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3. End-of-Service Benefits: The Only Social Safety Net at Risk Since the Crisis

Since 2019, the calculation of end-of-service benefits, the only protection for employees and public servants in the absence of a retirement pension, has been stuck in endless debates, leaving thousands in uncertainty. This situation is the result of a 98% devaluation of the Lebanese pound against the dollar, which has effectively wiped out the value of these benefits.

There is no doubt that employees remain the most vulnerable group in the struggle to ensure a dignified retirement. Their end-of-service benefits, intended to preserve part of their purchasing power, have been almost completely eroded by the multidimensional crisis that hit the country at the end of 2019.

Employers Plead Powerlessness

Employers say they cannot bear alone the cost of regularizing the situation of employees registered with the National Social Security Fund (NSSF), as no provisions were set aside in their annual budgets for this purpose.

“Over the years, employers have fulfilled their obligations to the NSSF. They do not have the means to pay these amounts a second time, nor to shoulder alone the consequences of an economic and financial crisis to which they have not contributed,” a business source who requested anonymity told This is Beirut. The source added, “The state must take its share of responsibility by providing concrete support to resolve the issue of calculating end-of-service benefits.”

A Heavy Burden for Employers

According to the Labor Code, end-of-service benefits can be paid after 20 years of actual service, without waiting for retirement age. They are calculated based on the last salary multiplied by the number of years of service. Employers must pay the difference between the last contractual salary and previous salaries, but this does not mean covering every gap over 20 years. The amount paid remains fixed and is based on the final salary.

This regularization represents an especially heavy burden for employers due to currency depreciation. Before 2019, salaries were calculated at 1,507.5 Lebanese pounds per dollar, compared with 89,500 pounds per dollar today.

Agreement and Disagreement in Negotiations

Discussions on end-of-service benefits oscillate between agreement and disagreement. They involve all relevant parties: employers, the state, the NSSF and employees.

During a joint press conference by economic organizations and the General Confederation of Lebanese Workers (GCLW), which brings together more than a thousand worker associations, the parties expressed support for MP Faysal Karame’s proposed law to revise the calculation of service benefits. However, the state, represented by Finance Minister Yassine Jaber, requested more time to consider the financing arrangements.

Under Karame’s proposal, the cost of regularizing the situation of employees registered with the NSSF is shared: half of the benefits would be paid by employers, and the other half financed by the state. But NSSF funds have been invested in Treasury bonds, which the state considers a priority claim, further complicating financing.

Karame’s Proposal

MP Karame’s resolution divides beneficiaries of end-of-service benefits into three categories:

First category: Employees who withdrew their benefits between October 17, 2019, and April 1, 2024. Their benefits would be multiplied by 30, allowing them to recover roughly 50% of what they would have received without the devaluation.

Second category: Employees who have not withdrawn their benefits and remained in their positions until the end of 2023. Benefits would be calculated based on their last salary in October 2019, at the official rate of 1,507.5 LL per dollar, ensuring they receive half of the amount they would have been entitled to without the crisis.

Third category: Employees still in service, waiting to reach the legal retirement age over the next five to ten years. For them, the reference salary for calculation would be that of December 2023, reduced by 50%. Remaining years would be calculated according to the standard rules of the Labor Code, based on the last salary actually received.

In all cases, the cost of regularization would be shared equally, with half covered by employers and half by the state.

The Plight of Public Servants

Public servants now face complete uncertainty. The draft 2026 budget does not include any funds to adjust the salary scale, yet public sector salaries and social allowances still make up nearly 47% of the current account.

End-of-service benefits are still calculated based on the public sector salary scale adopted by Parliament in 2017. As a result, for a civil servant retiring since 2019, the benefit received now represents only 4% of what they would have been entitled to if the crisis had not occurred. In addition, recently granted social allowances are temporary and not included in the base salary.

The contrast is striking given that the state has secured funds to pay high salaries to newly appointed executives. The CEO of Télé Liban, for example, earns $3,000, while part-time board members receive $500. Salaries for the presidents and members of regulatory authorities range between $6,000 and $8,000.