Transfer of business

Entitlements on company pension are subject to particular protection in the event of a transfer of business according to Section 613 a German Civil Code

By judgment of 22 October 2019 (docket number: 3 AZR 429/18) the Federal Labour Court has extended its settled case law regarding the replacement of pension plans in the event of mergers and acquisitions. A replacement of a pension plan by a pension plan existing at the acquirer a must be in accordance with the principle of protection of legitimate expectation and the principle of proportionality. For occupational pensions, the Federal Labour Court has developed a special three-stage examination that reflects these principles. In the present case, the Federal Labour Court stated that these principles and requirements also apply in …

Entitlements on company pension are subject to particular protection in the event of a transfer of business according to Section 613 a German Civil Code Read More »

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 at the acquirer. The parties were in dispute about the legal basis for the plaintiff’s occupational pension payments. The plaintiff’s employment relationship was transferred to a new employer (the defendant) in the course of a transformational merger in 2013, which at the same time constituted …

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