Category Archive: Pension

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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A company’s early retirement scheme does not constitute discrimination under the Equal Treatment Act

The Federal Labour Court (BAG) ruled in March (docket no.: 8 AZR 677/14) that a company’s early retirement pension scheme does not violate the German Equal Treatment Act if the employee is free in his decision to accept the offer. In this case the employer offered within early retirement scheme which provided that the employee …

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“Late marriage” clause in pension schemes is an age discrimination

A “late marriage” clause that requires for payment of the survivor’s pension that the employee, entitled to pension benefits, was getting married before reaching the age of 60 is invalid according sec. 7 para. 2 of the General Equal Treatment Act (AGG). This was decided by the Federal Labour Court (Bundesarbeitsgericht, BAG) on 4 August …

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Good news for company lawyers

On 1 January 2016, the law on reforming the rights of company lawyers (Syndikusrechtsanwälte) came into force. The reform will enable company lawyers to remain in the lawyer’s occupational pension insurance (Versorgungswerk), ie entitle them to be exempted from the statutory pension scheme. By this law, the legislator has corrected the decision of the Federal …

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Pension Indexations and Intra-Group Transfer Price Agreements

An employer who is in a favorable economic position must adjust ongoing pensions despite the fact that he is tied to a transfer price agreement within the group which is partially the source of his profits. This was decided by the Federal Labour Court (Bundesarbeitsgericht, BAG) on 10 February 2015 (ref.no. 3 AZR 37/14). The …

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Replacement of Individual Pension Grant by Works Agreement Containing New Pension Plan

The  Federal Labour Court (Bundesarbeitsgericht, BAG) ruled on 10 March 2015 (ref. no. 3 AZR 56/14) that even individual pension promises are subject to modification by a works agreement as long as they contain some element of collective nature. The parties disputed if the replacement of a pension plan initially stemming from the year 1976 …

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