1. CARICOM RECIPROCAL AGREEMENT ON SOCIAL SECURITY
“Move and don’t lose”
By Mineva C. Glasgow MBA,LLB
Deputy Executive Director
St.Vincent and the Grenadines National Insurance
Colombia
November26,2007

3. Overview Social protection for migrant workers and the self-employed.
Context
ILO Convention(102)-MINIMUM STANDARD OF SOCIAL SECURITY FOR ALL TO REDUCE THE RISK OF SOCIAL EXCLUSION.

4. Policies to foster co-operation ,free movement of workers in the Caribbean and economic growth
Federation-1958-failed in 1962
CARICOM-Established by Treaty of Chaguaramas in Trinidad-1973
CSME-ratified by all participating countries by 2006-

5. CSME-cont’d Provides limited freedom of movement. Protocol II
(I)-Rights of establishment
(II)-Movement of people

6. Rights of establishment
This provides rights of establishment of business enterprises for the provision of goods and services by the nationals of one community member in the territory of another and with liberalising capital movement in the Community.

7. Movement of people Migration)
Free movement of self-employed persons to establish businesses in any particular member country,
Governments participating in the CSME have agreed to the elimination of work permits for the following categories of workers:
University graduates
Artists
Sports persons
Media workers

8. CARICOM Reciprocal Agreement on Social Security
Under domestic legislation in each member state (country), both eligibility for benefit and the amount of benefit paid may depend on the number and extent of contributions made to the institution responsible for social security in the State.
Eligibility may also be conditional on the claimant’s residence in the country responsible for payment of benefit.

9. CARICOM Reciprocal Agreement cont’d
CARICOM Reciprocal Agreement was enacted to secure protection for migrant workers and their dependants entitlement to benefits.
To afford equality of treatment when workers move from one country to the next.

10. CARICOM Reciprocal Agreement cont’d
Two fundamental principles of the Agreement
Tantalization (Aggregation)-for the purpose of acquiring and retaining the rights to benefit and of calculating the amount of benefit, of all periods taken into account under the laws of several countries.
Payment of benefit to persons resident in other countries.

11. CARICOM Reciprocal Agreement cont’d
Agreement comprises 65 Articles
The aim of the Agreement is not to harmonize member countries social security legislation, but to coordinate their provisions in order to secure the objectives of ensuring that workers receive at least one pension.
To ensure that claimants’ contributions in different countries of CARICOM are aggregated for the purposes of pensions (benefits).

12. CARICOM Reciprocal Agreement cont’d
Persons entitled to benefits may collect them wherever they reside in CARICOM.
Agreement also include:
Self-employed-Article 12
Voluntary contributors (where applicable)-Article 4

13. Scope of the Agreement-Article 2
Invalidity pensions
Disablement pensions
Old age or Retirement pensions
Survivors’ pensions
Death benefits in the form of pensions

14. SALIENT PRINCIPLES
The worker cannot as a result of migration be out in a worse position than a worker who has not availed himself of the right of free movement.
CARICOM law cannot be invoked to allow rules to be applied to remedy inequalities suffered prior to its introduction.

15. Principles cont’d
Competent jurisdiction-the territory of the Contracting Party where the competent institution is situated.
Competent institution-(i)-the institution with which the person concerned is insured when claiming a benefit; or
(ii) The institution from which a claimant is entitled to receive a benefit, if he/she were living in the territory of the Contracting Party where that institution is situated; or

16. Principles cont’d
Dependants-(i) a member of the family of an insured person and who is dependent on that person; or
(ii) Some person who, though not being such a family member, is recognized as such by the applicable legislation; or
(iii) A surviving spouse of an insured person whether or not dependant on that person. N.B. This includes legal separation.

17. Applicable law (lex Laboris)
Article 6-Exclusivity of Applicable Law
This article makes it clear that a claimant would be governed by only one contracting state’s law at a time in relation to his/her employment.
(iii) The institution designated by the competent authority of the Contracting Party concerned.

