Company pension scheme – Pensions Update | Issue 1/2017

It’s done – the BRSG comes into force on January 1, 2018

There were discussions with professional associations and state governments right down to the last few meters – but now the BRSG has been passed by the Bundestag (16 June 2017) and Bundesrat (7 July 2017). Which final regulations will come into force on January 1, 2018? What do employers need to consider and bear in mind?

In order to strengthen the occupational pension scheme and make it more widespread, particularly in smaller companies and among employees with low incomes, the option of a purely defined contribution plan is being introduced. This is flanked by a new option model and improved tax conditions for the endowment of direct insurance policies, pension funds and pension funds. In the final version of the law, the obligation of employers to contribute social security contributions saved by employees through deferred compensation to the pension scheme has been significantly expanded. The planned subsidy model for low-income earners will be introduced unchanged, although the income threshold has been raised compared to the original announcement.

The new regulation on dealing with a reinsurance policy in the event of employer insolvency, the further increase in the Riester basic allowance and the reduced offsetting of benefits from occupational pension schemes, Riester and Rürup pensions against assistance towards living expenses and basic security in old age and in the event of reduced earning capacity have also been retained. In addition, the BRSG contains a regulation on pension adjustments when occupational pension schemes are implemented via direct insurance or a pension fund, which extends the regulation applicable to adjustment periods from 2016 to earlier periods and thus exempts employers from potential obligations to adjust pensions for past periods under certain conditions.

The main new regulations that directly affect employers are:

Introduction of a pure defined contribution plan

The original idea has been retained: From 2018, occupational pension schemes can also take the form of a pure defined contribution plan. In the event of a pension claim, employees receive the benefit resulting from the contributions made and the interest earned on them. There is no minimum benefit or guarantee of any kind; in fact, this is explicitly prohibited by the wording of the law. This means that the employer is generally not exposed to any company pension risk.

As initially planned, such contribution commitments must be based on a collective agreement, i.e. agreed between the parties to the collective agreement and implemented via a joint institution. This requirement still caused discussion shortly before the law was passed, as small and medium-sized companies in particular – which were the focus of the proposed legislation – are often not bound by collective agreements. In the final version of the law, the social partners are now explicitly required to consider opening up the law to companies not bound by collective agreements. The parties to the collective agreement should not deny access to the pension scheme implementing the defined contribution plan. The pension scheme itself may not impose any objectively unfounded requirements with regard to the admission and administration of employees of employers not bound by collective agreements.

Another new aspect is that, when introducing a defined contribution plan, the parties to the collective agreement are expressly requested to take appropriate account of existing occupational pension schemes and to examine whether contributions can be paid into an “old occupational pension scheme” instead, i.e. a defined contribution plan with an underlying benefit guarantee (defined contribution plan or defined contribution plan with minimum benefit). On the one hand, this provision is based on the fear that existing pension arrangements will be replaced by a pure defined contribution plan, which in specific cases would mean a deterioration in employees’ occupational pension provision. On the other hand, it accommodates companies that wish to continue using their existing pension schemes.

What has remained the same is that a security contribution is to be agreed to compensate for the liability path. This is to be paid by the employer in addition to the agreed regular contributions and serves to build up a higher capital stock (which then enables higher benefits and/or a more aggressive investment strategy). The fact that defined contribution plans are immediately vested and that the accumulated capital can be transferred to the new employer’s defined contribution plan in the event of a change of employer also remains. A regulation has been added which stipulates a remaining buffer in the capital cover in the event of an increase in current benefits. This is intended to prevent pension increases from having to be reversed in the near future, making pension payments unnecessarily volatile – another issue that was hotly debated until recently.

Introduction of an option system

The new option system (“opting out”) has remained unchanged. Here, employees automatically participate in an agreed remuneration conversion program unless they explicitly object to this within a set period. The law attaches certain conditions to these option systems with regard to the period within which the employee can refuse to participate and the “minimum content” of the employee information.

The introduction of an option system is left to the collective bargaining parties. However, employers who are not bound by collective agreements can also apply a relevant collectively agreed option system – in this respect, the wording of the final law is much more specific than the first draft law.

Employer subsidy for deferred compensation

The draft law already stipulated that the employer must increase the “employee contribution” by the social security contributions saved in the case of deferred compensation in favor of a new contribution system. For this purpose, 15% of the converted remuneration must be paid to the pension fund. This provision has been incorporated into the final wording of the law. However, the law that has now been passed goes even further: even in the case of existing deferred compensation schemes that are organized via direct insurance, a pension fund or a pension fund, the employer is now obliged to pay 15% of the conversion amount to the existing implementation channel if it saves social security contributions as a result of the deferred compensation. This requirement does not apply to direct and provident fund commitments.

This new regulation applies to all new deferred compensation agreements concluded from January 2019. There is a transitional period for agreements already in place at this time: the employer subsidy is not mandatory until 2022. The subsidy can be waived by collective agreements. Collective agreements already in place before the law comes into force that are less favorable to employees in this respect will remain valid. The legislator has thus complied with the wishes of the major employers’ associations concerned.

Improved tax framework for pension schemes via direct insurance, pension funds or pension funds

The new defined contribution plan can be implemented via a direct insurance policy, a pension fund or a pension fund. In order to create tax leeway for this, the limit up to which contributions to these implementation channels remain wage tax-free has been increased. This was already provided for in the first draft bill. However, the limit has now been raised to 8% of the contribution assessment ceiling for general pension insurance (BBG) rather than 7%. However, despite numerous demands to the contrary from the business community and interest groups, it has remained the case that contributions are only exempt from social security contributions up to a limit of 4% of the BBG.

Contributions to a pension fund paid on the occasion of the termination of the employment relationship also remain tax-free, provided they do not exceed 4% of the BBG multiplied by the number of years of service with the employer, up to a maximum of ten years. It is also possible to make up the tax-free contribution of 8% for periods of inactive employment for up to ten calendar years after the resumption of active employment.

Specific support model for low-income earners

The planned occupational pension contribution will be introduced for employees with low pay from 2018. The income limit for this was raised from the original EUR 2,000 per month to EUR 2,200 per month. An increase to EUR 2,500 per month had been called for in the discussion. In light of the fact that the adjustment that has now been made will already lead to additional tax revenue shortfalls of EUR 50 million per year (bringing the total annual tax revenue shortfall to EUR 250 million), the compromise that has now been reached was made for fiscal policy reasons.

