Garantie – The site of the retirees of CERN and ESO

Staff Association – Proton

For decades, Proton, the Staff Association’s publication, has accompanied CERN at key moments in its history. In December 2022, we addressed a subject that concerns us all: the future of the Organization. Today, we return to this important subject from a different angle.
The future of CERN and that of its personnel are intimately linked.

Whatever scenario is chosen for the Organization’s future, CERN will always need to be able to recruit, retain and motivate personnel of the highest competence from all its Member States. Ensuring that the Organization is still able to do so will again be the subject of the next five- yearly review, starting at the end of next year and ending in 2027, (to which we’ll be reporting in a forthcoming Proton).
Offering an attractive and on ensuring a lasting social protection system (which provides benefits until the death of the last beneficiary) is a key factor in the attractiveness of any intergovernmental organization, including CERN.

It is an ongoing challenge for the Organization which plays the role not only of employer, but also of State, to guarantee the payment of quality social benefits, whatever its future may be: continuation of the Organization’s mission, merger, reconstitution, other transformations or even dissolution.

Why deal with this subject now, when the future of the Organization is currently under discussion?

The Staff Association considers that the Member States, the Organization and the personnel have everything to gain:

Establishing a framework that will guarantee the payment of social insurance until the cessation of the rights of the last beneficiary, in the event of merger, reconstitution, other transformations or dissolution, is a
matter of good management.

Despite decades of progress on the subject, as the articles in the recently published Proton will explain, there is still a long way to go to make the acquired guarantees effective in terms of both pensions and health insurance, whatever the future of CERN.

Furthermore, our proposals have the potential to serve the future of the Organization, providing it with an even more robust foundation.

The Staff Association is proposing two lines of reflection:

A study of the internal taxation of pensions, which would allow additional income to be generated for the Organization’s budget and therefore make it available for the financing of the FCC;

The formal inclusion in the Organization’s legal corpus of the Member States’ guarantee, enabling the need for the Pension Fund to be fully capitalised at all times, to be rethought.

As an international organization, CERN has the obligation to provide social protection to its employees, pensioners, and their families. To ensure this protection, the organization established its own pension and health insurance scheme from its inception. Since the 1970s, member states have requested that CERN study the risks associated with possible dissolution of the organization and provide solutions to ensure the protection of social benefits. Several decisions have been made by the CERN Council to guarantee the continuation of social protection for those affected by the organization’s dissolution. Below are the main steps of this process.

In 1986, the CERN Council adopted a resolution by which the organization committed to “guarantee the payment of statutory benefits acquired by members and beneficiaries of the Pension Fund (…) until the extinction of the rights of the last beneficiary.” This principle has been included in the Pension Fund’s statutes since 1989.

In 1996, the Council adopted a second resolution making it possible to create a Swiss foundation to replace the Pension Fund in the event of the organization’s dissolution. This foundation aims to perpetuate and secure the fund’s capital.

Following this resolution, a working group of the Permanent Consultation Committee (PCC), commonly called the “Pension Guarantee Working Group,” was created in 1997 to study the following issues and develop the foundation’s regulations (defining the rights of its members and beneficiaries):

The withdrawal of one or more member states during the organization’s existence and its consequences for the Pension Fund;
Maintaining the level of benefits to be paid by the foundation after the organization’s dissolution and preserving the purchasing power of beneficiaries;
Ensuring that, in the event of dissolution, the organization will settle its debts with the Pension Fund;
Health insurance for the foundation’s beneficiaries.

The “Pension Guarantee Working Group,” chaired by a member of the legal service, is still active. The staff association, the Pension Fund, the CHIS, the HR department, and the GAC-EPA-EPA are represented.

Questions 1 to 4 have been successfully addressed with mechanisms providing good guarantees, including the latest decision made in December 2022 by the Council:

“CERN guarantees benefits acquired under the Regulations by members of the Scheme until the extinction of the last Member’s rights. In the event of CERN’s dissolution, the Council will take the necessary measures to guarantee the rights acquired on the day of the dissolution.”

The working group’s efforts (which should now be called the “Social Protection Guarantee Working Group”) are far from over. The focus is now on ensuring that the Swiss foundation intended to replace the Pension Fund in the event of CERN’s dissolution can effectively accomplish its missions and write its regulations (it is currently envisaged that the foundation, which will ensure the continuation of the Pension Fund’s activities, will also ensure the continuation of CHIS activities).

Updated on May 5, 2023.