No employer contribution if the collective agreement is silent on deferred compensation - regardless of the "age" of the collective agreement

The facts of the case

The employee worked for a municipal employer as a clerk. Accordingly, the collective agreements of the public service of the municipalities, including the collective agreement on deferred compensation for employees in the municipal public service of February 18, 2003 ("TV-EUmw/VKA"), applied to his employment relationship by virtue of mutual collective bargaining. The employee continuously converted parts of his remuneration on the basis of this agreement and now demanded that the company contribute to this with an employer contribution. However, the TV-EUmw/VKA did not provide for an employer contribution to deferred compensation.

The employee argued that, pursuant to Section 1a (1a) BetrAVG, he was entitled to the statutory employer subsidy for deferred compensation introduced from January 1, 2018. The TV-EUmw/VKA does not make any provision for such a subsidy and therefore cannot supersede or waive the statutory entitlement. Furthermore, this collective agreement could not effectively deviate from the statutory regulation in accordance with Section 19 (1) BetrAVG, as it was concluded by the parties to the collective agreement before the new law came into force on January 1, 2018 and thus in ignorance of it. However, what the parties to a collective agreement do not know cannot be effectively excluded.

The decision

Unlike the previous instances, the BAG did not follow this reasoning and dismissed the claim. To justify its decision, the court first referred to its previous decision from 2024, according to which a collective agreement can also deviate from statutory provisions that were only enacted after it was concluded (BAG of August 20, 2024 - 3 AZR 286/23).

In the present case, the decisive question was therefore whether the "silence" of a collective agreement on employer contributions should be understood to mean that the employer* should be exempt from the obligation to make contributions to deferred compensation in deviation from the statutory "normal case". The BAG affirmed this in the case of the TV-EUmw/VKA. The latter contains various explicit provisions on deferred compensation and regulates this in a recognizably conclusive manner. It is sufficient that the collective agreement independently regulates an entitlement to deferred compensation without an employer subsidy in accordance with Section 1a (1a) BetrAVG. This alone constitutes a provision that deviates from the law. An express provision that no subsidy is to be paid, on the other hand, is not necessary.

Consequences for practice

The decision has implications beyond the public sector. Companies whose employees convert pay on the basis of a collective agreement without the collective agreement mentioning an employer contribution and who nevertheless grant their employees a contribution to deferred compensation on the assumption that there is a supposed legal obligation to do so should check whether they can and wish to discontinue this practice or whether they wish to continue it.

In addition, a reclaim of subsidies already paid could also be considered. However, whether the discontinuation of further subsidies and the reclaiming of subsidies already paid is possible must be examined on the basis of the specific collective agreement and the other facts of the case. Particular care should be taken to check whether the company has made any other declarations or agreements from which protection of legitimate expectations in favor of the employee can be derived.

Employers who wish to continue to pay the allowance despite the possibility of hiring must bear in mind that there may be no explicit legal basis for this. Simply continuing to do so may therefore give rise to a company practice. It is very difficult to terminate this at a later date. For documentation reasons, it is generally advisable to have an express written agreement (especially in the case of direct commitments, also in view of the written form requirement under tax law).