Recently the first pure defined contribution (DC) occupational retirement plans were established in Germany, five years after the German Pension Act was amended to permit the implementation of such plans if agreed on jointly by trade unions and employers/employer associations. The first two plans were implemented by the chemical and pharma sector and by the energy company Uniper. Employers within the chemical and pharma sector will need to determine whether they want to join the pure DC offering, while employers from other sectors will need to determine if they want to follow a similar route.
Employers within the chemical and pharma sector should review their pension plans and decide whether they want to adopt a pure DC plan as offered under the TEA. Companies that already use an offering of the ChemiePensionsfonds will need to decide whether they want to switch to its pure DC plan option going forward.
It is recommended that all employers review their pension plans to position themselves regarding the option to introduce pure DC plans under the BRSG, either by a (potential) sector-wide or by a company-specific solution.