If the employer pays an amount of at least EUR 240 p.a. to a direct insurance scheme, a pension fund or a pension fund for a low-income employee, the employer can deduct 30% of this amount, up to a maximum of EUR 144, from the employee’s wage tax. The prerequisite for this subsidy is that the contribution is borne economically by the employer and is not funded by the employee’s deferred compensation. Furthermore, the employer must pay the contribution in addition to a company pension scheme already in existence in 2016. It was initially planned that the subsidy would only apply to new pension schemes introduced from 2018; however, employers who have already made additional pension contributions for their low earners in 2017 in anticipation of the new regulation have now been accommodated. Up to an amount of EUR 480 p.a., the “low-income employer contribution” to direct insurance, pension funds or pension funds remains tax-free, in addition to the tax-free amounts pursuant to Section 3 No. 63 EStG.

Open questions

The new features of the BRSG raise a number of questions for employers: Does the BRSG open up opportunities for company pension schemes that are more attractive than the previous offers? What aspects of employment law need to be considered when switching to the “new occupational pension scheme”, and which aspects are still unclear? How should the employer subsidies for deferred compensation now provided for be handled if the tax limits of § 3 no. 63 EStG have already been exhausted; how should they be handled in the case of direct insurance schemes taxed at a flat rate in accordance with § 40b EStG?

From the field: Porsche has applied the magnifying glass

In the fall of 2016, Porsche set itself the goal of conducting an internal audit of its employees’ pension commitments. The pensions team at KPMG AG Wirtschaftsprüfungsgesellschaft was asked to assist with this.

Porsche operates the occupational pension scheme via a direct commitment. This is financed both by the employer and by the employees through deferred compensation. There is also the option of deferred compensation in favor of the insurance-based implementation channels of direct insurance, pension funds or pension funds.

Goal/task

The internal audit focused on examining the structural design of the pension commitments, their conformity with case law, the correctness of the accounting and bookkeeping records and the complete and correct handling of business processes. Porsche’s internal auditors have extensive experience in auditing in general; however, they were unable to draw on comprehensive technical expertise in the area of occupational pension schemes. KPMG AG was therefore asked to develop a training document tailored to Porsche’s specific requirements and to familiarize the auditors with the occupational pension scheme on this basis.

Procedure

A training document first explained key basic terms. This included a definition of what is generally regarded as a company pension scheme. In addition, the implementation methods were characterized, the various forms of financing and commitments were explained and the treatment under social security and tax law was presented. The various Porsche commitments were clustered on this basis.

In the second chapter of the training document, the structural risks of the structure of the individual commitments were explained. The structural elements of interest, biometrics, consideration of salary development and actual expenses were examined and a statement was made with regard to the risk to be borne by Porsche (see figure below). As the promised interest rate in particular is one of the major risks, the consequences of the persistently low interest rate environment were presented for all five implementation channels. Finally, it was shown how modern pension commitments can be designed today in order to minimize the risks for the company and still provide employees with an attractive pension.

The third chapter of the training document provided an overview of the main legal sources for pensions. Various recent labor court rulings on the topics of equal treatment, part-time employment, surviving dependants’ pensions, retirement age and the obligation to adjust pensions were then discussed in detail. Finally, reference was made to special aspects of employment law that are often neglected in practice, e.g. lack of congruence between insurance contract and pension commitment, outdated deferred compensation agreement.

Chapter four provided an overview of the accounting, bookkeeping and tax recognition of occupational pension schemes. A distinction was made between German and international commercial law requirements. It also showed how cash flows are to be recognized in each case and which special accounting effects can occur.

The last chapter provided an overview of all general administrative occupational pension processes. Subsequently, it was shown how frequently these processes occur, which deadlines may need to be taken into account and which parties are involved. Finally, a specific process was discussed in detail and points were made to noteworthy aspects.

The training was followed by a workshop. In this workshop, a revision program was jointly developed. A mind map process was used to show where the focus could be placed when carrying out the audit. Access to information and the frequency of spot checks were also discussed. During the audit, KPMG was available for all queries from the auditors. In this way, audit and action recommendations could be made as required.

Conclusion

An internal audit adds value by uncovering risks that are often overlooked by those involved due to the depth of detail. One success factor of this project was that the complex topic of occupational pension schemes was presented and communicated in understandable language.

Alternative derivation of service cost and net interest under IAS19

In order to determine the scope of obligations from company pension commitments relevant for the annual financial statements, a discount rate must be selected in accordance with the requirements of the respective accounting standard, in addition to other assumptions. The discount rate not only has a significant impact on the present value of the obligation (DBO, PBO under US GAAP), but also on the current service cost and interest expense relevant to the income statement.

It is customary to use a uniform interest rate for the calculation of all three variables. In the USA in particular, there has recently been a clear trend towards using different interest rates to determine the DBO, current service cost and interest expense. This approach can have a significant impact on the calculation results. While certain alternative methods are expressly recognized by the US Securities and Exchange Commission (SEC) for US GAAP, discussions in this regard are still ongoing in the IFRS bodies.

The conventional method for measuring pension obligations under IFRS and US GAAP is characterized, among other things, by the fact that a uniform interest rate is used for the measurement of the pension obligation, i.e. the defined benefit obligation (DBO) according to IFRS terminology (projected benefit obligation (PBO) according to US GAAP terminology; for reasons of simplification, only the DBO term according to IFRS terminology is used here), on the one hand, and the expense figures on the other.

The calculation of the DBO is basically a multi-stage process. The first step is to determine the expected cash flows for the individual years, extrapolated using actuarial assumptions. These are then discounted to the valuation date using the actuarial interest rate for the term from the valuation date to the year under consideration (i.e. the so-called “matching term” interest rate for each year). The complete yield curve is thus taken into account. The actuarial present value calculated in this way is the basis for determining the DBO.

In the second step, this data is used to determine the one value for the actuarial interest rate which, when applied uniformly to all future cash flows, results in the same scope of obligation. This uniform actuarial interest rate therefore represents a weighted average interest rate. The “uniform interest rate” calculated in this way is then used in the conventional method to determine the expense variables, in particular the current service cost and the interest expense (for simplicity’s sake, the term “interest expense” is used here; according to IAS 19.123, net interest is to be determined).

In contrast, the full interest rate structure method (spot rate approach) does not use the uniform interest rate to calculate the current service cost and interest expense, but the interest rates with matching maturities (spot rates); i.e. here too, the expense for each future year is determined using the respective discount rate for the term between the measurement date and the year under review. The calculation of the DBO does not differ from the conventional method in the spot rate approach and therefore results in the same scope of obligation.

