Occupational pensions: What is the current status of the Social Partner Model?

The year 2026 is characterised by numerous planned reforms in pension policy – across all three pillars of the pension system: The Pension Security Commission (ASK) is to draw up proposals by the middle of this year on the future structure of old-age provision and structural reforms in the statutory pension insurance scheme. In the area of private pension provision, the Bundesrat approved the Pension Reform Act on 8 May 2026. Under the Act, the Riester pension scheme is to be reformed from 2027 onwards through a new, state-subsidised model for private pension provision. And in the area of occupational pensions, too, the legislature made important adjustments at the start of the year, giving the pure defined-contribution scheme in the form of the Social Partner Model (SPM) new impetus and the long-needed ‘boost’. As a result of these reforms, the uptake of the Social Partner Model in practice is also gaining noticeable momentum.

1. Regulatory background

The Social Partner Model was introduced with the first Occupational Pension Strengthening Act on 1 January 2018 and allows for pure defined contribution schemes (DC schemes) without guarantees. This means that employers – unlike with all other models – are only required to make the correct contributions to the insurers, but no longer bear any liability risk, including with regard to the promised benefits (‘pay and forget’ principle). Typically, the Social Partner Model is implemented via a pension fund. Although the pension fund does not provide employees with pension guarantees, the contributions received are managed in accordance with capital market principles and protected against significant capital market fluctuations.

2. Legislative changes in early 2026

The implementation of a Social Partner Model still requires a collective agreement as a basis. This is not unlikely to change in the foreseeable future. However, the legislative reforms will facilitate access to existing (and newly emerging) Social Partner Models for companies not bound by collective agreements, strengthen legal certainty for companies regarding governance and liability issues, and improve funding and administrative processes. The focus here is on the simplified option for employers not bound by collective agreements to ‘participate in’ existing sector-specific Social Partner Models without having to enter into a collective agreement themselves or join the relevant employers’ association.

3. Developments in practice

Following an initial period of low uptake and considerable reluctance, including on the part of the trade unions, a growing momentum has been evident since 2024. New sectoral models have emerged or are emerging at an increasing pace, and thanks to the reforms, their further spread is expected. Social Partner Models currently exist in the chemical industry, the private banking sector, the energy supply sector, among airport ground handling service providers, the private bus operators of Baden-Württemberg and – since early 2026 – now also in the health and social care sector. There is a clear trend towards further developing existing pension funds and suitable products for Social Partner Models across different sectors.

4. Opportunities and challenges

The Social Partner Model offers employers legal certainty, relief from liability, and cost certainty and predictability. It offers employees attractive return opportunities. Admittedly, this also entails a certain level of risk for employees, but this is likely to be effectively mitigated by the sophisticated safeguard and buffer mechanisms of the Social Partner Models. Above all, the Social Partner Model has the potential to provide many employees who have so far been uninsured or underinsured with access to an occupational pension scheme: relieving their employer’s concerns about assuming liability risks and thus encouraging, particularly among small and medium-sized enterprises, a willingness to offer employees a workplace pension scheme that goes beyond the statutory minimum (i.e. mere deferred compensation arrangements with an employer contribution, usually via direct insurance policies that yield virtually no return).

5. Practical guidance and conclusion

The development and spread of the Social Partner Model will continue to gain momentum. When reviewing a company’s current occupational pension schemes – a process that is regularly recommended in any case – the Social Partner Model should at least be considered as part of this process. This applies in particular to companies that do not belong to an employers’ association but are seeking a modern and sustainable occupational pension scheme without liability risks.