A 900-strong Dutch pensioners action group will hear this month whether they have been successful in a courtroom battle against their former employer, the dairy products group of Dutch corporation Wessanen, over Dfl2.5m (E1.13m) of pension surplus rights.
The case, brought against Wessanen by the pensioners following the retirement plan liquidation in July 1998, focuses on the fund’s retirement surplus. This was returned to the company whilst the scheme obligations were switched to an alternative insurance arrangement.
Louis Kuypers, lawyer at Amsterdam-based law firm Houthoff Bur-uma, explains: “The scheme’s surplus has been distributed to the employer and the pensioners claim this is unreasonable. There is no normal default situation in Holland for a pension fund surplus and in our opinion it should go towards whatever purpose is required by the trust deed, which is the payment of pensions. In any case, it should not go to the employer.
“Half of the surplus has already been used by the company to give a one-off payment to all employees including active workers, which we believe they had no reason to do.”
Kuypers adds that the pensioners, as creditors of the fund, have had their statutory rights ignored.
“One of these rights is to an index-linked pension. Since the fund liquidation, the pensioners are receiving less in retirement benefits than they were originally promised, because the insurance company has its own fixed indexation amount which is lower than the original pension contract.
“We feel the surplus should be used to return the pension to its original promised level.”
Robert Zagt, chairman of the pensioners group, adds: “The pension income of the retirees is dropping at a rate of 1% annually, which is a significant drop in purchasing power for these old people.
“We tried several times to enter into negotiations with the company over this, but they did not wish to talk to us. They were very negative, and, although they have set up an advisory group as required by Dutch law, none of our queries have been properly answered.
“We are the first group to act in this way, I believe, and although we have many problems with Wessanen, we decided to bring a legal case on the issue of the reduction of our pensions.” Hugh Wheelan