The granting of a benefit from the Company Social Benefits Fund requires not only verification of the employee’s financial situation, but also his or her family and life situation.

The primary objective of the social fund is to safeguard the social interests of the individuals eligible for obtaining benefits from the fund.

However, this does not mean that each and every eligible person will end up obtaining such benefits.

This is because, as a rule, the fund is not available indiscriminately to all. Rather, benefits from the fund should be granted to those most in need of financial assistance. 

When granting benefits, taking into account solely the material situation of the eligible individual from the perspective of his or her income may actually turn out to be an improper approach.

Rather, the proper verification of social criteria should also include an examination of the life and family situation of the persons in question.

Their life situation includes circumstances of a variable nature, occurring suddenly, requiring the granting of an additional benefit to the eligible individual at the respective point in time.

A person’s life situation may be associated with the health condition of either the applicant or his or her family member(s), the death of his or her relatives, or unfavorable economic changes in the life of the person concerned, such as the loss of a place to live.

The need to scrutinize the employee’s family situation is associated with the duty to take into consideration the living conditions of his or her family, including relevant unrelated family members, even if they live in a different household.

The criteria of relevance include the conduct of shared housekeeping duties and cooperation aimed at improving the fulfillment of the needs of everyday life. 

The proper management of the fund’s assets requires the taking of careful and reliable actions based on an in-depth analysis of each specific case.  

A breach of this duty may result in inspection authorities challenging the proper spending of money and classifying such disbursements as an additional discretionary benefit provided by the employer. 

Find more in the PRO HR May 2022.