18. Treatment accorded to certain categories of workers
Workers in Transnational Enterprises-Article 7
If an insured person is employed in one member state (e.g. St.Vincent) and his employer sends him to work in another member state (e.g. St. Lucia) for a period which is not expected to exceed 2 years, the employee will remain insured in St.Vincent. If the work exceeds this time, due to unforeseen circumstances, the laws and regulations of St.Vincent remain applicable until the work is completed, subject to the agreement of the St. Lucian social security institution.

19. Treatment to certain categories of workers cont’d
(B) Itinerant Employed Persons-Article 8
If an insured person who lives in one member state (e.g. Grenada), is employed other than in international transport, and he/she follows his/her occupation in 2 or more CARICOM Countries including Grenada he/she will remain insured in the country of residence (Grenada ) in this example. This rule also applies where an insured is employed by two or more employers who have their principal places of business or residence in different countries.

20. Treatment to certain categories of workers cont’d
(C) Employees in International Transport-Article 9
A person employed in international transport
In two or more CARICOM countries will be insured in the country where (i) the principal place of business is located;
(ii) A subsidiary, branch or agency of the company is located if the employee is employed by any of these and the location is different from the country of the company’s principal place of business;
(iii) The employee is resident and ordinarily employed, even if the company does not have its principal place of business, nor a branch, subsidiary or agency in that country.

21. Treatment to certain categories of workers cont’d
(D) Employees on ships
If an insured person is employed by a company which is his regular employer, either in one country e.g. Antigua, or on board a ship flying the flag of that country e.g. Antigua, and he is sent by that company to work on board a ship flying the flag of another country e.g. Dominica, he will remain insured in Antigua subject to:
The legislation of Antigua provided that the employment does not exceed two years;
The legislation of Antigua, if due to unforeseen circumstances the work exceeds 2 years. The legislation will apply subject to agreement by the two countries concerned, in this case Antigua and Dominica.

22. Employees on ships cont’d
(ii) If an insured person follows his occupation in the territorial waters, in a port in one country e.g. Trinidad or on board a ship flying the flag of another country, e.g. Guyana, but he is not a member of the ship’s crew, he will remain insured in the country where he normally follows his occupation i.e. Trinidad in this example.

23. Employees on ships cont’d
(III) If the insured is employed on board a ship flying the flag of one country e.g. St. Kitts and Nevis and he is paid by an organization or person having the principal place of business/residence in another country e.g. Jamaica, he will remain insured in Jamaica if he resides there. The company/person paying the remuneration is considered the employer for the purpose of the application of the legislation.

24. Treatment to certain categories of workers cont’d
(E) Persons employed in Diplomatic Missions, Consulates and International organizations
The Agreement does not apply to diplomatic agents, consular officers or to persons of equivalent status in international organizations of which a CARICOM country is a member. The regulations for employees on ships and in international transport also apply to members of the service staff of diplomatic missions, consulates or international organizations and persons employed in the private services of officials of such organizations. However, such employees who are nationals of a CARICOM country, which is a sending state may opt to be insured under the S.S. institution where he/she is a national.

25. Determination of benefits-Article 16
This may be referred to as the gateway to the CARICOM Reciprocal Agreement.
Entitlement of the insured (X )to benefits falls under the applicable legislation of each Contracting Party where that person was subject successively or alternatively to the applicable legislation of two or more contracting parties.

26. Article 16 cont’d
e.g. If the insured (X) is subject to the SS legislation of Country Antigua and Barbados either alternatively or successively then X is entitled to the benefit under Antigua and Barbados. X must satisfy the requirements for benefits in both countries. Totalization does NOT apply in this instance.

27. Totalization of contribution periods-Article 17
Where the applicable legislation of a Contracting Party makes entitlement to benefits conditional on the completion of a specified number of insurance periods, the competent institution should take into consideration all the insurance periods completed by the insured (X) in any other Contracting Party to determine whether the condition of serving specified number of insurance periods have been satisfied.

28. Payment of a Partial Benefit Article 18
Where the insured (X) satisfies the conditions for benefits in country A but does not satisfy the conditions for benefits in any other country that he serves for example, Country B and Country C-Country B and Country C must pay him or any person claiming through him a portion of his benefits which he would have been entitled to had he satisfied the relevant criteria in Country B and Country C. The payment bears the same ratio ,which the contributions of that person bear to the total qualifying conditions.

