Income

Income

If your employment contract is ended because a disability renders you incapable of working, you are entitled to benefits under the Dutch Work and Income (Capacity for Labour) Act, or 'WIA'. You are also entitled to two supplementary facilities provided by Philips Pensioenfonds. First, you will be awarded a disability pension. On top of that, even though you continue to accrue future pension rights, you will not contribute any premiums. Further information about WIA benefits and the disability pension is provided below. We also describe what individual arrangements you can make for yourself.

The legal income component: WIA

If a disability renders you incapable of working, you are entitled to benefits from the government, called 'WIA benefits', under the Dutch Work and Income (Capacity for Labour) Act (Wet werk en inkomen naar arbeidsvermogen, or 'WIA'). You may claim these benefits if you meet the appropriate requirements; one of those requirements is that you must be declared more than 35% disabled. The WIA provides for various forms of benefits.

The various forms of benefits under the WIA are:

• 'IVA benefits' for disabilities that render you wholly and permanently (at least 80%) incapable of working. 'IVA' is short for Inkomensvoorziening Volledig Arbeidsongeschikten, i.e. 'income for wholly disabled persons';
• Benefits for disabilities that render you less than 80%, but at least 35%, incapable of working. These are called 'WGA benefits', under the Werkhervatting Gedeeltelijk Arbeidsgeschikten ('resumption of work by persons partially capable of working') rules. If you have confirmation that your disability renders you at least 35%, but less than 80%, incapable of working, the employee insurance agency UWV will determine your residual earning capacity. Your residual earning capacity reflects how much income you could still earn, allowing for your disability.

For example, if your disability percentage is 40%, you are still earning 60% of your income by working: that 60% is your residual earning capacity. If your disability is established at less than 35%, the government will not pay you any benefits under the WIA. To find out more about WIA benefits, visit the website of the employee insurance agency UWV (in Dutch).

Your disability pension under the flex pension plan

If you start receiving WIA benefits following a long period of sick leave, and your employment contract is terminated from 3 years after the first day of illness, you are entitled to an additional disability pension from Philips Pensioenfonds. All our members automatically have insurance for this disability pension, which serves to supplement the WIA benefits.

Please note: does your employment end earlier than 3 years after the first day of illness due to full disability? Then you will receive the disability pension from 3 years after the first day of illness.

In what situations do you qualify for a disability pension?

To qualify for the full disability pension coverage, your disability must render you at least 80% incapable of working (based on the standards of the WIA). Partial disability carries other coverage percentages.

If the percentage of your disability changes, the UWV notifies us.

Individual arrangements

You also have the option of taking out insurance with an external party to cover the possibility of becoming disabled. For example, some or all of the risk of an income shortfall if disability renders you incapable of working can be covered via your mortgage.