Changing jobs, negotiation about pillar 2

Hello MP forum! Big fan here, long time lurker and this is my first post.

I am currently employed and am in the process of negotiating with another company. I’d like to include considerations of the different Pillar 2 offerings of the two companies as part of these negotiations.

Can someone recommend a list of information to ask about to understand the relative merits of each scheme?

I’m not so familiar with the intricacies of pillar 2, but some things I have thought about:

  • Contributions made by employer
  • Historic performance of the fund
  • Investment strategy (i.e. do they need to be conservative or can they have more exposure to stocks)

Other than the employer contributions, I’m not sure how to ask the recruiter without sounding like I have no idea what I’m talking about (which is the case) :sweat_smile:

Any advice would be much appreciated!

Edit: possibly relevant information: both companies are large firms.

I’d ask whether the company will match extra contributions. I’d also ask if your full salary is insured or only the mandatory part (85k), which means that when you’re claiming disability benefits etc, it’s either based on your full salary or 85k max. They don’t have to insure the whole amount, no one ever thinks about it, and some companies won’t insure beyond the minimum to save a few bucks on you that way.

But honestly, second pillars are anemic “investments” and I don’t think companies really care whether theirs are competitive or not. Second pillars pretty much suck across the board, giving you 1–2% returns at best, and they’re mandatory so why should they even try. The recruiter and company will probably shrug and wonder why you’re asking about that mandatory deduction. It’s also typically part of a company wide contract and they might not be able to make adjustments for individuals, even less so if you’re not “high profile”/C suite.

What I’d focus on instead is negotiating extra PTO, a signing bonus, a better salary, an SBB GA, and any other benefit you’d find useful. These are more conventional to negotiate for and companies have more wriggle room on these (despite what they’ll tell you) than their 2nd pillar terms.

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This is a good point, however, note that the maximum ‘coordinated’ BVG salary is even less at CHF 60’945 in 2021. I.e., you need to ask two questions, is the salary above 86k included and is the salary below 25k included? Or simply ask what the coordinated BVG salary is. If the salary is higher than 129k, also ask about a 1e plan.

This may be the case but additional employer contribution is essentially still money the company pays you on top of your gross salary and it’s low tax. I.e. despite the low return it’s still important to take into account when comparing salaries of multiple job offers.

While individual adjustments to the pension plan may not be possible, you can use a bad pension plan to negotiate a higher base salary (or the company may have multiple pension plans and you may be able to negotiate a switch to a better one).

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The performance of the fund doesn’t matter, what matters is how much return the fund pays out to you. Most the return is used to pay pensions of already retired persons and for reserves. Most pension funds only pay the required minimum.

Also doesn’t really matter, see above.
Pension funds are bound to the BVV2 regulations which has limits on how they are allowed to invest in certain asset classes, e.g. for stocks it’s 50%.
https://www.fedlex.admin.ch/eli/cc/1984/543_543_543/de#art_55

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Exactly this. Pension funds yield 10% sometimes and only pay the minimum of 1%, the rest is needed for the already retired.

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Ask about the coverage percentage of the pension fund.

More than 100% is OK, less than 90% exposes the pension fund to a recapitalization.

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