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Same-sex pension ruling praised for bringing the law ‘up to date’

The country’s top court has ruled that a gay man’s husband should be entitled to receive enhanced payouts from his pension in the event of his death.

John Walker had worked for chemicals company Innospec since 1980 and, until his retirement in 2003, had made regular contributions to the firm’s occupational pension scheme.

Walker, a gay former cavalry officer, has lived with his partner since 1993. The pair entered into a civil partnership in January 2006 and are now married. In 2006, Walker wrote to his former employer to ask if it would pay a spouse’s pension to his partner when he died.

However, Innospec declined to do so because Walker’s service predated December 2005, the date when civil partnerships were introduced in the UK. This meant that, if Walker was married to a woman, she would receive a spouse’s pension of roughly £45,700 per year when he died, while his same-sex partner was only entitled to the statutory guaranteed minimum of £1,000 per year.

Walker took a claim for discrimination to an employment tribunal, which found in his favour. However, Innospec appealed and the Employment Appeal Tribunal reversed the original decision. Walker then took his case to the Court of Appeal, where it was dismissed, before going on to the Supreme Court.

Allowing Walker’s appeal in a unanimous judgment, the top court decided it would be incompatible with a piece of EU equality legislation, which has been transposed into English and Welsh law, to not allow Walker’s husband to have the higher pension payouts.

“The salary paid to Walker throughout his working life was precisely the same as that which would have been paid to a heterosexual man,” said Lord Kerr as he delivered the judgment. “There was no reason for the company to anticipate that it would not become liable to pay a survivor’s pension to his lawful spouse.”

Max Orbach, associate solicitor in Russell-Cooke’s trust and estate disputes team, added: “This decision helps bring the law up to date in the area of same-sex marriages. However, on the death of a loved one, the position regarding entitlement to their pension is far from straightforward and will inevitably depend on the specific terms of their pension.”

Meanwhile, Jane Higgins, pensions partner at Allen & Overy, said: “[The decision] will mean that defined-benefit schemes will need to offer full benefits for civil partners and same-sex spouses if they don’t already do so. This is likely to mean some additional cost for those schemes and their employers. In our experience many pension schemes give full same-sex partner rights even though they haven’t been legally required to do so until now – but the government’s June 2014 review found that 27 per cent of private pension schemes had different benefits for same-sex survivors. It’s those schemes that need to look at their rules.”

The Department for Work and Pensions has previously raised concerns that applying the EU legislation retrospectively would impose costs on schemes that they had not accounted for. A spokesperson added that the government was now “reviewing the implications of this judgment in detail and will respond in due course”. 

Added: 14-07-2017

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