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  #21  
Old 10.07.2015, 23:14
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Re: Pensionskasse changes their mind!

From what I know, neither employment status nor healthiness have any influence on the ability to withdraw 2nd pillar money, or the amount available.

But I'm puzzled by the Ombudsmann saying the Pensionskasse did nothing wrong.
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  #22  
Old 11.07.2015, 09:00
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Re: Pensionskasse changes their mind!

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Thank you for your reply.

She was nowhere near 50 years old. She had never made a withdrawal before.

The withdrawal amount would have been Fr. 20'000.-- exactly (the minimum amount allowed by law), the Pensionskasse in question does not have a higher minimum limit.

The Pensionskasse cited the following two reasons:

- employee is unfit to work (100% krank)

- employee's contract has been terminated - [strictly speaking untrue, she had not received any written notice at all that the contract was going to be terminated in the future and it had certainly not been terminated at that time].
She really needs to read the fund's regulations. In a country carefully regulated, pension funds are amongst the most clearly regulated. Generally pension funds have 'experts' in the Board and these are the people she can turn to for an explanation.

Frankly, speaking a a member of a pension fund board, this sounds like the pension fund is following all the typical rules.
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  #23  
Old 11.07.2015, 12:18
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Re: Pensionskasse changes their mind!

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Go ask a lawyer for specialised information, sorry, get your friend to go ask a lawyer for specialised information
We don't need to take it in that direction at this point. It wasn't a massive problem, as stated, she simply used her own money to pay the seller the remaining amount. It was our intention here to find out if anybody has any knowledge on the matter, knows the rules or has been through anything similar.

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From what I know, neither employment status nor healthiness have any influence on the ability to withdraw 2nd pillar money, or the amount available.

But I'm puzzled by the Ombudsmann saying the Pensionskasse did nothing wrong.
Thank you for your reply. Well it was their opinion that the Pensionskasse could do this at their discretion if the employee was off sick and the contract was terminated (but not finished)(in any case untrue as she had not received a letter stating her contract had been terminated), but they did state that it was not for them to rule on as strictly speaking it wasn't a banking issue, - they thus didn't give an official ruling on it.

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She really needs to read the fund's regulations. In a country carefully regulated, pension funds are amongst the most clearly regulated. Generally pension funds have 'experts' in the Board and these are the people she can turn to for an explanation.

Frankly, speaking a a member of a pension fund board, this sounds like the pension fund is following all the typical rules.
Thank you for your reply. I can only gather then from what I've heard here that each Pensionskasse has its own rules for this sort of thing, which can be stricter than the general regulations that are in place.

My conclusion is the Pensionskasse acted in this way because they wanted to.
But that moreover it remains a fact that the action was pointless insofar as she could have in theory simply then withdrawn the money from the Freizügigkeitskonto claiming she was either purchasing/still paying the seller or renovating the property.

Last edited by plumtree; 11.07.2015 at 13:03. Reason: adding a phrase
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  #24  
Old 12.10.2015, 19:32
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Re: Pensionskasse changes their mind!

So, since this happened my friend's pension fund money has been sitting in this blocked 'Freizügigkeitskonto' (account) in a bank.

But since my last post on this things have now moved forward:

She has been deemed 100% unfit to work on a permanent basis (not uncommon given where she worked) and is now on disability.

She receives a 1st pillar state pension which according to the Swiss rules is not enough to live off and has a right to 'Ergänzungsleistungen', provided her income remains below a certain amount (I believe this is around Fr.1'900.-- per month, - although overall I believe it depends on one's circumstances and/or assets. In her case she is single and living alone and has no significant moveable assets as she recently purchased and partially renovated a property.
Ergänzungleistungen have been applied for and have been granted - and apparently they don't need to be paid back (unlike Sozialhilfe). But this is beside the point. The real problem/issue is what has happened to the pension fund in the Freizügigkeitskonto:

According to the rules of this special account, a withdrawal and closure of the account is only possible in certain circumstances.

One of the circumstances being if the 'Kontoinhaber' is awarded a 100% (IV-Rente) incapacity benefit. This is clearly stated in the account conditions and on the bank's website. So she qualifies.

She applied in person in one of the bank's branches for the closure of the account and this was granted and the transfer of the money was planned for a said date (into her account) just a few days later.
The day arrives, passes, the money never arrives.

She phones the bank. The bank tells her that the money has been transferred and asks her if she has 'Credit Suisse', astonished as she doesn't she has PostFinance she told the agent this. The agent on the line puts her on hold, checks and comes back with something that left her incredulous. The agent said the money was transferred back to her former employer (into a Credit Suisse account) at the request of the employer (who evidently received a copy of the IV decision). The bank it seems had no intention of informing her! My friend is now distraught as she was waiting on at least Fr.35'000.--!

She has no contact with the employer since she is off sick (was fired during sick leave which began as a result of mobbing) and doesn't work there any longer, moreover a Krankentaggeldversicherung took over payment of the salary a long time ago, but this obviously finishes soon and she will just be on IV + EL.

