14 Jul 2017

Supreme Court strikes out same sex survivors' pensions discrimination

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On Wednesday 12 July 2017, the Supreme Court ruled that an exemption in the Equality Act 2010, which had enabled pension schemes to limit certain same sex survivors' pensions, was incompatible with EU Law and must be disapplied. This important decision means a number of pension schemes will need to take urgent steps to address any such inequality that may affect their survivor benefits provisions and may have affected past (non-)payments of such benefits.

The case concerned Mr Walker, who had started Employment Tribunal proceedings against his former employer, Innospec, in 2011. Mr Walker claimed that Innospec had unlawfully discriminated against him because its pension scheme would only provide his surviving same sex spouse with a spouse's pension in relation to his service with Innospec after 4 December 2005. Mr Walker had left the company before that date, meaning that his spouse would only be entitled to a guaranteed minimum pension of around £1,000 per annum from the scheme instead of a spouse's pension of around £45,700. While such discrimination was expressly permitted under the Equality Act 2010, Mr Walker contended that such discrimination was incompatible with EU law and that his same sex spouse should be entitled to the same spouse's pension as an opposite sex spouse.

Roll forward to 2017 and the case had made its way up to the Supreme Court which allowed Mr Walker's appeal, declaring that the exception in the Equality Act was irreconcilable with the plain direct effect of EU law. The Supreme Court confirmed that Mr Walker's same sex spouse should be entitled to a spouse's pension calculated on the basis of all the years of Mr Walker's service with Innospec (provided they remained married at the time of Mr Walker’s death). Given the proposed general adoption of all EU law in to domestic law and the sensitive issues involved with this case, we consider that it is unlikely that this decision will be affected by any legislative change before or after Britain's departure from the EU.

Pension schemes that contain provisions that place limits on a same sex spouse's or civil partner's pension that would not apply to an opposite sex spouse's pension will need to take immediate action to stop any such discrimination going forward. They will also need to revisit any past (non-)payments of same sex survivor benefits that have had such a restriction applied and consider whether benefits need to be adjusted.

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Beth Hale

Beth Hale
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Alex Rush

Alex Rush
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