A higher interest rate is usually achieved for longer terms than for shorter terms, i.e. the longer the investment horizon, the higher the interest rate (rising yield curve). This means that when measuring pension obligations, cash flows that are further in the future are discounted at a higher interest rate than payments that are expected in the next few years. In these cases, the spot rate approach generally leads to a reduction in interest costs and current service cost.

In principle, the DBO is the sum of the present values of the projected cash flows of the individual years, i.e. the scope of the obligation can be broken down into individual annual slices. Due to the discounting effect, annual slices in the first few years have a higher weighting than parts of the obligation that relate to later years. To determine the interest expense, the spot rate approach weights the higher-weighted individual annual slices in the first few years at a lower interest rate than the conventional method when the yield curve rises. The resulting effect outweighs the effect of higher interest rates applied to obligations further in the future, which leads to a lower interest expense overall than with the conventional method.

The service cost is the portion of the pension obligation that is earned by current employees in a given year. The associated payment of pensions generally does not begin until retirement age is reached (exceptions may be payments in the event of disability), i.e. the expected pension payments typically do not occur for many years. The expected payments further in the future tend to be discounted at higher interest rates with the spot rate approach (due to the rising yield curve) than with the conventional method, which leads to a lower service cost.

Our analyses support previous studies according to which the use of separate interest rates, depending on the pension plan and the steepness of the yield curve, can lead to a reduction in interest costs of around 15% to 20% and in current service cost of between around 4% and 6% compared to the conventional method (see e.g. public meeting document of the IFRS-FA (DRSC) for the 53rd meeting of the IFRS-FA, October 10, 2016). Such a reduction in pension expenses generally leads to a corresponding increase in the profit reported in the income statement (or reduces the loss) and could be a possible motive for applying an alternative measurement method.

The US Securities and Exchange Commission (SEC) has expressly recognized the spot rate approach for reporting under US GAAP. This approach is now also used by a large number of companies. The extent to which this approach is also permissible for IFRS accountants is being discussed in the industry and in relevant IFRS committees, although no final decision has yet been made.

One aspect that could lead to a different assessment under US GAAP and IFRS is the different treatment of actuarial gains and losses that systematically arise under the spot rate approach. If a uniform interest rate is used to calculate the DBO, current service cost and interest cost, gains and losses only arise if the valuation interest rate (or another valuation assumption) has to be adjusted or the actual development deviates from the assumed development (e.g. granting of higher pension adjustments than assumed in the valuation). If these effects do not occur, such a valuation approach does not result in any gains or losses.

As the amount of the obligation under the conventional method and the spot rate approach is identical, as explained above, changes in the service cost and/or interest cost always result in actuarial gains/losses. If, for example, a lower service and interest cost is calculated using the spot rate approach, this implies that a lower level of obligation is expected at the end of the year. However, as the actual extent of the obligation remains high, this results in an actuarial loss at the end of the year.

Under IFRS, actuarial gains/losses are recognized directly in equity (other comprehensive income, OCI) and there is no (subsequent) amortization of these amounts via the income statement. The situation is different under US GAAP, according to which the amounts accumulated in accumulated other comprehensive income (AOCI) are “recycled” via the income statement, at least with a time lag, i.e. taken into account in the income statements of subsequent years. However, the extent to which this aspect was decisive for the recognition of the spot rate approach under US GAAP by the SEC and the extent to which the lack of this “recycling” under IFRS could be detrimental to recognition is still an open question at this stage of the discussion. The application of the spot rate approach would typically lead to lower pension expenses under IFRS – due to the lower service and interest costs compared to the conventional method – while the corresponding actuarial losses would remain in OCI under IFRS.

Should the spot rate approach – and possibly other alternative methods – be considered permissible under IFRS and used by companies, this will in any case have a negative impact on the comparability of the disclosures on pension obligations made in the annual financial statements. Appropriate flanking with meaningful explanations in the notes therefore appears necessary in any case.

Inheritance tax and pension obligations – one measure, two positive effects

Rising pension provisions are increasingly burdening balance sheets and reducing the distribution volume. External financing of pension obligations relieves the balance sheet and at the same time reduces the administrative assets to be taxed in the event of inheritance. We support you in identifying and implementing the optimal financing alternative for your company.

The occupational pension scheme is one of the fringe benefits most valued by employees and is becoming an increasingly important aspect of employer attractiveness against the backdrop of demographic trends. Direct commitments – i.e. commitments where the employee’s claim is made directly against the company – continue to be the most widespread financing alternative due to their flexibility and almost unlimited structuring options. Pension provisions must be recognized in the balance sheet for pension obligations entered into in this way. For this purpose, the future cash flows are determined, weighted with their respective probability and then discounted to the balance sheet date. According to HGB, the relevant discount rate for this is calculated from the average market interest rate of the last ten years. Due to the sharp fall in interest rates in recent years, the HGB discount rate has also fallen, but is still significantly higher than the current market interest rate – and will continue to fall in the coming years, even if interest rates rise moderately. Accordingly, a future increase in pension provisions can be assumed. This not only means a declining equity ratio and a poorer credit rating, but also reduces the funds available for distribution. For tax purposes, the pension provision is still determined on the basis of an interest rate of 6%. The tax-deductible amount is therefore significantly lower than the economic value of the pension obligations. There is no change in sight here.

The second challenge: Taxation of administrative assets in the event of inheritance

Due to the new inheritance tax regulations, administrative assets have been taxed at a significantly higher rate since July 1, 2016. Such administrative assets include, for example, securities that a company has invested to cover pension obligations. While a 100% exemption from inheritance tax was possible in these cases before July 2016, all administrative assets are now taxed if they exceed an allowance of 10% of the beneficiary assets. In addition, when administrative assets are reallocated – for example as part of a new investment of securities – so-called new administrative assets are created, which are directly attributed to the shareholder as non-preferential assets for two years and are fully taxable.

A solution for both challenges

One possible measure is the separation of assets and their earmarking for the occupational pension scheme. To this end, the assets are transferred to a trust model or an external financing vehicle. Pension funds and provident funds are suitable external financing vehicles in this context.

First advantage: balance sheet relief and improvement of the equity ratio

Depending on the financing model, there are different balance sheet effects, but the balance sheet is always relieved:

• In a trust model, pension obligations and assets are offset against each other. This means that only the part of the pension obligations that exceeds the separated assets (“underfunding”) appears in the balance sheet.
• In the case of an external financing vehicle, there is then a so-called indirect commitment, which is subject to the accounting option under commercial law. A shortfall – which may increase in the coming years due to the continuing fall in the discount rate – therefore only needs to be disclosed in the notes to the balance sheet.

