Pension dispute in the Administrative Court of Cassation of the Supreme Court: when the new average salary is applied
The Administrative Court of Cassation of the Supreme Court considered a case regarding the recognition of the Pension Fund's actions as unlawful in calculating the pension and the obligation to recalculate the old-age pension using the current average salary indicator for 2020-2022.
The disputed issue is the plaintiff's right, who was granted a pension for long service according to the Law of Ukraine No. 1788-XII, to be assigned an old-age pension according to the provisions of Article 40 of the Law of Ukraine No. 1058-IV after reaching retirement age.
Part three of Article 45 of Law No. 1058-IV establishes the procedure for transferring from one type of pension, assigned specifically under this Law, to another. Therefore, the average salary indicator when transferring to another type of pension must remain unchanged, that is, the one that was at the time of the pension assignment provided by Law No. 1058-IV. However, in the plaintiff's case, another pension was assigned under a different law, so the average salary indicator for the three calendar years preceding the year of the new pension assignment (old-age pension) must be taken into account.
The Supreme Court expressed a legal position in the ruling dated November 29, 2016, stating that if a person is assigned a pension for long service according to Law No. 1788-XII, which provides different grounds and procedures for pension assignment, and later the person wishes to receive an old-age pension according to Law No. 1058-IV, this is precisely the assignment of an old-age pension, not a transfer under part three of Article 45 of Law No. 1058-IV. This legal position of the Supreme Court of Ukraine was supported by the Grand Chamber of the Supreme Court in the ruling dated October 31, 2018, in case No. 876/5312/17.
Also, in the ruling dated September 30, 2025, the Supreme Court noted that considering the already established practice, if a person is assigned an old-age pension under the provisions of Law No. 1058-IV after already receiving a pension for long service under Law No. 1788-XII, such a transition cannot be considered a "transfer to another type of pension" within the meaning of part three of Article 45 of Law No. 1058-IV. This is a "new type of pension assignment" since the old-age pension and the pension for long service differ in legal grounds and conditions of assignment.
Thus, the plaintiff's transition from a pension for long service assigned under Law No. 1788-XII to an old-age pension under Law No. 1058-IV is precisely the initial assignment of an old-age pension within the meaning of the latter, not a "transfer from one type of pension to another" within the meaning of part three of Article 45 of this Law. Accordingly, when calculating the amount of such a pension, the provisions of part two of Article 40 of Law No. 1058-IV apply, which explicitly provide for the use of the average salary indicator in Ukraine for the three years preceding the year of application.
Therefore, the Administrative Court of Cassation of the Supreme Court concluded that the respondent's use of the mechanism of transferring from one type of pension to another, namely from a pension for long service to an old-age pension, was unfounded, and when calculating the pension, it was necessary to apply the average salary (income) indicator for the three years preceding the year of the old-age pension assignment, as required by part two of Article 40 of Law No. 1058-IV.
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