Equality
Cases
Coloroll Pension Trustees Ltd v Russel and others
[1994] IRLR 586, [1995] All ER (EC) 23
“…16 The High Court considered it expedient to stay proceedings and to refer the following questions to the Court of Justice:
1. (1) Can the direct effect of Article 119 of the Treaty establishing the European Economic Community be relied on (a) by employees and (b) by dependants of such employees, in relation to claims to benefits under a scheme where those claims are made not against the employer but against the trustees of the scheme?
(2) Can the direct effect of Article 119 be relied on in relation to a scheme (a) by employees and (b) by dependants of such employees,
(i) to require the trustees to administer the scheme as if the provisions of its rules had been altered (notwithstanding their actual terms) so as to reflect the principle of equal pay laid down by Article 119 by securing that the benefits payable under the scheme to such employees and/or dependants are equalised? or
(ii) to require the employer (if still in existence) and/or the trustees to use such powers as they may have, whether by amendment of the rules of the scheme or otherwise, to secure that the benefits payable under the scheme reflect the principle of equal pay?
and if the answer to (i) or (ii) is Yes,
(iii) does the principle of equality require the benefits of the disadvantaged sex to be increased in all cases, or is it consistent with Article 119 for the benefits of the other sex to be reduced?
(3) If the direct effect of Article 119 can be relied on both against the employer and against the trustees of the scheme, what is the relation between the liability of the scheme and that of the employer? In particular,
(i) can the employer be required to pay further funds to the trustees of the scheme?
(ii) where there are surplus assets in the scheme trust funds can the employer require that any liability under Article 119 be discharged in the first instance wholly or in part as the case may be from the surplus assets?
(iii) does any additional entitlement have to be provided for by the trustees out of the assets of the scheme where no claim has been made against the employer, or where no action has been taken by the employer to satisfy or provide for such a claim?
Amicus MSF Section, R (on the application of) v Secretary of State for Trade and Industry [2004] EWHC 860 (Admin)
The Directive
The Directive was adopted by the Council pursuant to article 13 (ex article 6a) of the EC Treaty, which in its amended form confers specific powers to take action to combat discrimination based on sex, racial or ethnic origin, religion or belief, disability, age or sexual orientation. The Directive’s recitals include:
“(1) In accordance with Article 6 of the Treaty on European Union, the European Union is founded on the principles of liberty, democracy, respect for human rights and fundamental freedoms, and the rule of law, principles which are common to all Member States and it respects fundamental rights, as guaranteed by the European Convention for the Protection of Human Rights and Fundamental Freedoms and as they result from the constitutional traditions common to the Member States, as general principles of Community law.
…
(4) The right of all persons to equality before the law and protection against discrimination constitutes a universal right recognised by the Universal Declaration of Human Rights, the United Nations Convention on the Elimination of All Forms of Discrimination against Women, United Nations Covenants on Civil and Political Rights and on Economic, Social and Cultural Rights and by the European Convention for the Protection of Human Rights and Fundamental Freedoms, to which all Member States are signatories. Convention No 111 of the International Labour Organisation (ILO) prohibits discrimination in the field of employment and occupation.
…
(11) Discrimination based on religion or belief, disability, age or sexual orientation may undermine the achievement of the objectives of the EC Treaty ….
(12) To this end, any direct or indirect discrimination based on religion or belief, disability, age or sexual orientation as regards the areas covered by this Directive should be prohibited throughout the Community ….
(13) This Directive does not apply to social security and social protection schemes whose benefits are not treated as income … nor to any kind of payment by the State aimed at providing access to employment or maintaining employment.
…
(17) This Directive does not require the recruitment, promotion, maintenance in employment or training of an individual who is not competent, capable and available to perform the essential functions of the post concerned or to undergo the relevant training, without prejudice to the obligation to provide reasonable accommodation for people with disabilities.
…
(22) This Directive is without prejudice to national laws on marital status and the benefits dependent thereon.
(23) In very limited circumstances, a difference of treatment may be justified where a characteristic related to religion or belief, disability, age or sexual orientation constitutes a genuine and determining occupational requirement, when the objective is legitimate and the requirement is proportionate ….
(24) The European Union in its Declaration No 11 on the status of churches and non-confessional organisations, annexed to the Final Act of the Amsterdam Treaty, has explicitly recognised that it respects and does not prejudice the status under national law of churches and religious associations or communities in the Member States and that it equally respects the status of philosophical and non-confessional organisations. With this in view, Member States may maintain or lay down specific provisions on genuine, legitimate and justified occupational requirements which might be required for carrying out an occupational activity.
…
(28) This Directive lays down minimum requirements, thus giving the Member States the option of introducing or maintaining more favourable provisions. The implementation of this Directive should not serve to justify any regression in relation to the situation which already prevails in each Member State ….
…
(31) The rules on burden of proof must be adapted when there is a prima facie case of discrimination and, for the principle of equal treatment to be applied effectively, the burden of proof must shift back to the respondent when evidence of such discrimination is brought. However, it is not for the respondent to prove that the plaintiff adheres to a particular religion or belief, has a particular disability, is of a particular age or has a particular sexual orientation …”
The Directive’s substantive provisions of principal relevance are these:
“Article 1: Purpose
The purpose of this Directive is to lay down a general framework for combating discrimination on the grounds of religion or belief, disability, age or sexual orientation as regards employment and occupation, with a view to putting into effect in the Member States the principle of equal treatment.
Article 2: Concept of discrimination
(1) For the purposes of this Directive, the ‘principle of equal treatment’ shall mean that there shall be no direct or indirect discrimination whatsoever on any of the grounds referred to in Article 1.
…
(5) This Directive shall be without prejudice to measures laid down by national law which, in a democratic society, are necessary for public security, for the maintenance of public order and the prevention of criminal offences, for the protection of health and for the protection of the rights and freedoms of others.
Article 3: Scope
(1) Within the limits of the areas of competence conferred on the Community, this Directive shall apply to all persons, as regards both the public and private sectors, including public bodies, in relation to:
(a) conditions for access to employment, to self-employment or to occupation, including selection criteria and recruitment conditions …
(b) access to all types and to all levels of vocational guidance, vocational training, advanced vocational training and retraining, including practical work experience;
(c) employment and working conditions, including dismissals and pay ….
…
(3) This Directive does not apply to payments of any kind made by state schemes or similar, including social security or social protection schemes ….
Article 4: Occupational requirements
(1) Notwithstanding Article 2(1) and (2), Member States may provide that a difference of treatment which is based on a characteristic related to any of the grounds referred to in Article 1 shall not constitute discrimination where, by reason of the nature of the particular occupational activities concerned or of the context in which they are carried out, such a characteristic constitutes a genuine and determining occupational requirement, provided that the objective is legitimate and the requirement is proportionate.
(2) Member States may maintain national legislation in force at the date of adoption of this Directive or provide for future legislation incorporating national practices existing at the date of adoption of this Directive pursuant to which, in the case of occupational activities within churches and other public or private organisations the ethos of which is based on religion or belief, a difference of treatment based on a person’s religion or belief shall not constitute discrimination where, by reason of the nature of these activities or of the context in which they are carried out, a person’s religion or belief constitute a genuine, legitimate and justified occupational requirement, having regard to the organisation’s ethos. This difference of treatment shall be implemented taking account of Member States’ constitutional provisions and principles, as well as the general principles of Community law, and should not justify discrimination on another ground.
Provided that its provisions are otherwise complied with, this Directive shall thus not prejudice the right of churches and other public or private organisations, the ethos of which is based on religion or belief, acting in conformity with national constitutions and laws, to require individuals working for them to act in good faith and with loyalty to the organisation’s ethos.
…
Article 8: Minimum requirements
(1) Member States may introduce or maintain provisions which are more favourable to the protection of the principle of equal treatment than those laid down in the Directive.
(2) The implementation of this Directive shall under no circumstances constitute grounds for a reduction in the level of protection against discrimination already afforded by Member States in the fields covered by this Directive.
…
Article 10: Burden of proof
(1) Member States shall take such measures as are necessary, in accordance with their national judicial systems, to ensure that, when persons who consider themselves wronged because the principle of equal treatment has not been applied to them establish, before a court or other competent authority, facts from which it may be presumed that there has been direct or indirect discrimination, it shall be for the respondent to prove that there has been no breach of the principle of equal treatment ….”
Article 18 of the Directive requires Member States to adopt the laws, regulations and administrative provisions necessary to comply with the Directive by 2 December 2003 at the latest. The Regulations, which relate to employment equality as regards sexual orientation and which came into force on 1 December 2003, form part of the measures adopted by the United Kingdom to implement the Directive.