How can something like this be allowed to happen? Can a bank just transfer a large amount of money like that to an employer despite there being a request pending in their system for it to be paid out to the 'Kontoinhaber'? The account is now closed and the bank claims the money can no longer be paid out to her as they are no longer in possession of it! Why would they do such a thing, why would the bank specifically not bother informing her? And why would the former employer go to such lengths (apparently it was done by fax and marked urgent) to take this money away from her, particularly if in firing her, presumably they wanted nothing more to do with her (and she wants nothing more to do with them at this stage)? The sheer heartlessness of how some organizations treat people beggars belief.

Any suggestions/thoughts would be appreciated.
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  #25  
Old 12.10.2015, 19:41
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Re: Pensionskasse changes their mind!

lawyer up.
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  #26  
Old 12.10.2015, 19:45
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Re: Pensionskasse changes their mind!

I think it was paid to the ex employer by mistake, the employer fund may pay out the full sum or it will have to of back to a 'Freizügigkeitskonto' where it can be paid out.


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So, since this happened my friend's pension fund money has been sitting in this blocked 'Freizügigkeitskonto' (account) in a bank.

But since my last post on this things have now moved forward:

She has been deemed 100% unfit to work on a permanent basis (not uncommon given where she worked) and is now on disability.

She receives a 1st pillar state pension which according to the Swiss rules is not enough to live off and has a right to 'Ergänzungsleistungen', provided her income remains below a certain amount (I believe this is around Fr.1'900.-- per month, - although overall I believe it depends on one's circumstances and/or assets. In her case she is single and living alone and has no significant moveable assets as she recently purchased and partially renovated a property.
Ergänzungleistungen have been applied for and have been granted - and apparently they don't need to be paid back (unlike Sozialhilfe). But this is beside the point. The real problem/issue is what has happened to the pension fund in the Freizügigkeitskonto:

According to the rules of this special account, a withdrawal and closure of the account is only possible in certain circumstances.

One of the circumstances being if the 'Kontoinhaber' is awarded a 100% (IV-Rente) incapacity benefit. This is clearly stated in the account conditions and on the bank's website. So she qualifies.

She applied in person in one of the bank's branches for the closure of the account and this was granted and the transfer of the money was planned for a said date (into her account) just a few days later.
The day arrives, passes, the money never arrives.

She phones the bank. The bank tells her that the money has been transferred and asks her if she has 'Credit Suisse', astonished as she doesn't she has PostFinance she told the agent this. The agent on the line puts her on hold, checks and comes back with something that left her incredulous. The agent said the money was transferred back to her former employer (into a Credit Suisse account) at the request of the employer (who evidently received a copy of the IV decision). The bank it seems had no intention of informing her! My friend is now distraught as she was waiting on at least Fr.35'000.--!

She has no contact with the employer since she is off sick (was fired during sick leave which began as a result of mobbing) and doesn't work there any longer, moreover a Krankentaggeldversicherung took over payment of the salary a long time ago, but this obviously finishes soon and she will just be on IV + EL.

How can something like this be allowed to happen? Can a bank just transfer a large amount of money like that to an employer despite there being a request pending in their system for it to be paid out to the 'Kontoinhaber'? The account is now closed and the bank claims the money can no longer be paid out to her as they are no longer in possession of it! Why would they do such a thing, why would the bank specifically not bother informing her? And why would the former employer go to such lengths (apparently it was done by fax and marked urgent) to take this money away from her, particularly if in firing her, presumably they wanted nothing more to do with her (and she wants nothing more to do with them at this stage)? The sheer heartlessness of how some organizations treat people beggars belief.

Any suggestions/thoughts would be appreciated.
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lawyer up.
Big waste of money as it can probably be sorted out over the telephone.
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  #27  
Old 12.10.2015, 20:03
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Re: Pensionskasse changes their mind!

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lawyer up.
Not an option unfortunately for two reasons:
1. She is in debt and the money that she had been expecting would have cleared the debt. I've seen her finances and now her monthly income is going to level off at Fr.2'000.--/month, there's no way to stretch to cover any sort of legal fees.
2. She is in a clinic, I am dealing with her affairs and all of her mail at present.

Note: I did go to the 'unentgeltliche Rechtsauskunft' (free legal advice slot) with her 2 issues (first what the employer/pension fund did way back, secondly with what the bank did upon the request of the employer later), the guy couldn't answer either of my questions and said I needed an appointment with a specialist (which has to be paid for in advance).

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I think it was paid to the ex employer by mistake, the employer fund may pay out the full sum or it will have to of back to a 'Freizügigkeitskonto' where it can be paid out.
The fact is the two requests also sort of crossed each other in the mail. Her request was first and the transfer was planned for a certain date. Thereafter the employer's request arrived. The transfer to her account was cancelled and the account number of the employer was inserted and paid out the same day.

The bank refuses to do anything about it or admit that it is a mistake, they say it is correct, despite what the conditions of the account state.

The banking ombudsman says the only thing the bank has done wrong is not to inform my colleague in writing before annulling her request and granting the employer's one. Apparently though they are not even legally obliged to inform her or request her permission to do what they did. It's simply crazy.

