Lietuviškai
THE CONSTITUTIONAL COURT OF
THE REPUBLIC OF LITHUANIA
R U L I N G
On the compliance of Article 5 of the Republic of
Lithuania Law on State Social Insurance, Item 1 of
Part 2 of Article 8 of the Republic of Lithuania
Law on State Social Insurance Pensions, and Item 1
of the 26 January 1996 Republic of Lithuania
Government Resolution No. 142 "On Partial
Amendment of the 20 February 1995 Republic of
Lithuania Government Resolution No. 266 "On
Approving the Rules of Forming of the Budget of
the Republic of Lithuania State Social Insurance
Fund and Its Implementation"" with the
Constitution of the Republic of Lithuania
12 March 1997, Vilnius
The Constitutional Court of the Republic of Lithuania,
composed of the Justices of the Constitutional Court Egidijus
Jarašiūnas, Kęstutis Lapinskas, Zigmas Levickis, Augustinas
Normantas, Vladas Pavilonis, Jonas Prapiestis, Pranas Vytautas
Rasimavičius, Teodora Staugaitienė, and Juozas Žilys,
the secretary of the hearing - Daiva Pitrėnaitė,
Jadvyga Andriuškevičiūtė, an adviser at the Social Affairs
and Labour Committee of the Seimas, the representative of the
Seimas,
the party concerned - Vytautas Žiūkas, Director of the
Department of International Affairs at the Ministry of Social
Protection and Labour, Benjaminas Merčaitis, Head of the Labour
Relations Division at the Ministry of Social Protection and
Labour, and Vincas Kunca, Director of the Board of the State
Social Insurance Fund, all they are the representatives of the
Government,
pursuant to Part 1 of Article 102 of the Constitution of
the Republic of Lithuania and Part 1 of Article 1 of the Law on
the Constitutional Court of the Republic of Lithuania, in its
public hearing on 19 February 1997 conducted the investigation
of Case No. 5/96 subsequent to the petition submitted to the
Court by the petitioner - the Šiauliai City District Court -
requesting to investigate if Article 5 of the Republic of
Lithuania Law on State Social Insurance, Item 1 of Part 2 of
Article 8 of the Republic of Lithuania Law on State Social
Insurance Pensions and Item 1 of the 26 January 1996 Republic
of Lithuania Government Resolution No. 142 "On Partial
Amendment of the 20 February 1995 Republic of Lithuania
Government Resolution No. 266 "On Approving the Rules of
Forming of the Budget of the Republic of Lithuania State Social
Insurance Fund and Its Implementation"" were in compliance with
the Constitution of the Republic of Lithuania.
The Constitutional Court
has established:
I
On 15 April 1996, the petitioner - the Šiauliai City
District Court - was investigating a civil case pursuant to the
claim of E. Šapienė to the city of Šiauliai division of the
Board of the State Social Insurance Fund, the Board of the
State Social Insurance Fund and the stock company "Šiaulių
Tauras" regarding the diminished person's pension period. By
its interlocutory ruling the court suspended the investigation
of the said case and appealed to the Constitutional Court with
the request to investigate if Article 5 of the Law on State
Social Insurance (Official Gazette "Valstybės Žinios", No.
17-447, 1991), Item 1 of Part 2 of Article 8 of the Law on
State Social Insurance Pensions (Official Gazette "Valstybės
Žinios", No. 59-1153, 1994), and Item 1 of the 26 January 1996
Republic of Lithuania Government Resolution No. 142 "On Partial
Amendment of the 20 February 1995 Government Resolution No. 266
"On Approving the Rules of Forming of the Budget of the
Republic of Lithuania State Social Insurance Fund and Its
Implementation"" (Official Gazette "Valstybės Žinios", No.
10-253, 1996), were in compliance with Article 52 of the
Constitution.
II
The petitioner grounds his request on the following
arguments.
Article 52 of the Constitution stipulates that the State
shall guarantee the right of citizens to old age and disability
pension, as well as to social assistance in the event of
unemployment, sickness, widowhood, loss of breadwinner, and
other cases provided by law. The petitioner alleges that under
Article 212 of the Civil Code the guarantee is an obligation to
satisfy the creditor for another person in case the person for
whom it is guaranteed does not fulfil his obligation or portion
thereof. Therefore, in the opinion of the petitioner, assessing
the norms of Item 1 of Part 2 of Article 8 of the Law on State
Social Insurance Pensions, those of Article 5 of the Law on
State Social Insurance, and those of Item 1 of the 26 January
1996 Government Resolution No. 142 "On Partial Amendment of the
20 February 1995 Republic of Lithuania Government Resolution
No. 266 "On Approving the Rules of Forming of the Budget of the
Republic of Lithuania State Social Insurance Fund and Its
Implementation"", a conclusion is to be drawn that for a
person, who is insured by state social insurance on compulsory
basis, the time period for which the employer has not paid
insurance contributions may be included or not included into
person's period to get pension depending on the agreement
between the employer and the institution of social insurance,
even though the insured person cannot exert any influence over
it.
