AUSTRIA - Around 150 members of the Siemens Pensionskasse in Austria are looking to sue their former employer, alleging they have not received as much from their retirement vehicle as was promised.
The claimants argue that when they were transferred to the Pensionskasse, which was founded in 1998, Siemens had promised them a minimum 1.5% pension increase per year.
Yet in 2008 the fund posted a 14 negative return, triggering 150 members of the fund, all of whom are former management, to take legal action.
In response, Stefan Eberhartinger, head of the Siemens Pensionskasse, said no such promise was ever made.
"It is basically a defined contribution scheme without guarantees and the claimants are referring to papers in which no guarantees - but a likely scenario of pension increases - had been given," he said.
Eberhartinger said both Siemens and the Pensionskasse are "not worried" about the legal action as they do not believe it will be successful.
He argued there would be an issue of timelapse if the pension fund members were to sue for compensation as a 1.5% pension increase has not been reached since 2003 - "but nobody has taken action before".
How to group the claimants now has to be assessed so they can file just a class action lawsuit rather than as individuals.
Some of the members had already retired when they were transferred to the Pensionskase and had retained their individual contracts, while all other members joined a collective contract for their retirement provision.
And while the focus so far has been on former managers, some of the non-management former employees are also thinking about joining the lawsuit.
The fund's recent performance appears to hve recovered some of the 2008 losses as Eberhartinger said he expects returns of up to 9% in the various portfolios of the Siemens Pensionskasse in 2009, with the most conservative portfolios returning approximately 6.5%.
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