The Regulations
Part I of the Regulations contains definitions and other general provisions, including a definition of “employment” (regulation 2(3)), a definition of “discrimination” on grounds of sexual orientation (regulation 3) and a definition of “harassment” on grounds of sexual orientation (regulation 5).
Part II is concerned with discrimination in employment and vocational training. Regulation 6 contains a prohibition on discrimination, in these terms:
“6.(1) It is unlawful for an employer, in relation to employment by him at an establishment in Great Britain, to discriminate against a person –
(a) in the arrangements he makes for the purpose of determining to whom he should offer employment;
(b) in the terms on which he offers that person employment; or
(c) by refusing to offer, or deliberately not offering, him employment.
(2) It is unlawful for an employer, in relation to a person whom he employs at an establishment in Great Britain, to discriminate against that person –
(a) in the terms of the employment which he affords him;
(b) in the opportunities which he affords him for promotion, a transfer, training or receiving any other benefit;
(c) by refusing to afford him, or deliberately not affording him, any such opportunity; or
(d) by dismissing him, or subjecting him to any other detriment….”
Regulation 7, headed “exception for genuine occupational requirement etc.”, contains some of the main provisions under challenge:
“7.(1) In relation to discrimination falling within regulation 3 (discrimination on grounds of sexual orientation) –
(a) regulation 6(1)(a) or (c) does not apply to any employment;
(b) regulation 6(2)(b) or (c) does not apply to promotion or transfer to, or training for, any employment; and
(c) regulation 6(2)(d) does not apply to dismissal from employment,
where paragraph (2) or (3) applies.
(2) This paragraph applies where, having regard to the nature of the employment or the context in which it is carried out –
(a) being of a particular sexual orientation is a genuine and determining occupational requirement;
(b) it is proportionate to apply that requirement in the particular case; and
(c) either –
(i) the person to whom that requirement is applied does not meet it; or
(ii) the employer is not satisfied, and in all the circumstances it is reasonable for him not to be satisfied, that that person meets it,
and this paragraph applies whether or not the employment is for purposes of an organised religion.
(3) This paragraph applies where –
(a) the employment is for purposes of an organised religion;
(b) the employer applies a requirement related to sexual orientation –
(i) so as to comply with the doctrines of the religion, or
(ii) because of the nature of the employment and the context in which it is carried out, so as to avoid conflicting with the strongly held religious convictions of a significant number of the religion’s followers; and
(c) either –
(i) the person to whom the requirement is applied does not meet it, or
(ii) the employer is not satisfied, and in all the circumstances it is reasonable for him not to be satisfied, that that person meets it.”
Regulations 8, 10 and 14 prohibit discrimination against contract workers, office holders and partners in a firm respectively. They each provide that such discrimination is not unlawful if the work to be done is such that if it were to be done by an employee, it would be lawful by reason of regulation 7 (see regulations 8(3), 10(5) and 14(4)). Those exceptions therefore depend on the validity of regulation 7.
Regulation 16 prohibits discrimination by authorities or bodies which can confer a professional or trade qualification, but contains an exception in relation to qualifications “for purposes of an organised religion where a requirement related to sexual orientation is applied to the qualification so as to comply with the doctrines of the religion or to avoid conflicting with the strongly held religious convictions of a significant number of the religion’s followers” (regulation 16(3)). The exception is therefore in similar terms to regulation 7(3), but without the equivalent of regulation 7(3)(c), and its validity is dependent on the same arguments as are addressed towards regulation 7(3).
Regulation 18 prohibits discrimination by employment agencies but provides that such discrimination is not unlawful if it only concerns employment which, by virtue of regulation 7, the employer could lawfully refuse to offer the person in question. The exception therefore depends on the validity of regulation 7.
Regulation 20 prohibits discrimination by institutions of further and higher education:
“20.(1) It is unlawful, in relation to an educational establishment to which this regulation applies, for the governing body of that establishment to discriminate against a person –
(a) in the terms on which it offers to admit him to the establishment as a student;
(b) by refusing or deliberately not accepting an application for his admission to the establishment as a student; or
(c) where he is a student of the establishment –
(i) in the way it affords him access to any benefits,
(ii) by refusing or deliberately not affording him access to them, or
(iii) by excluding him from the establishment or subjecting him to any other detriment.
…
(3) Paragraph (1) does not apply if the discrimination only concerns training which would help fit a person for employment which, by virtue of regulation 7 (exception for genuine occupational requirement etc.), the employer could lawfully refuse to offer the person in question ….”
The exception in regulation 20(3) is therefore again dependent on the validity of regulation 7, but its terms are also the subject of separate complaint.
Part III of the Regulations is concerned with other unlawful acts.
Part IV sets out general exceptions from Parts II and III. One such exception is in regulation 25, which gives rise to the other main area of challenge:
“25. Nothing in Part II or III shall render unlawful anything which prevents or restricts access to a benefit by reference to marital status.”
Part V contains provisions for enforcement. Proceedings may be brought in employment tribunals or county courts in respect of complaints or claims that a person has been subject to discrimination or harassment which is unlawful under the Regulations.
Issues
In the broadest of terms, the main issues are whether the impugned regulations are compatible with the Directive and whether they are compatible with the Convention.
As regards compatibility with the Directive, I have broken matters down into the following topics: (i) general principles concerning implementation of directives, including the requirement of legal certainty and the approach towards interpretation of implementing measures; (ii) the specific issues raised in relation to regulation 7(2); (iii) the specific issues raised in relation to regulation 7(3); (iv) the specific issues raised in relation to regulation 20(3); (v) the specific issues raised in relation to regulation 25; and (vi)the separate argument as to reduction of pre-existing levels of protection.
As regards compatibility with the Convention, I have broken matters down into (vii) the alleged breach of article 8 and (viii)the alleged breach of article 14. I have referred briefly at the end to (ix) an alternative argument as to breach of the common law principle of legality, which is founded on the same substantive points as the Convention arguments.
Before dealing with those topics, however, it is convenient to look at the general nature of the rights in issue in this case and, in that context, to deal in particular with some of the points made by and against the interveners. This is the backdrop against which the various detailed arguments in the case need to be assessed.
The fundamental rights in issue
It is self-evident that the case is concerned with fundamental rights of great weight, which are recognised as such both in Community law and under the Convention. Reference was also made in the course of submissions to the EU Charter of Fundamental Rights; but in my view, and as Mr Singh at least appeared to accept, it adds nothing material.
Sexual orientation is a most intimate aspect of private life and personal identity. It is protected under the Convention, in particular under articles 8 and 14 the application of which is considered later in this judgment. Such protection extends to the employment context. The Convention case-law also shows that weighty reasons are required to justify any interference with an individual’s Convention rights not to be discriminated against on grounds of sexual orientation.
Part of the background to the wording of regulation 7(3), and one of the matters that will need to be considered in examining the challenge to that provision, is a distinction drawn between sexual orientation and sexual behaviour. As regards the protection conferred by the Convention, however, I do not consider there to be any material difference between them. Sexual orientation and its manifestation in sexual behaviour are both inextricably connected with a person’s private life and identity.
Although Community law was relatively late in affording similar protection in respect of sexual orientation, this has now been addressed by amendments to article 13 of the EC Treaty and, as regards the employment context, by the Directive adopted pursuant to it. The Directive’s recitals refer to the Convention and to other human rights instruments and, as has been seen, include sexual orientation as one of a number of fundamental rights to which the principle of equal treatment is applied.
The right not to be discriminated against on grounds of sexual orientation is not, however, an absolute right. Much of this case is concerned with the striking of the balance between that right and other interests. In the case of regulation 7(2) the interests in issue are those of employers for whom being of a particular sexual orientation is a genuine and determining occupational requirement. There may, for example, be an occupational requirement for a homosexual (as for certain posts in gay or lesbian organisations) or an occupational requirement for a heterosexual (as for certain religious posts). It is in relation to employment for purposes of an organised religion, however, that issues of particular sensitivity and difficulty may arise. That is why regulation 7(3) seeks to make specific additional provision in relation to employment for such purposes.
In the course of his submissions on behalf of the interveners, Mr Dingemans drew attention to the problem faced in many jurisdictions by the competing claims of those asserting rights in respect of sexual orientation and those asserting religious rights. The tension is illustrated by the interveners’ own position, which is that their ability to hold their religious beliefs and to carry on their teaching and practices would be undermined if they were forced to employ persons whose sexual practices, and beliefs about those sexual practices, were completely at odds with the interveners’ religious beliefs, teachings and practices.