In the opinion of the petitioner, in such a case the
provisions of Article 1, Item 1 of Article 4, Articles 29, 30,
32, 38 and 45 become meaningless and the state does not
guarantee the citizens their constitutional right to social
maintenance. Therefore the district court requests to
investigate whether Article 5 of the Law on State Social
Insurance, Item 1 of Part 2 of Article 8 of the Law on State
Social Insurance Pensions, and Item 1 of the 26 January 1996
Government Resolution No. 142 "On Partial Amendment of the 20
February 1995 Republic of Lithuania Government Resolution No.
266 "On Approving the Rules of Forming of the Budget of the
Republic of Lithuania State Social Insurance Fund and Its
Implementation"" are in compliance with Article 52 of the
Constitution.
III
In the course of preparation of the case for judicial
investigation, on 31 July 1996 an explanation of G. Paviržis,
then Chairman of Health, Social and Labour Affairs Committee of
the Seimas, was received wherein it was indicated that the
system of social insurance is based on principles of uniformity
and obligation. The right to insurance payment occurs upon
fulfilling the requirements established by the law. Article 5
of the Law on State Social Insurance and Item 1 of Part 2 of
Article 8 of the Law on State Social Insurance Pensions
establish one of the conditions upon fulfilling of which the
right to social insurance payment occurs. The period of state
social insurance and person's period of state social pension
insurance are defined as the time period when a person's state
social insurance contributions are being paid by the person
himself or are being paid for him. The period of state social
insurance is important not only to calculation of pensions but
also to those of unemployment, sickness, motherhood benefits,
as well as other social insurance payments.
The said explanation indicated that, after the Law on
State Social Insurance Pensions come into force, pensions were
recalculated establishing the period of state social insurance
that a person had had. The aforementioned period is one of the
most objective criteria in establishing the contribution of the
insured person into the fund of social insurance as the size of
the contribution depends upon the size of the remuneration for
work of the insured person.
The State Social Insurance Fund budget revenue consists of
compulsory state social insurance contributions paid by legal
and natural persons, the revenue of the Board of State Social
Insurance Fund activities, appropriations from the state budget
allocated under the Law on State Budget, and voluntary state
social insurance contributions. The main part of the state
social insurance budget is formed from compulsory state social
insurance contributions. The period of state social insurance
is linked with these contributions so that the rights of
citizens, which are guaranteed by the Constitution, to old age
and disability pension, as well as social assistance in the
event of unemployment, sickness and other cases were realised.
It is maintained in the said explanation that the word "to
guarantee" is used in Article 52 and other articles of the
Constitution in the sense of "to motion, firmly promise,
guarantee, assure; to guarantee compensation for people". It
means that the state motions, guarantees and ensures citizens'
rights by regulating their implementation by laws and other
legal acts. In the district court the case is investigated
because of the size of the granted pension as the size of
pension directly depends on the period of social insurance and
the size of contributions but the question of realization of
the constitutional right, i.e. granting of pension is not under
investigation in the aforesaid case. Calculation and payment of
insurance contributions are not identical notions. Calculation
of insurance contributions is a primary action whereby the size
of a particular contribution is established and the said size
depends on the remuneration for work of the insured person,
whereas payment of insurance contributions means factual
remittance of calculated contributions into the account of the
Board of the State Social Insurance Fund. Therefore the
contested legal acts are in compliance with Article 52 of the
Constitution.
It is pointed out in the 25 July 1996 explanation of V.
Žiūkas, then secretary of the Ministry of Social Protection and
Labour, that the words "the state shall guarantee" used in
Article 52 of the Constitution are understood in the sense that
"the state shall vouch for" or "the state shall secure"
citizens' right to receive the guarantees provided for by the
Constitution. In the sense of Article 52 of the Constitution
the state, by implementing provisions of laws and other legal
acts which must be followed by enterprises, institutions,
organisations, officials and citizens of the Republic of
Lithuania, secures to citizens social guarantees indicated in
the said article ensuring that citizens receive these rights,
however, the state does not resort to any security or other
agreements while doing so. The notions "person's period of
state social pension insurance" and "the period of state social
insurance" are identical in the sense of granting of pension.
Insurance payers are responsible for calculation and
payment of insurance contributions. Payments of insurance
contributions are controlled and sanctions for the violation of
their payment procedure are applied by institutions of state
social insurance.
