The McCloud Judgement relates to two employment tribunal cases that were brought against the Government. The claimants argued that protection introduced following changes to public sector pension schemes in 2014/2015 amounted to unlawful discrimination as the protections only applied to certain older members.
Impact on LGPS:
In 2015 the new CARE pension scheme was introduced which changed how members built up their pension. Protection was introduced at this time in the form of an “underpin”. This ensured that anyone who was 10 years or less from Normal Retirement Age on 1st April 2012 would not be worse off, and they would receive a pension at least equal to the one they would have received, had the scheme not changed. Under the Ruling, this is considered a form of protection which is age dependent and therefore amounts to age discrimination.
Impact on members pensions:
If you’re affected by the McCloud judgement, you don’t need to make an employment tribunal claim; you’ll automatically receive any uplift required to remove the inequality that’s been identified. This includes members that have since left the pension scheme.
Despite this, we are aware that companies are actively encouraging members to lodge claims. These claims could be costly and are unnecessary because, if you’ve been affected you automatically benefit from any protection that’s provided and you risk sharing any benefits you would automatically receive with a third party.