Q & A
 

Obligations of non-profitable organizations to employees and other people

1.      Obligations to employees
1.1.      What are the obligations of non-profitable organizations regarding employees?
When non-profitable organizations employ physical persons, they have the same rights and obligations as employers, as other legal entities. It means that they are subject to the obligations according to the Law on labor relations as a general regulation of the labor right, but also to all the other laws and regulations that arrange the contents of labor relations. In accordance with this, the most important rights and obligations of non-profitable organizations as employers are the following:
-         the person who starts working in the organization signs an employment contract in a written form;
-         within 15 days the employee should be registered in the competent institution for pension insurance (Pension and Disability Insurance Company) and the competent institution for health insurance (Health Care Institution); and the Employment Office;
-         the employee should be provided with a job in accordance with the employment contract, to be paid for the job done and the salary can not be lower than the lowest salary determined for certain degrees of complexity according to a law or a collective agreement;
-         the employee should be given all the rights of the labor relation regulated by the laws, collective agreements or the labor relations rules (e.g. food and transport, lunch break, paid holiday, holiday pay, allowance of salary while absent from work during: festive occasions, pregnancy, birth and maternity, childcare; retraining, specialized and vocational training sent to by the employer; military exercises; participation in defense and protection training and in some other cases determined by a law or a collective agreement.)
-         the non-profitable organization can cancel the employment contract with the employee under conditions regulated by a law, at the same time respecting employees’ rights and the legally regulated procedure for canceling employment contract.

1.1.2 What are the regulated items of obligatory contributions from and to salary and are they same for all employees?
The items of obligatory contributions from the salary and to the salary are regulated by a Law. For the people who are employed a contribution for pension insurance is paid as a contribution from salary and three contributions that are regulated as contributions to salary (basic health insurance, special contributions for insurance from professional disease and contributions for employment).

The Law on obligatory insurance regulates the following items for contributions to salaries:
1.      health insurance contribution by item of 9,2%;
2.      contribution to salary in case of an accident at work and professional disease by item of 0,50% and
3.      contribution for employment to salary by item of 1,60%.

1.1.3 What is the lowest basis for calculating contributions to and from salaries?
For the people who have a full-time job of a regular labor relation, the lowest basis for paying obligatory contributions (by branches) is published in the monthly economic bulletins.

The basis for calculating and paying contribution for pension and disability insurance from the salary for the employees is the gross salary that contains the contributions and taxes paid from the salary, that is, the basis of which compensation to the salary has been calculated.

The basis for calculating and paying contribution for pension and disability insurance can not be lower than 65% of the average net salary by worker in the economy of the Republic of Macedonia announced in the current month.

The basis for calculating and paying contribution from the salary, that is, the basis of insurance cannot be higher than three average salaries by worker in the economy of the Republic of Macedonia announced in the current month.

For people who work part-time (less that 40 hours a week), the lowest basis for paying contributions for pension insurance and contribution for employment is determined in proportion to the duration of the part-time hours in comparison with the full-time hours. The basis for paying health contributions in case of working a part-time job is equal to the lowest basis regulated for a full-time job.

The basis for calculating and paying contribution for obligatory health insurance for the insured to which salary is determined is the gross salary and the compensation to salary, that is, the salary which contains the contributions and taxes paid from the salary, that is, compensation to salary. The basis for calculating the contribution cannot be lower than the lowest salary by employee determined with a collective agreement multiplied by the average coefficient of labor complexity at the employer.

The basis for calculating and paying the contribution for employment is the gross salary.

1.1.4 How is the employee’s salary taxed?
According to the Law, while paying the salary to his/her employees the employer is obliged to calculate the personal tax of the salary and to pay it at the regulated accounts. The personal tax to salary is calculated to the basis which is made by the total amount of all salaries reduced by contributions regulated by a Law that are calculated as contributions from salary and personal exemption.

The amount of personal exemption at the beginning of every year is valorized with the coefficient of the growth of the average monthly net salary of the employees in the Republic of Macedonia realized in the previous year, according to the data of the National Statistics Bureau.

1.1.5 What is the legal date of salary payment?
According to the Law on labor relations, the salary is calculated and paid at least once a month. The employee’s contributions and salary taxes are paid by the employer by the 15th next month at the latest.

1.2 What are the obligatorily regulated records for calculating and paying salaries?

While calculating the salaries, apart from the orders for paying contributions and taxes, the employer is also obliged to fill in the following: the form PDD-MP and the monthly statistic reports.

The employer is also obliged to run the following monthly records for the salaries paid: Annual application form of the payer and M-4 – an application form of data for determining the length of insurance and salaries for the current year.