High Court approves settlement in MNRPF ill-health benefits case

The High Court has approved a settlement in the case regarding ill-health early retirement (IHER) benefits in the Merchant Navy Ratings Pension Fund (MNRPF).

The case, which the trustee began in 2019, sought directions on several legal questions arising from the provision, revision and removal of enhanced IHER benefits first introduced into the MNRPF in 1985.

The trustee adopted a neutral stance on the issues and the court appointed representative parties to act for the members and the participating employers, with independent lawyers paid for by the MNRPF.

In August 2021, the parties entered into a settlement agreement under which the MNRPF would pay compensation to the members who were adversely affected by past decisions over the entitlement to IHER benefits.

This was due to be considered for approval by the Court in October 2021, but the hearing was adjourned due to new issues being identified over potential mis-alignments between the benefits paid in practice by the fund and the fund’s historic trust deed and rules, which could have affected the compensation under the settlement.

Following a period of negotiation, a revised settlement was agreed and approved by the court on the basis that it is for the benefit of both members and the employers.

The agreement is to implement the payment of compensation under the original settlement, but for the trustee to then adjust the position at later stages to take into account the new issues when they are resolved.

The trustee noted that it has been preparing to implement the settlement for some time with its administrators and advisers.

It will be providing lump-sum arrears and increased pensions in relation to several thousand affected members.

The affected members are in three broad categories: those whose IHER benefits were scaled back when first put into payment, those whose benefits were suspended or reduced, and those who should have been provided benefits but were not.

The level of compensation will vary from member-to-member, with a claims process in place for those who were not provided with an IHER benefit.

MNRPF independent chair, John Oldland, commented: “The trustee welcomes the certainty that this settlement brings for members and employers and that it avoids the need for further time and cost for the case to go full trial.

“The trustee has done all it can to facilitate the long settlement process to reach the point where the settlement can now be implemented.

“The trustee, in conjunction with its advisors, will now be working very hard to ensure payments under the settlement are paid to affected members in the shortest possible timeframe.”

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