EU Tries To Bridge Pension Portability Gaps
Employees moving between countries have to get special permission and are often hit with a “prohibitive” tax bill, according to the commission.
It’s often difficult to even transfer pensions within the same country. In both France and Finland, employees can’t move pension assets from one company plan to another. Elsewhere, workers can transfer their assets, but often lose money in the process according to a Dow Jones report.
That difficulty may explain the job-switcher statistics. Only 16.4% of EU workers changed jobs in the first year, compared with 30% in the US, the Commission said.
The Commission also complained that companies make it unnecessarily difficult for workers to obtain any pensions in the first place. It criticized the high minimum age for membership and the lengthy qualifying periods for company pension plans.
Unions and employers must come up with proposals within 12 weeks to improve pension mobility. After that, the Commission could come up with its own legislation, officials said.
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