Amendments to legislation which you should know about at a glance

Through regular updates, Mercer will keep you informed of all amendments to legislation that affect your pension scheme. In this update we discuss developments specifically relating to the corona crisis.


The Tax Department's Central Information Point for Pension-Related Matters [Centraal Aanspreekpunt Pensioenen (CAP)] provides information on the opportunities available for continuing pension accrual if a temporary reduction in working hours is applied due to measures relating to the coronavirus.


There are possibilities for continuing pension accrual unchanged without having to take into account the temporary reduction in working hours applied, according to CAP. CAP has described three situations in this regard. 


  1. A reduction of working hours in which the employment contract is maintained in full. In this case, in fiscal terms the period in employment counts towards pensionable years of service. The fact that a lower pensionable salary may apply need not be a problem provided this is a usual reduction in salary. In the case of a usual reduction in salary, pension accrual may be continued based on the salary enjoyed prior to the reduction in working hours. 
  2. A reduction in working hours in which the employment contract is (partially) terminated temporarily in relation to the coronavirus. If the employee receives a salary-related, income replacement benefit (for example, an unemployment benefit), in fiscal terms this counts towards pensionable years of service. Pension accrual may be continued on the basis of the pensionable salary enjoyed prior to the reduction in working hours.
  3. A reduction in working hours which does not involve involuntary dismissal or in relation to which an income replacement, salary-related benefit is received. In this case, subject to conditions it is possible to continue pension accrual on a voluntary basis. The most important conditions are: (i) pension accrual does not take place with any (temporary) new employer (no double pension accrual) or by means of an old-age reserve as an entrepreneur subject to income tax rules (ii) the period of voluntary continuation commences at the latest three years prior to the retirement age and through the pension scheme that is continued.


Pension accrual and a reduction in working hours, as well as leave and the termination of employment are complex (fiscal) topics. 


We recommend that you ascertain whether your pension regulations already provide for such possibilities and that you consult your pension administrator and/or the Tax Department, if necessary. In addition, this may have technical payroll implications. We will gladly assist you in finding solutions to these issues.  



As far as possible, pension administrators must meet entrepreneurs halfway, who experience acute problems due to the corona crisis if they experience problems with paying pension premiums. This was agreed by the Joint Industrial Labour Council and the umbrella organisations of pension administrators, the Pension Federation, and the Dutch Association of Insurers. 


Where possible, pension funds, insurers and premium pension institutions (PPIs) will assist the entrepreneurs affected. Since the issues differ per sector or employer, customised solutions will be offered. For instance, pension administrators may enter into payment schemes with individual employers that are experiencing acute financial problems. For this purpose, individual employers should contact their pension fund, insurer or PPI. 


Within the legal options available, payment terms, within which employers must pay pension premiums, will also be extended for the sectors and employers affected. A number of (large) pension funds have already taken measures by extending their payment terms. 


There are indications, however, that the present legal regulations with regard to the steps to be taken to recover premiums and payment terms offer limited scope for customised solutions. Although the Pensions Act stipulates that the parties must state in the administration agreement/administration regulations how the pension premiums should be paid by the employer to the pension administrator, the Pensions Act does include some preconditions with regard to the steps to be taken to recover premiums and payment terms.


The Dutch Association of Insurers, the Pension Federation, the Dutch Central Bank and the Ministry of Social Affairs and Employment are at present in consultation with each other regarding these “restrictive” legal provisions. 


The administration agreement between the employer and the pension administrator stipulates how the premiums should be paid to the pension administrator. In this regard, the Pensions Act contains several conditions, including the moment at which the premiums must be paid. If the payment is made per quarter, the premium must have been paid to the pension administrator one month after the end of the quarter. In principle, the employer is bound by this. 


The Joint Industrial Labour Council (Stichting van de Arbeid) and the umbrella organisations of pension administrators, the Pension Federation and the Dutch Association of Insurers, reached an agreement on 21 March 2020 to make concessions as far as possible for companies that experience acute difficulties as a consequence of the corona crisis, if they experience problems in paying the pension premiums.

Furthermore, in a situation of economic force majeure that makes it impossible to continue the pension scheme, employers may invoke the payment proviso included in almost all pension regulations pursuant to section 12 of the Pensions Act. In this case, the employer has the right to reduce or terminate its own contribution in the event of a far-reaching change of circumstances. Section 12 of the Pensions Act does not apply to employees’ contributions that have been withheld. These still have to be paid to the pension administrator. If the employer invokes the payment proviso, future pension accrual will be (temporarily) reduced or terminated. This depends on the provisions of the administration agreement between the employer and the pension administrator. 


Section 12 of the Pensions Act, however, does not apply to employers who are obliged to participate in a compulsory industry-wide pension fund. If they are unable to pay the premiums for financial reasons, it is not possible for them to invoke this provision. The employer, however, is obliged to notify the industry-wide pension fund of its inability to pay the premiums without delay. In this case, the fact that the premium is not paid does not have an immediate effect on pension accrual. This is simply continued. Of course, if many employers are unable to pay their premiums, this may ultimately, result in a (further) deterioration in the financial position of the industry-wide pension fund, as a result of which it would soon be necessary to curtail pensions. 


For the time being, we recommend that employers who are no longer able to pay pension premiums for their employees contact their pension administrator to look for a tailor-made solution. Naturally we would be able to assist you in this.  



During a press conference on 31 March 2020, the Minister of Social Affairs and Employment presented the Temporary Emergency Bridging Measure to Preserve Employment (the “NOW scheme”). The purpose of the NOW scheme is to replace the Regulations for Reduction in Working Hours, which was revoked on 17 March 2020.


The key feature of the NOW scheme is that it provides you, as an employer, with compensation for a maximum of 90% of your salary expenses, provided you have suffered a substantial loss of turnover (at least 20%) during a consecutive period of three months. This allows employers to continue paying their employees who have fixed or flexible contracts.


To this is added a supplement of 30% for employer’s expenses. This supplement is specifically intended for, amongst other expenses, pension premiums. The extent to which this 30% is sufficient depends, of course, on your pension scheme. The compensation relates to both the employees’ and the employer’s portions of the pension premium. 


The subsidy for salary expenses is provided in the form of an advance. The advance amounts to 80% of the expected NOW compensation. The fall in turnover must occur in the period from 1 March up to and including 31 July 2020. 

The turnover is compared with the turnover for the calendar year 2019 divided by 4, provided the company’s operations commenced at the latest on 1 January 2019. If the latter condition is not met, the method of calculation will differ.


The salary per employee that is eligible for subsidy is capped at € 9,538 gross per month (two times the maximum daily salary for social insurance). If an employer has agreed a higher salary with an individual employee, the excess is not taken into account when determining the level of compensation under the NOW scheme. 


The measure applies in any event for a period of three months, with the possibility of an extension for a further three months. Officially, applications can be submitted from 14 April 2020 onwards.  



Due to the outbreak of the coronavirus, private individuals and companies will claim benefits under a number of insurance policies, such as absenteeism insurance, event insurance, accident insurance or risk insurance. The question is whether current insurance policies offer (sufficient) cover for the consequences of the coronavirus. 


We see that generally insurers are dealing with this very differently at the moment. For an answer to this question, it is also still important to consider the applicable insurance contract with the insurer and the policy conditions. We can assist you in assessing these documents.  


The Dutch Association of Insurers has set out the most important and most frequently asked questions and the corresponding answers on its website  ( The questions and answers relate to insurance for both private individuals and companies. 


This website with questions and answers is regularly updated by the Dutch Association of Insurers. 



If you have any further questions or comments in relation to this legal update, kindly contact your Pension Consultant at Mercer.