There is no one company pension in Germany, but rather different models, paths and regulations. But of course it is not.
According to the Federal Statistical Office, only 52 percent of employees subject to social insurance contributions - especially women and men in large corporations - are provided for with company pension schemes. Company pensions are hardly widespread in small and medium-sized companies or among low-income earners. Employers are not obliged to pay a supplementary pension paid solely by the company.
“Company pensions are indispensable”
For Klaus Stiefermann, managing director of the retirement provision working group, there is still a lot of catching up to do. “Company pensions are indispensable to ensure a stable, solidarity-based and sustainable pension system,” he says in an interview with the ARD financial editorial team. This is especially true in times when the statutory pension is no longer sufficient for many people to be able to finance living costs in old age. The situation is likely to worsen in the coming years.
Other countries are further
In other countries such as the Netherlands, Sweden or Denmark, company pension schemes are not a voluntary benefit or a bonus from the boss. In many places, company pensions are determined to a much greater extent through collective agreements or industry agreements than in Germany. Double-digit percentages of salary are often paid in and - as in the Netherlands - fixed pension levels are guaranteed.
Peter Schwark from the German Institute for Retirement Provision sees these countries as a role model for Germany: "Are we able to achieve widespread coverage in company pension provision? These countries are a role model. There are sometimes penetration rates of 90 or 95 percent through collective agreements and collectively agreed pension schemes." Schwark can imagine models for Germany "where employees automatically save their salary into the company pension scheme unless they object."
Where the federal government acted
The federal government has also recognized that more needs to be done when it comes to company pensions. The Second Law to Strengthen Company Pension Provisions has been in force since January 2026. This is intended to strengthen company pension provision, especially for low earners and in small and medium-sized companies. This can be done through tax relief or through simplified procedures.
Klaus Stiefermann speaks of a “step in the right direction”. In principle, it's about putting company pension schemes on a broader basis, i.e. moving away from individual solutions towards solutions "where employers who are not bound by a collective bargaining agreement also have the opportunity to join."
A financial risk for entrepreneurs?
When the baby boomers, i.e. the baby boomers, retire, the payment of the promised company pensions gets closer for entrepreneurs. This can involve large amounts. But you shouldn't imagine that a company has to pay out a corresponding amount to pensioners at time X.
Depending on what type of company pension scheme has been agreed, the direct effects on companies can be very different. Employers often take out life or pension insurance for their employees. The benefit will then be paid out directly by the insurer later. There are also so-called support funds.
If a company promises a pension from its own company assets, appropriate provisions would have to be set up for this, according to expert Stiefermann: "If the employer has become insolvent in the meantime, the pension security association is liable. This means that the company pension scheme is also secured in multiple forms."
The importance of company pensions will increase
In the medium to long term, companies' annual spending on company pension schemes is likely to decline, as older baby boomer employees often receive higher company pensions than their younger colleagues.
The importance of company pensions is likely to continue to increase in the coming years. “Because it makes the employer more attractive and also shows that he is interested in his employees and their needs,” says Peter Schwark. Company pensions are also likely to become an increasingly important component in attracting new employees - as a strategy in times of increasing shortage of skilled workers.
