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EU Social
Security in Cyprus
The employer, the employee and the State all contribute to social insurance (6.3%, 6.3% and 4% respectively). The social insurance requirement applies to all persons working in Cyprus. When you start work in Cyprus you will begin to pay contributions to the Social Insurance Fund. Participation in social insurance gives the possibility of benefit cover for contingencies such as unemployment, sickness, maternity, occupational disease, disability and death etc. And, of course, it facilitates pensions for the self-employed, the old-age pension and the survivor’s pension. · You can find out about your own specific case by contacting the Social Insurance Services (Tel. +357 22 401 600). Community social security provisions
Social security systems in EU countries still show substantial differences, and this calls for a necessary coordination of social security regulations. Common rules ensuring access to social benefits are important to avoid disadvantages for European workers exercising their right of free movement. They are designed to prevent EU citizens from running the risk of being ensured twice or losing their social security benefits when moving to another country.Although there is no single European social security system, the EU has set common provisions in the field of social protection. This includes the coordination of national social security schemes without seeking to harmonise national regulations. EU law has laid down common rules and principles to be observed by national local authorities and social security institutions that do not replace, but complement, the social security provisions of Member States. The common social security provisions have the objective to:
The application of common provisions
The common regulations do not apply to all national social security legislation.
The following benefits are covered: · maternity and sickness · family benefits · workplace accidents · old-age and invalidity pensions · survivor benefits · unemployment benefits Benefiting from social protection within the EU
Social security benefits available in other Member States are established
by common EU provisions and apply to the following categories of people:
Affiliation of migrant workers with national social
security systems
If an EU citizen works in another Member State, it is important to determine
which national social security system he or she is subject to – either
the one in which they are insured or the one where they exercise their occupation.
The necessity to avoid that a worker receive double insurance or no social
security at all, requires certain rules settling the basic principles of
affiliation to one system and/or the other.Receiving a pension in another Member State
EU nationals have the right to retire in another Member State. Countries
where a worker has made pension contributions share a proportional responsibility
for paying that pension, based on the period of employment.Further Information
Social Insurance ServicesAt: 7 Byron Avenue, 1465 Nicosia, Tel: 22 401772/685 Leave and Sickness
The legislation provides 20 working days of leave for workers on a five-day week
and 24 working days of leave for workers on a six-day week. The contract
of employment or the collective agreement may give more days of leave (with
pay). Workers request the leave and take it when the needs of the company
permit. The number of official holidays, on which offices and organisations are closed, varies from 14 to 17. · Information about this can be obtained from the Social Insurance Department (Tel. +357 22 401 628/629). · Information about sickness and parental leave, leave for reasons of force majeure etc. can be obtained from the Department of Labour Relations (Tel. +357 22 451 500/1). Sickness
Sickness leave is fixed by agreement between employers and employees through collective
or individual agreements. A worker who does not receive sick pay from his
employer is entitled to sickness benefit from the Social Insurance Fund
under certain circumstances.Sickness benefit is payable to insured employed and self-employed persons and to persons who are working abroad for Cypriot employers and are voluntary contributors. Payment of sickness benefit is subject to the following conditions:
Sickness benefit is payable for at least 156 working days in each period of interruption of employment. Payment of the benefit may be extended for a further 156 working days in the same period of interruption of employment if the insured person satisfies the contributions requirements for an invalidity pension but is not expected to be permanently incapable of work. The amount of the benefit is determined on the basis of the insured person’s average weekly paid and credited insurable earnings in the previous contributions year. In order to be paid sickness benefit the insured person must submit a claim on a special form which can be obtained from any social insurance office and from the website of the Social Insurance Services. The claim must be accompanied by a medical certificate and be submitted within 21 days from the date on which the person became unable to work. Maternity and paternity
Sixteen weeks of maternity leave are given. Nine weeks must be given before the
period commencing two weeks before the expected date of the birth. An adoptive
mother is entitled to 14 weeks of maternity leave from when she takes over
the care of the child.Both the father and the mother are entitled to parental leave. A parent who has worked for an employer for more than six months is entitled to parental leave of up to 13 weeks after a birth or adoption in order to attend to the care and raising of the child. The law also provides for leave for reasons of force majeure (e.g. ill dependents). Study