This relief results in a reduction in the balance sheet total and thus also an arithmetical increase in the equity ratio, without the company relinquishing responsibility for the pension obligations or even getting rid of them.

Second advantage: Inheritance tax relief

The new statutory provisions of the Inheritance Tax Act contain an opening clause according to which “parts of the assets eligible for preferential treatment that serve exclusively and permanently to meet debts arising from pension obligations and are protected from access by all other creditors who are not directly entitled under the pension obligations” are not included in administrative assets. Therefore, if assets are transferred to a trust model or an external implementation channel and thus reserved for the purposes of the company pension scheme, these reinsurance assets can effectively be neutralized up to the amount of the market value of the encumbrance. However, there are two further positive effects: Firstly, there is a full offsetting of debts, whereas, as a rule, only a pro rata debt deduction in the ratio of administrative assets and beneficiary assets is possible when calculating the net administrative assets. Secondly, the outsourcing of pension assets prevents the creation of new administrative assets when securities assets are reallocated.

Third advantage: faster tax deductibility

As outlined above, the tax provision value for income tax purposes is limited in accordance with Section 6a EStG and is significantly lower than the provision under commercial law. If the pension obligations are outsourced to an external financing vehicle, i.e. a provident fund or pension fund, there will be no need to create a provision for tax purposes in future. Instead, the contribution to be paid to the financing vehicle can be claimed as a business expense for tax purposes. If a provident fund is used, an immediate business expense is incurred in the amount of the full contribution; however, this is not always significantly higher than the pension provision to be recognized for tax purposes. The situation is different in the case of a pension fund: here the contribution corresponds to the economic value of the pension obligations. Although the difference between the contribution and the pension provision for tax purposes must be spread over ten years in accordance with Section 4e EStG, the tax deduction is made much sooner than would be the case if the provision were to continue to be formed in accordance with Section 6a EStG.

What is the optimal solution for your company?

The answer to this question depends on a number of factors – the nature and structure of the pension obligations, the current liquidity situation and future liquidity requirements, the availability of illiquid funds that can be used for a trust solution and, of course, succession planning. We advise you individually and work with you to find the best solution. Feel free to contact us.

Labor law implementation issues relating to the BRSG

With the aim of strengthening and expanding occupational pension schemes, the BRSG paved the way for a fundamental reform of occupational pension schemes. In the following, we shed light on the current employment law issues arising from the implementation of the BRSG in the “new world of occupational pension schemes”.

The BRSG introduces the possibility of a liability-privileged collectively agreed pure defined contribution plan (TBZ). The employer does not have to pay for the permanent pension level. Guaranteed benefits are even prohibited to allow the employee, who bears the risks of the investment, the chance of a good return. In addition, it is now possible to implement deferred compensation per se in an option system if the employee does not actively object. Both commitments are designed in the social partner model with the participation of the collective bargaining parties. These central innovations are flanked by various regulations. This is mainly due to the improved tax framework for the allocation of the applicable implementation channels (direct insurance, pension funds and pension funds) to 8% BBG (but without a one-off amount of EUR 1,800). From January 1, 2019, employers will be required to pay a subsidy of 15% if social security contributions are saved as a result of deferred compensation; from January 1, 2022, this will also apply to existing pension schemes (except for the direct commitment and provident fund implementation methods).

Implementation issues under labor law

In the case of the introduction of a TBZ, which is at the core of the reform project (§§ 1 Para. 2 No. 2a, 21, 22 BetrAVG n.F.), implementation can take place (1) directly through a collective agreement or (2) by the collective agreement enabling a voluntary (or enforceable) works agreement and giving the works councils a right of initiative or co-determination for this. Depending on the design variant, there are different implications.

(1) Mandatory TBZ

In the event of a mandatory introduction of TBZ directly by means of a collective bargaining agreement, there would be no obligation under Section 77 para. 3, 87 par. 1 BetrVG leads to a blocking effect of this collective agreement: The company partners lack the regulatory competence for the contents that are regulated by collective agreement. This also applies if a collective agreement is subsequently agreed; the works agreement becomes invalid ex nunc on the basis of the collective agreement (BAG ruling dated January 21, 2003, 1 ABR 9/02). In the event of a collective bargaining lockout, a company agreement on the occupational pension scheme which has become ineffective cannot be reinterpreted as an overall commitment (BAG ruling dated March 5, 1997, 4 AZR 532/95) or, in view of its actual implementation, constitute a company practice (BAG ruling dated November 18, 2003, 1 AZR 604/02). The decisive factor for the blocking effect is the identity of the subject matter of the regulation.

It should therefore be questioned whether the parties to the collective agreement intended a conclusive regulation or whether they are based on the same conditions. This is accompanied by further follow-up questions such as whether the TBZ involves the same subject matter as a traditional commitment – does the form of the commitment as a (defined contribution) defined benefit or defined contribution with minimum benefit or the same implementation channel matter? At any rate, pure deferred compensation and an employer-financed pension will be able to be regarded as different subjects of regulation. A new collectively agreed option model (Section 20 of the German Occupational Pensions Act (BetrAVG), as amended) will also only affect employee-financed deferred compensation and will make previously voluntary occupational deferred compensation mandatory, but will not displace employer-financed pension plans.

It has not yet been clarified whether, in the event of a tariff freeze, the company agreement would also be invalid if and to the extent that it contains a higher pension level. In principle, the tariff blocking pursuant to Sec. 77 (1) of the German Commercial Code (HGB) does not apply. 3, 87 par. 1 BetrVG does not depend on the favorability of the regulation. However, it might be advisable to limit the blocking effect in line with the BAG’s three-stage theory. The collective bargaining block is dispositive in this respect if the collective bargaining agreement expressly permits the conclusion of supplementary works agreements. The collective agreement should therefore already regulate the effects on existing regulations (replacement, crediting or increase). The practical challenge that will arise, depending on the scope of the collective agreement, is first of all whether the provisions of the collective agreement do justice to the diversity of company constellations. From the company’s perspective, the question arises as to the extent to which existing pension commitments can be modified due to the TBZ if the collective agreement is implemented.