The interveners’ evidence expresses the strength of their religious beliefs on the issue of homosexual behaviour and other forms of sexual conduct. For example, Mr Roger Smith, who is Head of Public Policy at CARE, states:
“Any inappropriate sexual activity on the part of an employee would be considered grounds for dismissal. This would include behaviour amounting to adultery for a married member of staff, and any other inappropriate sexual conduct by unmarried members of staff. This would include an unmarried employee’s sexual activity with a member of the opposite sex or with a member of the same sex ….
The requirement relating to behaviour is a Genuine Occupational Requirement because it is necessary to maintain the ethos relating to Religion and Belief of the organisation. Every employee is, to a certain extent, an ambassador for CARE, both inside and out of work ….”
Mr Martyn Eden, Director of Strategic Development for the Evangelical Alliance, states:
“Evangelicals, like all orthodox, mainstream Christians, hold to the biblical teaching that monogamous heterosexual marriage is the form of partnership uniquely intended for full sexual relations between people. At the same time, we affirm God’s love and concern for all humanity, including those with an orientation towards people of their own sex, but believe that homoerotic sexual practice to be incompatible with his will as revealed in scripture ….”
Ms Hilary Reeves, Director and Chairman of the Trustees of the Christian Schools Trust (“CST”), describes the objectives, work and values of CST schools, which are established in order to provide a Christian alternative for the education of children. In CST’s view, unrighteous sexual acts include sexual intercourse with a person other than one’s spouse, outside marriage, with a close member of one’s family, or with a person of the same gender. CST’s standards are applied to teachers at their schools:
“… [T]he teacher’s own lifestyle must be a righteous one as defined above. This must, by definition, exclude from being a teacher in one of our schools a person whose lifestyle is known, or is reasonably believed, to include unrighteous sexual acts as listed above ….
To employ or continue to employ such a teacher would have such an adverse effect on our ability to educate our pupils in the way to which we are committed as to fatally undermine our ability to achieve our objectives and so our vision.”
The NUT disputes the existence of a coherent theological basis for the interveners’ views on sexual morality, in particular on homosexuality and homosexual behaviour. The evidence before the court includes witness statements, extracts from the Bible and other material directed to this issue. In my view, however, it is not an appropriate issue for this court to entertain. First, this is a judicial review challenge in the context of which the interveners’ beliefs have an illustrative rather than determinative function, helping in particular to cast light on the background to regulation 7(3) and on the competing claims between which a balance has to be struck. Secondly, and in any event, I consider that the resolution of the theological dispute raised by the NUT would take the court beyond its legitimate role.
In R (Williamson) v. Secretary of State for Education and Employment [2003] QB 1300, which raised the question whether the claimants’ belief in the use of mild corporal punishment as part of a Christian education was a “belief” for the purposes of article 9 of the Convention, Arden LJ observed that the court’s function at the fact-finding stage was to decide what the claimants’ beliefs were and whether they were genuinely held:
“Religious texts often form the basis from which adherents develop specific beliefs. It is not the court’s function to judge whether those beliefs are fairly based on the passages said to support them” (1370B-C, para 252).
Although the other members of the court did not adopt the same approach, it is one that seems to me to have a great deal to commend it.
A more extreme case, relating as it did to a doctrinal assessment of the fitness of a rabbi, but again one that points to the appropriateness of judicial restraint in this general area is R v. Chief Rabbi, ex parte Wachmann [1992] 1 WLR 1036. In that case Simon Brown J stated that “the court would never be prepared to rule on questions of Jewish law” and that, in relation to the determination of whether someone is morally and religiously fit to carry out the spiritual and pastoral duties of his office, the court “must inevitably be wary of entering so self-evidently sensitive an area, straying across the well-recognised divide between church and state” (1042G-1043A).
I should also note a case on which Mr Dingemans has placed substantial weight, namely the decision of the US Supreme Court in Boy Scouts of America v. Dale (2000) 8 BHRC 535, where it was said (at 541h-542b):
“The [New Jersey Supreme Court] concluded that the exclusion of members like Dale ‘appears antithetical to the organization’s goals and philosophy’ …. But our cases reject this sort of inquiry; it is not the role of the courts to reject a group’s expressed values because they disagree with those values or find them internally inconsistent …. The Boy Scouts asserts that it ‘teaches that homosexual conduct is not morally straight’ and that it does ‘not want to promote homosexual conduct as a legitimate form of behavior’ …. We accept the Boy Scouts’ assertion ….”
Such an approach is certainly in line with that which I consider to be appropriate in the present case in relation to religious beliefs, but the legal context of Dale was very different; and Mr Singh has drawn attention to a marked divergence, until very recently, between the jurisprudence of the US Supreme Court and the case-law under the Convention on the issue of homosexual rights. In the circumstances I think it advisable not to place any separate weight on Dale.
Accepting, however, for present purposes the interveners’ evidence as to the nature and strength of their religious beliefs, I turn to consider the way in which the interveners’ own rights and freedoms are engaged by the subject-matter of the present claims. Mr Dingemans has referred to several provisions of the Convention, but article 9 is plainly the most important. Article 9 reads:
“(1) Everyone has the right to freedom of thought, conscience and religion; this right includes freedom to change his religion or belief and freedom, either alone or in community with others and in public or private, to manifest his religion or belief, in worship, teaching, practice and observance.
(2) Freedom to manifest one’s religion or beliefs shall be subject only to such limitations as are prescribed by law and are necessary in a democratic society in the interests of public safety, for the protection of public order, health or morals, or for the protection of the rights and freedoms of others.”
Section 13 of the Human Rights Act 1998 provides that if a court’s determination might affect the exercise by a religious organisation of the Convention right to freedom of thought, conscience and religion, it must have particular regard to the importance of that right. I understand it to be common ground that, whilst there is a need to have specific regard to the rights protected by article 9, section 13 of the 1998 Act does not give greater weight to those rights than they would otherwise enjoy under the Convention. But they are in any event important rights. In Kokkinakis v. Greece (1993) 17 EHRR 397 the Strasbourg Court stated (at 418):
“31. As enshrined in Article 9, freedom of thought, conscience and religion is one of the foundations of a ‘democratic society’ within the meaning of the Convention. It is, in its religious dimension, one of the most vital elements that go to make up the identity of believers and of their conception of life …
While religious freedom is primarily a matter of individual conscience, it also implies, inter alia, freedom to ‘manifest [one’s] religion’. Bearing witness in words and deeds is bound up with the existence of religious convictions ….”
Through the rights granted to its members under article 9, a church is protected in its right to manifest its religion, to organise and carry out worship, teaching practice and observance, and is free to act out and enforce uniformity in these matters: see the admissibility decision of the European Commission of Human Rights in X v. Denmark (application 7374/76, decision dated 8 March 1976). In Hasan v. Bulgaria (2002) 34 EHRR 55 the Strasbourg Court stated (at page 1359 para 62):
“Where the organisation of the religious community is at issue, Article 9 must be interpreted in the light of Article 11 of the Convention which safeguards associative life against unjustified State interference. Seen in this perspective, the believer’s right to freedom of religion encompasses the expectation that the community will be allowed to function peacefully free from arbitrary State intervention. Indeed, the autonomous existence of religious communities is indispensable for pluralism in a democratic society and is thus an issue at the very heart of the protection which Article 9 affords. It directly concerns not only the organisation of the community as such but also the effective enjoyment of the right to freedom of religion by all its active members ….”
Mr Dingemans submits that the impugned regulations plainly affect the organisation of religious communities, which is protected by article 9. Employment is an aspect of a religion’s organisation; it engages the right to bear witness and the right to associate with those who have a uniformity of views. The closer one gets to the organisation and its essential values, the more difficult it is to justify an interference. These points lead to the submission that there is no question of the claimants’ rights outranking those of the interveners. The Directive covers both, and they are ranked equally for the purposes of protection against discrimination. The Directive confronts the tension between them, and the Secretary of State had proper regard to both in striking the balance in the implementing Regulations. The provisions of regulation 7 are justified by the terms of the Directive and are carefully drafted to ensure as much certainty in the law as is consistent with preserving the rights and freedoms of the claimants’ members and of the interveners and others.
