken for marriage, childbirth (for a father) or for the death of a close relative.
Pensions: Mandatory and Typically Provided
The current Russian retirement age is 60 for men, 55 for women; but is gradually being increased and is targeted to be 65 for men and 60 for women by 2028. Despite this, some categories of individuals may retire earlier (e.g. medical workers, employees in Far North regions).
Since state pensions are quite low, employees may choose to pay additional pension insurance contributions to an investment account intended to fund their state pension. The employer may pay matching contributions to the employee’s investment accounts of the state pension, though he is not obligated to do so. Individuals in Russia also have the option to pay into voluntary Russian pensions, via private Russian pension funds.
Other Required Or Typically Provided Benefits
In addition to the above listed statutory benefits, it is important to take note of the requirement to compensate employees working in specific Northern regions, for the cost or their travel to the place of annual leave and back, every two years (also for family members who are unemployed).
The following are optional, but popular benefits worth mentioning:
- paying up to salary during sick leave for a limited number of days per year;
- paid days of self-certified sick leave (commonly up to 5 per year);
- additional pay during maternity leaves;
- lunch allowance;
- paying up to salary during business travel or annual leave (during such periods the employee is paid average wages, which might be below the base contractual salary);
- material aid in case of childbirth, marriage or other family occasion.