This is the first of a two-part review of the most significant case law of the German Federal Labor Court in the field of occupational pension schemes from the previous year (2025). This first part focuses on two decisions concerning the adjustment of pension benefits and their implications for employers.
As with employment law generally, the often less-prominent area of occupational pension schemes (betriebliche Altersversorgung, bAV)—which employees regularly rank among the most valued benefits—is subject to constant change and must adapt to evolving factual circumstances, requirements and developments. In many instances, this evolution is shaped by the case law of the Third Senate of the Federal labor Court (Bundesarbeitsgericht, BAG), which has special jurisdiction in all matters relating to occupational pensions and clarifies both specific and more general questions of application through the interpretation and application of pension regulations and the underlying statutory provisions.
Against the backdrop of four key decisions issued in 2025, our two-part series examines the issues that particularly occupied the Court over the past year.
We begin with two decisions from September and October 2025 concerning the adjustment of pension benefits.
Federal Labor Court judgment of 25 September 2025 – 3 AZR 91/25
In its judgment of September 25, 2025, the BAG considered the conditions under which a flat-rate adjustment clause providing for an annual 1% increase in ongoing...
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