A jubilee award is a monetary benefit that an employer may grant to an employee upon reaching a specified number of years of service with that employer. The right to receive a jubilee award does not arise directly from statutory law; it exists only if it is expressly provided for in a collective agreement, rulebook on labor, or individual employment contract. Therefore, an employer has no legal obligation to pay a jubilee award unless such entitlement is defined in its internal acts. The right relates exclusively to years of service with the specific employer and is calculated in the manner and under the conditions precisely determined by the relevant internal act, including whether only uninterrupted service is recognized or whether all periods of employment with that employer are aggregated. Years of service completed with other employers are not taken into account unless this is explicitly stipulated.

The law does not prescribe a minimum or maximum amount of a jubilee award; consequently, its amount is determined by the employer’s internal act. In practice, it is most commonly defined as a fixed monetary amount, an amount equal to a specified average salary, or a percentage of the employee’s salary. The calculation method must be clearly and unambiguously defined to avoid differing interpretations.

From a tax perspective, a jubilee award constitutes employment income. The portion up to the applicable non-taxable threshold prescribed by secondary legislation is exempt from salary tax, while any amount exceeding that threshold is subject to salary tax and mandatory social security contributions in accordance with the regulations in force on the date of payment. Payment is made to the employee’s bank account, must be properly recorded in payroll documentation, and must be based on a formal employer’s decision. A clearly defined legal basis, accurate calculation of years of service, and application of the valid non-taxable threshold are essential for the payment to be fully compliant from both a legal and tax standpoint.