CYIL vol. 10 (2019)

KATEŘINA ŠIMÁČKOVÁ CYIL 10 ȍ2019Ȏ The Charter of Fundamental Rights and Freedoms guarantees adequate material security for all participants in pension insurance. The proportionality should be understood as a vague legal concept. The proportionality of financial security in relation to individual participants in pension insurance has to be seen in relation to the satisfaction of life needs of individuals in relation to the widest possible range of people, but also in relation to the insured person as a payer co-generating financial resources used to provide the adequate material security. According to the cited Constitutional Court judgment, the pension system is an instrument of social policy of the state, through which (basic) functions of social policy are fulfilled, including without limitation the protecting, distributing, and redistributing, as well as stimulating functions. The principles of solidarity and equivalence are represented in the pension systems (as part of social security systems) in a varying ratio. Every system of social security carries advantages or disadvantages of certain social groups, depending on when the viewpoint of solidarity or the principle of equivalence is preferred. This regulation is reserved for the legislature who cannot act arbitrarily. An expression of the constitutional prohibition of arbitrariness in determining the rights and obligations of persons is the constitutional principle of equality. A legal regulation that favours one group or category of persons over others cannot therefore be identified as a violation of the principle of equality without considering further aspects. The legislature has discretion to deliberate whether to enshrine such preferential treatment. In doing so, the legislature must ensure that the preferential approach is based on objective and reasonable grounds (a legitimate objective of the legislature) and that there is a proportionality relationship between this objective and the means to achieve it (legal advantages). According to the Constitutional Court, the duty of the legislature is to express transparently the ratio of the components of solidarity and equivalence in social insurance (including pension insurance), while this division should not be arbitrary. In the opposite case, i.e. in the absence of apparent element of equivalence, the weighted institution loses its legal nature, it ceases to be insurance and acquires the nature of tax. The Charter of Fundamental Rights and Freedoms therefore implies the fundamental right of the insured persons to the component of equivalence of the pension insurance system transparently designed by the legislature, and to such extent that still preserves the nature of the legal institution of insurance and does not change it into tax. The constitutional review of the relation of proportionality between the amount of income, pension insurance contributions, and the amount of pensions then includes an assessment of compliance with the safeguards arising from the constitutional principle of equality, both non-accessory (Article 1 of the Charter of Fundamental Rights and Freedoms), i.e. resulting from the requirement to exclude arbitrariness in distinguishing subjects and rights, and accessory in the scope defined in Article 3 (1) of the Charter of Fundamental Rights and Freedoms. The legislation implemented by the contested provisions (annulled by the Constitutional Court) of Section 15 of Act No. 155/1995 Collection of Laws (hereinafter the Coll.), on pension insurance (particularly establishing reduction limits), creates a situation where a pension system participant contributing three times the amount than the participant contributing an amount calculated from the average wage is granted a pension in less than half the amount, relatively. It is therefore clear that the legal regulation in order to ensure the adequate material security to all participants in pension insurance does not provide a part of

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