In April 2010, the Czech Constitution Court ruled on the invalidity of the provision of the Czech Pension Insurance Act No. 155/1995 Coll. (the "Act") related to the proportional distribution of pensions. The Court found such provision to be discriminatory against people with higher levels of income during their productive age.
The process was initiated by a claim of a man whose disability pension was disproportionally lower than his income during his productive life, due to the current legislation, which does not properly consider the man’s previous contribution to the state pension budget. Such provision means that a higher level of income during one's productive life does not influence the amount of their pension, since the proportion of previous income is just 10% up to a certain amount (EUR 1,000) of income. Therefore, people with a previous low level of income received a monthly pension that represented a much greater proportion of their previous contribution to the budget during their productive life.
The main issue with which the Court dealt was the conflict between discrimination against people with higher salaries and the principle of solidarity with the people with lower salaries, with an emphasis on the fundamental right to adequate material sustenance and the principle of equality entrenched in the Czech Charter of Fundamental Rights and Freedoms. As a result of that, the court ruled that the principle of solidarity should not thus defeat the principle of meritoriousness, and that people who paid higher amounts than others into the state pension budget during their productive lives should receive proportionally higher pensions during their post-productive lives.
Considering the current economic crisis, the Court postponed the effect of the decision until September 2011, although such resolution will influence the entire distributive system, such as the state budget plan for future years.