The number one employee benefits people in Bosnia and Herzegovina care about is health insurance. State provided healthcare is deemed insufficient and private healthcare is much preferred.
Bosnia and Herzegovina has a currency (Bosnian Convertible Mark) which has a fixed exchange rate to EUR (1 EUR = 1.95583 BAM).
Mandatory employee benefits in Bosnia and Herzegovina include pension, personal accident insurance (in the administration entity Republic of Srpska), legislative leaves, paid time off, unemployment insurance, and eye exams. COM and supplementary employee benefits in Bosnia and Herzegovina include healthcare and workplace canteens. Employee perks are not common in the country.
Mandatory Employee Benefits in Bosnia and Herzegovina
Bosnia and Herzegovina are divided into a few administrative entities:
- Federation of Bosnia and Herzegovina
- Republic of Srpska
- Brcko DC
Some regulations are not completely identical in these entities.
A pension plan is a mandatory and contributory savings plan for all employed persons in Bosnia and Herzegovina. Pensions are regulated via governments schemes, where the employer pays monthly contributions together with the salary.
The percentage of the pension contribution is prescribed by law and it amounts approx. 23% of gross salary.
An insured person is entitled to an old-age pension when he/she reaches 65 years of age and at least 15 years of insurance service, is at least 20 years of pension service, or when he/she reaches 40 years of insurance service regardless of age (Law on Pension and Disability Insurance).
Group Personal Accident
In the Republic of Srpska this benefit is mandatory and in other entities this coverage is voluntary. It typically covers:
- Death due to illness
- Death due to an accident
- Permanent disability
- Treatment costs due to an accident
- Hospital days due to an accident
Paid Leaves in Bosnia and Herzegovina are as follows:
- Annual leave
- Temporary incapacity for work (sick leave)
- Absences from work with the consent of the employer
The employer must maintain the employee’s position until it is reasonable for the employee to return to work.
Paid Time Off
Maternity / Paternity Pay – Maternity Benefits
During pregnancy, childbirth and childcare, an employed woman is entitled to maternity leave of one year continuously, and in exceptional cases, a woman may use a shorter maternity leave, but not less than 42 days after giving birth. Maternity leave can begin 28 days before the expected birth.
The father of the child also has the option of exercising the right to maternity leave in the event of the mother’s death, if the mother leaves the child, or if for other justified reasons, she cannot use maternity leave.
A woman who is on maternity leave during the fixed-term employment contract cannot be terminated by the employer, but after the expiration of the term for which the contract was concluded, the employment is terminated, and the employer is not obliged to extend the employment contract with the employee, who is on maternity leave.
An unemployed person who, at the time of termination of employment, has at least eight months of uninterrupted work or eight months with interruptions in the last 18 months, is entitled to cash benefits.
When determining the right to financial compensation, a period of 12 months is considered as a year of work, and work shorter than full working time, is recalculated to full working time.
The time spent at work is considered to be the time of compulsory insurance according to the regulations governing the system of taxes and compulsory contributions.
The amount of cash benefit is 40% of the average net salary paid in Bosnia and Herzegovina in the last three months before the termination of employment.
An unemployed person is entitled to cash benefits when he or she has not knowingly contributed to the termination of employment. The duration of payment of monetary compensation:
- The cash benefit is paid to an unemployed person for 3.6, 9, 12, 15, 18, or 24 months, depending on the time spent at work.
- In order for an unemployed person, who has fully used the cash benefit, to regain this right during the time spent at work, only the time spent at work after the expiration of the last established right to this benefit is included.
- An unemployed person who is entitled to cash benefits may, at his request, be paid a lump sum depending on the determined duration of the right to benefits for self-employment or with another person forming a company, business, or another form of self-employment.
- An unemployed person to whom the benefit has been paid cannot register with the employment service before the expiry of the time for which he received the lump sum.
Eye exams are available through government health insurance plans and also through voluntary supplemental health plans.
Supplementary Employee Benefits
International employers in Bosnia and Herzegovina offer an extended healthcare benefit to supplement the government health insurance plan for salaried employees. Extended healthcare includes outpatient healthcare in private clinics in Bosnia and Herzegovina. Also, annual preventive exams could be included optionally.
This benefit is not common in Bosnia and Herzegovina, however, in highly competitive industries such as the technology industry we are seeing an increase in catered lunches for employees. Large employers and employers outside of the cities often have an onsite cafeteria with discounted food prices.
This information about employee benefits in Bosnia and Herzegovina is provided by MAI CEE, Asinta’s employee benefits consulting partner in Bosnia and Herzegovina.