23 September 2019

Pension law is not for bakers, but it applies to them

By Koen Vermeulen

Most employees have no choice when they retire: their pension is accrued with the industry-wide pension fund to which their employer is obliged to pay a pension premium.

That seems uncluttered. But in practice, it can be a source of uncertainty and lawsuits, because it is sometimes unclear whether certain activities or products of an employer fall under a mandatory pension fund.

The same applies to the question of whether a company that bakes poffertjes and pancakes must pay pension premiums to the Bedrijfstakpensioenfonds Zoetwaren (Bpf).

To solve this, the subdistrict court in Rotterdam recently had to assess whether a pancake is a cake. What follows is a statement that reads like a cookbook, but is about a claim of 8.5 million Euros in overdue pension premiums.

Scope of the pension fund

The company in question has been producing poffertjes and pancakes since 1995 and has its own pension plan with Aegon. But if the baking of pancakes were to fall under the scope of the so-called mandatory decision of the Bpf Confectionery Industry, then the obligation to pay pension premiums to the Bpf would apply retroactively. The question therefore is what kind of work the company (mainly) performs and how they fit within the definitions of activities, products or work as they appear in that mandatory decision.

Pancake ≠ cake

In this case, the court had to answer the question whether poffertjes and pancakes qualify as a “cake” as mentioned in that mandatory decision. Due to the lack of definitions, the judge consulted Van Dale, Wikipedia, a market research among consumers and a bakery scientist to answer the question whether pancakes and poffertjes should be seen as cake. The answer is “no”.

The subdistrict court judge also discussed the difference in ingredients between and the preparation of poffertjes and pancakes on the one hand and cookies on the other. They further discussed the proportions of flour, flour, eggs and sugar in detail, the differences between dough and batter and the difference in baking process.

By explaining the text, the subdistrict court judge thereby established that pancakes and poffertjes are not cake and are therefore not comparable.

No extensive interpretation scope Bpf

For the subdistrict court judge it was also important that the Bpf should have been clearer in the text of the mandatory decision what exactly should be understood by cake, and if that meant pancakes. After all, the consequences for a company are huge: if the company does fall under the Bpf, it would cost 8.5 million euros in pension premiums. And there were already a number of so-called mandatory surveys showing that the company does not belong to Bpf Confectionery Industry, as had been initially announced by the Bpf.

The company needs to know where it stands and therefore there is no room for an extensive interpretation of the word “cake”, according to the judge.

Legal lesson

In addition to this cooking class, the statement also contains an important lesson for entrepreneurs. And that is to investigate (or have investigated) whether the company falls under one of the mandatory industry-wide pension funds in terms of their activities, work and products. A good time for this investigation is before entering into a self-insured pension scheme and in the event of a merger or takeover, or in the event of a change in business activities.

For advice on this, and other questions about pensions, you can contact the pension law specialists at GMW lawyers.

Koen Vermeulen

Koen Vermeulen

Lawyer / associate partner

Koen Vermeulen is your sparring partner for all questions on employment law, employee participation and pensions.

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