Employees Under 35 Must Adhere To Pvt Pension Fund 4 Mos From Hiring

Romanians under 35 must adhere to a private pension fund (Pillar II) in maximum four months after their hiring, said on Tuesday the Pension Watchdog, or CSSPP.

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The CSSPP council approved amending Norm no. 18/2007 on the initial adhesion and the evidence of participants to private pension funds, with all subsequent amendments, so that the normative act might contain common dispositions with respect for initial as well as continuous adhesion.

The continuous adhesion is the process through which eligible citizens become willing participants in a private pension fund, by signing an individual adhesion act or by being randomly assigned to such a fund by the National Pension House, subsequent to the initial adhesion process that ended on January 17, 2008.

“The new provisions on continuous adhesion stipulate all eligible people, under 35 must adhere to a private pension fund in maximum four months after they become eligible,” a press statement reads.

People who failed to adhere to a private pension fund as well as people who adhered to more than one fund, will be randomly distributed by the National Pension House by the 20th of each month.

CSSPP said that the distribution of people to pension funds will be made according to each fund’s market share.

The transfer to another pension fund can be made only after paying the first contribution to the pension fund a person chose or way assigned to.

The norm to amend Norm no.18/2007 will be published in the Official Gazette and will also be available on the CSSPP internet page.

The adhesion campaign to Pillar II took place during September 17, 2007- January 17, 2008.

Under Romanian pension law, the implementation of private pension system implies transferring 2% of the employee’s social insurance contribution – which currently reaches 9.5%– from the state management into private management.

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