Is the Egyptian government deceiving employees by calling for early retirement?

Mahmoud Seddik - Cairo

While the Egyptian citizen suffers many difficulties, the category of employees has many difficulties that sometimes lead some to the option of early retirement with the resort to search for a private job, but early retirement seems to have many risks, which requires consideration of the matter before embarking on it.

A female deputy raised a state of controversy among employees and pensioners when she advised Hani Mahmoud, the advisor to the Prime Minister for administrative reform, not to make statements without examining the legislation that comes out of Parliament for the public interest.

Mahmoud had stated that whoever applies for an early pension and exceeds the age of fifty will receive an exceptional promotion and a full pension, as if he had reached sixty years, which is the official retirement age.

Maysa Atwa (deputy of the Labor Force Committee in the House of Representatives) rejected what she saw as a government call for early pension because it harms the interests of some workers, so those who address the law that the government talks about will be deprived of many privileges if the conditions stipulated in the new law do not meet them.

What are the most important conditions for obtaining early pension under the new law? What are the most important difficulties that those who terminated their service and did not request the settlement of the pension will face after passing the law? Does the representative's statement mean that the government is deceiving workers and employees by inviting them to exit the pension early if the conditions are not met?

Early pension conditions
Law No. 148 of 2019 on Social Insurance began implementation on January 1, after it was ratified by the President of the Republic last summer. The law has set conditions that must be fulfilled in those who want to exit to the early pension, the most important of which is the existence of participation periods in old age, disability and death insurance that give the right to a pension of not less than 50% of the last settlement wage or income.

The insurance subscription must include, in accordance with the provisions of the law, an actual subscription period of no less than 240 months, and be for a period of three hundred actual months after five years from the date of the implementation of the new law.

This means, according to the comments of trade unionists, that those who do not have a twenty-year subscription period (up to 25 years starting from the application of the law) will not be able to apply for exit to the early pension.

Labor lawyer Mohamed Maher believes that there is a major crisis behind the new law, which is not defining a transitional period between applying the old and new laws to accommodate the affected people from the immediate application of the new law.

Deprivation of pension
The lawyer indicated to Al Jazeera Net that whoever goes out for a pension before the end of 2019, even one day, his pension will be completely different from his colleague who spent the same period of service, paid the same rate of participation and left after January 1, 2020.

Rather, those who leave for early retirement after applying the new law will be deprived of the full pension, but whoever came out before December 31, 2019 from the same employer, the length of service and the rate of participation deserves a pension according to the old law, according to the labor lawyer.

Muhammad Qutb, the trade union member of the Defense movement for pensioners, affirms that the new law did not say anything about the end-of-service gratuity that was paid by the insurance at a rate of one month for each year of the insurance period.

Government deception
Qutb added to Al Jazeera Net that the pension is calculated by the new law according to the average wage of the worker during the contribution period, and this will weaken the final amount of the settlement that was calculated by the old law over the average wage during the last five years of the service period in which the worker or employee reaches the highest salary.

He commented on the statements of the Prime Minister's adviser that motivated the exit of the early pension, and promised them many benefits that it would be a deception of the employees who would come out of the early pension to be shocked by depriving them of any pension according to the new law.

Almost impossible
Majdi Al-Badawi, Vice President of the Workers Union, President of the General Union for Press, Printing and Information Workers, believes that getting the insured to get an early pension is almost impossible due to the difficulty of achieving it in light of the current conditions regarding the average wages for workers in all sectors, whether governmental, public or private sectors.

And he confirmed - in press statements - that many are forced into an early pension due to health conditions and the inability to continue working, and a condition of 50% does not achieve the pension in any case, even if the age is over 55 years, very little, so those who are 38 to 52 years old cannot Obtaining an early pension, and he is able to work except in the presence of a disease that is proven through health insurance and disability committees.

Al-Badawi demanded to amend the condition of 50% of the last settlement wage to 50% of the average settlement wage for the previous period of the law, and the subsequent period of the law, or to add the phrase "excluded from this condition from exceeding the age of fifty" so that this can be applied to those who have exceeded the age of 53 years or more above.

Defense of the Minister of Solidarity
On the government side, Minister of Social Solidarity Nevin Kabbaj confirmed that this law gives all parties to the insurance relationship several advantages, whether the worker, the employer, the pensioner, or who are entitled to pensioners.

Al-Kabbaj said - in televised statements - that the benefits include a unified law that applies to all groups of Egyptians and is based on the unification of contributions, benefits, terms of participation and entitlement, in addition to reducing the rates of contributions for the employer and the insured.

According to the Minister, the new law has created an optional additional pension for insured persons whose wages exceed the maximum insurance wage in order to improve pensions, and to preserve all the additional rights that the insured, pensioners and those entitled to them receive without reduction.

It is reported that the actuarial study of the new law of insurance and pensions indicated that there is a contradiction between the early pension and the new law of insurance and pensions. the retirement".

The study, which was conducted with the participation of the International Labor Organization, monitored the exit of 45,000 employees annually to early pensions.