The State Social Insurance Fund budget (from which
pensions are paid) revenue consists of compulsory state social
insurance contributions paid by legal and natural persons, the
revenue of the Board of State Social Insurance Fund activities,
appropriations from the State Budget, and voluntary state
social insurance contributions. Thereby the state ensures
citizens' constitutional right to old age pension. The main
portion of the budget is formed from compulsory state social
insurance contributions paid by legal and natural persons (30+1
per cent against employees' remuneration for work), therefore
the law associates these contributions but never their
calculations with the period of state social insurance because
otherwise the required sum of money would not be accumulated to
pay pensions. Applying the said provisions, the state
guarantees citizens' constitutional right to old age pension.
It is alleged in the explanation that the laws do not
provide that insurance payers shall be exempted from compulsory
state social insurance contributions. Legal provisions
regulating payment of state social insurance contributions are
interpreted on the assumption that all insurance payers pay
them constantly to the budget of State Social Insurance Fund.
Providing there are violations, respective sanctions are
applied to them without exempting them from the payment of
required contributions.
The explanation indicates that providing the time period
when the insurance payer does not pay state social insurance
contributions for the insured person were included into
person's state social insurance period, the interests of
conscientious insurance payers and those of the insured persons
for whom these contributions are honestly paid would be
violated. Besides, the law does not provide for the
implementation of solidarity principle between the payer and
the insured. According to the Rules of the List of the Insured
on State Social Insurance Basis approved by the 5 June 1995
Government Resolution No. 782 "On Approval of the Rules of the
List of the Insured on State Social Insurance Basis", the
insured person, once a year, is entitled to acquaint himself
with the information which has been accumulated by the employer
or which has been transferred to a territorial division of the
Board of Social Insurance Fund. Thus the insured person is
granted the right to exert control by himself over the payment
of compulsory state social insurance contributions for him into
the budget of the State Social Insurance Fund.
It is noted in the explanation that the 17 October 1995
Law "On Amending and Supplementing the Republic of Lithuania
Law on State Social Insurance" granted the right to the Board
of the State Social Insurance Fund to exempt enterprises,
institutions, organisations from fine payments for overdue
remittance of contribution sums or to postpone exaction of the
said fine provided they are not able to pay contributions into
the budget of the State Social Insurance Fund for the reasons
that are not dependent on their activities. Therefore the
Government by Item 1 of its 26 January 1996 Resolution No. 142
"On Partial Amendment of the 20 February 1995 Government of the
Republic of Lithuania Resolution No. 266 "On Approving the
Rules of Forming of the Budget of the Republic of Lithuania
State Social Insurance Fund and Its Implementation"
supplemented the Rules of Forming of the Budget of the Republic
of Lithuania State Social Insurance Fund and Its Implementation
and established that providing the Board of State Social
Insurance Fund postpones exaction of contributions compulsory
to the insurance payer, and providing the insurance payer pays
all current contributions or clears off existing debts in other
manner, the period of accumulation of debts and the period of
their payment postponement shall be included into the period of
social insurance. If the period of contribution exaction is
postponed, and the insurance payer does not pay them, the debt
period may be included into the period of social insurance of
the insured person when in a particular case of pension
granting the insurance payer pays for him a respective sum of
compulsory social insurance contributions which have not been
paid.
Alongside, the Constitutional Court received the
explanation of 13 January 1997 of a specialist - the associate
professor R. Lazutka, Director of the Centre of Social
Insurance Training and Research - regarding disputed legal
norms.
IV
In the hearing of the Constitutional Court the
representative of the Seimas J. Andriuškevičiūtė agreed in
essence with the arguments set forth in the paper of the
Chairman of Health, Social and Labour Affairs Committee of the
Seimas.
During the court hearing the representatives of the
Government V. Žiūkas, B. Merčaitis and V. Kunca agreed in
essence with the motives of the explanation of the Ministry of
Social Protection and Labour and alleged that the disputed
legal acts were in compliance with Article 52 of the
Constitution.
Explanations in the court hearing were presented by a
specialist - the associate professor R. Lazutka, Director of
the Centre of Social Insurance Training and Research.
The Constitutional Court
holds that:
Article 52 of the Constitution provides that the State
shall guarantee the right of citizens to old age and disability
pension, as well as to social assistance in the event of
unemployment, sickness, widowhood, loss of breadwinner, and
other cases provided by law.
These provisions express social character of the state,
while social maintenance, i.e. contribution of the society to
maintenance of such its members who are incapable to provide
themselves from work or other means or who are not sufficiently
provided due to important reasons provided by law, is
recognised as having the status of a constitutional value.
This is in line with the contemporary concept of functions
of the state, as well as the constitutional tradition of the
Lithuanian State of the 20th century, the origins of which is
in the 1922 Constitution which provided that the state,
pursuant to certain laws, shall protect employees in the event
of sickness, old age, accident or unemployment.
