Good employment practices are of great importance for an employee who is disabled and pension-free premium accrual

If you, as an entrepreneur, are dealing with an employee who is unable to work, your first thought is the well-being of your employee, continued payment of wages and reintegration. However, it is important to also look further. From a recent case at the Court of Appeal in The Hague (ECLI:NL:GHDHA:2020:888) it appears that it can be costly for a (former) employer if she forgets the pension element when the employer is dealing with an employee who is incapacitated for work.

The case

This case concerned an employee for whom the employer pays a pension premium to the Transport Pension Fund. The employee then becomes (partially) incapacitated for work. The Transport Pension Fund provides a right to non-contributory accrual in the event of total or partial disability. With non-contributory accrual, no or less pension premium is due for the (further) accrual of old-age pension and/or survivor's pension.

To be entitled to this non-contributory accrual, it must be requested by the participant, in this case the employee. This request must be made within one year after reaching the maximum benefit period. If this request is not made in time, the right to the non-contributory accrual will in principle lapse. In this case, the employee had failed to timely submit a request for non-contributory accrual in connection with the disability.

More than fifteen years after the end of the employment contract and only after the employee has retired, does the employee submit a claim. He holds his former employer liable for the damage he suffers and will suffer as a result of missing out on non-contributory continuation/pension loss and demands payment of a significant amount.

The employer defends itself and states that it did not know that this report had to be made and that the employee should have made the report himself.

The judgement

The Court of Appeal does not agree with the employer's defenses and states that the employer has failed in its duty to behave as a good employer. A good employer may be required to draw the employee's attention to the obligation to report to the pension insurer, which means that the defense that the employee should have made the report himself will not succeed. It therefore follows that the employer's obligation to provide information is far-reaching.

The employer's next defense, that she herself did not know that this report had to be made, let alone had to be made within a certain time, does not help her either. The Court of Appeal rules that it is the employer's task to know what consequences the employee's (partial) disability has for the employee's further pension accrual. After all, pension accrual is an important employment condition.

The employer also argues that it has a small company without an HR department, so it cannot be expected to have this knowledge. But the Court of Appeal does not agree with this either. Knowledge of its own employment conditions can also be expected from a small employer. This also applies to the pension scheme, especially if it is applied voluntarily.

The Court of Appeal's conclusion is therefore that the employer has not fulfilled its obligation to provide information to the employee and has therefore failed to act as a good employer and is therefore liable for the employee's lack of non-contributory accrual of his pension.

Advice

Is your employee ill and have you completed the primary issues such as calling in the company doctor, reporting to the insurance company and having a conversation about possible reintegration? Then take a look at the employment contract, the personnel regulations and/or the collective labor agreement and assess whether any other employment conditions may be affected by the (partial) disability. And don't forget the element of pension! Otherwise it could cost you dearly.

For more information about this specific or other employment law topic, please contact Lexsigma Advocaten.

Mr. drs. Bob van der Kamp
Mr. Ramon Pasma
Mr. Lara Smeets