Equalisation - A victory for common sense?
The Court of Appeal has reached a landmark determination in a key pensions equalisation case that will have the pensions industry heaving a sigh of relief.
In the case of Foster Wheeler v Hanley the Court was asked by the sponsoring employer to clarify how, in practical terms, the pension scheme should pay benefits to members in line with its sex equalisation provisions. The rules of the scheme used to provide different retirement ages for men and women - namely 60 for women and 65 for men. The effect of the Barber v Guardian Royal Exchange judgement, which applied from 17 May 1990, was in effect to equalise the normal retirement ages (NRA) of men and women to age 60, in schemes which had such a disparity, from the date of the judgement until an effective amendment was made to provide for an equalised retirement age. In the Foster Wheeler case this occurred in 1993 when the rules were amended to increase the retirement age to 65 for all members. This reflected the common approach that many pension schemes adopted although it inevitably resulted in a pre and post amendment period during which a different retirement age applied. This period is often referred to as the "Barber Window".
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