(2) Optional TBZ

In the case of “optional” TBZ by works agreement, no collective bargaining block applies, since the collective bargaining agreement in this constellation expressly authorizes the introduction of TBZ by means of a voluntary or enforceable works agreement. However, the three-tier theory also raises questions here – for example, can the collective agreement regulate how the company TBZ relates to existing pension schemes. In the case of a new collective agreement governing the occupational pension scheme, there is no equity review within the meaning of the three-step theory (BAG ruling dated July 28, 2005, 3 AZR 14/05). However, a TBZ implemented by company agreement is not covered by this exception. Therefore, if the collective agreement does not contain a conflict-of-law provision, the three-step theory applies. If – as is to be expected – there is no interference with past service, but only the freezing of the old pension system and the introduction of the TBZ for future service, only objectively proportional reasons for the modification of the pension commitment are required. In addition to economic reasons or an undesirable development of the occupational pension scheme, the reassessment by the company parties can also constitute a reason for intervention (BAG ruling of 13.10.2016, 3 AZR 439/15). The codification of the TBZ in the BRSG could already be used for a modification with ex nunc effect.

(3) Liability privilege?

The lack of a duty of compliance for the TBZ from § 1 para. 1 sentence 3 BetrAVG does not mean that there is a comprehensive release of the employer from liability. If the target pension of the TBZ is subsequently missed or if there are significant losses of paid-in contributions, it is to be expected that pension beneficiaries will try to claim against the employer. One possible line of argument could be that the legislator has not expressly excluded the obligation to pay on the basis of the basic employment relationship. In particular, (form) errors in the (deteriorating) replacement of the previous supply system involve process risks. Whether the TBZ, with its opportunities and risks, is actually more (in)favorable than the previous supply system must be analyzed in detail. The pension beneficiary may wait until the start of the pension period to file an action without forfeiting his rights. From the company’s point of view, it is important – as always in occupational pension schemes – to be able to fall back on comprehensive and transparent documentation, especially with regard to the reasons that prompted the change in the pension system. In the same way as the formulation of pension commitments, labor law case law is constantly evolving. A failure to provide sufficient information about the risks of (total) loss (as in the case of prospectus liability), assurances and advice from pension providers or the lack of transparency of the employment contract provision (Section 307 (1) sentence 1 of the German Civil Code (BGB)) could also constitute gateways for liability.

The ball is in the collective bargaining parties’ court

It remains to be seen whether the reform goals in favor of occupational pension schemes will be achieved. In the first step, this depends on how the parties to the collective bargaining agreement implement it in practice. The second step will be to examine the consequences of the respective collective agreement for the companies’ existing pension systems.

Current labor law jurisprudence

In this issue, our case law section deals with decisions (1) on the application of Section 2 BetrAVG in the case of a final regulation of the calculation of the early company pension in a pension scheme, (2) on actuarial deductions in the case of early drawdown of the company pension, (3) on the liability of the PSVaG for pension benefits and capital benefits already accrued, (4) on the (in)effectiveness of a restriction of the surviving dependants’ pension to the “current” spouse and (5) on the assessment standard for the effectiveness of the deteriorating modification of a collectively agreed pension commitment.

In its ruling of January 24, 2017, the BAG decided that there is only room for a corresponding application of Section 2 BetrAVG to calculate a company pension in the event of early drawdown if the pension scheme itself does not contain a provision.

In the case underlying the decision, the plaintiff was employed by the defendant employer for more than 43 years until the end of 1996, who also granted him company pension benefits. The underlying directive stipulated that an old-age pension would be granted if the employee left the company after reaching the age of 65, but did not contain any provision on early retirement pensions. With the introduction of § 6 BetrAVG in December 1974, the directive became incomplete and was subsequently amended twice: Firstly, by a notice signed by the employer and the works council in 1986 with the insertion of the provision that a retirement pension would be paid without actuarial deductions even if the employee left before reaching the age of 65 and drew retirement benefits from the statutory pension scheme. Secondly, in 1993, when the calculation rule, the limitation and the minimum pension amount were changed in the directive. The plaintiff left the employment relationship at the end of 1996 at the age of 63 and received a company pension in accordance with the directive from January 1, 1997. With effect from September 1, 2009, the defendant reduced the company pension with reference to the application of § 2 BetrAVG by now taking as a basis a possible qualifying period of employment up to the age of 65, notionally extrapolating the qualifying statutory pension to the pension achievable in the event of entitlement from the age of 65 and reducing the resulting amount in the ratio of the actual to the possible period of employment up to the age of 65.

Wrongly, as the BAG has now ruled. It upheld the claim for an unreduced pension. Since the directive itself conclusively regulates the company pension and its amount in the event of retirement before the age of 65, there is no room for a quota system with corresponding application of Section 2 BetrAVG. It is true that if the company pension is claimed early in accordance with § 6 BetrAVG, the equivalence relationship between the promised pension benefit and the work to be performed by the employee is always interfered with in two ways; firstly, because the employee does not provide his benefit in full, i.e. up to the planned age limit, and secondly, because he therefore claims the company pension earlier and most likely longer than promised. According to the case law of the BAG (fundamental ruling of 23.01.2001, 3 AZR 164/00), this generally entitles the employer to reduce the pension claimed early in accordance with § 6 BetrAVG by means of quotas in accordance with § 2 BetrAVG. However, the plaintiff had not left the company “prematurely” within the meaning of § 6 BetrAVG, but had left the company at the end of 1996 when the new pension claim was made in 1986. Since the directive – as can be seen from its interpretation – itself contains conclusive regulations for calculating the amount of the company pension claimed prematurely, there was no room for quotas in corresponding application of § 2 BetrAVG. The intervention in the equivalence relationship is conclusively taken into account by the fact that the years between the employee’s departure and the age of 65 are not taken into account as eligible years of service. The amount of the company pension claimed early is to be calculated solely in accordance with the guideline applicable at the employer.

Conclusion: With this ruling, the BAG has clarified that quotas are only to be applied in accordance with § 2 BetrAVG if the pension scheme itself does not contain a conclusive regulation on the calculation of the company pension claimed in advance in accordance with § 6 BetrAVG.

(2) Replacement of an existing pension scheme through the introduction of actuarial deductions for early retirement pensions (BAG judgment of 13.10.2016, 3 AZR 439/15)

In its ruling of October 13, 2016, the BAG decided that the principle of equal pay for men and women can justify the setting of a uniform fixed age limit for men and women for retirement pension benefits under a company pension scheme, but cannot justify the first-time introduction of actuarial deductions for all employees in the event of early claiming of the company pension. The first-time intervention in future increases based on length of service when a company agreement is replaced by a subsequent regulation is not related to equal pay for men and women and is therefore invalid.

