Company Pension Scheme

Company Pension Strengthening Act II ("BRSG II") – Draft by the Federal Government – What it brings and who benefits from it!

On 3 September 2025, the German govern­ment published its draft of the BRSG II. There are no significant changes com­pared to the unimplemented BRSG II draft from the last legis­lative period. Worth men­tioning is the evaluation mandate gi­ven to the BMAS. By 2030, it is to examine whe­ther the preva­lence of company pension schemes has increased noticeably as a result of the planned opening up of social partnermodels.

Unfortunately, the big breakthrough for company pension schemes is unlikely to happen. It is questionable what your company can expect then.

We will briefly outline the key measures for increasing the efficiency, attractiveness and prevalence of company pension schemes:

§ There will be an additional severance payment option to supplement the existing severance payment scheme. Accordingly, in addition to the existing severance pay option under Section 3 (2) of the German Company Pensions Act (BetrAVG), small pension entitlements can in future be settled at up to 2% of the monthly reference amount pursuant to Section 18 SGB IV or, in the case of capital payments, at up to 24/10 of the monthly reference amount pursuant to Section 18 of the German Social Security Code IV (SGB IV). However, this requires the employee's consent and that the severance payment is used by the employer directly to pay contributions to the statutory pension insurance scheme.

By Dietmar Ketzer and Mario Mitrovic