Whether the impugned regulations strike an appropriate balance and are in other respects lawful are matters that I consider later in this judgment. What the submissions for the interveners serve to emphasise, however, is the need to strike a balance. Religion is an area where the principle of non-discrimination on grounds of sexual orientation may conflict very obviously with other important rights which are themselves recognised by the Convention and by the Directive. At the same time it should be noted that the weight to be given to religious rights may depend upon how close the subject-matter is to the core of the religion’s values or organisation. X v. Denmark concerned a clergyman. Hasan v. Bulgaria concerned executive interference in the appointment of the Chief Mufti of the Bulgarian Muslims. The statements of principle in those cases must be read in context. Mr Singh makes the point that article 9 involves a spectrum. At one end is the right to freedom of thought, conscience and religion, which is an unqualified right. There is then the right to manifest one’s religion or beliefs, which is a qualified right that may encompass a range of activities from private acts of worship to acts that intrude heavily into the rights of others. He submits that the greater the degree of intrusion into the rights of others, the more likely it is that those other rights will have to prevail. Such considerations are plainly relevant to whether the impugned regulations strike an appropriate balance or enable an appropriate balance to be struck.
Before considering the specific grounds of challenge to the regulations, however, I bring together under the heading of general principles a variety of points that arose in the course of submissions and that are more conveniently dealt with in this way.
Implementation of directives: general principles
Article 249 (ex Article 189) of the EC Treaty provides:
“A directive shall be binding, as to the result to be achieved, upon each Member State to which it is addressed, but shall leave to the national authorities the choice of form and methods.”
Although Member States are free to choose how a directive is implemented, they must adopt in their national legal systems all the measures necessary to ensure that the directive is fully effective, in accordance with the objective which it pursues: Von Colson v. Land Nordrhein-Westfalen [1984] ECR 1891 at pages 1906-1907, paras 15 and 18. It is inherent in article 249 EC, and is clear from Von Colson and later authorities, that a Member State is not required to copy out the exact wording of the directive. It has considerable flexibility in implementation, provided that the requisite result is achieved.
That point is underlined in the present case by the broad nature of the Directive’s provisions. In evidence to the House of Lords Select Committee on the European Union, Mme Odile Quentin, the Acting Deputy Director General of the Directorate General for Employment and Social Affairs at the European Commission, stated:
“We were also reminded by Governments and by NGOs that some Member States already had developed legislation on non-discrimination and that we should not force change for its own sake. We of course took into account the experience of this legislation; and in particular, we acknowledge the achievements of British legislation. We have therefore opted, in the case of the Directives, for proposals which set objectives without going into too much detail as to how those objectives should be achieved. At the same time, we have suggested definitions of the most important concepts such as direct and indirect discrimination, drawing on the extensive case-law of the European Court of Justice, to ensure that there is at least a comparable level of protection across the EU as a whole. But most of the provisions leave considerable latitude to the Member States …” (Ninth Report of the Select Committee, 16 May 2000, page 1279).
Member States’ broad discretion as to the manner of implementation is circumscribed not just by the need to achieve the required result but also by the principle of legal certainty. This has been emphasised in particular in the context of failures by a Member State to adopt any or any adequate implementing legislation, or a failure to amend incompatible national legislation. It is, however, a principle of general application. It was expressed in this way in Commission v. France [1997] ECR I-1489 at page I-1501, para 15:
“Accordingly, the provisions of a directive must be implemented with unquestionable binding force and with the specificity, precision and clarity required in order to satisfy the requirement of legal certainty, under which, in the case of a directive intended to confer rights on individuals, persons concerned must be enabled to ascertain the full extent of their rights ….”
I shall come back to the principle of legal certainty in a moment, in dealing with a submission by Mr O’Neill. In order to put the matter in context, however, I deal first with the normal position as regards implementing regulations under United Kingdom law.
Section 2(2) of the 1972 Act confers a power to make regulations in order to meet the obligation of the United Kingdom to implement a directive:
“Subject to Schedule 2 to this Act, at any time after its passing … any designated Minister … may by regulations, make provision –
(a) for the purpose of implementing any Community obligation of the United Kingdom …; or
(b) for the purpose of dealing with matters arising out of or related to any such obligation ….”
In this case the Secretary of State was the designated Minister. By virtue of Schedule 2 to the 1972 Act, the Regulations made by him had to be laid in draft before Parliament and approved by a resolution of each House.
It is common ground that any regulations made under s.2(2) that were incompatible with the directive sought to be implemented would not be made for the purpose of implementing a Community obligation and would be ultra vires.
In Pickstone v. Freemans Plc [1989] AC 66 it was held by the House of Lords that where regulations had been made in order to give effect to a Community obligation, there was an obligation to apply a purposive construction so as to give effect to the legislative intention and implement the Community obligation (see in particular per Lord Templeman at page 123B-D and Lord Oliver at pages 124G-128D). Pickstone was applied in Litster v. Forth Dry Dock Co. Ltd. [1990] 1 AC 546 in relation to regulations made for the express purpose of implementing a directive. The position was summarised in this way by Lord Oliver (at page 559):
“The approach to the construction of primary and subordinate legislation enacted to give effect to the United Kingdom’s obligations under the EEC Treaty has been the subject matter of recent authority in this House (see Pickstone …) and is not in doubt. If the legislation can reasonably be construed so as to conform with those obligations – obligations which are to be ascertained not only from the wording of the relevant Directive but from the interpretation placed upon it by the European Court of Justice at Luxembourg – such a purposive construction will be applied even though, perhaps, it may involve some departure from the strict and literal application of the words which the legislature has elected to use.”
That approach accords with the classic statement of principle by the ECJ in Marleasing SA v. La Comercial Internacional de Alimentacion SA [1990] ECR I-4135 that “in applying national law, whether the provisions in questions were adopted before or after the directive, the national court called upon to interpret it is required to do so, as far as possible, in the light of the wording and purpose of the directive in order to achieve the result pursued by the latter …” (para 8 of the judgment). (A similar approach is required in relation to compatibility with the Convention. In making the Regulations the Secretary of State was obliged by s.6(1) of the Human Rights Act 1998 to act compatibly with Convention rights, and by virtue of s.3(1) of the 1998 Act, so far as it is possible to do so, the Regulations must be read and given effect in a way which is compatible with Convention rights.)
Mr O’Neill, for the NUT, challenged the applicability of the above line of reasoning by reference to a series of ECJ cases dealing with the adequacy of a Member State’s implementation of a directive. His original submission was that it was simply not open to the Secretary of State to rely, as a defence to a challenge to the implementation of a directive, on the obligation of the courts to adopt a purposive interpretation of national law. By the time of his reply he had modified this stance slightly, accepting that it was permissible to take account of an actual and consistent body of case-law of the national courts on the interpretation of national law but contending that it was not open to a Member State to defend inadequate implementation by the argument that the national courts would adopt a purposive interpretation of national law so as to ensure its compatibility with Community obligations. In order to meet the requirement of legal certainty there must be a sufficiently precise and clear implementation in national law and individuals must be made fully aware of their rights.
I have already referred to Commission v. France [1997] ECR I-1489, in which the principle of legal certainty was articulated. The further cases cited by Mr O’Neill in this connection were Commission v. Netherlands [2001] ECR I-3541, Commission v.Italy [2002] ECR I-819, Commission v. Luxembourg (Case C-97/01, judgment of 12 June 2003, not yet reported) and Evans v. Secretary of State for the Environment, Transport and the Regions (Case C-63/01, judgment of 4 December 2003, not yet reported). In my judgment that line of authority does not carry the weight that Mr O’Neill sought to place on it. It is true that the cases stress the requirement of legal certainty and in particular that a directive must be implemented in a manner that is sufficiently precise and clear. They show that if the legal position is not sufficiently precise and clear, as where there has been no specific implementing measure or only an inadequate implementing measure, a Member State cannot plug the gap by reliance on the obligation of the national courts to interpret national law compatibly with Community obligations. It does not follow, however, that where detailed implementing measures have been adopted it is impermissible to have regard to the interpretative obligation of the national courts when determining whether the national measures comply with the directive and are lawful.
For example, in Commission v. Netherlands, after referring to the obligation of the national court to interpret national law, so far as possible, in the light of the wording and purpose of the directive so as to achieve the result pursued by the directive, the Advocate General went on (at para 35 of his Opinion):
“However, I repeat, that principle of interpretation does not solve the problem at issue here. It is designed to be of issue pending the transposition of a directive into national law – or even after transposition if this is incorrect or incomplete – but it certainly cannot serve as an excuse for failure to transpose or for inadequate transposition.”
That is very far from suggesting that the principle cannot apply in a context such as the present.
