Company pension schemes are no longer a marginal topic: increasing life expectancy, legal requirements and economic uncertainties are bringing them more and more into focus. Burkard Fabritius, partner and labour law specialist at GÖRG in Hamburg, explains in an interview with Betriebs-Berater why companies should regularly review their pension commitments and which risks are particularly common.

Focus on legal risks

Many companies have already developed new occupational pension concepts in recent years in order to limit financial risks from high interest and actuarial interest rates. Nevertheless, there are often unknown liability traps lurking in old contracts and pension schemes. In view of the increasing number of pension applications and corresponding lawsuits, uncertainty is growing: Can former employees claim higher benefits than originally calculated?

A first warning signal is often a company sale (M&A process), when buyers want to know exactly what pension burdens and obligations they are taking on. Insolvency protection also plays a major role: if a crisis occurs, any pension commitments are often inadequately secured if they are not clearly documented. In the event of a crisis, any pension commitments are often inadequately secured if they are not clearly documented. A third factor is internal risk analysis. More and more companies are specifically reviewing their portfolio of old contracts and analysing any gaps or ambiguous commitments.

Why companies should react early

A company pension scheme not only includes aspects of labour law, but also tax and social security law. Even small ambiguities in the contracts can turn out to be major risks later on. It is therefore advisable for companies to have existing pension schemes reviewed on a regular basis: this allows liability traps to be identified in good time, contract designs to be optimised and long-term planning security to be created.

Companies that underestimate the complexity of occupational pension schemes could otherwise find themselves confronted with unexpected lawsuits in the future. It is therefore essential to analyse existing pension commitments, potential obligations to make improvements and current legal requirements at an early stage.

The complete video (in German): https://www.youtube.com/watch?v=LxHdGjqjz44