An employer has a duty of care and to inform about pension benefits. On March 27, 2017, the Amsterdam court addresses the scope of this duty of care. This duty does not include an obligation for the employer to actively inform employees about individual consequences of their pension choices.
What was going one in this case?
Employee has been working for a telecommunications company since 2013. The pension scheme includes compulsory and voluntary benefits. The partner’s pension benefit and the Anw gap insurance are voluntary. Upon entering service, the employee only opts for the compulsory benefits and pays premium only for those compulsory benefits.
In 2015, the employee dies. According to the spouse, the employer did not act as a “diligent employer” by providing insufficient, misleading and/or contradictory information about the pension benefits. Also, her husband was not adequately informed about the consequences of not insuring the voluntary benefits for his wife. According to the spouse, the fact that they are parents of a resident disabled child should have been considered. The employer was aware of these circumstances. The spouse claims damages.
The Amsterdam court does not agree
The information provided by the employer on the pension scheme was not misleading, unclear or contradictory. In seven separate sources of information, it was always clearly stated that the pension scheme consisted of compulsory and voluntary benefits. The partner’s pension and the Anw gap insurance were included as voluntary benefits. Also, the employee made the explicit choice not to take out a partner’s pension and Anw gap insurance by completing the “Voluntary Pension Benefits Selection Form”. This form was also signed by his spouse.
According to the court, the duty of care of a ‘diligent employer’ with respect to offered pension benefits does not include an obligation to actively provide employees more information about the individual (in this case very profound) effects of their choices than the employer already has done in this case.
Duty of care has limits
The employer’s duty of care on pension benefits has its limitations. An employer is not required to provide individual advice. However, employers should remain careful.
In this case, the employer could demonstrate that the employee was informed in an intelligible and clear manner about the options available in 7 sources of information (employment contract, cover letter, information brochure, pension agreement and the selection form).
An employer should carefully check how employees are informed about their pension choices.
More about this subject?
Frederique de Jong
T: +31 20 760 8817