29. Payment of a partial benefit-an example
A claimant has worked in Countries A,B, and C and satisfies the conditions for entitlement to a benefit in the jurisdiction of Country A, but not in Countries B or C. In the example, the minimum number of contributions required for entitlement to a pension is given as 500.
Claimant’s contribution history
A-800
B-300
C-200
Application-Country A pays a full pension (not required to consider contributions paid in B or C)
Country B will pay a basic pension and will therefore only use contributions paid in other countries to satisfy the requirements for a basic pension-in this case 500 contributions.
The same will apply for Country C

30. Payment of partial benefit-example cont’d
In Country B the basic weekly pension is 40% of average weekly earnings and average weekly earnings in this case is calculated at $200.00, the proportionate basic pension would be calculated as follows:-
40%of &200.00=$80.00=notional pension
Proportionate pension=300/500x80.00=$48.00
Similarly, the proportionate pension paid by Country C would be 200/500
N.B. in countries where there is a provision for a minimum pension and the notional pension is less, it should be upgraded to the minimum pension before calculating the proportionate part.

31. Apportionment of Totalised Benefits-ARTICLE 19
Each contracting party has to determine whether X or his dependants are entitled to benefits under Articles 16,17 and 18 of the Agreement in accordance with their legislation and to what extent X and his/her dependants are entitled to those benefits.
An institution that determines that X has satisfied the relevant conditions for entitlement as stated in article 17 should make a calculation of the amount of benefit that X can claim as if the periods completed in the other contracting states were completed in the contracting state of the said institution.
Each institution which is responsible for paying benefits to X shall pay an amount that bears a direct relationship between the number of insurance periods completed by X in the territory to the number of periods completed by X in all the territories.
E.G. If X serves 9 years in SVG and served a total of 30 years altogether: 9/30=0.3. SVG is entitled to pay an amount equal to o.3 of the notional amount payable to X-the notional amount being the nominal or face value amount that is used to calculate payments. This amount generally does not change hands.

32. Apportionment cont’d A worked example
A claimant has worked in countries A, B and C but does not satisfy the conditions for entitlement to a benefit in any one country.
In this example, the minimum number of contributions required for entitlement to a pension is given as 500.
Claimant’s contribution history
A-400
B-300
C-200

33. Apportionment cont’d
Using the Totalization method in accordance with Article 17, the number of contributions which must be used by each country in calculating a notional pension would be =900
Each country would then calculate its notional pension in accordance with its own legislation and using the 900 contributions as if they had been paid in that country.
The actual amount payable by each country shall bear a direct ratio to the notional amount which the number of contributions paid or credited in that particular country bears to the total number of contributions paid or credited in the three countries.

34. Apportionment-worked example cont’d
Country A would therefore pay 4/9 of its notional pension
Similar conditions would apply for Country B and Country C
In any case where provision is made for a minimum pension and the notional pension is less it should be upgraded to the minimum pension and the amount actually paid shall be the proportionate part of the minimum pension.

35. Article 24-Conversion of Invalidity
Benefits (1) Where Country A’s SS Act allows it, invalidity benefits must be converted into old age or retirement pensions where appropriate and the provisions of Articles will apply. (2) If X is receiving an invalidity pension from an institution and he becomes entitled to old age or retirement pension he shall continue to receive the invalidity pension from the institution who has a continuing liability to pay him the invalidity pension until the provisions under paragraph 1 becomes applicable and his invalidity pension is converted into old age or retirement pension.

36. Article 33-Application of Article 18-payment of a partial benefit
Before X can benefit from Article 18 a certificate must be sent to all the institutions liable to pay a portion of the benefits indicating that X has satisfied the qualifying conditions for a benefit under the legislation of another contracting party.
That certificate must be issued by the institution of each applicable contracting party under the legislation of which X has qualified upon the request of X or upon the request of the institution who is liable to pay a portion of the benefits.