Find out more about the purpose and function of the occupational pension plan (OP), the second of the three pillars of the Swiss retirement system.
As a cross-border worker, you depend on the Swiss pension system according to the agreements between Switzerland and the EU. Indeed, in principle, every person must be insured with the pension system of the country in which he/she works and not in which he/she resides. This is why, as a cross-border commuter, you must contribute to a second pillar through your employer.
In this guide, we will therefore introduce you to the occupational pension plan (OP), the second pillar of the Swiss pension system.
The occupational pension plan (OP) is complementary to the first pillar, which is often insufficient to guarantee a minimum subsistence level. It allows the insured to maintain their previous standard of living, with the objective of covering at least 60% of the salary.
The OP is compulsory for all those working in Switzerland who are already insured with the OASI, provided they earn a salary of more than CHF 21'510 per year.
The OP, unlike the OASI, is an individual savings plan. This means that all working people save their own retirement assets through a capitalization process. Each individual finances his/her own benefits by saving and contributing for retirement. However, the OP also covers the risk of disability due to illness or accident and death.
A mandatory minimum rate is provided for by law and must be paid equally by the employee and the employer (share directly deducted from the employee's salary). This minimum rate is set by the Confederation and varies according to age:
|Age||OP contribution rate|
NB: This is a minimum rate. This rate may be higher depending on the company in which you work. This may be an element to take into account in your job search and employer comparison, since a company with a high contribution rate is more interesting in the long term than one that only applies the minimum rate set by law.
On the other hand - and just like the OASI, the Swiss occupational benefit plan entitles you to a:
As soon as you reach retirement age, i.e. 64 for women and 65 for men, your retirement assets are converted into a pension. This amount depends on three factors:
At the beginning of each year, your pension fund will provide you with a pension certificate showing the amount of your future retirement pension. However, this amount is only indicative and depends on other factors, such as the evolution of your salary, your employment rate, etc. You can see an example of a pension certificate here.
You should also be aware that if you lose or change your job, but also if you leave Switzerland permanently, the 2nd pillar does not automatically follow you and you must take the necessary steps to open a vested benefits account.
However, under no circumstances can your 2nd pillar be "lost". If you or your employer has not taken the required steps correctly, you can contact the 2nd Pillar Central Office, which can help you find your "forgotten" OP contributions.
You can receive the capital built up with your 2nd pillar in one of the pension cases listed below. This act is called the vested termination benefit, i.e. the fact of withdrawing your assets from the pension fund where they are located to be used for one of the following pension cases:
In the case of one of these events, your pension fund has to draw up a statement showing the amount due to you, known as the vested termination benefit. This amount will be transferred to the bank account of the institution dealing with the pension case in question (a bank, another pension fund or a vested benefits institution).
In the event of permanent departure from Switzerland, there are several possible scenarios:
For more information on all vested benefits, we strongly advise you to consult the brochure issued by the Federal Social Insurance Office (FSIO).
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