Alongside, it should be noted that the provisions of
Article 52 of the Constitution guaranteeing citizens' right to
social maintenance, are in line with the principles of social
protection consolidated in international legal acts, too.
Measures of social protection express the idea of public
solidarity. They help a person to protect himself from possible
social hazards. Of course, in a civic society the principle of
solidarity does not deny personal responsibility for one's
destiny. This is the most important condition of the expression
of a free human being. The recognition of mutual responsibility
of a person and the society is important in ensuring social
harmony, guaranteeing freedom of a person and possibility to
protect oneself from difficulties which could not be overcome
by one person alone. Therefore the state creates a system of
social maintenance which would help to maintain living
conditions corresponding to personal dignity, and, in case of
need, would render a person necessary social help.
As a rule, social maintenance is rendered in 2 forms -
social insurance and social assistance - for persons who due to
the reasons that do not depend on them are incapable to provide
themselves with sufficient means for the living.
The sources of social insurance are associated with the
recognition of the right of employees to certain payments, as
well as to old age pension. To implement this right social
insurance funds are founded which are formed from contributions
of employers and employees. As a rule, a certain part of means
are allotted to these funds by the state. The contributions of
employers and employees are calculated taking account of
remuneration for work while sizes of would-be pensions or
benefits are associated with the said contributions. This is an
essential characteristic of social insurance. In this it
differs from social assistance which is rendered to persons who
need it but who are not entitled to get maintenance from a
social insurance fund, or who get some means from it but they
are insufficient for living. The source of social assistance is
budgets of either the state or local governments.
Upon restoration of the independent state of Lithuania, it
became evident that the inherited system of social guarantees
did not correspond the relations of market economy. Devising a
social protection corresponding changed economic and social
living conditions, a model of social protection was chosen
according to which state social insurance acquires the main
role.
The principles of the relations of state social
maintenance are consolidated by the Law on Principles of State
Social Maintenance System passed on 23 October 1990 whereby it
is established that State Social Maintenance System is the
basis of State Social Welfare. The law also provides that along
with this system, other public and private systems of social
maintenance may exist. It is established by the Law on State
Social Insurance adopted on 21 May 1991 that State Social
Insurance shall be the system of social economic measures
established by the State, which shall provide insured residents
of Lithuania, as well as their family members in cases
established by law, with finances and services necessary for
living if, for reasons established by law, they are unable to
subsist on their earned income or other income, or for valid
reasons established by law, they have additional expenditures.
The relations of state social insurance are also regulated by
the Law on State Social Insurance Pensions passed on 18 July
1994.
The following types of state social insurance are
established in Lithuania: pension insurance; sickness or
motherhood insurance when persons are insured for sickness and
maternity (paternity) benefits; insurance for burial benefit;
insurance for compensations for transport expenses; insurance
against unemployment when persons are insured for unemployment
benefits under the Law on the Employment of the Population;
insurance against accidents at work and occupational disease,
as well as for other payments. The categories of persons who
are insured by every type of insurance are established by
respective laws regulating the procedure of that type of
insurance. Alongside, there exists established procedure of
compulsory insurance of persons.
Alongside, the provisions of Article 52 of the
Constitution which guarantee citizens the right to social
maintenance obligate the state to establish sufficient measures
to implement and protect the said right.
1. On the compliance of Article 5 of the Law on State
Social Insurance and Item 1 of Part 2 of Article 8 of the Law
on State Social Insurance Pensions with the Constitution.
1.1. Article 5 of the Law on State Social Insurance
stipulates that "the period of state social insurance shall be
the period when a person's contributions are being paid by the
person himself or are being paid for him, as well as any other
period which is equalled by law to the period of state social
insurance coverage".
Article 8 of the Law on State Social Insurance Pensions
determines insured person's period of state social pension
insurance which was acquired when the person was working under
employment contract or on the basis of membership or service,
as well as that which was acquired when the person was
self-employed.
Items 1-4 of Part 1 of Article 2 of the Law on State
Social Insurance Pensions list the persons who acquire the said
period under employment contract, as well as employed in
elective institutions on the basis of membership, partnerships,
agricultural companies or cooperative organisations and
receiving remuneration for work, as well as other indicated
persons. Person's period of state social pension insurance of
the aforementioned categories of persons is determined by the
norms disputed by the petitioner. Item 1 of Part 2 of Article 8
of the Law on State Social Insurance Pensions stipulates that
person's period of state social pension insurance is "the
period during which these persons pay by themselves state
social insurance pension contributions established by law or
the contributions are paid for them".