It is also helpful to refer to the most recent of the cases, Evans, which concerned the United Kingdom’s implementation of a directive relating to insurance against civil liability in respect of the use of motor vehicles. Implementation had been effected by means of a number of agreements between the Secretary of State and an existing body, the Motor Insurers’ Bureau. In considering the adequacy of such implementation, the ECJ stated:
“35. As to whether it is sufficient, for the purposes of transposing the Second Directive, to rely on an existing body, it must be borne in mind that, whilst legislative action on the part of each Member State is not necessarily required in order to implement a directive, it is essential for national law to guarantee that the national authorities will effectively apply the directive in full, that the legal position under national law should be sufficiently precise and clear and that individuals are made fully aware of all their rights and, where appropriate, may rely on them before the national courts …
…
37. In those circumstances, it must be held that a body may be regarded as authorised by a Member State within the meaning of Article 1(4) of the Second Directive where its obligation to provide compensation to victims of damage or injury caused by unidentified or insufficiently insured vehicles derives from an agreement concluded between that body and a public authority of the Member State, provided that the agreement is interpreted and applied as obliging the body to provide victims with the compensation guaranteed to them by the Second Directive and provided that victims may apply directly to that body” (emphasis added).
Far from supporting Mr O’Neill’s submissions, that judgment plainly contemplates that the normal interpretative obligation can be relied on as ensuring adequate implementation even in a case where no implementing legislative measure has been adopted. The point should apply with even greater force in relation to the interpretation of detailed implementing measures such as the Regulations at issue in the present case.
I take the view that Mr O’Neill has produced nothing capable of displacing the approach laid down by the House of Lords in Pickstone and Litster. It would moreover be extraordinary if, in considering the challenge to the lawfulness of implementation, this court were precluded from interpreting the Regulations in accordance with the normal principles applicable to a national measure adopted for the purpose of implementing a directive. The Regulations, as Miss Carss-Frisk submitted, can have only one true construction. Their meaning cannot vary according to whether they are being considered in the context of a challenge to their validity or in the context of a claim by an individual that he or she has been subject to unlawful discrimination. Accordingly I take the view that I should construe the Regulations purposively so as to conform so far as possible with the Directive, and that the present challenge should be resolved in the light of what I consider to be the true construction of the relevant provisions.
None of this removes the need for compliance with the requirement of legal certainty. It does mean, however, that the normal principles of interpretation can be considered and applied in determining whether the provisions of the Regulations are sufficiently precise and clear to comply with that requirement.
A further submission made by Mr O’Neill is that in interpreting the Regulations the court is not entitled to take into account ministerial statements to Parliament. He submits that the rule in Pepper v. Hart [1993] AC 593 operates only as an estoppel, “to prevent the executive seeking to place a meaning on words used in legislation which is different from that which ministers attributed to those words when promoting the legislation in Parliament” (per Lord Hope in R v. Secretary of State for the Environment, Transport and the Regions, ex p. Spath Holme Ltd [2001] 2 AC 349 at pages 407-408) and is in any event not concerned with statements about matters of policy as opposed to the meaning of words (ibid.). Thus, as he puts it, the executive cannot rely on Parliamentary materials to shore up its position in defending the present challenge.
I reject that submission. It is not necessary to examine in this case the precise scope of the rule in Pepper v. Hart and in particular to look at what precisely was laid down by the House of Lords in the Spath Holme case. It is well established that a wider principle operates when considering legislation implementing a Community obligation. In Pickstone Lord Keith stated (at page 112B-C):
“The draft Regulations of 1983 were presented to Parliament as giving full effect to the decision [of the ECJ] in question. The draft Regulations were not subject to the Parliamentary process of consideration and amendment in Committee, as a Bill would have been. In these circumstances and in the context of section 2 of the European Communities Act 1972 I consider it to be entirely legitimate for the purpose of ascertaining the intention of Parliament to take into account the terms in which the draft was presented by the responsible Minister and which formed the basis of its acceptance”
In the same case Lord Templeman set out at some length what had been said by the relevant Minister to Parliament (pages 121H-122G). There is nothing in Pepper v. Hart to suggest that such an approach was being disapproved. On the contrary, Lord Browne-Wilkinson referred to it without question as an existing major inroad into the rule that references to Parliamentary material as an aid to statutory construction is not permissible – i.e. the exclusionary rule into which the decision in Pepper v. Hart itself represented a further inroad (see [1993] AC at page 631).
Further, the admissibility of background material, including Parliamentary statements, in the present context is supported by recent developments in relation to the application of the Convention. In Wilson v. First County Trust Ltd. (No.2) [2003] UKHL 40, [2003] 3 WLR 568, the House of Lords held that such material is admissible for the purpose of evaluating compatibility of legislation with Convention rights, including the value judgment inherent in the test of proportionality. As Lord Nicholls expressed it (at pages 587-588):
“63. When a court makes this value judgment the facts will often speak for themselves. But sometimes the court may need additional background information tending to show, for instance, the likely practical impact of the statutory measure and why the course adopted by the legislature is or is not appropriate. Moreover, as when interpreting a statute, so when identifying the policy objective of a statutory provision or assessing the ‘proportionality’ of a statutory provision, the court may need enlightenment on the nature and extent of the social problem (the ‘mischief’) at which the legislation is aimed. This may throw light on the rationale underlying the legislation.
64. This additional background material may be found in published documents, such as a government white paper. If relevant information is provided by a minister or, indeed, any other member of either House in the course of a debate on a Bill, the courts must also be able to take this into account. The courts, similarly, must be able to have regard to information contained in explanatory notes prepared by the relevant government department and published with a Bill. The courts would be failing in the due discharge of the new role assigned to them by Parliament if they were to exclude from consideration relevant background information whose only source was a ministerial statement in Parliament or an explanatory note prepared by his department while the Bill was proceeding through Parliament. By having regard to such material the court would not be ‘questioning’ proceedings in Parliament or intruding improperly into the legislative process or ascribing to Parliament the views expressed by a minister. The court would merely be placing itself in a better position to understand the legislation.
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66. I expect that occasions when resort to Hansard is necessary as part of the statutory ‘compatibility’ exercise will seldom arise. The present case is not such an occasion. Should such an occasion arise the courts must be careful not to treat the ministerial or other statement as indicative of the objective intention of Parliament. Nor should the courts give a ministerial statement, whether made inside or outside Parliament, determinative weight. It should not be supposed that members necessarily agreed with the minister’s reasoning or his conclusion.”
What was said in Wilson, a case about primary legislation, should apply at least as strongly to secondary legislation. Similar considerations should also apply when determining whether legislation enacted for the purpose of implementing a Community obligation is compatible with that obligation. In my judgment, therefore, it is clear not only that the principles stated in Pickstone remain good law but that a wide range of relevant background material can properly be looked at in accordance with the approach approved in Wilson, albeit subject to care in the use of such material as also emphasised in Wilson.
Having considered those general points concerning implementing regulations, I turn to consider the specific grounds of challenge to the individual regulations.
Regulation 7(2): compatibility with the Directive
Regulation 7(2), read with regulation 7(1), contains an exception in respect of discrimination where sexual orientation is a genuine and determining occupational requirement. It is intended to implement article 4(1) of the Directive. It may be helpful to repeat its terms:
“This paragraph applies where, having regard to the nature of the employment or the context in which it is carried out –
(a) being of a particular sexual orientation is a genuine and determining occupational requirement;
(b) it is proportionate to apply that requirement in the particular case; and
(c) either –
(i) the person to whom that requirement is applied does not meet it; or
(ii) the employer is not satisfied, and in all the circumstances it is reasonable for him not to be satisfied, that that person meets it,
and this paragraph applies whether or not the employment is for purposes of an organised religion.”
It is common ground that a derogation in respect of occupational requirements is permitted by article 4(1) of the Directive, and there are important respects in which regulation 7(2) is accepted to be an appropriate form of derogation: in particular, by providing that proportionality is to be assessed on a case by case basis (in contrast to the approach adopted in regulation 7(3)). The Amicus claimants contend, however, that it is defective and incompatible with the Directive in two respects: (i) it does not include a provision that the discriminatory requirement must meet a legitimate objective; and (ii) the exception applies not only where a person does not in fact meet the requirement as to sexual orientation but also, by virtue of regulation 7(2)(c)(ii), where the employer is reasonably not satisfied that the person meets it. The NUT supports the second ground of challenge.
The first ground, concerning legitimate objective, is based on the absence from regulation 7(2) of language corresponding to the express proviso in article 4(1) that “the objective is legitimate”. Mr Singh does not press the contention hard, accepting that the concept of legitimate objective may be implicit and that the absence of an express reference to it may be remedied by a purposive construction. But he seeks a ruling to that effect for the avoidance of doubt.
