February saw the IBM pension scheme returning to the High Court for the third time in a little over a year. The first IBM case concerned the rectification of the scheme’s rules to give active members a right to retire from age 60. The second case concerned the question of good faith and whether IBM would have breached its implied duty of good faith if it refused to amend the scheme to allow deferred members to also take their benefits at age 60. The latest instalment also concerns the issue of duty of good faith but in a different context. So what exactly is the implied duty of good faith and why is it such a popular argument in pensions disputes? (more…)
Archive for the ‘Disputes’ Category
Pensions and the duty of good faith – a regular visitor to court
Thursday, 14 March 2013Incorrect pension benefit statements: let the buyer beware – or not?
Wednesday, 24 October 2012Here’s the situation: a pension scheme member, considering retirement or redundancy options, asks for a benefit quote. Unfortunately, there’s a substantial error in the quote, but no-one spots it and the member takes their life-changing decision. When the mistake comes to light, does the member bear any responsibility for having failed to spot it? (more…)
Early retirement rights and TUPE – where next?
Thursday, 12 July 2012Many years ago the European Court decided that some short term supplementary payments payable on redundancy or restructuring could transfer under TUPE to the transferee of the undertaking (Beckmann v Dynamco and South Bank University v Martin). These cases involved the public sector and Whitley Council-negotiated terms*. The Court decided that the right to unfunded supplementary pension payments payable before normal pension age (when the main pension started) would become a liability of the transferee. It has always been unclear – and controversial – how, if at all, the principle might apply to early retirement rights under funded private sector occupational pension schemes. (more…)
Pensionable pay in theory and practice
Wednesday, 20 June 2012How well do you know your scheme’s pensionable pay definition? Many people might be able to quote a summary of it from the members’ booklet, or give the gist of what is pensionable for their scheme. The further you get from the precise terms of the rules, though, the greater the risk of getting it wrong. Two employers have recently been told that their scheme rules didn’t say what everyone thought they did. In one case, that was an expensive mistake. (more…)
Avoiding pensions litigation: written instructions to advisers
Tuesday, 20 December 2011I recently gave an Allen & Overy client seminar about avoiding some of the most common causes of pensions disputes. One of the causes of pensions litigation that I identified was mistakes in scheme documentation: the parties intended the document to say X but it actually says Y. I suggested a few practical points for trying to avoid these mistakes arising in the first place. One of those points focused on the value of giving clear instructions to advisers when instructing them to amend the scheme documentation. It was a point that seems to have been well received and so I thought it was worth covering it again in brief in this blog.