The petitioner is of the opinion that, provided the
disputed norms are followed, the period for which the employer
has not paid insurance contributions may be either calculated
or not calculated into the period under which pension is
received for a person who is insured by compulsory state social
insurance. Therefore, the norms of Article 5 of the Law on
State Social Insurance and those of Item 1 of Part 2 of Article
8 of the Law on State Social Insurance Pensions violate the
rights of these persons when they associate person's period of
state social pension insurance with the payment of insurance
contributions. The petitioner doubts whether these norms are in
compliance with Article 52 of the Constitution which provides
that the state shall guarantee the right of citizens to old age
and disability pension, as well as to social assistance in the
event of unemployment, sickness, widowhood, loss of
breadwinner, and other cases provided by law.
Investigating the issues pointed out in the petition, the
Constitutional Court notes that, when allotting pensions,
"period of state social insurance" established in the Law on
State Social Insurance and "the person's period of state social
pension insurance" established in the Law on State Social
Insurance Pensions, in essence have identical meaning,
therefore the compliance of the both disputed norms with the
Constitution is to be investigated concurrently.
1.2. State social insurance pensions are paid from the
budget of the State Social Insurance Fund of the Republic of
Lithuania. It is an independent budget which is included
neither into the budget of the state nor those of local
governments. Article 30 of the Law on State Social Insurance
provides that the State Social Insurance Fund budget revenue
consists of compulsory state social insurance contributions
paid by legal and natural persons, the revenue of the Board of
State Social Insurance Fund activities, appropriations from the
state budget allocated under the Law on State Budget, and
voluntary state social insurance contributions. The main part
of state social insurance budget is formed from compulsory
state social insurance contributions.
Insurance payers, i.e. enterprises of all forms of
ownership, institutions and organisations, as well as natural
persons, that pay remuneration to persons who work under
employment contract, as well as employed in elective
institutions on the basis of membership or service, are
responsible for fair calculation of state social insurance
contributions and their duly payments into the budget of the
State Social Insurance Fund. The functions of insurance payers
are implemented by owners of individual enterprises and other
persons equalled to them by an established procedure.
Part 36 of the Law on State Social Insurance provides that
state social insurance contributions shall be calculated and
paid to the budget of the State Social Insurance Fund by the
insurance payer himself. Item 1 of Part 2 of Article 4 of the
Law on State Social Insurance mentions persons for whom state
social insurance is compulsory. Article 2 of the Law on State
Social Insurance Pensions lists persons who are compulsorily
insured by state social pension insurance. Part 3 of the said
article points out that other persons may be insured by this
insurance on a voluntary basis.
The insurance payers - enterprises, institutions,
organisations - calculate and deduct social insurance
contributions from incomes of the aforesaid insured persons and
pay them into the budget of the State Social Insurance Fund.
The procedure and dates of their payment are established by the
Rules of Forming of the Budget of the Republic of Lithuania
State Social Insurance Fund and Its Implementation. They
provide that insurance payers, when calculating the sums of
remuneration for work, must calculate compulsory state social
insurance contributions and pay them into the budget of the
Republic of Lithuania State Social Insurance Fund no later than
the last working day which falls before the fifteenth day of
the following month. The paid remittances are presented for
banks for the whole sum of respective period of compulsory
state social insurance contributions irrespective of the fact
how much means exist in the account of the insurance payer,
while the sums of contributions of the insurance payer and
those of the insured are indicated separately.
On associating person's period of state social insurance
with the aforesaid contributions, the disputed norms attempt to
ensure accumulation of means required to pay pensions and
benefits.
The problems and difficulties of current period of changes
in Lithuanian economy and social life influence the functioning
of social insurance system. Not all enterprises are able to
adapt themselves to the new conditions, other business entities
are still under formation or undergo reorganisation, not all
business plans are carried out. The employers not always get
the planned income, therefore they cannot pay remuneration for
the employees and compulsory social insurance contributions.
Sometimes the employee is paid his remuneration while social
insurance contributions are not paid. Due to these or similar
circumstances, in order to ensure people's right to social
maintenance, positive performance of all levels of the system
of social insurance is necessary. Such a performance should be
guaranteed by a clear and functional mechanism of legal
regulation.
Insurance payers must constantly pay contributions into
the budget of the State Social Insurance Fund. Laws provide for
responsibility of legal and natural persons to state social
insurance, as well as sanctions for violations of contributions
payments. Valid laws do not provide for cases exempting
insurance payers from compulsory state social insurance
contributions. Conforming to Article 29 of the Law on
Enterprise Bankruptcy, regulating the sequence of and procedure
for fulfilling creditors' claims, in case of an enterprise
bankruptcy the satisfaction of claims concerning compulsory
state social insurance under the Law on State Social Insurance
shall be second in sequence, after employees' claims connected
with labour relations and claims of compensation for maiming or
other physical injuries as well as for the deprivation of life
have been satisfied.