For my part, I accept the submissions for the Secretary of State that the concept is indeed implicit and that express reference to a legitimate objective is unnecessary. The exception applies only where being of a particular sexual orientation is “a genuine and determining occupational requirement” and it is “proportionate” to apply that requirement in the particular case. If the exception can apply only where the requirement is genuine and determining, it is difficult to see how the objective could be anything other than legitimate. Moreover, it is inherent in the test of proportionality that the exception must serve a legitimate aim. Nor has anyone suggested any factual scenario in which it could sensibly be argued that, in the absence of an express reference to a legitimate objective, regulation 7(2) could be relied on in pursuit of a non-legitimate objective.
It is true that article 4(1) itself contains the same language of “a genuine and determining occupational requirement” which must be “proportionate”, yet makes additional reference to the need for a legitimate objective. It does not follow, however, that the reference to a legitimate objective adds anything of substance. If it does add something, then I see no difficulty in the national court implying a corresponding substantive requirement in pursuance of its duty to interpret the Regulations purposively so as to ensure compliance with the Community obligation.
The second ground of challenge raises a more serious point. The rationale for regulation 7(2)(c)(ii) is set out in the witness statement of Rosalind McCarthy-Ward, Director of the Selected Employment Rights Branch in the Department of Trade and Industry:
“Regulation 7(2)(c)(ii) was included in order to cater for cases in which there may be some uncertainty as to the sexual orientation of the complainant, or in which the complainant may prefer not to disclose his or her sexual orientation. The provision is intended to enable an employer to rely on the GOR [genuine occupational requirement] where the applicant refuses to disclose his or her sexual orientation, without having to impinge on the applicant’s privacy unnecessarily. In the absence of this provision, it would be very difficult for the respondent to show that the complainant did not meet a GOR, because the complainant’s sexual orientation may be something which is in his or her exclusive knowledge. The respondent might even feel compelled, in those circumstances, to collect as much evidence as possible about the private life of the complainant with or without his or her consent. Regulation 7(2)(c)(ii) is intended to prevent this situation arising. An employer is not required to prove the actual sexual orientation of a job applicant or employee.
The Government recognised that the inclusion of Regulation 7 was likely nevertheless to result in employers asking questions about sexual orientation which some complainants would consider personal and intrusive. However, once it is accepted (as the Directive envisages) that there are some cases (however rare) in which sexual orientation truly is a GOR for a particular post, some such inquiry is inevitable and, in the Government’s view, justified. The Government has thus sought in Regulation 7(2) to strike a balance between the protection of privacy and the availability of a GOR defence.”
The claimants contend, however, that the provision is objectionable for a number of reasons. There is, submits Mr Singh, no provision in the Directive that allows for reliance on an occupational requirement based on perceived, as opposed to actual, sexual orientation. By allowing an employer to rely on an occupational requirement where he “is not satisfied” that a person meets the requirement, regulation 7(2)(c)(ii) extends the exception in a way that is incompatible with the Directive and is therefore ultra vires.
In supporting Mr Singh’s submissions on this issue, Mr O’Neill expresses the point in this way. Whilst “being of a particular sexual orientation” may be a “characteristic related to sexual orientation” for the purposes of article 4(1) of the Directive, “appearing, to the employer’s reasonable satisfaction, to be of a particular sexual orientation” cannot be said to be a “characteristic related to sexual orientation” for such purposes. It transforms a potentially legitimate occupational requirement of being of a particular sexual orientation into the wholly illegitimate one of seeming to be of a particular sexual orientation. This leads to employers acting on the basis of assumptions and social stereotyping (e.g. by reliance on a man’s “camp” appearance as a reason for believing him to be a homosexual), one of the very things that the principle of non-discrimination is intended to challenge. Mr O’Neill also submits that the provision places a reverse burden of proof on the individual to prove to the employer’s satisfaction that he is of the required sexual orientation, contrary to article 10(1) of the Directive which places the burden of proof on the employer.
The claimants further contend that, since regulation 7(2)(c)(ii) requires an employer to take reasonable steps to satisfy himself as to a person’s sexual orientation, this must at least involve questioning a person about the matter and possibly making other intrusive inquiries. Such inquiries would almost certainly amount to “harassment” within article 2(3) of the Directive (“unwanted conduct … with the purpose or effect of violating the dignity of a person or creating an intimidating, hostile, degrading, humiliating or offensive environment”). Under the Directive the prohibition of harassment is not subject to any exception based on a genuine and determining occupational requirement. Inquiries of this kind would also be likely to violate article 8 of the Convention: see Smith and Grady v. United Kingdom (2000) 29 EHHR 493. In the claimants’ submission, an employer must accept what a person says about his or her sexual orientation. Further questioning about such an intimate aspect of a person’s private life and personal identity is impermissible.
In response to the claimants’ case, Miss Carss-Frisk submits first that there is no substance to the argument that the provision encourages stereotyping. An employer can rely on perceived orientation only to the extent that in all the circumstances it is reasonable for him not to be satisfied that a person meets an occupational requirement. Reliance on mere stereotyping would have no chance of meeting the reasonableness test.
Secondly, she submits that although article 4(1) of the Directive does not refer in terms to perceived orientation, it is not limited in scope to those who are actually of a particular orientation. The permitted exception applies to “a difference of treatment which is based on a characteristic related to any of the grounds referred to in Article 1” (emphasis added). Where a particular sexual orientation is a genuine and determining occupational requirement for a post, an employer who refuses to employ a person in that post because he is reasonably not satisfied that the person meets the requirement is applying a difference of treatment “based on” on a characteristic related to sexual orientation. It is common sense and also accords with recital (31) of the Directive (which refers to the burden of proof and states inter alia that “it is not for the respondent to prove that the plaintiff … has a particular sexual orientation”) that an employer should not be required to prove that a person is of a particular sexual orientation. Further, the prohibition on discrimination in article 2 of the Directive is clearly intended to apply not just to discrimination on grounds of actual sexual orientation but also to discrimination on grounds of perceived sexual orientation; and the power to derogate in article 4(1) should be similarly construed.
Miss Carss-Frisk further submits that, in a case where sexual orientation is a genuine and determining occupational requirement, it would place an employer in a difficult if not impossible situation if he could rely on the requirement only where he could prove that the person did not meet the requirement. An employer should not be required to accept a person’s say-so, or be precluded from making further inquiry if the person refuses to give an answer about sexual orientation at all. He must be entitled to ask further questions directed at determining whether the occupational requirement is or is not met. The advantage of regulation 7(2)(c)(ii) is that it avoids the risk of seriously intrusive questioning or inquiry in an attempt to ascertain a person’s actual sexual orientation to the extent required to discharge a burden of proof in the event of legal challenge. If reasonable steps have been taken to ascertain that person’s sexual orientation, an employer is entitled to act on the basis of his reasonable belief.
The same line of reasoning is relied upon to meet the claimants’ argument that the provision could lead to a breach of the prohibition on harassment and to a breach of article 8 of the Convention. Regulation 7(2)(c)(ii) has the effect of limiting the questioning that might otherwise be necessary. Reasonable inquiries of this kind would not amount to harassment or to an unjustified interference in article 8 rights.
In general I accept the submissions for the Secretary of State on this issue. In my judgment regulation 7(2)(c)(ii) has a sensible rationale. In those cases where being of a particular sexual orientation is a genuine and determining occupational requirement, it cannot be right that an employer, having asked the plainly permissible initial question whether a person meets that requirement, is bound in all circumstances to accept at face value the answer given or is precluded from forming his own assessment if no answer is given. At the same time the provision limits the risk of unduly intrusive inquiry. If the employer is not satisfied that the person meets the requirement, and if it is reasonable in all the circumstances for him to do so, the employer can decline to employ the person without having to make the same degree of inquiry as might be called for if it were necessary to gather sufficient evidence by way of proof of sexual orientation to meet a potential complaint of unlawful discrimination.
The requirement of reasonableness ensures that decisions cannot lawfully be based on mere assumptions or social stereotyping to which Mr O’Neill took particular objection in his submissions.
Nor do I accept the claimants’ argument that any form of inquiry beyond the initial question whether a person meets the requirement would amount to unlawful harassment or to breach of article 8 of the Convention. It is certainly true that particularly intrusive inquiries could give rise to such breaches, but that possibility exists independently of regulation 7(2)(c)(ii). In my viewthe provision serves to reduce rather than to increase the risk.
