Insights

Q1 2023 International Benefits Update

April 26, 2023

/Employee Benefits

In the first quarter of 2023, many European countries continue to update their family leave entitlements. These include Bulgaria increasing maternity leave by two months, Spain launching menstrual leave, and Ireland launching domestic violence leave, becoming one of the first European countries to have such a leave. The United Kingdom also announced an extra holiday this year for the coronation of King Charles III.

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Americas

Brazil Updates Daycare Mandates, Offers Option to Extend Maternity Leave

Brazil has updated daycare mandates as part of its Employ + Women Program. Effective September 22, 2022, all employees can get daycare costs reimbursed for children up to age five years and 11 months as a non-taxable benefit. Previously, this benefit was applicable only to women with children up to six months of age. If employers provide this benefit, they do not have to provide daycare facilities to parents of children up to six months of age who are still breastfeeding.

Total maternity leave, including employer-paid and social security, can now be extended by the employer to 120 calendar days at full pay, based on 50% paid time off and 50% working time agreement. Employer-paid leave can also now be shared between both parents if both are part of the employment arrangement.

El Salvador Implements Pension Reforms 

The El Salvador government implemented several changes as part of pension reforms, effective January 1, 2023. The monthly employer contribution rate increased to 8.75% from the previous 7.75%. The employee contribution rate remains the same at 7.25% of monthly earnings. The salary used for calculating monthly contributions will now be the employee’s total gross salary and will include commissions, paid leave, and other compensation, with no salary cap. The old-age pensions increased by 30%.

Europe, the Middle East, and Africa (EMEA)

Belgium Launches Bicycle Allowance

Effective May 1, 2023, all employees who regularly cycle to work will be eligible for a bicycle allowance of EUR 0.27 per cycled kilometer. The benefit will be capped at 20 km per trip or 40 km per round trip, per day. The initiative is an effort to promote sustainable means of transport. The allowance is exempt from personal income tax and social security contributions.

Bulgaria Adds Two Months to Paternity Leave

The Bulgarian government has added two months to its paternity leave. Biological and adoptive fathers are now entitled to a total of two months and 15 days of government-paid paternity leave, beginning once the child leaves the hospital. 

The leave may be used until a child reaches eight years of age and can be taken all at once or in multiple shorter periods.

The initial 15 days of paternity leave remains payable at 90% of the insured person’s social security income, and the contributions requirement is reduced from 12 months to six months of qualifying contributions, given the short leave period. Payment for the extended paternity leave of two months is equal to the statutory minimum wage of BGN 780 per month and is paid by the National Social Security Institute. To qualify for this leave, fathers are not allowed to use maternity leave or any other leave that was transferred to them by the other parent. The changes went into effect on August 1, 2022.

France to Increase Retirement Age

France recently proposed legislative changes that increases the minimum retirement age from the previous 62 years to 64 years for employees born after January 1, 1968. The retirement age is set to gradually increase in three-month increments till it reaches age 64 in 2030. The changes will go into effect on September 1, 2023.

Hungary Enacts Changes to Family Leaves

Effective January 1, 2023, Hungary enacted several changes to their family leave provisions as part of the 2019 EU Directive on work-life balance.

Paternity leave: Men can now take 10 days of paternity leave, up from previous five days. The leave must be taken within two months of birth or adoption of the child. The leave is fully paid for the first five days and at 40% of the salary for the remaining five days.

Parental leave: Employees are now entitled to 44 days of employer-paid parental leave. Each parent can take the leave until the child reaches three years of age. Employees will receive 10% of their salary during the leave.

Carer leave: Employees can now take up to five days of carer leave to care for family members dealing with serious medical issues. The leave is unpaid and may be taken in two installments.

Poland Makes Changes to Family Leaves, Adds Care Leave

Poland enacted several changes that will come into effect on April 26, 2023.

Paternal leave: The duration of parental leave in Poland has been extended by nine weeks—to 41 weeks for the birth of one child and 43 weeks for the birth of multiple children. Each parent is entitled to an exclusive nine weeks of parental leave that is not transferable to the other parent. For parents of children with disabilities that arose during pregnancy or childbirth, parental leave can be taken for 65 weeks for the birth of one child and 67 weeks for the birth of multiple children.

Paternity leave: Fathers can take two weeks of government-paid paternity leave until the child is 12 months old.

Carer leave: Employees can take carer leave of up to five days to provide personal care or support to a family member who is living in the same household and requires care or support for serious medical reasons. Eligible family members include children, parents, and a spouse. This leave is unpaid.

Emergency leave (“Force majeure”): Employees can take up to two days, or 16 hours, leave from work for illness and accident emergencies of immediate family members. Employees will receive 50% of their salary during emergency leave.

Spain Launches Menstrual Leave, Updates Maternity Leave

Menstrual leave: Spain’s parliament has a law that grants employees menstrual leave to recover from severe menstrual pain. The leave will be paid from the first day of absence by social security and without a minimum contribution period requirement. The maximum duration of the leave is not specified under the law. The leave is part of a new abortion law and goes into effect on June 1, 2023.

