In Russia it's always #1 discussed and negotiated, because all the taxes and payments (like the retirement fund), including those that are supposedly paid by the employee, are handled by employer's accounting. Most people don't even know how much taxes and other payments they pay to the government each month, and most people don't even care that much whether the employer actually pays it all or doesn't. Just to clarify: not paying taxes and social payments on employee salary is, obviously, illegal, and employee is aware of that, but (1) in Russia, people generally don't care about breaking the law that much and (2) people don't believe in the pension system enough to care if they're paying anything into it or not. Most feel that by the time they get to retirement, government will find some way to steal their pension money, or it will be completely eaten away by hyperinflation or some other catastrophic economic event.