That still leaves the question whether the provision comes within the terms of the derogation in article 4(1) of the Directive. In my view the derogation, which refers to a difference of treatment “based on a characteristic related to” sexual orientation, is wide enough to cover it, even allowing for the need to construe derogations strictly (see e.g. Johnston v. Chief Constable of the Royal Ulster Constabulary [1986] ECR 1651 at para 36 of the judgment). Equally I see nothing in the policy of the Directive that calls for so restrictive a construction as to preclude a provision of this kind.
I should make clear that, whilst I accept that the general prohibition on discrimination in article 2 is intended to apply to discrimination on grounds of perceived as well as actual sexual orientation, I do not think that the same reasoning can automatically be applied to the power to derogate in article 4(1). Article 2 confers protection in respect of a fundamental right and should be given a broad construction. On the other hand, a derogation from such protection should in principle be given a narrow construction. Nevertheless, as I have indicated, the derogation in article 4(1) is in my view apt to cover regulation 7(2)(c)(ii).
I should also indicate that, although both sides have referred to the Directive’s provisions concerning burden of proof, I do not find those provisions of assistance either way. Recital (31) must be read with article 10(1), which is directed in particular at the nature of the burden on a respondent when a prima facie case of discrimination is made out. The provisions relate to a different question from that which arises here.
I should mention finally that in the course of argument comparisons were drawn with provisions of other anti-discrimination legislation. Mr Singh pointed out that the s.5 of the Race Relations Act 1976, which contains exceptions for employment requiring genuine occupational qualifications, lays down an objective test relating to actual rather than perceived membership of a racial group. On the other hand, an amendment made to that Act in July 2003 by way of implementation of a directive requiring the prohibition of racial discrimination has added a new s.4A, which contains exceptions for genuine occupational requirements in terms that correspond closely to those of regulation 7(2) of the Regulations here in issue. The Sex Discrimination Act 1975 contains an objective test in s.7 and has not as yet been amended so as to include any provision comparable to regulation 7(2) or to s.4A of the Race Relations Act 1976. Those references to other legislative provisions show that regulation 7(2) does not stand alone and that the issues raised in this case have implications in related areas, but I do not think that they assist the resolution of the substantive dispute in the present case.
For the reasons previously given, however, I reject the claimants’ challenge to the compatibility of regulation 7(2) with the Directive.
Regulation 7(3): compatibility with the Directive
As has been seen, regulation 7(2) applies to employment of any kind. Regulation 7(3), read with regulation 7(1), contains a further, specific exception from the prohibition on discrimination where the employment is for purposes of an organised religion and the other conditions laid down are met. Again it may be helpful to repeat its terms:
“This paragraph applies where –
(a) the employment is for purposes of an organised religion;
(b) the employer applies a requirement related to sexual orientation –
(i) so as to comply with the doctrines of the religion, or
(ii) because of the nature of the employment and the context in which it is carried out, so as to avoid conflicting with the strongly held religious convictions of a significant number of the religion’s followers; and
(c) either –
(i) the person to whom the requirement is applied does not meet it, or
(ii) the employer is not satisfied, and in all the circumstances it is reasonable for him not to be satisfied, that that person meets it.”
The Secretary of State has made clear that the provision is intended to form part of the implementation of article 4(1) of the Directive (the general derogation for occupational requirements) rather than of article 4(2) (the derogation in respect of differences of treatment based on a person’s religion or belief where religion or belief constitutes an occupational requirement).
Regulation 7(3) was not included in the detailed draft regulations originally published for the purposes of consultation. It was added as a result of representations from the Churches, including in particular, it would seem, the Archbishops’ Council of the Church of England. The rationale is explained as follows in the witness statement of Ms McCarthy-Ward:
“… Regulation 7(2) simply sets out criteria of general application and leaves it to the courts and tribunals to determine in individual cases if those criteria are met. This was not done in relation to employment for purposes of an organised religion in regulation 7(3), because the Government was concerned it would lead to litigation in tribunals about the extent to which requirements dictated by doctrine or the religious convictions of followers could legitimately limit working for an organised religion, and to what extent those requirements, and by extension, the doctrine or convictions giving rise to them, could be said to be reasonable or proportionate. The Government was engaged in striking a delicate balance between the employment rights of gay and lesbian people, and the right of religious groups to freedom of religion. The Government took the view that it is not appropriate for courts or tribunals to make such judgments, and that the balance should be identified in the Regulations themselves.”
The Government’s position was explained in more detail by the Minister of State, Lord Sainsbury of Turville, in replying to the debate on the Regulations in the House of Lords on 17 June 2003:
“It became clear that with the regulations as [originally] drafted the Churches would have some difficulty upholding the doctrine and teaching of their faith in relation to particular posts …. [W]e do not believe that these regulations should interfere with religious teachings or doctrine, nor do we believe it appropriate that doctrine should be the subject of litigation in the civil courts ….
This is not a question of extreme positions. Article 4(1) of the European directive is quite clear that religious considerations can be taken into account. What we are debating this evening is exactly where that line is drawn.
Under these circumstances I believe that Government need to take a lead – and we did that in preparing Regulation 7(3). It resolves the problem of interfering with doctrine and teachings while remaining consistent with the directive. We believe that Regulation 7(3) is lawful because it pursues a legitimate aim of preventing interference with a religion’s doctrine and teaching and it does so proportionately because of its narrow application to a small number of jobs and the strict criteria which it lays down ….
When drafting Regulation 7(3) we had in mind a very narrow range of employment: ministers of religion, plus a small number of posts outside the clergy, including those who exist to promote and represent religion. The words on the page reflect our intentions ….
First, this is no ‘blanket exception’. It is quite clear that Regulation 7(3) does not apply to all jobs in a particular type of organisation. On the contrary, employers must be prepared to justify any requirement relating to sexual orientation on a case by case basis. The rule only applies to employment which is for the purposes of ‘organised religion’, not religious organisations. There is a clear distinction in meaning between the two. A religious organisation could be any organisation with an ethos based on religion or belief. However, employment for the purposes of an organised religion clearly means a job, such as a minister of religion, involving work for a church, synagogue or mosque.
A care home run by a religious foundation may qualify as a religious organisation, for example … but I believe that it would be very difficult under these regulations to show that a job of a nurse in a care home exists ‘for the purposes of an organised religion’. I would say exactly the same in relation to a teacher at a faith school. Such jobs exist for the purposes of health care and education ….
Regulation 7(3) does not stop there. Even if an employer can show that the job exists for the purposes of organised religion, and that is a significant hurdle, he may only apply a requirement related to sexual orientation if one of two further tests are met. In the first test the requirement must be applied to comply with the doctrines of the religion. We do not believe that that test would be met in relation to many posts. It would be very difficult for a church to argue that a requirement related to sexual orientation applied to a post of cleaner, gardener or secretary. Religious doctrine rarely has much to say about posts such as those.
If the first test is not met, what about the second? … Both elements have to be satisfied before the second test can be met. It is, therefore, a very strict test and one that will be met in very few cases. The position of a cleaner and librarian, which has been raised many times, has to be judged against those strict criteria. They are strict criteria and one cannot say in a specific case what the situation will be. In such cases one has to apply the criteria and see whether or not they are fulfilled ….”
Reference should also be made to evidence indicating that one reason for the different terms of regulation 7(3) is to encompass occupational requirements related not to sexuality as such but to sexual behaviour. A letter dated 9 June 2003 from the Secretary General of the General Synod and the Archbishops’ Council to the Clerk to the Parliamentary Joint Committee on Statutory Instruments states (para 13):
“The difficulty is that regulation 7(2) applies only where being of a particular sexual orientation is a genuine and determining occupational requirement. As explained above, we have no posts or offices where there is a requirement to be heterosexual (or indeed homosexual). Our requirements are in relation to behaviour, not sexuality itself. That is why the new regulations 7(3) and 16(3) refer to a ‘requirement related to sexual orientation’.”
I have already dealt with the general issue of admissibility of such background material. The Secretary General’s letter may be thought to be stretching the limits, but it helps to explain the difference in wording and the related issue in the case.
In his submissions for the Amicus claimants, Mr Singh contends that regulation 7(3) is unduly broad. It is additional to regulation 7(2), which applies to employment whether or not for the purposes of an organised religion, and it would be unnecessary unless it were capable of applying to a wider range of circumstances than regulation 7(2). A requirement related to sexual orientation can be applied, under regulation 7(3)(b), either (i) so as to comply with the doctrines of an organised religion or (ii) so as to avoid conflicting with the strongly held religious convictions of a significant number of the religion’s followers. It thereby permits discrimination on grounds of sexual orientation in circumstances where the requirement does not pursue a legitimate objective or is not proportionate. The very absence of a specific requirement of proportionality, to be applied by the courts by reference to the facts of individual cases, is a particular ground of complaint. In addition, issue is taken with the authorising of discrimination on grounds of perceived sexual orientation, by regulation 7(3)(c)(ii), i.e. the same point as that already considered in relation to regulation 7(2)(c)(ii). All these matters, it is submitted, mean that the exception fails to meet the strict requirements of the derogation in article 4(1) of the Directive.
