The impact of the Age Regulations on pension schemes

The Department for Work and Pensions and DTI have published Guidance on Employment Equality (Age) Regulations 2006 and their impact on occupational and personal pension schemes.

This guide is intended to assist those who must apply the Employment Equality (Age) Regulations 2006 to pension schemes after 1 December 2006. This guide will be of relevance to employers and trustees or managers of pension schemes, as well as to members and prospective members of schemes.

The requirements in the Regulations that apply to other aspects of age discrimination in employment and vocational training came into force on 1 October 2006.

Summary of key aspects of the Regulations

From 1 December 2006:

• it is unlawful for trustees or managers of occupational pension schemes to discriminate against members or prospective members of a scheme on the basis of age where members are in the same circumstances or their circumstances are not materially different;
• it is unlawful for employers to discriminate (in relation to provision of pensions via an occupational pension scheme or making contributions to a personal pension scheme) on the basis of age (note that it has been unlawful for employers to discriminate in relation to all other matters from 1 October 2006);
• discrimination (direct or indirect) will only be lawful if one of the specific exemptions applies or if it can be "objectively justified". Objective justification and direct and indirect discrimination are explained in chapter 3. Specific exemptions are explained in chapter 6;
• pension benefits which accrued in relation to service prior to 1 December 2006 and benefit payable prior to 1 December 2006 will not be affected by the Regulations;
• trustees or managers of occupational pension schemes will be obliged to disapply any discriminatory rules under their scheme and are also given power to amend any scheme rules which allow unlawful discrimination;
• workers who suffer unlawful discrimination on grounds of age in relation to pensions can bring a claim to an Employment Tribunal, or before the Pensions Ombudsman, against the trustees/managers and/or employer.

Download the Guidance on Employment Equality (Age) Regulations 2006 (PDF - 315Kb) and their impact on occupational and personal pension schemes.

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