A recent court decision has once again highlighted the issue of compatibility between receiving retirement due to age and carrying out professional activity, especially when this activity is not properly communicated to Social Security. The case concerns a pensioner who continued to receive the full amount of her pension while working independently, a situation that ended up being considered illegal.
A Spanish pensioner was ordered to pay back 4,768.82 euros to Social Security for having accumulated, for several months, the full payment of her retirement pension through an activity carried out as a self-employed worker in the catering sector.
The decision was handed down by the Superior Court of Justice of Castile and Leon, which ruled in favor of the National Social Security Institute, understanding that the situation violated the provisions of the General Social Security Law, according to the Spanish digital newspaper Noticias Trabajo.
Pension received in full and independent activity
According to the sentence, the pensioner, identified as Celestina, received a monthly pension of 917.47 euros, corresponding to 100% of the amount to which she was entitled. In April 2019, he chose to register with the independent workers scheme to develop an activity in the restaurant sector, maintaining this registration for four months before canceling it.
The central element of the process is related to the fact that this situation was not communicated to Social Security.
Undue amounts identified by Social Security
When Social Security became aware of the case, it found that the pensioner continued to receive her full pension while she was registered as self-employed and managed an establishment with workers under her charge.
This accumulation was considered incompatible with current legislation, as it did not fit into any of the exceptions provided, according to the same source. Therefore, the return of R$ 4,768.82 was determined, relating to the four months of retirement unduly paid.
First favorable decision ended up annulled
Unsatisfied, the pensioner turned to the courts. In the first instance, Labor Court No. 2 of Valladolid ruled in his favor, considering that the situation would be “fully compatible”. However, Social Security filed an appeal and the Superior Court of Justice ended up revoking this decision, following the interpretation defended by the INSS.
Incompatibility foreseen in legislation
The high court based its decision on article 213 of the General Social Security Law, which determines that receiving a retirement pension is incompatible with any professional activity, whether employed or self-employed, according to the previously cited source.
The ruling also highlights that anyone who carries out an activity without reporting it incurs liability and is obliged to refund the amounts of pensions received unduly.
SMI exception was not applicable
The decision also clarifies that the conditions were not met to apply the exception provided for earnings below the interprofessional minimum wage in annual terms. This aspect was reinforced by the fact that the pensioner had hired workers during the period in which she was registered as self-employed, which indicates income above the legal limit.
Lack of communication and income above permitted
The court was clear in identifying two essential points. On the one hand, the lack of communication to Social Security about the beginning of professional activity. On the other, the fact that the income obtained exceeds the ceiling that could allow for some compatibility.
Although the law contemplates modalities such as partial, flexible or active retirement, they always require compliance with specific requirements and the respective communication to the competent authorities, according to .
Overview of the situation in Portugal
In Portugal, the applicable regime differs from the Spanish model. The general rule determines that retirement due to age can be accumulated with earnings from work, without the need to suspend the benefit. There are, however, relevant exceptions to this principle.
The legislation establishes that the accumulation of retirement due to age is not permitted when it results from the conversion of retirement due to absolute disability, maintaining a structural incompatibility here. Furthermore, there is a temporary limitation for beneficiaries who access early pensions through the flexibility regime, being prevented, for three years, from carrying out professional activities in the same company or within the same business group.
Whenever these prohibitions are violated, the right to a pension may be lost during the period of infringement, and the return of benefits received unduly may also be required, under the terms provided for by law.
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