- 25 Jul 2016
The long-awaited opinion of the Commission for Occupational Pensions (COP) in connection with the recent amendments to the Act on Occupational Pensions (AOP) has been published (opinion no. 38). The COP gives a unanimous opinion on several interpretation questions and in this way clarifies the legislation.
Such questions include: How is the cost of the death coverage for sleepers (i.e. former employees who leave their vested pension reserves with the pension provider of their former employer) calculated for different types of pension commitments? Regarding the minimum guaranteed return, how can one move from the horizontal method to the vertical method (and vice versa)? Does the mandatory link between an occupational pension and a state pension also apply to sleepers who are already retired? Does the requirement that the ordinary retirement age in the pension plan rules for new plan members as from 2019 has to be equal to the state retirement age mean that the plan rules need to provide an individual normal retirement age? How do these changes to the AOP relate to the Act of 5 May 2014 on the harmonisation of blue and white collar workers in occupational pensions?
These questions and many others are dealt with in the COP’s opinion. Such an opinion is not binding on the courts but in general is followed.
The COP highlights the importance of the transitional measures for the stability and legal certainty in occupational pensions. However, the COP acknowledges that certain changes to the AOP may in specific cases jeopardise the expectations of plan members, notwithstanding the transitional measures.
Should you have any questions regarding the application of the recent changes of the AOP to your pension plan rules or pension agreement, it is definitely worth consulting the COP’s opinion (link Dutch, French). Of course, you can also always address your questions to our pension team.
> Action point
Pension plan rules and pension agreements should be adapted to the amended AOP by the end of 2018. Now that the opinion of the COP has been released, we recommend you to make such adaptations as soon as you can. Indeed, the amendments to the AOP entered into force on 1 January 2016.