| <<<Back |  | Working in Russia |  | Forward>>> |
XII. Unemployment - безработица
1. How to Apply for Unemployment (Как оформлять получение пособия по безработице)
If the employee had worked 26 fulltime weeks before being discharged on honorable grounds or quitting “with good reason,” he/she may also register with their local Employment Service (биржа труда) and apply for unemployment benefits (пособие по безработице). For the first three months of unemployment, the unemployed receive 75% of their former wages, then 60% for another four, and 45% for the rest of the year. For an additional year, or if the applicant does not meet the work requirements, the unemployed may receive benefits in the sum of 30% of the minimum subsistence level (размер прожиточного минимума) for their region.
2. Funding and Administration (финансирование и администрация)
The Ministry of Health Services and Social Development (Министерство здравоохранения и социального развития) provides general supervision, control, and partial financing for the program. Regional employment services are charged with administering and financing the program.
Commentary: 8.3 percent of the Russian population was officially unemployed as of 2005. However, only about 3% of all Russians have registered with the unemployment office and only about 1% receives benefits. Low registration is due, in part, to the fact that benefits are very low. They are calculated by the employee’s official wages, which are often much lower than an employee’s actual wages. (See section III).
Commentary: The official minimum subsistence level varies across Russia. In Moscow, it is calculated at 4101 RU per month and in Irkutsk, at 2590 RU per month. In Moscow, a thirty percent payment would thus be equal about $43 US.
Commentary: The official unemployment figure is approximate at best since many employees are unofficially employed and many more are on company record books as being employed when they have really been released or have left.
XIII. Retirement (отставка; выход на пенсии)
Standard retirement age in Russia is 60 for men and 55 for women. Those who have worked in certain dangerous conditions can retire early and teachers, nurses and doctors may retire after a set number of years (25-30).
1. State Pension (Пенсионный Фонд Российской Федерации - ПФР)
State pension is calculated as 55% of the retiree’s former salary. Retired government employees and military personnel qualify for bonuses. If a worker chooses to remain in the labor force and not draw a pension, that worker can add 1% to the base of 55% for each extra year worked, to a maximum of 75%. Theoretically, pensions are to be indexed for inflation each year, although the government in crises years has withheld this index and crises years have, unfortunately, not been few. The average pension is currently 2500 RU (90 US).
Commentary: Again, the presence of official and unofficial pay poses a problem, because the pension is figured based on official pay. (See section III)
Commentary: One thing that President Putin is credited with is reform of the pension system. Most pensioners who own their apartments now claim that they have barely enough to feed and clothe themselves (which is an improvement from the nineties), although medications are still a heavy burden.
2. Private Pension Funds (негосударственные пенсионные фонды)
A handful of large, highly successful companies have retirement programs for their workers, but these are very rare. There are some private investment firms that are now helping private individuals create personal retirement funds. These pension funds will likely continue to grow in importance and perhaps eventually eclipse the state fund as problems with earnings reporting compound.
Commentary: To find out a bit more about the growth of these funds, see the following interview with Bernard Suchar, one of the founding leaders in the field for Russia.
 | Special Thanks to:
Alexey Panteleev, Artem Babamuratov, Chet Bowling and especially to the employees of Alinga Consulting Group, a business consulting and audit firm with offices in Moscow and Boston, for their help in compiling and verifying this information. ACG is a sister company to SRAS. |
Questions or comments about this resource? Contact the author.
| <<<Back | 
Painters in Moscow, three stories up. Note the lack of safety equipment. | Working in Russia | 
ACG employees go on a company retreat. | Forward>>> |
