Objections of the insurance industry – ruling of the LAG Munich (Gezillmerte Tarife bei Entgeltumwandlung)

In its ruling of 15.03.2007, the Regional Labor Court (LAG) decided that
Munich, that zillmerized tariffs within the scope of employee-financed
company pension scheme is inadmissible and the corresponding
deferred compensation agreements are invalid. The LAG reasoned
its decision, on the one hand, with the company pension law (BetrAVG)
of equal value (section 1(2) no. 3 of the BetrAVG). The
Zillmerung in the case of deferred compensation also constitutes a breach of the
prohibition of unreasonable disadvantage (§ 307 BGB) as well as the
The basic idea of portability (Section 4 of the German Occupational Pensions Act (BetrAVG)). Zillmerized tariffs at the
Moreover, the employee-financed occupational pension schemes do not comply with the
Principles of the more recent case law of the BGH and the BVerfG, according to which
the acquisition costs are proportionate and the objective of a
should not be allowed to frustrate the accumulation of assets.
The insurance industry objects that with zillmerised tariffs
higher maturity benefits are achieved and, with sufficient clarification of the
the employee is a private, autonomous, voluntary (individual) agreement, according to which
that also §§ 307 ff. BGB would not apply. Moreover, the BGH should have ruled in
the decision relied on by the LAG, it was held that the
Zillmer procedure in principle no unreasonable disadvantage in the
within the meaning of Section 307 of the German Civil Code. It should also be borne in mind that the
legislator in the context of the pending amendment of the VVG itself of
the admissibility of offsetting acquisition costs.
This appeal against the decision of the Landesarbeitsgericht München
However, the arguments put forward are not convincing. The legal requirement of
Equality of value cannot be justified on the grounds of an allegedly higher
The payment on maturity of zillmerised contracts can be circumvented, especially as this would result in
the portability and thus flexibility required by the German Company Pensions Act (Betriebsrentengesetz)
for the employees, who on average only work for just under five years for a
employers would not be achieved.
Furthermore, even an explicit reference to zillmerisation does not lead to this,
that a general business condition becomes an individual agreement.
Legal regulations cannot be waived by private autonomy –
if, in view of the lack of transparency of the products, there is any
basis for voluntary private autonomous decision is given. The
The principle of equality of value is one of the special features of labour law.
which, pursuant to § 310 para. 4 sentence 2 BGB in determining the effectiveness
of a general terms and conditions clause must be observed. This is what the GDV is allowing to happen in its
Opinion on the decision disregarded.
The cases decided by the BGH concerned
Life insurance contracts without reference to (employee-financed) occupational pension schemes.
The BGH ruled that policyholders with premature
a certain minimum repurchase value (just under half of the
of the contributions paid in) must be due if the
The company was of the opinion that the clause on the settlement of acquisition costs was non-transparent and therefore ineffective.
Indeed, the BGH recognized that an insured person in the collective could be given less
must pay if one awards more to another, because altogether not
more money is available – so a compromise had to be found.
You don’t need that kind of compromise in employment law.
According to the BGH, the acquisition costs must be proportionate and the objective
of capital accumulation must not be thwarted. This case law
was confirmed by the BVerfG. A fortiori, these
The considerations on which decisions are based shall apply when the
employer’s remuneration due to the employee into a vested right to
bAV. Within the framework of the agreement concluded by the employer with the
The product provider therefore has the choice of a contract for the benefit of a third party.
of a zillmerized contract should be omitted, as the goal of a
Accumulation of assets for retirement provision in the event of premature termination of employment
employment relationship (as a reminder, the average duration is
not even five years!) is rendered impossible by the fact that, as the LAG
case decided (6,230 euros in contributions paid in, after three years
the surrender value of the reinsurance policy was only EUR 639)
showed. In view of such case constellations due to zillmerised tariffs of
value equality, as the GDV has done in its statement
is therefore not very convincing and demonstrates a lack of
Discussion of the reasons put forward by the LAG Munich
for the ineffectiveness of zillmerization in the case of deferred compensation.
Also from the fundamental admissibility of zillmer-like (a zillmerization
In the narrower sense, insurance contract law permits, according to the current
pending VVG reform just no more)
Acquisition cost allocation methods – e.g. over five years – according to the
VVG cannot be applied to the effectiveness of corresponding regulations in the context of
of the employee-financed occupational pension scheme. Also here overlooks
the insurance industry the precept of equal value as in labour law
to that extent overriding lex specialis.
Contrary to GDV’s view, it is therefore by no means possible to assume that the
it is to be assumed that the BAG, should it come to an appeal by the defendant
employer, the judgment of the LAG Munich is amended. reasons hereof
doubts already result from the fact that the decision in
The Court of Justice of the Federal Labour Court (Bundesarbeitsgericht – BAG),
Dr. Gerhard Reinecke, supported.


Courtesy ofwww.experten.de.

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Dr. Johannes Fiala Dr. Johannes Fiala

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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