Last year, we reported on the Employment Tribunal’s decision in Walker v Innospec Limited (ET 2411316/2011) that a pension scheme’s failure to provide survivor’s benefits for civil partners equal to those provided for spouses was unlawful discrimination. In reaching its decision, the Tribunal found that the exemption contained in the Equality Act 2010 which permitted pension schemes to pay equal benefits for civil partners (in respect of the non-contracted-out part of a member's pension) only in respect of benefits for service on or after 5 December 2005 was incompatible with the EU Equal Treatment Framework Directive.
An appeal of that decision was recently heard by the Employment Appeals Tribunal (EAT) and the Employment Tribunal’s decision was overturned. The EAT held that the provision of equal benefits for civil partners only for service from 5 December 2005 was not direct discrimination and that the exemption in the Act was compatible with the EU Directive.
This decision will be good news for the large number of pension schemes that have made use of the exemption in the Act and provide equal benefits for civil partners only for service from 5 December 2005. Employers and trustees should however be aware that the Marriage (Same Sex Couples) Act 2013, which introduces same sex marriage in England and Wales, requires the UK government to review the differences in survivors benefits provided for opposite sex spouses and civil partners (and same sex spouses). The review is expected to conclude in July 2014 and a possible outcome is the abolition of the existing exemption and a requirement for schemes to provide equal benefits for all service.