BAG: Early retirement rights stay protected

The Federal Labor Court ruled that employers can’t unilaterally remove early retirement options if they were explicitly agreed in employment contracts. This decision protects long-standing benefits for employees at subsidiary companies.

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Early retirement rights upheld

The Federal Labor Court (BAG) ruled on April 21, 2026 (case no. 9 AZR 103/25) that employers cannot unilaterally remove early retirement options that were explicitly agreed in employment contracts. This means if your contract references specific retirement benefits from a parent company’s policies, your employer can’t later replace them with less favorable terms from their own company policies.

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Why the court decided this way

The key issue was whether employment contracts can be silently modified by later company policies. The court clarified that when contracts explicitly reference specific benefit systems (like a parent company’s retirement plan), these terms remain binding unless both parties agree to changes. The ruling prevents employers from using their own policy updates to override previously agreed benefits.

What happened in this case

A journalist at a TV production company (subsidiary of SPIEGEL-Verlag) had early retirement rights referenced in her 1991 employment contract. When the company later introduced its own policy without early retirement options, she sued to maintain her original benefits. The court found her contract’s reference to the parent company’s retirement plan remained valid, despite the employer’s attempt to replace it with their own policy.