Category Archive: Pension

Occupational Pensions: “Split pension formula” and pro-rata reduction of pension entitlements in accordance with European law

By judgment of 13.07.2017 (C 354/16) the European Court of Justice has ruled that a “split pension formula” and a pro-rata reduction of pension entitlements do not constitute discrimination against part-time employees or age discrimination. The employer granted to his employees a pension promise, according to which salary components above the German Social Security Contribution …

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Occupational Pensions: No right of segregation under Section 47 of the German Insolvency Act for contributions to a captive pension insurance

By judgment of 21.03.2017 (3 AZR 718/15) the Federal Labor Court has ruled that a right of segregation under Section 47 of the German Insolvency Act generally does not exist in the event that an employer ceased contribution payments to a captive pension insurance and later became insolvent. Such a right only exists if the …

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Employee’s request for fixed-term employment narrowly interpreted

Entering into a valid fixed-term contract can be a bit of a challenge under German law. Under the Fixed Term and Part-Time Employment Act (TzBfG), one of the reasons which may be used to justify a fixed-term contract is that there are reasons relating to the circumstances of the particular employee. A recent case decided …

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Occupational Pensions: Deteriorating replacement of a works agreement in the course of a transfer of business

By judgment of 08.02.2017 (4 Sa 34/16) the Regional Labour Court Baden-Württemberg has ruled that an occupational pension scheme can be worsened by a transfer of business in accordance with § 613a of the German Civil Code (BGB) if a works agreement existing at the seller is replaced by a less favorable works agreement existing …

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Occupational Pensions: Clause of general terms and conditions according to which only a “present” wife of an employee is entitled to survivors’ benefits can constitute inadmissible disadvantage

By judgment of 21.02.2017 (3 AZR 297/15) the Federal Labor Court has ruled that a clause in general terms and conditions according to which only a “present” wife of an employee is entitled to a survivor’s pension constitutes an unreasonable disadvantage for the employee and therefore is invalid according to § 307 para (1) sentence …

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Federal Labor Court has tightened legal requirements concerning a special procedure regarding the calculation of vested pension entitlements (so-called “insurance contract solution” (“versicherungsvertragliche Lösung”))

By judgment of 19 Mai 2016 (BAG, docket number 3 AZR 794/14), the Federal Labor Court has ruled that an employer’s choice in favor of the so-called “insurance contract solution” – which is a special procedure for calculating vested pension entitlements – requires in every single case a new corresponding declaration to the employee and …

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No discrimination of disabled people in case of reduction of occupational pensions because of prematurely claiming

By judgment of 13 October 2016 (BAG, docket number 3 AZR 439/15), the Federal Labour Court ruled that a reduction of occupational pension payments due to prematurely claiming prior to reaching the fixed retirement age as provided for in the pension plan does not constitute discrimination on grounds of disability according to the German General …

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Employer’s subsidiary liability for occupational pension payments

By judgement of 20 September 2016 (BAG, docket number 3 AZR 302/15), the Federal Labour Court ruled that an employer is liable for occupational pension payments, where the pension payments have been granted on the basis of a collective agreement and the implementation via an external pension provider could not take place during the vesting …

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Requirements concerning pension adjustments

By judgment of 7 June 2016 (BAG, docket number 3 AZR 193/15), the Federal Labour Court ruled that an employer is allowed to refuse pension adjustments due to economic reasons, where the employer is not able to continue generating a sufficient equity yield rate or has a lack of equity capital. The parties were in …

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Interpretation of invalid works agreements as “individual pension grants with collective nature”

The German Federal Labour Court has ruled that a legally invalid works agreement on pensions can be interpreted as ” individual pension grants with collective nature” (“Gesamtzusage”). This is in accordance with sec. 140 of the German Civil Code (German Federal Labour Court – Bundesarbeitsgericht, 23 February 2016,  ref.no. 3 AZR 960/13). The court had to decide …

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