UK Judges Win Pension Claim

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25 Jan 2017

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The Central London Employment Tribunal has upheld a claim made against the Lord Chancellor and Secretary of State for Justice and the Ministry of Justice, that judges in the UK have been discriminated against following changes to their pension scheme.

Background

In April 2015, younger judges were required to transfer from the Judicial Pension Scheme to a new scheme with less valuable retirement benefits. The new scheme contains transitional provisions to protect older judges from the adverse effect of the new scheme; total protection or tapered protection. The government decided that those judges closest to their retirement would receive total protection and remain in their original, higher value pension scheme, while a second category (based on their age) to transfer to the new scheme after a period of time. The judge’s date of birth was the only factor determining whether they would receive either form of protection. The protected groups amounted to 85% of all judges, leaving the remainder in a much less generous pension arrangement. To put this into perspective, to replace the lost value of their pension, the younger judges would have to contribute at least an additional £30,000 per year. The judges also claimed indirect discrimination on the grounds of gender and race, as the younger group included a greater proportion of female and ethnic minority judges. The Respondents agreed that the transitional provisions amounted in less favourable treatment of the younger judges. However contended that these provisions met a legitimate aim, which was to protect those closest to retirement from the financial effects of the pension reform, and therefore was justified. The Tribunal found that this was not a legitimate aim, as members who were closest to retirement were less adversely affected by the pension reforms and less in need of protection. Commenting on the transitional provisions, the Tribunal held that these were not a reasonably necessary means of achieving the purported legitimate aim. This result was found to be the same for the claims of indirect sex and race discrimination made. Commenting on the case Paul Holcroft, Head of Legal and Advisory at Croner, says: “The Tribunal upheld the claim of age discrimination due to the lack of evidence that the pension changes were a proportionate means of achieving a legitimate aim. This shows that despite the ‘aim’ being an employer’s decision, it must still be thoroughly considered and rational in order for it to be legitimate”. It is anticipated that this outcome is likely to spark a number of claims from other public sector groups, who have seen similar transitional arrangements applied to their pension scheme which have had a discriminatory effect on certain types of worker. A current example is the Fire Brigades Union, who have challenged the Government on a similar point and the same arguments regarding legitimate aim are being advanced. Croner can help organisations looking to make changes to terms or conditions and/or documentation. For further information call 0800 032 4088.

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