The ‘85 Rule’ in the Local Government Pension Scheme discriminates on age grounds – News – agediscrimination.info

The High Court has dealt with the first case relating to age discrimination in the UK. This was not a claim under the Age Regulations, but a judicial review case about the government’s decision to change an age-discriminatory rule in the Local Government Pension Scheme (LGPS).

The so-called ‘85 Rule’ in the LGPS provided a benefit to members of an unreduced pension at retirement if, when adding together the member’s age and years of pensionable service, the figure came to 85 or more.

The government decided to remove the 85 Rule with effect from 1 October 2006, when the Age Regulations came into force. It had two reasons for doing so:

• the 85 Rule contravened the age discrimination provisions in the European Equal Treatment Framework Directive (which the Age Regulations now implement); and

• it was too costly to continue providing the benefit in this way in the future.

Unison, the public sector trade union, applied for a judicial review of the decision to change the 85 Rule. They argued that the 85 Rule did not amount to age discrimination under the Directive, and also argued that even if it did, it was exempt from the Directive or could be justified.

The government successfully defended the application. The High Court decided that the government would have changed the 85 Rule on cost grounds, even if there had not been concerns about age discrimination.

However, the Court also decided that the 85 Rule was discriminatory on age grounds, as an older worker with the same length of service as a younger worker could receive a higher pension under the Rule. The Court decided the government had acted reasonably in reaching its conclusion that the discrimination could not be justified. It also concluded that the 85 Rule was not exempt under the Directive, and the exemptions should be construed narrowly.

It is worth bearing in mind that the High Court did not have to consider whether or not the discriminatory rule was actually justified. Because this was a judicial review application, the Court only had to decide whether a reasonable decision-maker could have come to the conclusion that there was no justification, or whether that conclusion was irrational.

Employment tribunals will need to look at justification in much more detail, and where an employer considers that discrimination is justified, they will need to be able to produce evidence of a legitimate aim and that the relevant decision or practice was a proportionate means of achieving that aim.

Unison v The First Secretary of State [2006] EWHC 2373 (Admin), 27 September 2006