Supreme Court on the scope of mandatory industry-wide pension fund decisions: negligible activities do not trigger mandatory participation
Publication date: 19 June 2026
On 22 May 2026, the Supreme Court delivered an important judgment on the interpretation of scope provisions in mandatory participation decisions for industry-wide pension funds. The ruling builds on an earlier decision of the Court of Appeal in ’s-Hertogenbosch and provides further clarity on whether a company with only very limited relevant activities is required to participate in an industry-wide pension fund.
Background
The case concerns whether Hazet, a wholesaler of cleaning and hygiene products, is required to participate in the industry-wide pension fund for the fashion, interior, carpet and textile sector (Bpf MITT). Hazet sells, among other things, corporate clothing. Customers can have their company logo applied to these garments.
The Court of Appeal ruled that this constituted the processing of textiles and that the company therefore formally fell within the scope of the mandatory participation decree. Notably, the mandatory participation decision of Bpf MITT does not include a “principal activity” criterion, which would assess whether a company’s activities predominantly consist of the defined sector activities. At the same time, however, the Court of Appeal held that, given the very limited scale of the MITT-related activities (less than 1% of total turnover) and the fact that the employer already has its own collective pension scheme, it would be unacceptable, based on standards of reasonableness and fairness, to require actual participation.
Supreme Court ruling
The Supreme Court reached a different conclusion. Scope provisions must be interpreted in accordance with the so-called “collective agreement standard”, meaning that the wording is interpreted objectively, based on the text and the plausibility of its legal consequences.
An interpretation of the scope provision without any threshold would result in companies that carry out virtually no activities within the relevant sector nonetheless falling within the scope of the mandatory participation decision. The Supreme Court considers this to be implausible.
The Court therefore introduces an important nuance: a company does not fall within the scope if it performs only negligible activities that would otherwise fall under the decision. The Supreme Court sets aside the judgment of the Court of Appeal ‘s-Hertogenbosch. Another court, the Court of Appeal Arnhem-Leeuwarden, must assess whether Hazet’s activities are indeed of a negligible scale. If this is not the case, the question arises whether, in the specific circumstances, invoking the mandatory participation decision would be unacceptable under the standards of reasonableness and fairness.
Relevance for practice
This judgment is highly relevant for employers that perform only ancillary activities within a sector covered by a mandatory industry-wide pension fund.
Until now, it was often assumed in practice that the absence of an explicit principal activity criterion meant that any relevant activity - regardless of its size - could trigger mandatory participation.
The introduction of a threshold (“negligible scale”) implies that a substantive assessment is now required, taking into account factors such as the proportion of activities relative to total operations, turnover, payroll and/or working hours.
Conclusion
With this ruling, the Supreme Court introduces greater balance in the application of mandatory participation decisions. Employers that carry out only very limited activities within a sector no longer automatically face the risk of mandatory participation in an industry-wide pension fund.
At the same time, the legal position is not yet fully crystallised and remains highly fact-specific. The question of when activities can be considered “negligible” will need to be further developed in practice. Legal certainty would be significantly improved if mandatory participation decrees that currently lack a principal activity criterion (such as Bpf MITT) were to include one, thereby enhancing clarity and consistency in the definition of scope.