The banking ombudsman says it doesn't cover such cases (as it is pensions/insurance) and that it is between the parties...

Meanwhile her 'more than Fr.35'000.--' has now gone walkabout...
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  #28  
Old 12.10.2015, 20:25
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Re: Pensionskasse changes their mind!

First of all, plumtree, well done for trying to sort things out for your friend who is now in a clinic. That circumstance can be stressful enough, and good for you for being a friend to her.

Some clinics have social workers who know all sorts of things, themselves, and are also networked, and they may be able to get you specific legal advice. Also, you could try www.procap.ch, www.integrationhandicap.ch and www.promentesana.ch, all of which have at least some telephone legal advice, and sometimes take on cases.

Though you seem to have a solid base of knowledge, I'll still try to set out my background understanding, just in case there's any small part of it that could help you and your friend.

My first impulse is: the money is highly unlikely to be truly gone. I say this even though the paperwork and the sequence of events and transfers do sound rather strange.

The Swiss system uses the vocabulary “pillars”.
The 1st pillar is the AHV/IV -> pays out state pensions.
The 2nd pillar is the BVG (= pension plans) -> pays out pension plan pensions.
The 3rd pillar (a) is money one saves by oneself, and pays into a blocked fund or blocked account. Saving in this was brings tax advantages. The money is blocked with some certain conditions, one of which is reaching normal old-age retirement age, and another of which is becoming disabled.
The 3rd pillar (b) is just any other kind of saving one has done, and one has free control over these moneys.

At the risk of making the text tedious to read, I’m going to insert the pillars all over my text below.

The state disability pension (IV-Rente) is from the 1st pillar.

The money from a “Freizügigkeitskonto” is from the 2nd pillar. It blocked in terms of the law on pension plans, called the BVG in German. This law guarantees employees of a company a second slice of pension, beyond the IV-Rente (1st pillar).

Typically, a company pension plan (2nd pillar) pays out a disability pension if their employees are proven to be unable to work. However, such company pension plans (2nd pillar) generally wait until the decision is taken by the state disability office (IV-Stelle, 1st pillar). Then, they (2nd pillar) don’t bother to require any medical evidence for themselves, but rely on the conclusion drawn by the investigations already conducted by the IV-Stelle (1st pillar).

There’s sometimes some dispute about when, exactly, the cover offered by the company pension plan (2nd pillar) ends. Sometimes, a company deems a former employee to be no longer their business, which makes sense, for example, when someone resigns and moves on to a new employer. However, when the employee became unable to work while still employed, it could well be that the pension plan rules (2nd pillar) state that she, as a former employee who became ill still while insured in the company pension plan (2nd pillar), is entitled to a pension from the pension plan (2nd pillar). Therefore, your friend should get a copy of the rules of the company’s pension plan (2nd pillar), and read there under which circumstances an employee is entitled to a company pension (2nd pillar), and if she is eligible, which administrative steps she'd need to take to apply for it.

If the company is liable to pay her a pension (2nd pillar), then it would make sense that they moved as fast as possible to prevent the capital accidentally being paid out. After all, that money in the Freizügigkeitskonto (2nd pillar) is part of the sum which has been amassed (“angeäuft”) and out of which a pension (2nd pillar) would be – at least in part – funded.

Now, if your friend had also opened up an extra blocked savings account (nothing to do with her employer, nothing to do with the 2nd pillar and therefore not with the Freizügigkeitskonto) into which she saved for her old-age pension (3rd pillar a), in terms of those rules (3rd pillar a) she is now, as someone who received a state pension (1st pillar) entitled to draw that money in cash, just as she pleases. In such a case, if her 3rd pillar money were ever to be paid out to anyone else, then the bank will, indeed, have made a serious error. And will no doubt pay her, anyway, and go and fix their mistake.

In terms of receiving top-up help from the state, such as further insured state benefits like as "Ergänzungsleistungen zur IV-Rente", the value of all her assets (including the property she owns which is 3rd pillar b) will be taken into account when the relevant government department (in Zurich the Amt für Ergänzungsleistungen, in smaller centres the Gemeinde itself) calculates to how much top-up she is entitled.
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  #29  
Old 12.10.2015, 21:59
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Fired during illness, now on incapacity benefit (IV/AI)

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Though you seem to have a solid base of knowledge, I'll still try to set out my background understanding, just in case there's any small part of it that could help you and your friend.
Thank you for your very kind and detailed response. Yes I have some knowledge about it as I went through the same procedure, with the same employer/Pensionskasse and in the same canton. Though obviously her case is a bit different.

Firstly like me, she has no 3rd pillar of any type, so this makes things a bit more straightforward at least. Secondly the Freizügigkeitskonto is definitely closed and the balance was transferred to the employer. I should make one thing clear: the Pensionskasse and the employer here for us are basically one and the same thing as the firm owns/manages/has its own internal pension fund/plan. (I am also with this pension fund and am on incapacity benefit and the money comes each month from the same place as it did when I worked for the firm.)
In my case the employer was 'leistungspflichtig'. I had no problem with my Freizügigkeitskonto being closed as I know this money would be utilized to pay a monthly 2nd pillar incapacity pension (which I now receive on top of the 1st Pillar 'Rente' and an allowance from another country I worked in).