The laws regulating relations of social maintenance
establish the system of administration of state social
insurance which is commissioned to implement state social
insurance. It is comprised of the Board of the State Social
Insurance Fund under the Ministry of Social Protection and
Labour, the board of directors of the fund and its territorial
divisions, as well as other state social insurance institutions
and insurers.
Every constituent part of this system has particular
rights and duties necessary to ensure the realisation of the
rights to social maintenance guaranteed by the Constitution.
For instance, Article 44 of the Law on State Social Insurance
determines the duty of insurance payers for timely and accurate
calculation and payment of contributions into the state social
insurance budget. According to Article 43 of the same law,
local divisions of the Board of the State Social Insurance Fund
shall be established in rural areas and towns, which shall be
directly responsible for the collection of state social
insurance contributions, timely and accurate pension payment,
as well as other provided functions. Article 45 of the said law
determines the right of state social insurance institutions to
exert control. Institutions authorised to implement state
social insurance shall have the right to check the documents on
which the contributions and payments administered by them are
based. While exercising their duties, officials of the state
social insurance institutions shall have the following rights:
to receive information and copies of documents from
enterprises, institutions, organisations and other persons
pertaining to the property and income of a legal or natural
person under investigation necessary for exercising their
duties; without prior warning on presenting office certificate
to enter the insurance payer's working premises (including
those taken on lease) connected with his activities to inspect
working conditions, the number of employees, etc.; to issue
instructions to the insurance payer mandatory to be observed on
issues concerning state social insurance; to draw up the
records of violation of administrative law in such legal cases
that are within the competence of the official of state social
insurance; to demand from the insurance payer that his
book-keeping be put in order; to receive from the insurance
payer explanations concerning issues of state social insurance
contributions and payments; to draw up acts of established
violations concerning calculation of state social insurance
contributions, penalties, fines, etc. The heads of enterprises,
institutions and organisations, as well as natural persons, who
impede the official to exercise this right are brought to
responsibility pursuant to the procedure provided for by laws.
Alongside, the law grants broad rights to the Director and
deputy directors of the Board of the State Social Insurance
Fund, as well as to the heads and deputy heads of its
territorial divisions. They are entitled to exact overdue
social insurance contributions and forfeit under non-dispute
procedure from accounts of enterprises in commercial banks, to
instruct banks to suspend money payments and remittances from
accounts of enterprises, to impose administrative penalties,
etc. Fine is established for contributions remitted overdue.
The law provides that overdue contributions of insurance payers
and the insured persons for the State Social Insurance Fund, as
well as fine and penalties, shall be exacted under non-dispute
procedure but only for the period which is no longer than two
foregoing years.
The analysis of these norms permits to assert that a
special system is created to implement state social insurance.
Civil, administrative and criminal responsibility is provided
for violations in the sphere of social insurance relations.
Institutions and officials of social insurance are entitled and
authorised to collect the means provided by laws. Thus, legal
prerequisites are established by laws for the system of social
insurance institutions so that it could fulfil the duty which
has been commissioned to it and ensure the rights guaranteed to
citizens in Article 52 of the Constitution.
1.3. A special place in the relations of social insurance
is occupied by the ensured working persons. First, with their
work they create material preconditions for social insurance.
The main portion of the budget of the Social Insurance Fund is
comprised of deductions from calculated remuneration for work.
On the other hand, the purpose of social insurance is to
provide these persons with finances and services necessary for
living if, for reasons established by law, they are unable to
subsist on their earned income or other income, or for valid
reasons established by law, they have additional expenditures.
Therefore the social insurance system established by legal
norms is meaningful only in such a case when it ensures the
constitutional right to social maintenance of the aforesaid
persons.
The disputed legal norms are of imperative character. The
insured person with his work creates values, as well as
finances, necessary for social insurance, while the employer
must calculate and pay them into the budget of the State Social
Insurance Fund. The institutions ensuring insurance must take
all measures provided by the law that the employer who is an
insurance payer fulfil his duty. Not paying of state social
insurance contributions is violation of the law. The insured
persons should not suffer from performance or non-performance
of the employer or other institutions implementing insurance.
Otherwise the mechanism established by laws of constitutional
right realisation would not correspond to its purpose.
The disputed legal norms regarding the period of state
social insurance and person's period of state social insurance
are applied to persons who insure themselves on voluntary
basis, as well as persons who are insured on compulsory basis.