In the facts underlying the decision, the company agreement from 1992 (BV 1992), which was decisive for the plaintiff employee’s pension, stipulated as conditions for the payment of the retirement pension that the employee (1) had reached the age of 65 and had left the employment relationship with the employer at the latest on reaching the age of 65. (2) has at least ten years of interrupted service and (3) is or would be entitled to a full old-age pension (full pension) from the statutory pension insurance scheme at this time if he were not exempt from the obligation to contribute.

In 1995, the parties concluded a new company agreement on retirement benefits (BV 1995). The provision on the waiting period remained unchanged. In addition, the BV 1995 stipulated the following for the benefit case: “The starting age for this company pension is generally the age of 65. If an employee takes the company pension before reaching the age of 65, the entitlements acquired from January 1, 1996 onwards are reduced by 0.4% for each month of early retirement during the entire term. The entitlements acquired up to December 31, 1995 remain unreduced.”

Finally, a company agreement was concluded in 2001 on a change to the pension scheme for employees who joined the company before December 31, 1995 (BV 2001). In the BV 2001 it was agreed: “If an employee takes the company pension before reaching the age of 65, the entitlements acquired from January 1, 1996 onwards will be reduced by 0.4% per month for each month of early retirement before reaching the age of 65. The entitlements acquired up to December 31, 1995 remain unreduced.” According to the preliminary remarks to this BV 2001, early pension benefits are to be significantly improved by the introduction of so-called additional periods. “Both changes have the effect of restoring the funding framework that applied before the [BV 1995] came into force, which represents the value of the company pension scheme.”

The severely disabled plaintiff employee was employed by the defendant employer from April 1, 1980 to April 30, 2013. Since May 1, 2013, he received an early retirement pension from the statutory pension insurance as well as a company pension of EUR 1,324.41 from the defendant. The company retirement pension was calculated on the basis of an unreduced retirement pension of EUR 1,515.10 gross. The plaintiff objected to the actuarial reduction in his early retirement pension provided for in the BV 1995 and BV 2001. In addition, the deductions would violate the prohibition of discrimination on the grounds of disability. The second instance LAG Hessen dismissed the claim.

The BAG upheld the plaintiff’s appeal against the second-instance judgment dismissing the action. At the heart of the BAG’s decision is the question of the factual and proportional reasons required to justify the intervention in the future, seniority-dependent increase amounts of the BV 1992. The BAG assessed this according to the three-stage theory it developed for the replacement of works agreements. According to this theory, the replacement principle generally applies to successive works agreements with the same subject matter. This also applies if the new works agreement is less favorable for the employee. However, the principles of protection of legitimate expectations and proportionality must be observed in the context of a legal review in accordance with the three-stage theory. This also applies to the introduction of an actuarial discount. Insofar as the interventions, as in the present case, affect increases that are dependent on length of service and have not yet been earned, factual and proportional reasons on the part of the employer are sufficient to justify the intervention. In the present case, the employer assumed justification on the basis of the principle of equal pay, according to which the BV 1992 still provided for different age limits for men and women. However, the BAG denied a connection between this principle and the first-time introduction of actuarial deductions. It overturned the judgment of the second instance and referred the legal dispute back to the Hesse Higher Labor Court. The BAG further stated that when assessing whether there is an objectively proportional reason to justify the intervention, the subsequent circumstances and any changes in values must also be taken into account. In the present case, the funding framework was to be maintained by offsetting the introduction of the deductions with improved benefits in the event of early retirement. In this case, the parties to the agreement could have a margin of discretion with regard to the new distribution decision. However, the amount of the deductions is subject to the control of equitable discretion. There is no (un)/direct discrimination, as the new regulations do not provide for any different treatment for the plaintiff (due to his severe disability) than for a comparable employee in a comparable situation.

Finally, the BAG recognized that the plaintiff was not precluded from invoking the invalidity of the replacement of the BV 1992 on the basis of his many years of service as chairman of the works council and his participation in the works agreements pursuant to § 242 BGB (good faith).

Conclusion: In the case of long-term company agreements on company pension schemes, there may be a need to adapt to changing values over time. The BAG has clarified that the company parties have the option of reacting to such changes (here: equal pay between male and female employees) as long as the funding framework of the pension remains at least essentially the same and the intervention is reasonable for the affected group of employees. Reasonableness must be based on operational criteria in accordance with the three-stage theory of the BAG; it cannot be based on a concomitant phenomenon for the implementation of the changed values.

(3) The Pensions-Sicherungs-Verein (PSV) is also liable for pension claims that have already arisen when the insured event occurs and for lump-sum benefits in arrears (BAG, judgment of 20/09/2016, 3 AZR 411/15)

In its ruling of 20 September 2016, the BAG recognized that the PSV is also liable for pension benefits that have already arisen when the insured event occurs and also assumed liability for lump-sum benefits if these can be qualified as occupational pension benefits.

Pursuant to Section 7 (1) sentence 1 BetrAVG, the PSV is liable to the pension recipient for direct pension commitments in the event of the employer’s insolvency. A lump-sum payment can be a benefit of the occupational pension scheme within the meaning of Section 1 (1) sentence 1 BetrAVG and is subject to insolvency protection if the cover serves the biometric risks specified in the Occupational Pensions Act. § Section 7 (1) sentence 1 BetrAVG also stipulates liability for pension claims that have already arisen when the insured event occurs.

In its further reasoning, the BAG stated that the provision of Section 7 (1a) sentence 3 BetrAVG, according to which outstanding occupational pension benefits are only protected against insolvency by the PSV if the claim arose up to twelve months prior to the opening of insolvency proceedings, is not applicable to benefits that are to be paid as lump-sum benefits under the pension scheme. This is already clear from the wording, which refers to “current pension benefits” and not to “capital benefits”. Although the term “pension benefits” can in principle include all occupational pension benefits and therefore also capital benefits, the specific wording in Section 7 (1a) sentence 3 BetrAVG shows that the legislator only had current pension benefits in mind. Furthermore, a lump-sum payment is a one-off payment and the plural form of “pension benefits” does not imply a meaningful connection with a periodic pension benefit. In contrast, the entitlement to a lump-sum benefit arises once at the time of the occurrence of the pension event, even if the lump-sum benefit is paid out in installments.