However, in my colleague's case she opted for a capital pay out to her directly. The bank did not respect her wish (because of the meddling from the employer) and the money has gone back to the employer.

She doesn't want anything to do with the former employer and its Pensionskasse, in fact they don't even have her new address in her new canton (Aargau). The bank has it, but I assume can't give it to the Pensionskasse just like that for privacy reasons. In any case the bank is probably out of the picture now.

My colleague is now in receipt of IV (1st pillar/state) + EL to cover the amount not covered by the IV Rente, to bring her up to the Existenzminimum of around Fr.1'900.--. On the application for EL we marked: 'not in receipt of a 2nd Pillar pension' and 'no payout of capital'!! The EL people (in SVA-Aargau in Aarau) accepted this without query and EL is paid monthly without any issue!! A decision from another country she had worked is pending.

Everything that you wrote about the 2nd pillar tallies with what happened in my case.

I think my employer (although they applied for IV on my behalf) expected me to find work elsewhere straight away, but instead I ended up being granted an IV Rente and now they are paying a high price for firing me whilst I was off sick, as they have to keep paying a 'salary' (albeit in the form of incapacity benefit). Apparently they have to pay it monthly for as long as one is on IV (up to the age of 65)! This surprised me as it basically means we don't have to work again (unless the IV Rente is revised/reduced in the future) and I'm still in my 30s! This has happened to quite a few people in the same firm (especially in Ticino where we were based), and now my colleague's (in her early 40s) IV decision has come through and she too will remain off work permanently!

My friend has authorized me to contact the bank, I have called several times and spoken to various people (saying I was her) but they simply won't budge and say they can't do anything. They give me all the information I want (thinking I'm her), but they won't actually do anything.

My friend doesn't want me/hasn't authorized me to contact the Pensionskasse/employer (and I don't know if I am comfortable doing it as they may know it is me pretending to be her, since they know me and my case), however I fear that it (contacting them) is the only way she is going to get her money back at this stage.

We now have a copy of the Pensionskasse plan etc. and it tallies to what you said. I believe she is due a 'Rente' from them... but if the two sides are not speaking to each other, and moreover she is already in receipt of EL, the situation may remain unchanged. This is why she firmly believes the Fr.35'000.-- are lost!

I even believe in theory that she is erroneously in receipt of the EL as were a 2nd pillar pension to be paid out, it would definitely bring her over the Existenzminimum by a long way, not to mention the fact that the other country she worked in could also pay out a pension! But the EL don't know this and so continue to believe she is entitled to them!
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Old 13.10.2015, 15:26
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Re: Fired during illness, now on incapacity benefit (IV/AI)

Hello plumtree
in a few minutes, I'll post some further ideas about this.
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Old 13.10.2015, 15:53
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Re: Fired during illness, now on incapacity benefit (IV/AI)

@plumtree

This is very, very serious, and needs to be brought in order.

As I understand it, there are legal obligations which must be fulfilled. As you know, Ergänzungsleistungen (EL) are a top-up paid out by the state, to persons in receipt of a state disability or an old-age pension (1st pillar), who do not have enough to live on.

However, EL are so-called “subsidiary” which means that one may not apply to the EL-office as the first option. They are there to help out ONLY when all other sources of income, to which one is legally entitled, have been used up.

This means that one is NOT entitled to EL if the 1st, 2nd and 3rd pillars, together, yield up sufficient income to survive. Moreover, the calculation takes into account not only what one truly does receive, but also that to which one is ENTITLED. This rule was made so that, for example, wealthy enough old people don’t, for example, suddenly give away all their assets to their adult children, so as to magically become poorer and thereby unfairly eligible for EL.

For your friend (I’m just going to call her Mary, hope that’s okay), the calculation to determine how much EL Mary may receive, will be based on the sum of
• Mary’s IV-Rente (= state disability pension, 1st pillar)
• any BVG (= pension company pension, 2nd pillar) Mary receives OR to which she is ENTITLED
• a certain portion of the asset value of the home Mary bought.

In addition, a certain slice of the assets are put into the calculation. You write that Mary does not have any 3rd pillar assets, but the home she owns will be counted as such.

The calculation also takes account of the so-called “Eigenmietwert”, (literally: own rent value) which is a concept from tax law and means, very roughly speaking, the amount of rent Mary could, hypothetically, charge if she were to rent out her home. I do not understand how all of this works.

Here is an approximate EL calculator:
http://www.pro-senectute.ch/ergaenzungsleistungsberechnung.html.
If you put in Mary’s info, with and without a BVG pension plan (2nd pillar) pension, it will, of course, turn out two very different EL amounts.

It seems to me that Mary is fed-up or frustrated or hurt, etc. by what she’s been through with her former employer. That’s understandable if she has been treated badly while working there. And presumably that’s why she wants nothing more to do with them.