It should be noted that in the first case the appearance of
voluntary insurance relations is linked with the will of a
person. The basis of these legal relations is an agreement upon
voluntary insurance. In the second case relations of social
insurance occur irrespective of the will of the parties and are
obligatory to the employer, social insurance institutions, and
the insured person alike. Furthermore, in the first case a
person pays social insurance contributions by himself, whereas
in the second case it must be done by the employer. These
differences exert influence over establishing the period of
state social insurance and person's period of state social
insurance. This must be taken account of when interpreting the
disputed legal norms.
It should be noted that the purpose of the designed social
insurance system is not only to pay social insurance pensions
and benefits but, first of all, to collect all the means
provided by the law. This is a function of social insurance
implementation but not that of mediation. The law does not
provide for the duty for the insured person to exercise control
over the insurance payer or to fulfil functions characteristic
of a social insurance institution. In legal relations of social
insurance a juridical fact of working activity obligates an
insurance payer to duly calculate and pay social insurance
contributions, while institutions of social insurance are
obligated to exert control over the insurance payer, as well as
to ensure collection of contributions.
Therefore the Constitutional Court notes that the question
of the period of social insurance regulated by the disputed
norms is to be investigated not only taking account of
reciprocal relations of contributions payments between the
insurance payer and state social insurance but also bearing in
mind the overall system of state social insurance relations
whereby social maintenance to people is rendered.
Solving the issue as to how significant insurance
contribution payments are for the implementation of the right
to social maintenance, one should consider several
circumstances. First, one should consider the fact that with
his work the working person creates a material basis to
implement this right. Therefore the duty occurs for other
participants of social insurance relations - employers,
institutions of social insurance - to fulfil all duties
established by laws. Relations of contribution payments are
reciprocal relations between the employer and institutions of
social insurance. They constitute only one part of the
whole-complex of social insurance relations devoted to ensure
the right of the insured person to social insurance pension or
benefit. In case the subjects of these legal relations fulfil
their duties improperly, the insured person should not suffer.
As it was mentioned, the meanings of the period on the
basis of which pensions are granted as established by the Law
on State Social Insurance, as well as the Law on State Social
Insurance Pensions, are virtually identical. On the other hand,
the characteristics of the period established by the Law on
State Social Insurance are more general, they are applied to
various types of social insurance, while the characteristics of
person's period of state social insurance are applied only for
state social insurance of pensions, i.e., they are special
ones. Thus, one should ground himself on special
characteristics when deciding questions concerning receiving
pensions under social insurance period. Establishing this
period, the insurance period is emphasised, i.e. the time
period during which persons pay by themselves or the employer
pays or must pay contributions for them, but never is the
payment of means calculated by the employer accentuated in such
a case.
The Constitutional Court notes that providing this norm
were understood otherwise, the persons who are insured on
compulsory basis, who acquired this right to such maintenance
because of their work would become dependent on particular
actions of the employer or those of institutions of social
insurance. The imperative legal norms which peremptorily
obligate all the subjects of the relations to fulfil the duties
prescribed by the law would also become meaningless. Therefore,
in order to implement the right of a person who is insured on
compulsory basis one may not interpret the period of state
social insurance and person's period of state social pension
insurance on the basis of the fact whether the employer or
institutions of social insurance fulfilled their duties
properly or improperly. If the insured person's period of state
social pension insurance were interpreted so, thereby the
essence of the right to social maintenance provided for in
Article 52 of the Constitution would be denied.
The Constitutional Court emphasises that granting pensions
to persons who are insured on compulsory basis, person's
insurance period is understood as a certain time period during
which persons either pay contributions by themselves or they
are paid for them, i.e., as the time period during which a
person with his work creates values, as well as means of social
insurance. Therefore the length of person's period of state
social pension insurance may not be associated with the fact
whether the employer paid the finances prescribed by the law.
It is such an interpretation of the period of social insurance
and person's period of state social insurance which is in
conformity with the essence of the system of social insurance
relations guaranteed by the Constitution, and which ensures
implementation of rights for persons who are insured on
compulsory basis in the sphere of social insurance. Only so
interpreting the period of social insurance and the period of
state social pension insurance of persons who are insured on
compulsory basis, a conclusion is to be drawn that the norms of
Article 5 of the Law on State Social Insurance and those of
Item 1 of Part 2 of Article 8 of the Law on State Social
Insurance Pensions are in compliance with Article 52 of the
Constitution.
2. On the compliance of Item 1 of the 26 January 1996
Government Resolution No. 142 "On Partial Amendment of the 20
February 1995 Republic of Lithuania Government Resolution No.
266 "On Approving the Rules of Forming of the Budget of the
Republic of Lithuania State Social Insurance Fund and Its
Implementation"" with the Constitution.