Despite the correct finding, the BAG did not finally decide the legal dispute and referred the dispute back to the LAG Cologne for a decision, as it had not decided on the causal link between the non-payment of the pension debtor at the time of his payment obligation and the subsequent security case, which is necessary to establish the PSV’s obligation to pay. However, it is already necessary and sufficient for the PSV to have an obligation to pay that the pension debtor was already in financial difficulties at the time of its payment obligation and therefore did not pay the pension owed.

Conclusion: The PSV is also liable for pension benefits in the form of lump-sum benefits that have already accrued when the insured event occurs. § Section 7 (1a) sentence 3 does not apply to lump-sum benefits.

(4) (In)effectiveness of a restriction of survivor benefits to the “current” wife by means of a GTC clause in the pension commitment: exceptional supplementary interpretation of the contract with restriction only to marriage already existing during the employment relationship (BAG ruling of 21.02.2017, 3 AZR 297/15)

According to the decision of the Federal Labor Court of February 21, 2017, a clause in a pension commitment that limits a survivor’s pension to the spouse at the time the pension commitment takes effect is invalid pursuant to Section 307 (1) sentence 1 BGB.

The plaintiff was employed by the defendant employer from February 1974 to October 1986. With effect from July 1, 1983, the employer granted the plaintiff a pension commitment which, with regard to survivors’ benefits, provided for a restriction to the plaintiff’s “current” wife. At that time, the plaintiff was married to his first wife. After the employment relationship ended, the marriage was divorced in 2004. In 2008, the plaintiff then married his current wife. Since May 2014, the plaintiff has received an old-age pension from the defendant, but subsequently refused to recognize his current wife as the beneficiary of a widow’s pension. In his lawsuit, the plaintiff sought to establish his current wife’s entitlement to a pension. After he was unsuccessful in the lower courts, the BAG also rejected his appeal.

In its grounds for the decision, the BAG firstly stated that the restriction of the pension commitment to the wife married to the employee at the time it came into effect constituted an unreasonable disadvantage that was not offset by equivalent advantages or justified by justified and reasonable interests of the employer. The employee has a legally protected interest in ensuring that the typical pension interest resulting from the close relationship with the wife to whom he is married at the time of his death is secured in accordance with the promise of a survivor’s pension for non-divorced wives. Due to the restrictive clause, the employee is denied the protection of the pension commitment in the event of a later marriage, although the underlying employment relationship continues to exist.

However, in a second step, the BAG carried out a supplementary interpretation of the contract in the ruling. It stated that the gap in the pension commitment created by the invalidity of the clause pursuant to Section 307 (1) sentence 1 BGB could exceptionally be filled by a supplementary interpretation of the contract if adherence to the contract would represent an unreasonable hardship for the employer. Otherwise, a pension claim would exist without restriction for the wife who was married to the employee at the time of his death, regardless of when the marriage was concluded. An employer would then in principle be exposed without restriction to all risks arising from a later marriage, in particular if the age difference was particularly large, resulting in a long pension period, or if the marriage had only been concluded a long time after the termination of the employment relationship. This financial risk was therefore unreasonable in the case in question, as the legal situation was unclear at the time the commitment was made in 1983. The law on general terms and conditions has only been applicable to employment relationships since the modernization of the law of obligations with effect from January 1, 2002 and an appropriateness check has only been provided for since then. The employer had therefore not used a clause that was obviously invalid at the time. The commitment should therefore be interpreted in a supplementary manner to the effect that the wife is only covered by the commitment if her marriage to the employee already existed during the current employment relationship. If the marriage – as in the present case – was only concluded after the employment relationship had ended, the wife is not entitled to a widow’s pension.

Conclusion: For the assessment of the possible supplementary interpretation of a clause, which in principle is ineffective, on the exclusion of spouses who only entered into marriage with the employee receiving the pension after the pension scheme was issued, a distinction must be made between commitments made before the Modernization of the Law of Obligations Act came into force on 1 January 2002 (old commitments) and those made afterwards (new commitments). For old commitments, the employer can hope for at least partial risk limitation by means of a supplementary interpretation of the contract. New commitments with ineffective restrictions on survivors’ benefits, on the other hand, cannot be “mitigated” by a supplementary interpretation of the contract. These are invalid with the consequence that, due to the prohibition of reduction to preserve the validity of the contract, the pension commitment includes the spouse who is married to the employee at the time of death, regardless of when the marriage was concluded and whether the employment relationship still existed. According to this case law, a restriction of the survivor’s pension to the spouse whose marriage to the employee already existed during the employment relationship is not objectionable. Spouses whose marriage to the employee was only concluded after the employment relationship ended may be excluded.

(5) Deterioration of pension rights due to a superseding collective agreement requires special reasons legitimizing the intervention (BAG judgement of 20.09.2016 – 3 AZR 273/15)

In its decision of September 20, 2016, the BAG established – in part for the first time – important guiding principles for the assessment under employment law of the effectiveness of a deteriorating replacement of collectively agreed pension provisions; in particular on the requirements for the effectiveness of a deteriorating modification of a collectively agreed pension commitment.

In the case underlying the decision, the plaintiff employee was employed by the defendant employer until 2005. The employer had promised the employee a collectively agreed company pension in the form of a total pension. The collective agreement governing the pension commitment stipulated, among other things, that the pension benefits were to increase in line with the salary development of active employees. The employee drew pension benefits from the pension commitment from 2010. In two supplementary collective agreements to the collectively agreed pension commitment in 2012 and 2014, the parties to the collective agreement agreed that the salary increases for active employees in these two years should not be applied to the pension benefits of company pensioners. In her lawsuit, the employee demanded that these salary increases be passed on to her pension benefits. She based her claim on the fact that the parties to the collective agreement were already unable to conclude effective collective agreements for company pensioners, and that the freezing of pension benefits in the supplementary collective agreements was ineffective in view of the direct transfer of salary increases to pension benefits regulated in the original collective agreement and violated the principle of equality with regard to the collectively agreed salary increases granted to active employees. The first two labor court instances dismissed the claim. The BAG partially upheld the employee’s substantive arguments and referred the legal dispute back to the regional labor court of second instance for a decision.

As a starting point, the BAG recognized that the regulatory power of the parties to the collective agreement also relates to the retirement relationship. The collective bargaining autonomy guaranteed in Art. 9 Para. 3 GG also covers the decision of the parties to the collective agreement on collective bargaining regulations for retirement relationships.

The BAG denied a violation of the principle of equality with regard to the suspension of the passing on of collectively agreed salary increases to pension benefits. The occurrence of the pension event represented a caesura for the employment relationship. The changed legal status of company pensioners justifies a different regulation of the salaries of active employees and the pension benefits of pension recipients.