And I can also understand if Mary (and you) feel(s) that the employer and the pension plan are one and the same entity. However, in this you are both mistaken, as they definitely legally separate entities and they have, by law, different formally constructed governing bodies. Therefore, your own pension, though it feels to you like a “salary” is simply not one. On the contrary, it is an insured benefit paid out of the pension (2nd pillar). It does not, in fact, get paid by the company at all, even though it may appear that way if the same company logo is all over the paperwork. Nevertheless, I think for Mary’s case it is a crucial distinction: pension plans pensions are not paid by former employers, but by the pension fund (2nd pillar) which has, behind it, an insurance company.

I may be wrong and Mary might not be entitled to a pension plan pension (2nd pillar) after all. But if she is entitled to it, then she should definitely claim it. If she chooses to forego it, she will be hurting herself. And if she chooses to forego it, AND THEN STILL claims EL, then the EL has to be informed so that they can re-do the calculation based on all of Mary’s real income PLUS the income which she has foregone. I’m trying to formulate this gently, because I understand that you and Mary are probably heartily sick of the whole matter as it is. The thing is: if Mary is entitled to a pension plan pension (2nd pillar), and does not tell the EL office, this is considered unfair and dishonest, and it is against the law. Wrongfully drawing state benefits such as the EL, to which one is not or not fully entitled, is considered a serious offence. And such wrongfully drawn moneys must all be refunded to the EL office, in full.

As I see it, the most efficient thing to do would be:

FRIST
Mary (or her legal representative, with a signed Power of Attorney) should write a REGISTERED letter to the EL-office, explaining that although she does nut fully understand how the system works, she has now learned that she may, perhaps, be entitled to a pension plan pension (2nd pillar), after all. And that she is now ill, and hospitalised (include a doctor’s certificate from the clinic), but will, health permitting, work on finding whether or not, and will then (don't pledge a date by when) duly supply all the information to the EL office. Such a letter will most likely keep her out of trouble with the EL office.

SECOND
Mary should give some PROFESSIONAL person a written Power of Attorney to deal with the pension plan (2nd pillar). You are doing an excellent job as a loyal friend, and that’s a very good support. Well done for not giving in to the temptation to phone the pension plan Office pretending to be Mary. Just don’t pretend anything. You are right in feeling that this wouldn’t really lead to any good result. Much better for Mary to get the services of a professional who truly understands these matters much better than you or I.
With Mary’s written permission, you could supply all the info you have collected to such a person (e.g. an advisor from one of the services to which I linked, above, or the Social Worker in Mary’s clinic or, as others say, a lawyer) so that they don’t have to start at zero, but can go straight ahead to establish whether or not Mary is entitled to her pension plan pension (2nd pillar). And if possible, also how much it would actually be, per month, and paid out from when.

THIRD
The advisor should take all the income(s) and all the assets into account, and re-do the calculation of the EL. Such a calculation is typically merely an approximation, and only the EL office provides the final numbers.
Included in this should be how much EL Mary will have to refund to the EL office if, in fact, she has been paid more than what was due to her.
I imagine that the Mary will be wealthier, overall, with a state disability pension (1st pillar) plus the pension plan pension (2nd pillar), than with a state disability pension (1st pillar) plus EL. And certainly she would be freer, as in less answerable to anyone about how she spends her money, and also free to move and no longer bound to her municipality, as each "Gemeinde" has ist own way of calculating EL.

A final thought. If I were in charge of the pension plan (2nd pillar), and I had a former employee for whom I thought that the pension plan would most likely have to pay a pension, I would most definitely obtain control of the Freizügigkeitskonto (2nd pillar) as quickly as I could. So as to be able to fund at least a part of the pension.
And this reaction would be all the stronger if I did not even have any way to contact the former employee, as you describe it. If Mary could give some professional person a formal Power of Attorney, then he/she could write on Mary’s behalf. It may be that the pension plan is waiting for contact details, so that they can figure out what to do. No matter how evil or how well-intended the staff in the pension plan may be, Mary will not know what is going on there, nor what happened to her Freizügigkeit money, until someone - and I mean someone who really has a professional grasp of all these concepts - makes first enquries of the pension plan (2nd pillar). I hope you can encourage her to speak to the social worker in her clinic, or to another professional.


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Old 13.10.2015, 15:55
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Re: Fired during illness, now on incapacity benefit (IV/AI)

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Old 13.10.2015, 19:08
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Re: Fired during illness, now on incapacity benefit (IV/AI)

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EL are so-called “subsidiary” which means that one may not apply to the EL-office as the first option. They are there to help out ONLY when all other sources of income, to which one is legally entitled, have been used up.
True, but even in my case for example EL were paid out for a couple of months until the pension fund people calculated the actual 2nd pillar pension I was due. Then a recalculation took place and I simply paid back the money, but only after having received the elapsed months' payments from the 2nd pillar pension fund all in one go.

As far as everything else you wrote: thank you! Simply everything tallies with what has happened in my case and in hers, and what ought to happen in hers.

