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Millions of women are set to receive a substantial pension boost following a landmark court ruling which overturns decades of retirement inequality and unfairness.
The High Court ruled that Lloyds Bank must equalise its pension payments for men and women, resolving a pensions equality dispute that dates back as far as the nineties. The decision could cost the bank up to £150m, as well as setting a precedent that could lead to payouts of up to £15bn for women within final salary schemes - including arrears which may go back decades.
An estimated 35,000 scheme members will see an increase in their annual retirement income by more than £500 according to BTU, the trade union representing Lloyds Staff, with a further 8,000 members receiving over £3,000.
The long-standing dispute revolved around guaranteed minimum pensions (GMPs) for employees who contracted out of state pensions, resulting in both them and their employer paying lower national insurance. In return for the tax break, the employer would provide staff with a pension equivalent to that which they would have received from the state. However, due to their earlier retirement age, existing rules allowed GMPs to be lower for females.
Whilst this case will primarily result in gains for female members, the ruling in favour of equality could result in some men also getting increases due to women receiving their state pensions earlier than their male counterparts.
For accurate legal advice concerning retirement planning and pensions, contact our expert team today.
