Since 17 May 1990 there has been a conflict between the requirement for occupational pension schemes to treat men and women equally and the fact that contracted-out schemes must provide Guarantees Minimum Pensions (GMPs), which legislation defines in different ways for men and women. It has not been clear whether or how to solve this puzzle.
On 26 October 2018, the High Court ruled that trustees have a duty “to equalise benefits for men and women so as to alter the result which is at present produced in relation to GMPs”. The case concerned Lloyds Banking Group Pensions Trustees Limited and three related schemes, but it will have implications for other schemes contracted out between 1990 and 1997. The DWP and HMRC were also represented in court because of the potential for a wider precedent to be set.
The ruling also considered a variety of potential methods of equalisation and concluded that several were permissible, although the employer can require the trustees to adopt the method which involves the minimum additional liabilities (before allowing for administrative and implementation costs).
Aon provided three expert witnesses to the case.
To hear more on the topic from Aon please refer to the toolkit resources below, or email firstname.lastname@example.org
This latest webcast considers what we have learnt in the 100 days since the High Court ruling on the Lloyds Bank GMP Equalisation case, which is having wide ranging impacts for the pensions industry. This session explores the steps taken so far, the challenges uncovered and how to design practical solutions for GMP Equalisation.
Lynda Whitney Chairs, with Tom Yorath, who acted as expert witness and is leading the team who have provided over 500 GMP Equalisation estimates so far, alongside Mike Edwards from Aon’s Risk Settlement team and David Bunkle from Aon’s Member Options team. They explore:
Just when you thought it was all over once you finish GMP reconciliation along comes the next problem for GMPs. The High Court has ruled on the Lloyds Bank GMP Equalisation case which is expected to have wide ranging issues for the pensions industry. Aon’s webinar, co-hosted with Sackers explores:
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