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EU Commission consults on pensions mobility

EUROPE – The European Commission has published a consultation paper on pensions mobility.

The paper asks social partners to play their role in tacking problems faced by workers who lose out on occupational pension rights when moving jobs, particularly to another member state.

Last year, both unions and employers agreed that action was necessary at the Community level to ensure that workers do not lose pension rights when moving jobs. Now, a consultation paper has been published to invite social partners to make proposals for the creation of a general Community-wide framework.

Says employment and social affairs commissioner, Anna Diamantopoulou: “We have discussed and analysed the problem of transferring pension rights with all stakeholders.

“It is clear that action is needed at EU level to ensure that workers do not lose out on their rights when they change job, and I am particularly looking to the social partner to take a decisive step in the right direction.”

The Commission believes a solution could be found in the gradual reduction of vesting periods, or the recognition of relevant employment periods in another member state. It is also viewed that workers should be able to choose whether they want to transfer their acquired pension rights or not – and, if not, then those monies left should be made more inflation-proof.

A response is expected from social partners within six weeks. If social partners do not act, the Commission says it may propose legislation itself. A new directive protecting the pensions rights of workers that change jobs was hinted at being forthcoming earlier in the year.

The Commission had earlier hinted it was considering a directive on the issue. In a question and answer document accompanying a strategy paper in May, the Commission said it was considering “action to facilitate cross-border mobility of people changing jobs between different firms (a Directive may be proposed following consultations with the social partners)”.

Leonardo Sforza, head of research and EU affairs at Hewitt Associates, believes that the measures introduced by the Commission would lack teeth.

“The Commission will not want to interfere in national laws and provisions, so I expect what measures there are to be soft. Perhaps an exchange of information and experience between the member states to see how obstacles can be overcome – but nothing binding.”

Sforza added that the difficulty would be ensuring that solutions proposed are balanced. “We need solutions that remove obstacles but that do not introduce excessive burdens for those providing the schemes.”

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