The situation to me is now much clearer. Mary in theory is not entitled to EL in which she is already receipt of monthly, because the amount that the 2nd pillar pension fund summed with the 1st pillar pension will wipe out any entitlement (and yes at this stage I have even included the Eigenmietwert in the calculation, like it was included in mine since I also am an owner-occupier).
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It seems to me that Mary is fed-up or frustrated or hurt, etc. by what she’s been through with her former employer. That’s understandable if she has been treated badly while working there. And presumably that’s why she wants nothing more to do with them.
Absolutely correct. And I don't see this changing for some time to come, given also Mary's present condition.
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And I can also understand if Mary (and you) feel(s) that the employer and the pension plan are one and the same entity. However, in this you are both mistaken, as they definitely legally separate entities and they have, by law, different formally constructed governing bodies. Therefore, your own pension, though it feels to you like a “salary” is simply not one. On the contrary, it is an insured benefit paid out of the pension (2nd pillar). It does not, in fact, get paid by the company at all, even though it may appear that way if the same company logo is all over the paperwork. Nevertheless, I think for Mary’s case it is a crucial distinction: pension plans pensions are not paid by former employers, but by the pension fund (2nd pillar)
You're right. The Pensionskasse though is owned entirely by the 'umbrella' company and has on its books all of the employees in the group.
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which has, behind it, an insurance company.
That I did not know! Interesting!
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I may be wrong and Mary might not be entitled to a pension plan pension (2nd pillar) after all.
No, you are right. She is definitely entitled to one just as I was/am. It is probably a little over the amount she gets from/in the form of EL. It is quite possible that the pension is calculated and ready to be paid out, but if the pension fund doesn't know the employee's address and the employee does not make contact for whatever reason, then the situation will simply remain (at least for now) as it is! I assume, the more EL are paid out over time, months (even years), the more that will have to be paid back, should the situation one day become unblocked. The main thing is that the amount that is paid out (if one day it gets paid out) is greater than then amount that Mary has received in EL, meaning that Mary will be financially capable of paying back the EL.

I don't know if Mary is doing anything wrong/illegal herself in receiving EL, since officially and/or in writing she is not aware that she is entitled to a 2nd pillar pension. We (you and I) know that she is entitled to it, but we don't know this officially and have no written proof of her case in our hands (there is nothing from the employer and/or the Pensionskasse amongst her mail ever - and there isn't likely to be) and neither you or I can change the situation officially or legally at present.

It is astonishing that EL have no way of checking if an individual has/is entitled to a 2nd pillar incapacity pension! As I see it the system in place here is open to abuse. Example: Had I not informed EL that I was entitled to and/or then later started to receive a 2nd pillar pension, I could have continued to receive EL (and at that stage I would agree with you) completely illegally!

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Mary (or her legal representative, with a signed Power of Attorney) should write a REGISTERED letter to the EL-office, explaining that although she does nut fully understand how the system works, she has now learned that she may, perhaps, be entitled to a pension plan pension (2nd pillar), after all. And that she is now ill, and hospitalised (include a doctor’s certificate from the clinic), but will, health permitting, work on finding whether or not, and will then (don't pledge a date by when) duly supply all the information to the EL office.
A possible solution, but not at this stage. It's too early.
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Mary should give some PROFESSIONAL person a written Power of Attorney to deal with the pension plan (2nd pillar). You are doing an excellent job as a loyal friend, and that’s a very good support. Well done for not giving in to the temptation to phone the pension plan Office pretending to be Mary. Just don’t pretend anything. You are right in feeling that this wouldn’t really lead to any good result. Much better for Mary to get the services of a professional who truly understands these matters much better than you or I. With Mary’s written permission, you could supply all the info you have collected to such a person (e.g. an advisor from one of the services to which I linked, above, or the Social Worker in Mary’s clinic or, as others say, a lawyer) so that they don’t have to start at zero, but can go straight ahead to establish whether or not Mary is entitled to her pension plan pension (2nd pillar). And if possible, also how much it would actually be, per month, and paid out from when.
It is my understanding that the pension (2nd pillar) is paid out from when the Krankentaggeld ends, i.e. after 2 years, since they pay out for a maximum 720 days of illness approx. and Mary has been off sick for more than 2 years. I originally thought that Mary still received Krankentaggeld, but apparently this ended in July (2015) - she has been off sick since July 2013. It is from then that she has IV 1st pillar (provisionally), a few months later the decision of the permanent IV Rente came through, which is when the Freizügigkeit money was supposed to be paid out as requested (in the form of a one off capital payout) and as you know was not paid out (although you specify that this is correct), Mary should have at the very least been informed by the bank of what was going on, not just left hanging, expecting to receive Fr.35'000.-- or so anytime soon to clear her debts for then onyl to have a relapse illness-wise!

What astonished me was that a bank can do that, literally behind someone's back. After all the account, albeit blocked, is in the name of the individual not in the name of the employer or the pension fund.

