Consumer advice centre informs about claims
18.05.2007 According to a new ruling by the Munich Regional Labor Court of March 15 (Case No.: 4 Sa 1152106), the offsetting of acquisition and sales costs for company pension plans in the first few years is invalid. By this Zillmerung in such a way specified employees lose so far with premature departure from the enterprise very much money. Retirement provision expert Erk Schaarschmidt of the Brandenburg consumer advice centre advises: “Those affected should assert their claims against the employer as the contractual partner!” The consumer center offers group lectures to workforces for clarification. After the Stuttgart labor judges (Az.: 19 Ca 3152/04) now likewise the regional labor court Munich decided to 15. March 2007 (Az.: 4 Sa 1152106) that the clearing of conclusion and selling costs in the first years of the operational old age pension is ineffective. This affects employees who waive parts of their salary in order to build up a company pension (deferred compensation). In particular, it was irrelevant whether the employee had been informed about losses in the event of early departure from the company. The Munich judgment was based on the following case: An employee took out a company pension through her employer. She paid 6,230 euros into a pension fund in just under 3 years. When she left the company, she only received a full 10 per cent back as the “surrender value”, i.e. 639 euros. The large “remainder” was lost in particular due to the offsetting of the commission costs against the contributions and must now be compensated by the ex-employer. From the current judgement claims of thousands of employees against their employer result. Who agreed upon a company pension and left the enterprise early because of job change or job loss, received too little back, if conclusion costs with the first annual contributions were set off. Due to the up-front debiting of the company pension account, above all with costs for sales commissions, many capital-forming contracts are still in the “minus” in the 10th or sometimes also in the 15th contract year. This is not permissible in the case of employee-financed occupational pension provision. The decisions in Stuttgart and Munich are bitter setbacks for the insurance industry. “The current ruling and the obligation to disclose the costs of life, health and accident insurance policies now planned by the Ministry of Justice give reason to hope that so-called zillmerisation will soon be a thing of the past, and not just in occupational pension provision”, believes Erk Schaarschmidt, pension provision expert at the Brandenburg consumer advice centre. He expects customers to avoid overpriced contracts from 2008 onwards. According to the Fiala law firm in Munich, which won the Munich ruling, around 90 percent of all deferred compensation contracts are ineffective. Schaarschmidt recommends to those affected: “Anyone who has forfeited claims as a result of losing their job or changing jobs should assert these claims for back pay against the former employer or its legal successor, citing the relevant rulings!” Workforces and employee representatives are offered lectures on the subject of “company pension schemes” by the Brandenburg consumer advice centre. They can be arranged under Tel.: 0331-298 71-43.
(vzb.de (18.05.2007))
Courtesy ofwww.vzb.de.
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Dr. Johannes FialaPhD, MBA, MM
Dr. Johannes Fiala has been working for more than 25 years as a lawyer and attorney with his own law firm in Munich. He is intensively involved in real estate, financial law, tax and insurance law. The numerous stages of his professional career enable him to provide his clients with comprehensive advice and to act as a lawyer in the event of disputes.
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