Tuesday 23 December 2003

Part-Time Pensions - Preston v Wolverhampton (no. 3)

Perfectly timed to wrap up in a stocking, the EAT has handed down the latest decision in the Preston v Wolverhampton saga of pension cases. The series of cases represent the largest litigation ever in an employment tribunal, involving roughly some 60,000 claims, mainly by female part-time workers.

In an admirably clear judgment, the EAT (HHJ McMullen, sitting alone) asked and answered the following six questions (note: I have adopted the order used by the judge in his judgment, not the order used in the formal list of issues):

(1) Is there a breach of the Equal Pay Act 1970 where pension scheme membership is compulsory for full-time staff but part-time staff are excluded? Yes (paras 30-55)

(2) Is there a breach of the 1970 Act where scheme membership is compulsory for full-time staff and optional for part-time staff? No (paras. 56-66)

(3) Is there a breach of the 1970 Act where an employer has failed to inform staff of the removal of a barrier to scheme membership? Yes, but only where there is a policy of failing to inform, having a disparate effect on women (paras. 67-80)

(4) Did the Chairman err in his consideration of Mrs Savage’s and Mrs Thomas’ test cases? Yes - their cases should be dismissed. (also paras. 67-80)

(5) When does a “stable employment relationship” arise? One needs to look at the intention of the parties. (paras. 81-128)

(6) Does time begin to run in a claim against a TUPE transferor from the date of transfer, or does time not run until the end of an employee’s employment with the transferee? Since pension rights do not transfer under TUPE, employees need to sue the transferor as well as the transferee. Time, for the purpose of the six-month limitation period, starts running from the date of end of employment with the transferee, not when the transfer took place. (paras. 129-148)

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