Schemes facing a flood of discrimination claims

Wedlake Bell said schemes and their sponsors could be forced to pay out on discrimination claims dating back decades.

At present schemes and employers only have to pay damages for discrimination against members or their dependents on the basis of age or sexual orientation if the incident happened after December 2, 2006 and December 1, 2003, respectively.

But partner Jane Wolstenholme said both cases – Tadao Maruko v Versorgungswerk der deutschen Bühnen and Birgit

Bartsch v Bosch und Siemens Hausgerate (BSH) Altersfursorge – ruled there should be no time limit on discrimination

claims.

She said: "These cases open the door to legal challenges that are likely to be hugely costly for employers. Employers who have been sticking to the letter of the law could now find the very basis of that law is unsound.

"Having thought they didn’t need to worry about the past, they could now face the prospect of paying equalised retrospective benefits going back decades to huge numbers of members and members’ partners.

"Since this won’t have been factored into their liability assumptions, this is going to be a very painful blow. It could well spur even more companies to decide to pull the plug on their occupational schemes."

Wolstenholme added: "The advocate general’s opinion in Bartsch indicates the EU’s general anti-discrimination principles can be applied with so called ‘vertical effect’ – meaning that employees could rely on these principles to take action directly against their employers, without infringement proceedings being brought against the UK government first."

Examples of possible discrimination in pension schemes include disqualifying younger spouses from claiming a survivor’s pension; disqualifying same sex civil partners from claiming a survivor’s pension; and different accrual rates or employer contributions for employees of different ages.