Cap on Parental Leave Benefits, Youth Job Incentives Take Effect

The government-sponsored legislative changes envisaging minor modifications aimed at dealing with the crisis were passed by the National Assembly in mid-July.

In an effort to reduce social security spending, the changes limit parental leave benefits paid out to mothers or fathers who stay at home to take care of their newborn at twice the average wage in Slovenia or EUR 2,800.

The benefit is paid out in accordance with the average salary of the parent in the past 12 months. Previously it was capped at 2.5-times the average wage.

The new cap on parental leave benefits entered into force today and will be valid until the year after economic growth in Slovenia reaches 2.5% of GDP.

In a bid to encourage hiring of young people, the changes also envisage that employers are exempt of paying social security contributions for a period of two years for all employees under the age of 30 hired anew on an open-ended contract.

The hiring incentive will be in place from November until the end of 2014 and will be available to companies which have settled all their contributions to employees and whose accounts are not blocked.