Munich, Germany
24. May 2022

Servus – 05/2022

The topics covered in our current newsletter are: “new developments in the social partner model”, “PSVaG: declining insolvency activity in 2021”, “new BMF letter on company pension schemes” and “case law: employer allowance”.

Table of Contents

New developments in the social partner model

It’s already four years since the social partner model – also known as the Nahles pension, named after the former Federal Minister of Labor, Andrea Nahles – was introduced by lawmakers as a new way of implementing company pension plans. However, not much has remained of the initial euphoria. As a reminder, the most important feature of the social partner model is that employers only have to make a pure contribution commitment. In this case, the employer undertakes to pay a certain contribution, but is not liable for the resulting pension benefit. This simplification was linked to the legal expectation of strengthening the company pension in Germany and making it more widespread, especially in small and medium-sized companies.
The disadvantage of a lack of pension guarantee is to be compensated for by various statutory measures. The most important of these is the involvement of the respective collective bargaining partner. However, the numerous hopes pinned on the social partner model have not been fulfilled. In particular, the legal requirements for the involvement of the collective bargaining partners lead – to put it somewhat bluntly – to an almost unmanageable mix of issues relating to insurance supervision and collective bargaining law in the already quite complex world of occupational pensions. In any case, it is an interesting experiment if BaFin, as the insurance supervisory authority, now deals with collective bargaining agreements under labor law.


But at least there now seems to be some progress in the chemical industry. The collective bargaining parties BVAC and IGBCE have announced that they will develop the first industry-wide social partner model and create the collective bargaining regulations by June 20 of this year. However, the social partner model was also supposed to get underway in 2021, when Verdi and the Talanx insurance company announced that after two years of negotiations they would start the first social partner model on July 1, 2021, albeit initially only for the Talanx insurance group’s own employees. And we can also look forward to developments in the chemical industry. This is actually about restructuring of the existing chemical industry pension fund, in which the future minimum benefit is to be lowered in response to the low-interest phase that has been going on for years. It therefore remains to be seen to what extent this will actually have a positive impact on earnings for pension beneficiaries.

PSVaG: declining insolvency volume in 2021

Due to declining insolvency activity in 2021, the Pension Protection Association has lowered its contribution rate to 0.6 per mille, down from 4.2 per mille for 2020. Due to the declining – and surprisingly low – level of insolvencies in the second Corona year, the contribution rate is thus considerably lower than the 10-year average of 2.2 per mille. This was mainly due to the significant reduction in the number of major claims. However, it remains to be seen whether this will continue in 2022.

New BMF letter on company pension plans dated March 18, 2022

On August 12, 2021, the BMF updated its letter on tax incentives for occupational pensions. However, without involving the relevant associations as usual. The new version also raised numerous questions, to which the BMF has responded at least in part with the new version.


The most important clarification was made regarding the matching models. According to Section 100 of the German Income Tax Act (EStG), additional employer contributions are also eligible if, in the case of so-called “voluntary matching models”, the amount of the employer contribution is linked to deferred compensation. It is also important to clarify that it is harmless for tax purposes in all implementation channels if the employee reaches the age of 60 at the time of payment, but has not yet terminated his professional activity. As the previous versions only referred to insurance-based implementation methods, this clarification is extremely positive for pension commitments and support funds.


Another point concerns the quintupling rule under Section 34 of the German Income Tax Act (EStG) for one-time payments in the pension commitments and support funds implementation path. Previously, Section 34 EStG was blocked for partial lump-sum payments over several years. Now the BMF adds that minor partial payments are harmless and refers to the BMF letter of 4.3.2016, according to which it is objected for simplification reasons to assume a minor payment if it does not exceed 10% of the main payment.

Case law: employer allowance for collective agreements concluded before 2019.

The employer’s obligation, which has existed since 2022 for deferred compensation, to contribute the saved social security expenses in the amount of 15 percent can be deviated from by collective agreement. Public sector employees in particular, seem to be affected more often. The Occupational Pensions Act explicitly provides that collective agreements may deviate from the mandatory employer contribution, even if this places employees at a disadvantage. However, it is disputed whether this also applies to collective agreements in force before 2019 – the year of the statutory introduction of this supplementary obligation. For in the case of such collective agreements, it can hardly be assumed that the collective bargaining parties deliberately wanted to deviate from a statutory regulation that did not yet exist.


The Federal Labor Court has now ruled at least on the constellation in which a new in-house collective agreement from 2019 refers to an existing collective agreement from 2008. In this case, a claim to the employer’s allowance is excluded in any case because the new law already existed at that time (BAG dated March 8, 2022, 3 AZR 361/21).