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Benchmarking Pension Benefits

360°Benefits I News

By Eileen Pollard and Sarah Hannibal | April 24, 2023

Pension benefits are a key part of Swiss employee benefits for many reasons.

Benchmarking Pension Benefits

A company´s ability to stay competitive and execute on its business strategy relies on attracting and retaining the best talent in the market, whilst managing the costs of doing so over the long-term. The labour market environment has made this increasingly challenging over the last years, with a more mobile workforce, competition for top talent, and many employees being unable to afford to retire. In addition, companies must withstand capital market volatility and pension benefits becoming more and more expensive as people live longer.

With the exception of compensation and variable pay, providing retirement benefits is typically the largest cash outlay on employee benefits for any company in Switzerland. It is therefore essential for companies to ensure that not only is a competitive benefit provided, but also that it is financially sustainable and aligned to the company's total rewards philosophy.

Retirement planning and hence the retirement benefits offered by a company are a high priority for workers, with c. 65% of employees believing they are not saving enough for retirement compared to what they should. Whilst it may not be the main criterion upon which a prospective employee chooses the company they want to work for, according to WTW’s Global Benefits and Attitude Survey Switzerland 2022, retirement benefits are the number one financial benefit (after pay and bonus) that attracts and retains employees.

With the recent challenges mentioned above, companies are trying to improve their benefits offering so that it matches not only the strategic vision of the company but also employees’ expectations. As such, companies have been more attentive to ensuring the following elements in their pension offering:

  • Flexible and modern design
  • Fair and inclusive benefits to improve trust by employees
  • Benefits that are valued by both existing and potential employees
  • Easily understandable benefits and access through digital platforms where possible
  • Financial cost which is sustainable over the longer-term for the company

Companies may first look to educate their employees on the pension benefits being offered or use employee surveys to understand what matters most to their employee base. There may be some initial changes that can be made at a low cost to ensure fair and inclusive approaches before taking the step of completely reviewing the pension offering.

Accessing reliable benchmarking data and advice is key to being able to successfully navigate this challenge and make informed decisions about your pension benefits going forward. A periodic benchmarking confirming that benefits offered are still competitive, modern, and aligned with the market is a great governance exercise and can be equally as valuable for employees as it can for employers.

How WTW can support you

WTW is a market leader in Switzerland for benchmarking employee benefits and in pension plan design and will listen to your needs in order to provide a benchmarking that fulfils your expectations and requirements.

We offer a range of benchmarking options, including qualitative and quantitative, against specific industries, general industry or a specifically selected group of peers.

By combining our extensive database, market experience and state-of-the-art tools we deliver a clear and comprehensive benchmark of your occupational pension scheme. Your personalised report will show how your pension benefits compare to your chosen peer group and provide details on the areas of your pension scheme that can be optimised based on the latest market trends. It will provide the basis for you to make the best decisions for your company and employees.

Comparing SLI Pension Benefits

Since 2009 WTW have biennially conducted an overview of the Swiss 2nd pillar pension benefits market, by comparing the pension fund benefits of the SLI® companies. The SLI Pension Benchmarking Study highlights current market trends in the Swiss pension market. The report also easily allows other companies to see whether certain features of their pension benefits are prevalent in the market, e.g. the maximum level of salary insured or whether the employee can choose between different levels for their contributions.

The results of this study are publicly accessible. The 2023 edition is underway and will be released later this year. The 2021 SLI study can be found Comparison of the pension plans of the SLI®-companies.

If you are interested in finding out more about the types of benchmarking WTW can offer, please reach out to us directly as indicated in our contact information below.


Head of International Valuations

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