In our forthcoming case book on Global Issues in Employee Benefits Law, Sam Estreicher (NYU), Rosalind Connor (Jones Day-London), and I write about the emergence of Institutions for Occupational Retirement Provisions (IORPs) in the European Union:
A driver in Europe over recent years has been an attempt to create a single market in employee benefits, particularly pensions. The recent Pensions Directive (the “IORPs Directive”) and the applications of the draft new insurance directive (“Solvency II”) has been part of a push to make a level playing field. The Directive grappled with a range of different pension plan structures (UK trust-based plans, Dutch wholly insured plans, German self-funded plans and French government underwritten plans, to name a few) with a view to allowing Belgian employers to employ German employees through an Irish trust based plan, if that is what is wanted.
Apparently, according to Global Pensions, there is still much work to be done:
The European Commission consultation on possible changes to the Institutions for Occupational Retirement Provision (IORP) law should not lead to further harmonisation in the current climate, an industry body has warned.
The European Federation for Retirement Provision (EFRP) said a harmonisation agenda “could prove inconsistent” with the aim of providing adequate retirement income and added the scope of such a “major and complex” undertaking would be both “untimely and inappropriate”.
EFRP said the IORPs directive as it stands provides for minimum common standards, which provided the necessary legislative stability it felt was needed at present.
Furthermore, it added the IORPs Directive “has had insufficient time to develop significantly” since it was introduced in June 2007 with only 70 cross border IORPs schemes active, the majority (39) of which pre-dated the directive.
I agree with the EFRP that effective implementation of such a European single market for pension schemes may still be at least a decade away.
Cross posted at Workplace Prof Blog.