UK - Banks face legal action from thousands of female workers who say they were tricked into swapping their pensions for cash lump sums.
Bank union Unifi, which is backing the workers, explained that in the 1960s and 1970s companies routinely offered women a cash payment when they got married. But these “marriage gratuities” wiped out all their accumulated pension contributions.
Unifi is targeting HSBC first in a bid to win compensation for its members. Lead negotiator Hugh Roberts will meet with HSBC representatives next month to discuss the issue. If compensation is not agreed the matter will be taken to court.
Roberts believes the action taken by Midland (now part of HSBC), Lloyds and the Royal Bank of Scotland in the 60s and 70s was discriminatory and that in some cases women lost pensions built up over 10 to 20 years.
He explained that 30 to 40 years ago employers presumed that women would never return to work and that they did not bother to either inform workers directly that they would lose their pension, or include that information in any relevant documentation.
HSBC responded to the union’s allegations by stressing that it is a “fair“ employer and that it is confident it complied with all relevant employment legislation.
One leading pensions lawyer was also doubtful about Unifi’s chances of success.
The lawyer said: “Although it looks like extreme discrimination, it might be quite difficult to actually prove because it existed in an era before there was any legislation against sex discrimination.”
Earlier this year, HSBC and Unifi settled out of court over the pension rights of part-time workers. HSBC admitted current and former part-time employees – who were excluded from the company pension scheme – into the fund following a landmark decision by the House of Lords.
The compensation bill reportedly totalled £25m.
Most respondents in this week's Pensions Buzz do not think businesses should be able suspend AE contributions if in financial distress.
Former BHS owner Dominic Chappell has lost the appeal against his section 72 conviction and sentence for failing to hand over information to The Pensions Regulator (TPR).
This week's top stories include Marsh and McLennan Companies agreeing to buy JLT, and the home secretary calling for AE to be scrapped in a no-deal Brexit scenario.
Lesley Titcomb says the watchdog wants closer interactions with pension funds to spot problems sooner and act before having to use its more stringent powers