Switzerland

(Swiss plans)

Retirement, death-in-service and disability benefits 

Funded

Nature of the benefits provided

The pension plans of Tecan Group Ltd., Tecan Schweiz AG, Tecan Sales Switzerland AG and Tecan Trading AG are plans with guarantee of a minimum interest credit on the savings and fixed conversion rates at retirement. Disability and death benefits are defined as percentage of the insured salary.

Regulatory framework

The plan provides benefits based on the LPP/BVG law, which stipulates the minimum requirements of the mandatory employer-sponsored pension plan in Switzerland. In particular, annual salary up to CHF 85’320 (amount in 2020) must be insured and the financing is age-dependent with contribution rates in per cent of the insured salary ranging from 7% to 18%. The conversion rate to calculate the annuity based on the accrued savings capital is 6.8% at normal retirement age (65 for men and 64 for women).

Under LPP/BVG law, the plan must be fully funded on a static basis at all times. In case of underfunding, recovery measures must be taken, such as additional financing from the employer or from the employer and employees, or reduction of benefits or a combination of both.

Specific plan rules

The saving credits for the retirement benefits are defined in percentage of the insured 
salary. The saving credits for the part of the annual salary between CHF 24’885 and 
CHF 85’320 are age-dependent and range from 8% to 19%. The saving credits for the part 
of the annual salary above CHF 85’320 amount to 14% for the employees and to 18% or 19% for the members of the management. The conversion rate for the mandatory part of the 
savings capital is 6.8% at normal retirement age. For the exceeding part of the savings 
capital, the conversion rate is defined by the board of trustees. 

The annual disability pension amounts to 70% of the insured salary, the annual partner’s pension to 50% of the insured salary or to 60% of the current retirement pension. In case of death before retirement an additional lump-sum of 200% of the insured salary is paid.

Governance of the plan

The companies are affiliated to the collective foundation Swiss Life Collective BVG Foundation. The collective foundation is a separate legal entity. The foundation is responsible for the governance of the plan; the foundation’s board of trustees is composed of an equal number of representatives from the employers and employees chosen from all affiliated companies. The foundation has set up investment guidelines, defining in particular the strategic allocation with ranges.

Additionally, there are pension committees for each affiliated company composed of an equal number of representatives from the company and the employees. The pension committee is responsible for the set-up of the plan benefits.

Risks to which the plan exposes the Group

The plan provider Swiss Life Collective BVG Foundation has reinsured the risks disability, death, longevity and the investment risk with Swiss Life Ltd. Therefore, the only risks for the Group are that the Swiss Life Collective BVG Foundation terminates the affiliation contract or increases the premiums.

Plan amendments, settlements or curtailments

In 2020 the board of trustees has decided to reduce the conversion rate for calculating the annuity relating to the exceeding part of the savings capital, starting from January 1, 2022. This modification is considered as a plan amendment. The resulting past service costs amounting to CHF 2.6 million were recognized immediately in profit or loss and are included in the personnel costs of 2020.