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Court of Appeal decision on age discrimination in public sector pensions - update

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You may have seen in the news that the Supreme Court has refused permission for the government to appeal against the 2018 Court of Appeal ruling which concluded that members of certain public sector pension schemes had been subjected to unlawful age discrimination in changes to their pension scheme. This 2018 ruling stated that the protections that the government had introduced for older workers in these pension schemes to allow them to continue to benefit from the previous, more generous pension arrangements discriminated against younger employees as they were not given the same protection. 

In the context of the Teachers’ Pension Scheme (England and Wales), this means that all younger members who were moved to the career average pension scheme have been treated less favourably than older workers who did not have to move and kept their final salary pension entitlement.  The local government pension scheme did not make the same type of changes in 2015 and we will need to see whether any elements of this pension scheme are discriminatory.

There are no further routes of appeal open to the government – so steps will have to be taken to eliminate the discrimination caused by the changes made in 2015. In practice this means that the Employment Tribunal who first heard the relevant cases will now have to decide how to remedy the discrimination in the pension schemes. The government seems to accept that it must take action in relation to all members of public service pension schemes disadvantaged by protection provisions in order to avoid further litigation – this means that the Employment Tribunal will consider the changes needed across the board to ensure that any discrimination is removed.  We are working with the department for education and the teachers’ pension scheme to ensure that the Employment Tribunal considers the appropriate points when looking at the best way to remedy the discrimination. The Local Government Pension Scheme Advisory Board are also considering this and are also feeding into the Employment Tribunal process to ensure that the ramifications of the Court of Appeal judgement are fully considered in the context of this pension scheme. 

We will let you know how any discrimination will be corrected as soon as the Employment Tribunal has made its decision on the approach needed in each relevant pension scheme and most importantly how this might impact your pension. For NAHT members in Northern Ireland it is likely that the changes made to the Northern Ireland Teachers’ Pension Scheme made under the reforms introduced under the Public Service Pensions Act (NI) 2014 which broadly replicate the changes introduced under the equivalent Westminster Act in 2015 are also discriminatory and as such changes will also need to be made to that scheme, although the process for doing this is currently less clear as the Employment Tribunal only has jurisdiction in England and Wales –we will continue to monitor the approach being taken in Northern Ireland and will provide you with any updates as soon as we have them. 


First published 03 July 2019