Background information

The Guarantee fund is made up of insurance contributions of employers in the event of their insolvency, in order to pay the wage claims of employees. The guarantee fund is administered by the Social Insurance Agency (SP) which is a public organization.

The legal regulation is in Act no. 461/2003 Coll. on social insurance (§ 103,116,135,165 and 234) and in Act no. 7/2005 Coll. on bankruptcy and restructuring.

The guarantee covers non-paid wages, bonuses, holiday remuneration, severance payments and travel expenses. The guarantee also covers mandatory contributions to old-age pension savings (Pension II pillar) unpaid by employers

Content of measure

An employer is considered insolvent if they have filed for insolvency at the court. Workers in an employment relationship of at least 18 months before the insolvency of their employer are eligible. However, employees of the state, public organisations, support organisations, national funds and municipalities, as well as domestic workers in a family business or people working for their family relatives who have not entered into an employment relationship are not eligible. The benefit covers employees wage claims for a maximum duration of three months.

To get access to the wage guarantee benefits, the employee has to apply within 60 days after the insolvency or termination of the employment relationship. The Social Insurance Agency has to decide and pay the benefit within 60 days from the application.

Use of measure

The number of beneficiaries of benefits from the Guarantee Fund was higher during the economic crisis - in 2009 it was 676 per month, then their number decreased - in 2017 it was 121 beneficiaries per month. However, the number of beneficiaries increased to 248 per month in 2019, only to drop to 108 per month in 2021 during the Covid-19 pandemic.

In 2017, the average benefit paid to an employee was €1,587. In 2018, there was a slight decrease, but in 2019 it increased again to €2,173. In 2021, the average benefit paid to an employee reached €2,176. The total value of benefits paid annually also fluctuated, from around €2.3 million in 2017 to around €6.5 million in 2019. During the Covid-19 pandemic in 2021, the total expenditure on these benefits amounted to €2.8 million.

More information is available in the ERM legal database .

In 2022, the Social Insurance Agency paid out a total of 713 guarantee insurance benefits in the amount of €1,856,258, an average of €2,607 per benefit. In 2023, more were already paid out – 1677 benefits of guarantee insurance in the amount of €3867181, an average of €2307 per benefit. In the first 8 months of 2024, the Social Insurance Agency paid out 872 guarantee insurance benefits in the amount of €2386499, an average of €2737 per benefit. See also web-page https://www.socpoist.sk/sp-transparentne/statistiky#garann-poistenie-?ref=1592

As part of the guarantee insurance, the Social Insurance Agency also had expenses for the payment of mandatory contributions for old-age pension savings unpaid by the employer to the basic fund of contributions for old-age savings: in the amount of €21 million in 2021, then €28 million in 2022 and €30 million in 2023.

Target groups

Workers	Businesses	Citizens
Employees in standard employment	Applies to all businesses	Does not apply to citizens

Actors and funding

Actors	Funding
National government Company / Companies Social insurance Public support service providers	Companies Employer National funds

Social partners

Social partners' role in designing the measure and form of involvement:

	Trade unions	Employers' organisations
Role	Unknown	Unknown
Form	Not applicable	Not applicable

Social partners' role in the implementation, monitoring and assessment phase:

• Unknown
• Main level of involvement: Unknown

Involvement

Unknown

Views and reactions

In the record of the interdepartmental comment procedure on the draft law on social insurance at that time (May - June 2003), there were no comments from the social partners on the provisions on the Guarantee Fund. See the meeting of the Government of the Slovak Republic on June 11, 2003

Sources

• 21 January 2013: Finweb (2013), Slotex Fashion je v konkurze. Vytunelovali ho. (finweb.hnonline.sk)
• 01 November 2013: The Ministry of Labour, Social Affairs andf Family (MPSVR SR) (www.employment.gov.sk)
• 06 April 2020: Zákon č. 68/2020 z 3. apríla 2020 (www.slov-lex.sk)
• 01 April 2022: Report on Social Insurance Agency activity in 2021 (www.registeruz.sk)
• 14 October 2022:  Socialna poistovna, garancne poistenie, statistiky. (www.socpoist.sk)
• 17 October 2022: Record of the interdepartmental comment procedure 11/06/200 (rokovania.gov.sk)
• 24 October 2022: Report on the social situation of the Slovak population for 202 (www.employment.gov.sk)
• 25 September 2024: Ministry of Labour, Social Affairs and Family of the Slovak Republic (2023): Report on the social situation of the population of the Slovak Republic for the year 202 (www.employment.gov.sk)