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Coronavirus - Pensions and COVID-19 - Netherlands

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Most people will be reluctant to consider the possible consequences for retirement, in respect of the COVID-19 outbreak. However, this is not justified. As more and more people in the Netherlands are becoming infected with the virus and are advised not to travel (other than in emergencies), it is relevant to look at the possible consequences of the current circumstances for pension schemes.

Coronavirus - as a result of COVID-19 infection an employee has become (partially) disabled for work. What consequences does this have for pension insurance?

The cause of the occupational disability is not relevant. If the pension agreement provides for an insured disability pension, this will normally be paid out. This will also apply if non-contributory continuation in case of occupational disability is insured.

In the event of the death of an employee as a result of COVID-19 infection, can a partner claim a survivor's pension?

The Dutch Association of Insurers (Verbond van Verzekeraars) has indicated that the cause of death is not relevant for making a payment. Many policy conditions of (pension) insurances exclude death or disability in the event of a stay in a risk area. Such exclusions in the policy conditions of the pension insurance with regard to stays in areas where a negative travel advice applies are not intended for situations such as the COVID-19 outbreak. The expectation is that all insurers will act accordingly, but it is advisable to check with your insurer ASAP whether an exclusion from coverage may apply if you are in doubt and an employee has demonstrably fallen ill or died after or during a stay in an area with negative travel advice.

Coronavirus - as an employer, I make use of the Temporary Emergency Measure for Job Retention (NOW). Could the pension accrual of the employee be continued unchanged ?

On 31 March 2020, the Temporary Emergency Measure for Job Retention (NOW) was presented. Employers are entitled to a subsidy of 90% of the salary if they meet certain conditions, the most important of which is that they keep the employee(s) employed. The subsidy is granted from a 20% drop in turnover. The NOW provides for continued payment of pension contributions by means of a flat-rate surcharge of 30% for 'social security contributions' on the salary amount of the employer. This surcharge is deemed to be sufficient for the accrual of holiday pay and the payment of pension premiums (employer and employee contribution).

Are there longer payment terms to pay the pension contribution to the pension provider as a result of the coronavirus crisis?

The Pension Federation and the Dutch Association of Insurers have indicated that insurers will accommodate employers as much as possible if they have problems paying pension premiums. The exact details of the measures have yet to be worked out; consultations with the Ministry of SZW (social affairs) and DNB (the supervisor) will take place in the near future. The Dutch Association of Insurers, the Labour Foundation and the Pension Federation are urging that, in consultations with the government, pension contributions for both the employees' and the employers' sections be adequately included in the Temporary Emergency Measure for Job Retention (NOW).

A payment arrangement will be tailor-made and is expected to differ from insurer to insurer. The Pensions Act provides strict conditions for the payment of pension contributions and the communication in this respect (articles 26 and 29 of the Pensions Act). This will also be discussed in consultation with SZW and DNB and the aforementioned parties, as these strict provisions and, above all, the payment term could block customisation by pension providers.

Could retired health care workers, who have retired 5 years before their regular state-old-age pension age, return to work in the health care sector without tax consequences?

Yes, the Tax and Customs Authority has indicated that retired health care workers, who are now returning to work in connection with the outbreak of COVID-19, could do so without tax consequences for their pension.

For all international COVID-19 information, please see our coronavirus hub.