Social Security Agreement between BPS and "Bituach Leumi"
The Agreement applies to people, regardless of their nationality, who are or have been subject to the social security legislation of Uruguay, or who reside or have resided in Israel. It also applies to those whose rights derive from the above (for example, family members or beneficiaries).
What are the basic principles of the Agreement?
The Preservation of Acquired Rights through the recognition of years of contributions and the totalization of periods, applying the “prorated” rule, according to the years recognized by each State.
The Export of Benefits means that, if a right to a benefit is obtained in one of the Contracting States, the beneficiary or their rightful claimants can continue to receive that benefit even if they reside in the other State.
What is the totalization of periods of work?
The purpose of totalization is to prevent social security rights from being lost due to having contributed in Uruguay or resided in Israel without meeting the necessary requirements in either State to access a benefit.
To avoid these effects, the Agreement stipulates that periods credited in both States can be added together, and each Competent Institution of both States will take into account the periods credited in the other State.
If the beneficiary or their survivor qualifies for the benefit when the insurance periods completed under the legislation of both Contracting Parties are added together, the competent insurance institution of Israel will determine the benefit.
How is the benefit to be received calculated?
The agency of one of the countries (called the "Contracting Party") will review the time the person has worked in that country and calculate if they are entitled to receive any benefit (such as a pension). For this calculation, only the time worked in that country will be considered.
If the person has not worked enough time in one country to receive a benefit, the agency of that country will add the time worked in the other country. If, by adding the periods of work from both countries, the time requirement to receive the benefit is met, then the person may receive it.
Calculation of the benefit:
When calculating how much the person is entitled to receive, two steps are followed:
- First: The amount the person would receive is calculated as if all their working time had been in the first country, without considering work in the other country (this is called the "theoretical pension").
- Second: That amount is then adjusted to take into account only the time worked in each country. That is, the person will receive a proportional part of that theoretical pension, according to the time worked in each country. This is called the "prorated pension".