What would have happened for example if she had changed banks and/or withdrawn all/almost all the money for a different reason listed in the conditions of the account? She would have had her money and been happier, a great deal happier than she is now. And the pension fund people would have been the ones left astonished! The pension fund people through what they have done are actually contributing to the prolonging of the illness. Mary needs that money to clear debts, which include a personal loan and taxes.

Also one more interesting question remains on this:
If, a Pensionskasse automatically becomes 'leistungspflichtig' when an IV Rente (40-100%) is granted, why on earth does it clearly state in the conditions of the Freizügigkeitskonto that one of the reasons that the money can be withdrawn by the individual and thereby the account closed is the individual being awarded a 100% IV Rente! That is a total contradiction in itself. It is almost like it is a race to see who can withdraw it first. The bank clearly didn't know what they were doing by accepting Mary's request for the release of the funds to her, but the Pensionskasse's request annulled Mary's.
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Old 13.10.2015, 19:13
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Re: Fired during illness, now on incapacity benefit (IV/AI)

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True, but even in my case for example EL were paid out for a couple of months until the pension fund people calculated the actual 2nd pillar pension I was due. Then a recalculation took place and I simply paid back the money, but only after having received the elapsed months' payments from the 2nd pillar pension fund all in one go.

As far as everything else you wrote: thank you! Simply everything tallies with what has happened in my case and in hers, and what ought to happen in hers.

The situation to me is now much clearer. Mary in theory is not entitled to EL in which she is already receipt of monthly, because the amount that the 2nd pillar pension fund summed with the 1st pillar pension will wipe out any entitlement (and yes at this stage I have even included the Eigenmietwert in the calculation, like it was included in mine since I also am an owner-occupier).

Absolutely correct. And I don't see this changing for some time to come, given also Mary's present condition.

You're right. The Pensionskasse though is owned entirely by the 'umbrella' company and has on its books all of the employees in the group.
That I did not know! Interesting!
No, you are right. She is definitely entitled to one just as I was/am. It is probably a little over the amount she gets from/in the form of EL. It is quite possible that the pension is calculated and ready to be paid out, but if the pension fund doesn't know the employee's address and the employee does not make contact for whatever reason, then the situation will simply remain (at least for now) as it is! I assume, the more EL are paid out over time, months (even years), the more that will have to be paid back, should the situation one day become unblocked. The main thing is that the amount that is paid out (if one day it gets paid out) is greater than then amount that Mary has received in EL, meaning that Mary will be financially capable of paying back the EL.

I don't know if Mary is doing anything wrong/illegal herself in receiving EL, since officially and/or in writing she is not aware that she is entitled to a 2nd pillar pension. We (you and I) know that she is entitled to it, but we don't know this officially and have no written proof of her case in our hands (there is nothing from the employer and/or the Pensionskasse amongst her mail ever - and there isn't likely to be) and neither you or I can change the situation officially or legally at present.

It is astonishing that EL have no way of checking if an individual has/is entitled to a 2nd pillar incapacity pension! As I see it the system in place here is open to abuse. Example: Had I not informed EL that I was entitled to and/or then later started to receive a 2nd pillar pension, I could have continued to receive EL (and at that stage I would agree with you) completely illegally!

A possible solution, but not at this stage. It's too early.

It is my understanding that the pension (2nd pillar) is paid out from when the Krankentaggeld ends, i.e. after 2 years, since they pay out for a maximum 720 days of illness approx. and Mary has been off sick for more than 2 years. I originally thought that Mary still received Krankentaggeld, but apparently this ended in July (2015) - she has been off sick since July 2013. It is from then that she has IV 1st pillar (provisionally), a few months later the decision of the permanent IV Rente came through, which is when the Freizügigkeit money was supposed to be paid out as requested (in the form of a one off capital payout) and as you know was not paid out (although you specify that this is correct), Mary should have at the very least been informed by the bank of what was going on, not just left hanging, expecting to receive Fr.35'000.-- or so anytime soon to clear her debts for then onyl to have a relapse illness-wise!

What astonished me was that a bank can do that, literally behind someone's back. After all the account, albeit blocked, is in the name of the individual not in the name of the employer or the pension fund.

What would have happened for example if she had changed banks and/or withdrawn all/almost all the money for a different reason listed in the conditions of the account? She would have had her money and been happier, a great deal happier than she is now. And the pension fund people would have been the ones left astonished! The pension fund people through what they have done are actually contributing to the prolonging of the illness. Mary needs that money to clear debts, which include a personal loan and taxes.

Also one more interesting question remains on this:
If, a Pensionskasse automatically becomes 'leistungspflichtig' when an IV Rente (40-100%) is granted, why on earth does it clearly state in the conditions of the Freizügigkeitskonto that one of the reasons that the money can be withdrawn by the individual and thereby the account closed is the individual being awarded a 100% IV Rente! That is a total contradiction in itself. It is almost like it is a race to see who can withdraw it first. The bank clearly didn't know what they were doing by accepting Mary's request for the release of the funds to her, but the Pensionskasse's request annulled Mary's.
Departments in CH can't check up, it's not allowed. The tax office can't talk to the AHV, so the always go on trust.
It would appear that the money should have never left the original scheme, as they were still on the hook.
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Old 13.10.2015, 19:19
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Re: Pensionskasse changes their mind!