The BAG also stated that the three-stage review scheme it developed for the substantive review of collective-law interventions in pension entitlements is not transferable to collective bargaining agreements. The limited review of collectively agreed regulations is justified by the fact that the parties to the collective agreement are entitled to a scope of assessment and discretion within their collective bargaining autonomy in accordance with Art. 9 Para. 3 GG and collective agreements are not subject to equity review.

The effectiveness of the worsening modification of a collectively agreed pension commitment must rather be assessed in accordance with the constitutional principles of the protection of legitimate expectations and proportionality set out in Article 20 (3) of the Basic Law. These principles require that worsening collective bargaining regulations require special reasons that legitimize the intervention. Typically, these collective bargaining regulations affect legal relationships between the employer and the individual company pensioner that have not yet been concluded and regularly have a non-genuine retroactive effect. Depending on how significant the resulting disadvantages are, the grounds for replacement would also have to be of varying importance. In the case of only minor disadvantages, objective reasons would be sufficient for the replacement, whereas in the case of more than minor disadvantages, weighty reasons would be required. According to the BAG’s assessment, the threshold for assessing whether or not the relevant disadvantage is more than minor should be the hypothetical question of whether the intervention would reasonably have given the employee reason to obtain additional private pension provision during an ongoing employment relationship in relation to the reduction associated with the intervention.

Conclusion: The BAG clarifies the requirements for the deteriorating replacement of collectively agreed provisions. The assessment framework is provided with lower intervention thresholds than the legal principles established by the BAG for a worsening replacement of works agreements on the three-step theory. Here too, an examination of the relevant (factual) reasons in the individual case is decisive.

News from the legislator

bAV News Ticker

On July 1, 2017, the annual pension increase (“pension adjustment”) took place for the approximately 21 million people in Germany who are entitled to a pension. The pension adjustment is lower than last year.

In accordance with the ordinance issued by the federal government, statutory old-age pensions increased by 1.9% in the old federal states and by 3.59% in the new federal states as of July 1, 2017. The current pension value thus increased in the old federal states (West) from 30.45 euros to 31.03 euros. In the new federal states (East), the pension value rose from 28.66 euros to 29.69 euros. This means that the current pension value in the new federal states is now 95.7% of the western value. The pension adjustment is behind last year’s increase. On July 1, 2016, there was an increase of 4.25% in the old federal states and 5.95% in the new federal states. The pension adjustment was based on a pension adjustment formula. However, the increase in 2016 was due to a one-off effect in the pension trend caused by a change in the national accounts.

The annual adjustment is based in particular on the development of gross wages in Germany. In addition, a so-called sustainability factor is taken into account, which reflects the change in the contribution rate in pension insurance and the development of the numerical ratio of contributors to pensioners. The wage development relevant for pension adjustments was 2.06% in the new federal states and 3.74% in the former East Germany. The sustainability factor is -0.14. The number of contributors taken into account in the adjustment barely increased at 0.02%, while the number of pensioners rose more strongly at 0.5%.

From January 1, 2017, the basic exemption amount for income tax also increased, which also applies to pensioners. It should be noted that pensioners must also pay income tax if their income is above the basic tax-free allowance. Pensioners are therefore in no way exempt from tax liability or the obligation to file a tax return. In 2017, the basic tax-free allowance is €8,820 for single people or €17,640 for married couples. In 2016, this was still EUR 8,652 for single people or EUR 17,304 for married couples.

Pensioners can earn additional income up to the basic allowance without a reduction in their pension. However, a pension deduction may be made if the additional net income received, including pension, is above the corresponding allowance. Supplementary income includes not only earned income, but also other income such as sickness benefit, unemployment benefit I, assets and rental income as well as company pensions.

Pensioners were informed of the amount of the pension adjustment by July 20, 2017 with the pension adjustment notification.

Pensions in eastern and western Germany are to be fully aligned by January 1, 2025. A corresponding bill (Pension Transition Final Act) by the federal government was passed by the Bundestag on June 1, 2017 and passed the Bundesrat on July 7, 2017.

Conclusion: Pensioners should obtain information about possible deductions from the statutory pension insurance advice centers. It is not always easy to answer the question of the extent to which income is actually taken into account and what deductions can be expected. Experts should be consulted if necessary.

Tax news

The BMF letter dated July 4, 2017 (IV C 5 – S 2333/16/10002) deals with the wage tax treatment of the transfer of a pension commitment.

The letter, which in particular also takes into account the BFH ruling of August 18, 2016 (VI R 18/13), highlights how the assumption of a pension commitment (direct commitment) of a shareholder managing director is treated for income tax purposes. The decisive factor here is the extent to which the shareholder managing director has a right of choice – to the effect that he can demand immediate payment to himself – when taking over the pension commitment. If such a right of choice exists, an inflow for income tax purposes is assumed. However, the transfer of a direct commitment or a provident fund commitment to a pension fund, a pension fund or a direct insurance policy is always subject to income tax.

Something different from these regulations for the transfer of a pension commitment of a managing director applies to the transfer of direct commitments to employees who fall under the German Company Pensions Act in accordance with Section 4 BetrAVG. Such a transfer is subject to wage tax in accordance with § 3 no. 55 p. 2 EStG (Income Tax Act).

Events – Dates and topics of upcoming events

We, the pensions team of KPMG Law Rechtsanwaltsgesellschaft mbH and KPMG AG Wirtschaftsprüfungsgesellschaft, will be holding our joint roadshow on occupational pensions after the summer vacation. Participation is again free of charge this year.

On the part of KPMG AG Wirtschaftsprüfungsgesellschaft, Susanne Jungblut and Tobias Schmitz will discuss the core content and attractiveness of the new BRSG. Andreas Johannleweling and Detlef Mann discuss the effects of the BRSG on implementation methods and financing decisions and new tax options for the endowment of insurance-based commitments.

Dr. Lars Hinrichs and Christine Hansen from KPMG Law Rechtsanwaltsgesellschaft mbH will shed light on employment law options and issues in connection with the BRSG and the resulting employment law options, as well as open questions from a company perspective and, as always, will conclude with a report on current employment law case law on occupational pension schemes.

We look forward to your participation. You can register for the event directly on this website.

Please save the date:

September 28, 2017 – Frankfurt am Main
October 12, 2017 – Hamburg
October 17, 2017 – Berlin
October 19, 2017 – Düsseldorf
October 24, 2017 – Munich
October 25, 2017 – Stuttgart