Same-sex couples should have pension equality, Supreme Court rules

In a landmark judgment, the Supreme Court has today, 12 July, ruled that same-sex couples that are married or in a civil-partnership should have the same pension benefits as heterosexual couples.

The ruling follows a five-year legal battle by John Walker, who wished to secure equal pension benefits for his husband. The Supreme Court ruled unanimously that an exemption in the Equality Act – letting employers exclude same-sex partners from spousal benefits paid into pension funds before December 2005 – is discriminatory and breaches EU equality laws.

The ruling from the UK’s highest court means the provision is immediately disapplied. From today, companies taking advantage of the exemption will be breaking the law. It marks the end of a lengthy fight for Walker and his legal representatives, Liberty, after an initial Employment Tribunal victory in 2012.

Walker retired from chemicals group Innospec in 2003, having worked for the company for more than 20 years. During his time there, he was required to pay into its pension scheme and he made the same contributions as his heterosexual colleagues.

Walker has been in a relationship with his husband since 1993, and they entered into a civil partnership in January 2006, having registered on the first day it was legally possible to do so. This was later converted into a marriage.

However, relying on the Equality Act exemption, Innospec made clear that – should Walker die – his husband would not receive the same survivor benefits he would if he were a woman.

Those benefits would not include all the contributions Walker had made prior to 2005 – leaving his husband with a pension of only a few hundred pounds a year. If he were married to a woman, she would receive £45,000 a year for the rest of her life.

Innospec’s position was supported by the Department for Work and Pensions (DWP), which joined the case and led much of the argument against Walker. The DWP argued that gay couples in the position of Walker and his husband should not benefit from the same pension arrangements as heterosexual couples.

However, today’s unanimous judgment, handed down by Lord Kerr, agreed the loophole was discriminatory and breached EU law. The judgment found that the legal status of gay and lesbian employees has been transformed by the introduction of equality legislation from the EU. Non-discrimination on grounds of sexual orientation is now a principle of EU law. Any denial of a spouse’s pension calculated on the basis of all Walker’s years of service would be unlawful.

Furthermore, the Equality Act loophole that enables such discrimination is unlawful and must be disapplied. Since the European Communities Act 1972, UK courts have had the power to disapply national law where it conflicts with EU law. However, this will change when the UK leaves the EU.

Commenting on the result, Walker said: “I am absolutely thrilled at today’s ruling, which is a victory for basic fairness and decency. Finally this absurd injustice has been consigned to the history books – and my husband and I can now get on with enjoying the rest of our lives together.

“But it is to our government’s great shame that it has taken so many years, huge amounts of taxpayers’ money and the UK’s highest court to drag them into the 21st century. In the years since we started this legal challenge, how many people have spent their final days uncertain about whether their loved one would be looked after? How many people have been left unprovided for, having already suffered the loss of their partner?

“What I would like from Theresa May and her ministers today is a formal commitment that this change will stay on the statute books after Brexit.”

In addition, Liberty lawyer, acting for Walker Emma Norton said: “We are delighted the Supreme Court recognised this pernicious little provision for what it was – discrimination against gay people, pure and simple.

“But this ruling was made under EU law and is a direct consequence of the rights protection the EU gives us. We now risk losing that protection. The Government must promise that there will be no rollback on LGBT rights after Brexit – and commit to fully protecting them in UK law.”

Commenting on the judgment, Gowling WLG partner Liz Gane said: “From Mr Walker’s perspective, the ruling of the Supreme Court is to be welcomed. It addresses an inequality which was difficult to justify – opposite sex partners benefit from the full spouse’s pension for the whole period of service regardless of when they marry. In principle, there is no reason why same sex partners should not benefit from the same protection.

“The ruling will impact the way in which pension scheme benefits are administered in the future but happily for schemes already suffering in times of turbulent markets, it should have minimal immediate impact on pension scheme liabilities since many pension schemes already assume that proportion of their members are married – and do not distinguish between same sex and opposite sex marriages. More widely, the decision could have wide reaching implications for the application of discrimination law, because the decision is effectively allowing protection for pension scheme members in respect of periods before protective discrimination legislation came into force.”

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