The Supreme Court has ruled that paragraph 18 of Schedule 9 to the Equality Act 2010 is incompatible with EU law and must be disapplied. Paragraph 18 provides that, where a member of an occupational pension scheme dies leaving a surviving same sex spouse or civil partner, the scheme is only required to provide a spouse’s pension in respect of the member’s service from 5 December 2005. (Separate legislation requires that the surviving same sex spouse or civil partner also receive a widower’s GMP in respect of the member’s contracted-out service from 6 April 1988, and in the light of the Court’s ruling, this may have to be reviewed, at least for male members.)
The Government is currently considering its response to the Court’s ruling. However, as a result of the ruling, schemes that do not currently provide the same spouse’s pension to same sex spouses and civil partners as they do to opposite sex spouses should:
- ensure that, going forwards, an equal spouse’s pension is paid in respect of any deceased member who is survived by a same sex spouse or civil partner (including in relation to members who have died recently, but in respect of whom survivors’ benefits have not yet been put into payment);
- amend their scheme rules to reflect the entitlement of same sex spouses and civil partners to an equal spouse’s pension;
- revisit any pensions already in payment to same sex spouses or civil partners and adjust them as necessary to reflect that an equal spouse’s pension should have been in payment.
The requirement to pay equal spouses’ pensions to same sex spouses and civil partners may have an impact on the scheme’s funding position (although we do not believe the impact is likely to be significant). Schemes may wish to ask their actuary for advice in this respect.