Previous Legal Framework

Under the prior Pension Insurance Act (2013), only part-time work (up to 50% of full-time hours) was allowed without suspension of pension payments. This applied to recipients of certain types of old-age, survivors’, and disability pensions (under Articles 33, 99, 180).

While the system allowed limited work while receiving a full pension, it did not permit full-time employment without losing the pension. This changes under the new law.

Key Change: Working While Receiving a Pension

Article 100(1) of the new ZOMO provides that the Croatian Pension Insurance Institute (HZMO) will suspend pension payments if a pension recipient becomes employed beyond half-time hours or starts an activity that triggers compulsory insurance.

For recipients of disability pensions due to total loss of work capacity or general incapacity (or where such a pension has been converted into an old-age pension), even working 3.5 hours a day or more will result in suspension of the pension. This specific rule will apply from 1 January 2026.

However, ZOMO introduces important exceptions.

Exceptions: When Pensions Are Not Suspended

As of 1 July 2025, pensioners working full-time will retain 50% of their pension in the following cases-

• Recipients of partial disability or professional incapacity pensions;
• Recipients of old-age pensions under special regulations;
• Seasonal agricultural workers;
• Pensioners earning secondary income or carrying out other self-employed activity.

From 1 January 2026, the right to receive 50% of the pension while working full-time will also apply to:

• Recipients of old-age pensions (including long-term insured and early retirees), survivors’ pensions, or part of a survivors’ pension, who work full-time or engage in compulsory-insurance activities after age 65;
• Persons who have acquired the right to an old-age pension without ceasing insurance.

Additionally, Article 100(6) ensures these rules apply mutatis mutandis to pensioners under special regulations if more favourable.

Until 1 January 2026, most pensioners remain restricted to part-time work if they wish to retain their pension in full.

Implications for Employers

This reform opens new opportunities for employers to engage experienced retirees full-time without triggering the full suspension of their pension entitlements — a key benefit in a labour market facing chronic shortages.

Employers should be aware of the following:

• The ability to hire retirees full-time (while they receive 50% of their pension) increases workforce flexibility and lowers onboarding/training costs by reintegrating skilled workers;
• Legal obligations relating to employment (social and health insurance registration, working time records, payroll contributions) remain fully in effect unless expressly exempted by law;
• Until 1 January 2026, careful attention is required. Hiring a retiree full-time who only becomes eligible for the pension exception in 2026 will trigger full suspension of the pension.

Conclusion

The new ZOMO presents a concrete opportunity for employers to engage pensioners full-time under clearly defined legal conditions. While the first wave of changes already applies from 1 July 2025, broader application starts from 1 January 2026 — offering greater flexibility in workforce planning, especially in sectors struggling with labour shortages.

To fully leverage these reforms, employers should stay informed of applicable criteria and adjust internal hiring processes accordingly.

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