Netherlands: agreement on pensions reform on its way to becoming law (in brief)

After several years of negotiations, an agreement in principle was reached on 5 June between employers, unions and the government on a pensions reform, which is now set to materialise after votes in favour by members of the two main trade union confederations in the Netherlands, the FNV and CNV, with respective majorities of 75% and 79%. Regarding the retirement age, this will be frozen at 66 years and 4 months for the next two years (instead of transitioning to 67 years in 2021). The retirement age will then rise gradually between 2022 and 204, eventually reaching 67. Finally, from 2026, the retirement age will increase by eight months per additional year of life expectancy (instead of a full year previously). Another breakthrough achieved by the unions is the possibility for workers who have been in an arduous job to claim their pension rights three years earlier, following an individual agreement with their employer or a collective agreement that has been signed at their company. The other major part of this agreement in principle concerns pension funds – the second pillar of the Dutch regime and very important in the country – for which a steering group has been set up to establish two new contracts, which are more resistant to changes in economic conditions.