The institutional and regulatory framework in the area of labour legislation has been improved by the adoption of the Labour Inspection Act No 9634 approved on 30 /10/2006 and the establishment of the Labour Inspectorate, which has concluded cooperation agreements with the General Tax Department and the National Employment Service. However, the limited capacity of the regional labour offices and the Labour Inspectorate hampers the effective implementation of legislation. There has been no progress in establishing a modern framework approximated to the EU legislation as regards labour law. Albania is progressively approximating legislation on working conditions and equal opportunities to European standards as regards gender equality. However, the State Committee on Equal Opportunities remains weak and the Gender Equality Act remains largely unimplemented. For that reason further action is required to facilitate the inclusion of women in the labour market and their participation in the decision-making process. Albania remains at an early stage in mainstreaming gender in employment as well as in other policies. In the area of social protection, minimum wages and pensions have been increased. Contributions to the social security and pensions systems have been reduced in order to combat informal employment and increase social insurance collection rates. The core functions of the Social Insurance Institute have not been consolidated and there are no properly defined procedures for pensions and social contributions. The 7-year strategy for Social Assistance and the Social Inclusion Strategy (2007-2013) have not yet been finalised.
Social security services are no longer an exclusive domain of the state-owned Institute of Social Security. A Law, introduced in 2004, allows Albanian and foreign private entities to invest and operate in this market. To date, there are two companies, one American and the other Albanian, which offer pension plans to Albanian citizens.
In 2005, there was a major controversy over the government’s decision to raise the retirement age by five years. A coalition of Unions and advocacy groups asked for a referendum, filing a petition that was signed by more than 20 000 employees. The Constitutional Court, the country’s highest court, rejected the request for a referendum. The retirement age will progressively increase by six months every year, until it reaches 65 for men and 60 for women; reaching these goals by 2012.