Miscarriage and maternity leave: Effective June 1, 2023, employees dealing with miscarriage or the interruption of pregnancy, whether voluntary or not, will be considered eligible to qualify for sick leave while they are receiving medical care from the Public Health Service and are unable to work.

Additionally, the legislative changes will provide a special sick leave for pregnant employees from the first day of the 39th week of pregnancy. This leave is in addition to the 16 weeks of maternity leave. The sickness benefit is paid by social security from the day following the day of sick leave, and the employer must pay the full salary corresponding to the day of sick leave.

Sweden Makes Changes to Retirement Age

Effective January 1, 2023, Sweden’s government has raised the minimum retirement age from 62 to 63 for the mandatory individual account (or premium pension) program and notional defined contribution (NDC) pension program. The retirement age for the income-tested guarantee pension, the means-tested old-age income support, housing allowance, and contributory pension supplement increased from 65 to 66 years of age.

Ireland Launches Medical Care Leave, Domestic Violence Leave

Ireland has changed two leave laws in response to the EU’s 2019 Work-Life balance directive.

Domestic violence leave: The Irish government has launched domestic violence leave. Employees who have experienced or are currently dealing with domestic violence can take five days of paid leave per consecutive 12-month period. The employee is not required to present evidence of domestic violence to their employer, nor is the employer allowed to request details and documentation due to the sensitive nature of the leave. The leave can also be taken by the employee if they are assisting a relevant person who has experienced or is experiencing domestic violence for prescribed purposes including relocation, seeking medical services, and attending victim services.

Ireland is one of the few countries in the world to offer domestic violence leave. Other countries that offer it include Canada, the Philippines, New Zealand, and Northern Ireland.

Medical care leave: The legislation also introduced a new statutory leave called medical care leave. Employees can take five days of unpaid leave to provide care and support to close family members dealing with serious medical issues. This leave is in addition to any paid “force majeure” leave entitlements. Unlike domestic violence leave, an employer may request a medical certificate confirming that the person is indeed in need of such care.

Israel to Implement Pension Reforms

Israeli employees are covered by National Healthcare Insurance (NHI) for basic medical benefits such as general practitioner visits, hospitalization, and prescription medications. Several employers offer private medical insurance (PMI) to supplement the NHI benefits. Starting May 1, 2023, insurers are required to offer a basic Tier 1 policy to all employees who have individual or group PMI policies. The Tier 1 policy will cover benefits not offered by NHI, such as specialized treatments abroad, surgeries, transplants etc. Up to four additional coverage tiers can be offered. Tier 2 coverage will include private surgery in Israel, while Tier 3 will offer policy extensions for Tiers 1, 2, and 3. Tier 4 provides outpatient coverage for any medical diagnosis, treatments using advanced technologies, medical devices, consultations, and home hospitalization. Tier 5 provides coverage for critical illness. Employees can get discounts on premiums; however, the discount should be offered by the insurer at a fixed rate for a period of a minimum of 10 years.

Switzerland Rolls Out Paid Adoption Leave

Effective January 1, 2023, employees can take two weeks of paid adoption leave. The leave will take effect once the child starts to live with the parents in Switzerland. During the leave, employees will be paid 80% of their salary, capped at CHF 220 per day. The leave can only be taken once by couples.

Turkey Eliminates Retirement Age

Effective January 1, 2023, the Turkish government has eliminated the minimum age requirement for retirement. Previously, the retirement age for women was age 58 and age 60 for men.  

Employees are required to have a minimum period of paid premiums of 5,000 days, or a minimum of 20 years of insured services for women and 25 years for men. Eligible employees who choose to retire will be eligible for existing mandatory employer-paid severance. The lump sum payout is equal to one month’s pay per year of service, capped at TRY 19,213 per month. Retired employees are allowed to work after retirement and may be rehired by their former employer.

United Kingdom Introduces a New Holiday for 2023

The coronation of His Majesty King Charles III will take place on Saturday, May 6, 2023. To mark the occasion, employees in the United Kingdom will receive an additional one-off public holiday on Monday, May 8, 2023. The holiday applies to both public- and private-sector employees.

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All views expressed in this article are the author’s own and do not necessarily represent the position of Woodruff-Sawyer & Co.

Sid Bahadkar

Account Manager, International Benefits

Sid is an SHRM certified professional with experience of working in the Indian and US markets as an HR and Employee Benefits professional. Having worked closely with employees of diverse cultures, she brings a broad and enriched perspective to client solutions. As an Account Representative, she collaborates with the international team on global mobility pieces and a variety of service areas.

415.402.6438

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Sid Bahadkar

Account Manager, International Benefits

Sid is an SHRM certified professional with experience of working in the Indian and US markets as an HR and Employee Benefits professional. Having worked closely with employees of diverse cultures, she brings a broad and enriched perspective to client solutions. As an Account Representative, she collaborates with the international team on global mobility pieces and a variety of service areas.

415.402.6438

LinkedIn