If you are studying for a degree you should be aware that some organisations grant
leave for that sort of thing. Whether or not such leave is granted is up
to the employer. The leave is usually granted to enable the employee to
obtain professional qualifications (e.g. certified accountants) or qualifications
which enhance his work skills. If you are thinking of continuing your studies,
it is advisable to come to an agreement with your employer before proceeding.Self employment
It should be noted that most companies in Cyprus work in the services sector and
are classified as small on the basis of the EU definition.Registering a company in Cyprus requires the submission of an application to the Registrar of Companies (+357 22 40 44 00), in order that the name of the company can be examined and approved, and payment of a fee of €12 or, if the rapid service is required, of €25. After the name has been approved, the relevant documents have to be submitted by a lawyer practising in Cyprus. The registration fee depends on the capital of the company. If you are interested in creating a company in which you will be self-employed or in moving your existing company to Cyprus, you should seek the guidance of a lawyer and an accountant in order to avoid mistakes and unnecessary trouble. You can find information relating to companies and/or professionals providing legal and accountancy services on the websites of the Nicosia Bar Association and the Institute of Certified Public Accountants of Cyprus. If you wish to pursue a regulated profession in Cyprus, you must submit an application for that purpose to the competent body, together with the requisite certificates and items of proof. · Information can be obtained from the National Reference Body for Professional Qualifications at the Department of Labour (Tel: +357 22 400 845). Financial assistance, subject to criteria, is provided to young people and women for innovative activity through the national benefits framework, chiefly by the Ministry of Commerce, Industry and Tourism. Pensions
Contributions and benefits are proportionate and calculated as a percentage of
the insured person’s income from employment. A main feature is the
provision for the regular revaluation of insurable earnings and the adjustment
of benefits in line with movements in salaries, wages and the consumer prices
index.The Social Insurance Scheme provides compulsory cover for every person who is gainfully occupied in Cyprus. Insured persons are placed in three categories: · employed persons · self-employed persons · voluntary contributors Employed
The contribution in the case of an employed person is calculated on the basis
of the wage or salary up to a certain ceiling. The contribution is shared
between the employer, the employed person and the State at the rates, respectively,
of 6.3%, 6.3% and 4%.Self-employed The contribution in the case of a self-employed person is calculated on the basis of income levels which are fixed according to occupation and the place of the employment. Voluntary
The contribution rate for voluntary contributors within Cyprus is 13.5% of earnings.
The insured person pays 10% of the contribution and the State pays 3.5%.
The contribution rate for voluntary contributors employed by Cypriot employers
abroad is 16.6%, of which the insured person pays 12.6% and the State pays
4%.The Scheme
The Scheme provides cash benefits for marriage, maternity, sickness, unemployment,
widowhood, invalidity, orphans, old age, in respect of a missing person
spouse, funerals, employment injuries and occupational diseases. It also
provides free medical treatment for persons with entitlement to an invalidity
pension and for insured persons who have suffered bodily harm because of
an employment injury or occupational disease. Employed persons have entitlement to all the above-mentioned benefits. Self-employed persons are not entitled to unemployment benefit and employment injury benefits. Voluntary contributors are entitled only to the marriage, maternity, widowhood, old age, missing person, orphan and funeral benefits. Voluntary contributors working abroad for Cypriot employers are entitled to all the benefits to which employed persons are entitled other than employment injury benefits. Unemployment Benefits
Unemployment benefit is payable to insured persons who have been employed and
to voluntary contributors who have worked abroad for a Cypriot employer.
Insured persons under 16 and over 63 years of age are not entitled to employment
benefit.An insured person may claim unemployment benefit for days when he is unemployed, able to work and willing to accept suitable employment. He is not considered to be unemployed:
Conditions:
When an employed person becomes unemployed, unemployment benefit is paid from the fourth day of unemployment. In the case of a voluntary contributor who was working abroad for a Cypriot employer, the benefit becomes payable after the first 30 days of unemployment. The benefit is payable for 156 working days in each period of interruption of employment. Unemployment benefit is made up of a basic benefit and a supplementary amount. In order to claim benefit the unemployed person must attend in person at the nearest social insurance office and sign the unemployment register. He must attend regularly to sign the register on days stipulated by the social insurance office. An unemployed person loses entitlement to unemployment benefit for up to six weeks if he:
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