Supreme Court 30 August 2024: Explanation of an unclear scope of a pension scheme
On 30 August 2024, the Supreme Court issued a judgement in which it ruled that the judge must also interpret an unclearly worded scope provision in a pension scheme. The judge may not get stuck on the observation that the wording is unclear, and then on that basis rule that an employer is not bound by the scheme.
The case in question concerned the Sectoral Pension Fund for the Construction Industry (Bpf Bouw, an industry-wide pension fund as defined in the Pensions Act), which administers a pension scheme for the construction and infrastructure industries, among others. Participation in Bpf Bouw for employees who are employed by employers in this industry is regulated by a compulsory participation decree. This compulsory participation is based on the Compulsory Participation in an Sectoral Pension Fund Act (Bpf 2000 Act).
The employer in this case is part of a group of companies that is involved in the construction of real estate, among other things, and at least one of which falls under the scope of the Compulsory Membership Order and the collective labour agreements for the construction industry (the construction schemes).
After an investigation instigated by the employer, Bpf Bouw informed the employer that it fell under the scope of the construction regulations. This resulted in the employer being subject to the necessary obligations towards its employees, including the obligation to pay pension contributions for these employees to Bpf Bouw. This led to a lawsuit between the employer on the one hand and three construction funds (Bpf Bouw and two affiliated funds) on the other.
The District Court ruled in favour of the construction funds, while the Court of Appeal ruled in favour of the employer. The Court of Appeal ruled that the scope clause in the compulsory insurance decision was insufficiently clear. The clause was open to multiple interpretations and therefore did not meet the requirements. After all, an employer must know where they stand. According to the Court of Appeal, the employer was therefore not bound by the construction regulations. The construction funds lodged an appeal in cassation.
On 30 August 2024, the Supreme Court ruled that the judge cannot be satisfied with the observation that the scope clause is unclear. The judge must interpret such a clause according to objective standards, based on the collective labour agreement standard. This must also be done if the wording used to describe the scope is unclear. In doing so, the judge may consider the wording used elsewhere in the construction regulations, the plausibility of the legal consequences of the various possible interpretations, any earlier or later versions of the regulations and any written explanation of those regulations. In addition, the Supreme Court ruled that the complaints of the construction funds about a text interpretation considered possible by the court of appeal were also successful.
This ruling of the Supreme Court is in line with the conclusion of AG De Bock in the case between Bpf Vervoer and Deliveroo from 2023 in which Bpf Vervoer was also assisted by Arjan van den Steenhoven.
The interpretation of a decision to make something compulsory, such as the present one, results in a so-called legal decision. This means that the Supreme Court may fully review the judge's interpretation. This is different from, for example, the case when the judge interprets agreements between parties. In such an interpretation, the judge must apply the correct standard (the Haviltex criterion), but the interpretation of the standard is, in cassation terms, a factual decision. The Supreme Court may only review this interpretation to a limited extent, namely only for comprehensibility.
The building funds were represented in cassation by Arjan van den Steenhoven. In the lower courts, they were represented by Prof. Erik Lutjens.