Dismissal, pension compensation and the new Pensions Act

Publication date: 23 June 2026

Are you a lawyer or financial advisor supporting employers or employees in matters relating to termination of employment and individual compensation in the context of the transition, because of the Dutch Future of Pensions Act? If so, the key starting point is a simple but crucial question: ‘Is the pension provider a pension fund, or an insurer or premium pension institution (PPI)?’. In this news article, we outline the key differences and points of attention.

Compensation in pension funds: no individually enforceable claim against the employer

The transition to the new pension system will in most cases result in compensation being provided by the pension fund for the abolition of the uniform accrual system. This compensation is added by the pension fund to the participant’s individual pension capital. The compensation is not linked to the individual employment contract, but to the condition that the employee participates in the scheme at the time the fund pays out the compensation. An employee who leaves employment before the compensation moment therefore runs the risk of missing out on this compensation. As a rule, the employer is not directly liable for this compensation and does not have an independently enforceable obligation towards the employee. For further details, we refer to our recent update.

Age-based contribution scales in insured schemes: a different type of disadvantage upon departure

For employers offering defined contribution schemes with age-dependent contributions (administered by an insurer or PPI), the situation is different. An employee may be entitled, both before and after 2028 (the latter due to transitional law for contribution scales), to a contribution that increases with age. If such an employee is dismissed, the disadvantage arises from the fact that, with a new employer, the employee will generally (and, for employment commenced after 2028, always) participate in a pension scheme with a flat contribution rate. For older employees, dismissal may therefore result in a substantial pension disadvantage, as the current (age-based) contribution is simply higher. The same disadvantage generally arises where the current employer does not apply the transitional regime for contribution scales but instead compensates employees annually in salary for the abolition of the scale. In such cases, the salary compensation is linked to the existing, active employment relationship. In short, both types of disadvantage materialise as a result of changing jobs, irrespective of the timing of the transition to the new scheme.

Different liability positions for the employer

In the case of pension funds:

• compensation is collective and fund-based. If the employment relationship ends before the compensation moment, the employee will generally not have a claim to this compensation; there is no independently enforceable obligation towards the employer;
• the employer does have a duty to inform the employee and must explicitly point out the risk of missing out on pension fund compensation upon termination of employment.

In the case of an insured scheme:

• salary compensation or an age-based contribution - unlike pension fund compensation - forms part of the employment conditions agreed with the employer. When this ceases at the end of the employment relationship, there is an economic loss;
• the employer has a duty to inform the employee and must highlight the consequences of dismissal (economic loss);
• an employee may seek to claim additional compensation for pension loss if the dismissal involves serious culpable conduct or negligence on the part of the employer;
• in the case of involuntary dismissal, a social plan may provide that pension or income loss is taken into account in determining the statutory transition payment;
• in the context of a settlement agreement, there is scope for negotiation.