This case illustrates really well why the Government wants to stop the us of pension pots to purchase homes- as if things go wrong it leaves people with nothing and need looking after by the State.

I imagine that the only real way out would be to sell the property, pay debts and live on the remainder, or ask for help at that time if unsufficient funds are left. I am sorry to say.

From Le matin 14.04.12
Si on parle de limiter cette pratique, c’est qu’elle pose problème. «C’est souvent la même histoire, raconte Colette Nova, vice-directrice de l’Office fédéral des assurances sociales. Un couple a acheté un logement grâce au 2e pilier. En raison d’un aléa de la vie, il doit le revendre rapidement et n’obtient pas un bon prix. La banque récupère son dû, mais le couple se retrouve dans une situation difficile. Comme il a puisé dans son capital de prévoyance, et s’il ne l’a pas reconstitué, il percevra une rente plus basse. Il n’a plus de logement, plus d’épargne et devra faire appel aux prestations complémentaires voire à l’aide sociale pour joindre les deux bouts». Et c’est là que le bât blesse. «Est-ce vraiment à l’ensemble de la collectivité à supporter ce type de situation?»

If the practice of borrowing from second pillar (to buy/renovate a home), it's because it leads to problems. It's often the same storzy, says Colette Nove, VP of the Federal Office for social Insurance. A couple has bought a flat thanks to the second pillar. Because of a crisis in their life, they have te resell and do not get a good price for the property. The Bank gets it money back, but the couple finds itself in a difficult situation. As they have dug into their pension pot, and if it has not been topped up later, they will receive a lower pension. Without accommodation, without savings- they will have to call upon other support or social help to make ends meet. And here is where it hurts- should the the collectivity have to support this type of situation?.

Last edited by Odile; 13.10.2015 at 19:29.
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Old 13.10.2015, 19:26
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Re: Pensionskasse changes their mind!

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This case illustrates really well why the Government wants to stop the us of pension pots to purchase homes- as if things go wrong it leaves people with nothing and need looking after by the State.

I imagine that the only real way out would be to sell the property, pay debts and live on the remainder, or ask for help at that time if unsufficient funds are left. I am sorry to say.
Thank you for your response. Interesting suggestion. However the mortgage and running costs combined are low. Her monthly outgoings would double (or even treble) if she had to move into a rented apartment! So she would then become even more reliant on benefits and possibly even long-term!

Moreover, there's no guarantee she would find a buyer or be able to sell it for equal to or greater than the price she paid!

A move is also a big thing and in itself has a cost. The house has been partially renovated and she has made it 'hers'. I don't think a move is psychologically a good thing right now.

Note: Neither myself or my colleague withdrew sums from our pension funds to pay for property. I didn't take the option, despite being offered it, I paid in cash. She tried to withdraw funds, but was blocked by the employer/pension fund (hence the existence of this very thread (first post)!
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Old 13.10.2015, 19:54
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Re: Pensionskasse changes their mind!

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Moreover, there's no guarantee she would find a buyer or be able to sell it for equal to or greater than the price she paid!
Property purchase with borrowed funds using any pension deposit is a high risk strategy, if the price falls 20% most peoples capital & possibly all their pension are wiped out.

No guarantee the property can be sold for what's outstanding on the mortgage either.
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Old 13.10.2015, 20:09
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Re: Pensionskasse changes their mind!

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Property purchase with borrowed funds using any pension deposit is a high risk strategy, if the price falls 20% most peoples capital & possibly all their pension are wiped out.
No guarantee the property can be sold for what's outstanding on the mortgage either.
Thank you for your response. On the subject of the mortgages themselves. Can they be cancelled (gekündigt) by the bank for the simple fact that the individual is no longer employed and no longer has the same income as when the mortgage was set up? Is that a valid reason for the bank to pull out/repossess or do you actually have to fall behind with payments for that to happen?
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Old 13.10.2015, 20:21
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Re: Pensionskasse changes their mind!

We just do not know enough about the house, the area, the conditions of the mortgage, the length of the agreement, and other detail about your friend, etc, etc, etc- to really comment properly. Getting disability benefit is very difficult for Swiss people too, I can assure you- and many people who have been on disability are seeing their payments cut, one way or another.

You really need to get professional advice, face to face, with the Bank involved and possibly a legal representative. EF is not the best place for such a complicated situation, with so many unknowns.
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Old 13.10.2015, 20:22
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Re: Pensionskasse changes their mind!

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Thank you for your response. On the subject of the mortgages themselves. Can they be cancelled (gekündigt) by the bank for the simple fact that the individual is no longer employed and no longer has the same income as when the mortgage was set up? Is that a valid reason for the bank to pull out/repossess or do you actually have to fall behind with payments for that to happen?
Well the bank could withdraw funding, however if they are being paid they won't notice. Best to only ever give such information on a need to know basis.
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