On appeal from [2015] EWCA Civ 1000


This appeal considered, where a pension is calculable by reference to service, whether the period of service prior to the coming into effect of the relevant Directive should be taken into account in calculating the amount of pension to be paid. The Supreme Court unanimously decided to refer the question to the CJEU as it was not persuaded that the case of either appellant or respondent was clearly right. This was because, as a matter of EU law, when a new rule of law comes into force, it cannot apply to legal situations which have arisen and become definitive prior to that date, but can apply to the future effects of a situation which arose under the old law. Therefore, the entitlement to a pension (or lack thereof) based on periods of employment under the old law was not a situation which arose and became definitive at the time of the employment, but was a future effect of that employment. However, the CJEU has also previously treated occupational pensions as a deferred form of pay, the entitlement to which accrues continuously over the employee’s service, and therefore the respondent argued that an occupational pension constitutes deferred pay for past work, and the worker’s entitlement to that pension accrues and is fixed at the time of the work for which it constitutes pay; the entitlement is not determined when the person retires and the pension becomes payable. Due to these two approaches, the Supreme Court was inclined to think that the effect of the Directive is that it is unlawful to discriminate against part-time workers when a retirement pension falls due for payment; however the correct approach did not appear to the Supreme Court to be sufficiently clear.

Thus the following question was therefore referred to the CJEU: “Does Directive 97/81, and in particular clause 4 of the Framework Agreement annexed thereto concerning the principle of nondiscrimination, require that periods of service prior to the deadline for transposing the Directive should be taken into account when calculating the amount of the retirement pension of a part-time worker, if they would be taken into account when calculating the pension of a comparable full-time worker?”

For judgment, please download: [2017] UKSC 46
For Court’s press summary, please download: Court’s Press Summary
For a non-PDF version of the judgment, please visit: BAILII

To watch the hearing, please visit: Supreme Court Website (8 Mar 2017 morning session) (8 Mar 2017 afternoon session) (9 Mar 2017 morning session) (9 Mar 2017 afternoon session)