The Government, by Item 1 of its 26 January 1996
Resolution No. 142, supplemented Paragraph 2 of Item 21 of "The
Rules of Forming of the Budget of the Republic of Lithuania
State Social Insurance Fund and Its Implementation" approved by
the 20 February 1995 Government Resolution No. 266 "On
Approving the Rules of Forming of the Budget of the Republic of
Lithuania State Social Insurance Fund and Its Implementation"
with the following norms: "Providing the Board of State Social
Insurance Fund suspends the time of exaction of debts of
compulsory contributions for the insurance payer, while the
insurance payer pays all current contributions and fulfils the
conditions indicated in the agreement or clears off existing
debts in other ways, then the time period of accumulating of
debts and their payment shall be included into the period of
social insurance of insured persons. Providing the Board of
State Social Insurance Fund does not suspend the time of the
exaction of debts, and providing the insurance payer does not
pay them, the time period of accumulating of debts may be
included into the period of social insurance of the insured
person provided the insurance payer pays for him in a
particular case (in the case of pension granting, permanent
sickness and death) a corresponding sum of compulsory social
insurance contributions which have not been paid."
The petitioner alleges that under the disputed legal norms
and Item 1 of the said Government resolution and depending on
the agreement between the employer and an institution of social
insurance, it is permitted to include or not to include the
period during which the employer did not pay insurance
contributions. The person himself neither takes part in such a
bargain nor can he exert any influence over it. In such a case
the state does not ensure for people the right to social
maintenance guaranteed by Article 52 of the Constitution.
The Constitutional Court notes that the rule is
established in the item of the disputed resolution that, while
deciding the question of suspension of the time of exaction of
debts of compulsory contributions, the time period of
accumulation of debts and their payment is included into the
period of social insurance only provided that existing debts
have been cleared off. When the Board of State Social Insurance
Fund does not suspend the time of debts exaction, and the
insurance payer does not pay them, the time period of
accumulating of debts may be included into the aforesaid social
insurance period if the insurance payer pays for him in a
particular case (in the case of pension granting, permanent
sickness and death) a corresponding sum of compulsory social
insurance contributions which have not been paid. Thus the
norms of the disputed item of the Government resolution
associated the right of the insured person to social
maintenance with the payment of contributions failing to take
into account the fact that such debts may have occurred because
of performance or non-performance of the employer or
institutions of social insurance.
The Constitutional Court has held in the present ruling
that granting pensions to persons who are insured on compulsory
basis, person's insurance period, under Article 5 of the Law on
State Social Insurance and Item 1 of Part 2 of Article 8 of the
Law on State Social Insurance Pensions, is understood as a
certain time period during which persons either pay
contributions by themselves or the employer pays or must pay
contributions for them as established by the law. Therefore
this time period may not be associated with the fact whether
the employer in fact paid the means established by the law. The
Government, while defining the length of person's period of
state social pension insurance by the disputed norms of the
resolution, groundlessly associated the said length with
factual payment of contributions. Therefore, assessing Item 1
of the disputed Government resolution, it should be concluded
that it contradicts the norms of Article 5 of the Law on State
Social Insurance and those of Item 1 of Part 2 of Article 8 of
the Law on State Social Insurance Pensions, as otherwise
people's rights guaranteed by Article 52 of the Constitution
would be denied.
Conforming to Article 102 of the Constitution of the
Republic of Lithuania and Articles 53, 54, 55 and 56 of the Law
of the Republic of Lithuania on the Constitutional Court, the
Constitutional Court has passed the following
ruling:
1. To recognise that Article 5 of the Republic of
Lithuania Law on State Social Insurance and Item 1 of Part 2 of
Article 8 of the Republic of Lithuania Law on State Social
Insurance Pensions are in compliance with the Constitution of
the Republic of Lithuania providing the compliance of the norms
of these laws is based on the interpretation that person's
insurance period, under Article 5 of the Law on State Social
Insurance and Item 1 of Part 2 of Article 8 of the Law on State
Social Insurance Pensions, is understood as a certain time
period during which persons either pay contributions by
themselves or the employer pays or must pay for them
contributions as established by the law.
2. To recognise that Item 1 of the 26 January 1996
Republic of Lithuania Government Resolution No. 142 "On Partial
Amendment of the 20 February 1995 Republic of Lithuania
Government Resolution No. 266 "On Approving the Rules of
Forming of the Budget of the Republic of Lithuania State Social
Insurance Fund and Its Implementation"" contradicts Article 52
of the Constitution of the Republic of Lithuania, Article 5 of
the Republic of Lithuania Law on State Social Insurance, and
Item 1 of Part 2 of Article 8 of the Republic of Lithuania Law
on State Social Insurance Pensions.
This Constitutional Court ruling is final and not subject
to appeal.
The ruling is promulgated on behalf of the Republic of
Lithuania.