To illustrate those concerns, Mr Singh submits that regulation 7(3) appears to authorise discrimination in the following cases, among many others: (a) a church is unwilling to engage a homosexual man as a cleaner in a building in which he is liable to handle religious artefacts, to avoid offending the strongly-held religious convictions of a significant number of adherents; (b) a school for girls managed by a Catholic Order dismisses a science teacher on learning that she has been in a lesbian relationship, reasoning that such a relationship is contrary to the doctrines of the Order; (c) a shop selling scriptural books and tracts on behalf of an organisation formed for the purpose of upholding and promoting a fundamentalist interpretation of the Bible is unwilling to employ a lesbian as a sales assistant since her sexual orientation conflicts with the strongly held religious convictions of a significant number of Christians and/or of that particular organisation; (d) an Islamic institute open to the general public but frequented in particular by Muslims is unwilling to employ as a librarian a man appearing to the employer to be homosexual, reasoning that his sexual orientation will conflict with the strongly held religious convictions of a significant number of Muslims. In each of those cases, it is submitted, it is doubtful whether the characteristic of sexual orientation could be said to be a genuine and determining occupational requirement and in accordance with the principle of proportionality; and if those conditions were satisfied, the case would fall within regulation 7(2) and it would not be necessary to rely on regulation 7(3).
The interveners’ written grounds of resistance and witness statements are relied upon as providing concrete evidence that the fullest reach will be pursued if regulation 7(3) remains in place. For example, their grounds of resistance state that the interveners’ standards of morality apply to “trans-denominational movements, societies and groups, as well as to churches and congregations”, and that “the same standards would apply to any avowedly evangelical organisation whether the member of staff is a secretary or a technician”.
It is further submitted that even if it were possible to reconcile the terms of regulation 7(3) with those of the Directive by a narrow, purposive construction, the gulf between the two is so great that the regulation cannot be said to be a proper implementation of the Directive. It does not implement article 4(1) with the specificity, precision and clarity required to enable persons concerned to ascertain the full extent of their rights. It therefore fails to comply with the principle of legal certainty.
Mr Singh also refers to doubts as to vires that have been expressed by the Parliamentary Joint Committee on Statutory Instruments, in its Twenty-First Report (13 June 2003, paras 1.11-1.20), and to observations of distinguished commentators such as Lord Lester of Herne Hill QC. In response to my concerns about the admissibility of some of this material, Mr Singh used the device of adopting it by way of submission, though acknowledging that he could not then derive any additional weight for the submission from the authority of the original author.
In supporting Mr Singh’s submissions, Mr O’Neill makes clear that a particular concern of the NUT is the position of teachers in faith schools. In summary Mr O’Neill submits that regulation 7(3) has no counterpart in the Directive and is therefore unlawful. As a derogation from the protection of a fundamental right – and a permitted rather than mandatory derogation – article 4(1) of the Directive has to be read narrowly, and there is a very limited margin of appreciation afforded to the Member State in implementing it. The Secretary of State has exceeded such margin of appreciation as exists.
Mr O’Neill submits that regulation 7(3) does not pursue a legitimate aim. It is not entirely clear to what extent he accepts that the protection of religious rights can constitute a legitimate aim. But in relation to article 9 of the Convention, which comes in here through the medium of Community law, he submits that it is directed primarily to the personal sphere of personal belief and worship and does not guarantee the right to behave in the public sphere of society as a whole in a way which is dictated by particular religious beliefs. He cites the admissibility decision of the European Commission of Human Rights in Hibbs and Birmingham v. United Kingdom (application 11991/96, decision dated 18 July 1996), a case concerning an objection by Quakers to the obligation to contribute through general taxation to funds which may then be used by the State for arms procurement. Similarly, he submits, the act of employing others in the context at least of public schooling involves an engagement in the public sphere, is not intimately linked to religious practice or observance, and cannot involve a legitimate aim of protecting the freedom to manifest and practise one’s religion.
Mr O’Neill submits further that the proportionality test is fact-sensitive and requires assessment by the court. Particular occupational requirements can only be considered to be justified if the court is able to consider how they apply in practice in an individual case before it. It is not open to the State to specify in advance by general legislation that certain occupational requirements are to be regarded in all cases as proportionate and therefore legitimate. Reliance is placed on Case 222/84, Johnston v. Chief Constable of the Royal Ulster Constabulary [1986] ECR 1651. That case concerned provisions implementing the Equal Treatment Directive under which an unreviewable certificate by the Secretary of State amounted to conclusive evidence that the conditions for derogating from the principle of equal treatment were fulfilled. The ECJ found in paragraphs 17-20 that the certificate was contrary to the principle of effective judicial control laid down by article 6 of the Equal Treatment Directive, and observed in paragraph 39 that it was for the national court to ensure that the principle of proportionality was observed. To similar effect is the decision of the Strasbourg court in Tinnelly and Sons Ltd v. United Kingdom (1999) 27 EHRR 249. It is submitted that the same approach is required in the present case. Article 9 of the Directive contains a similar provision to article 6 of the Equal Treatment Directive, namely an obligation to ensure that judicial or administrative procedures for enforcement of obligations under the Directive are available to all persons who consider themselves wronged by failure to apply the principle of equal treatment to them. Regulation 7(3) takes away from the national court the question whether an occupational requirement is proportionate in the particular circumstances of the case. Johnston shows that it is unlawful to adopt such an approach. In so far as the Secretary of State relies on the difficulties for a tribunal or court having to determine whether religious doctrines are reasonable and proportionate, that is based on a misunderstanding. It would not be necessary for the court to go that far in order to determine whether there was a legitimate aim and whether the application of an occupational requirement was proportionate. In any event the court will inevitably have to go into areas of potential religious controversy in determining e.g. whether employment is “for purposes of an organised religion”, whether convictions are “religious convictions” and how strongly they are held.
Either as a further aspect of the same submission or as a separate point, Mr O’Neill submits that regulation 7(3) fails to allow proper weight to be given to the individual’s rights to private life and not to be discriminated against, as against the employer’s apparently competing rights with regard to the manifestation (and imposition on employees) of religious beliefs and dogmas.
The case for the Secretary of State is in summary that the concerns expressed about the width of regulation 7(3) are misplaced. The exception has a very narrow scope. The criteria are tightly drawn and are to be construed strictly (since this is a derogation from the principle of equal treatment). The exception represents a proportionate striking of the balance between the competing interests involved. Without prejudice to the decisions that might be reached by employment tribunals in individual cases, Miss Carss-Frisk suggests that it is unlikely that any of the examples put forward by Mr Singh would meet the conditions in regulation 7(3).
Miss Carss-Frisk’s detailed submissions reflect the tenor of Lord Sainsbury’s statement in Parliament, set out above, emphasising the number of hurdles to be overcome by an employer seeking to rely on the exception.
First, it is stressed that regulation 7(3)(a) provides that the employment must be “for purposes of an organised religion”, not “for purposes of a religious organisation”. This is contrasted with the broader wording of regulation 7(3) of the Employment Equality (Religion or Belief) Regulations 2003, which are separate regulations implementing the Directive in relation to discrimination on grounds of religion and belief. They provide an exclusion for a genuine and determining occupational requirement “where an employer has an ethos based on religion or belief”. It is submitted that the latter wording would be apt to apply, for example, to a faith school and other religious organisations of that nature, whereas the wording of regulation 7(3)(a) of the Regulations relating to sexual orientation would not.
Secondly, it is submitted that the provisions of regulation 7(3)(b) are likewise very restrictive. In order to satisfy the first of the two alternatives, in regulation 7(3)(b)(i), the requirement must be applied “so as to comply with the doctrines of the religion”. This condition is likely to be satisfied in only a very small number of cases: it will have to be shown that employment of a person not meeting the requirement would give rise to a breach of the doctrines of the religion. In order to satisfy the second alternative, in regulation 7(3)(b)(ii), the requirement must be applied “because of the nature of the employment and the context in which it is carried out, so as to avoid conflicting with the strongly held religious convictions of a significant number of the religion’s followers”. That test creates formidable hurdles for an employer to overcome.
As to the expression “a significant number”, that is an ordinary English expression which courts or tribunals should have no difficulty in applying in practice: cf. “considerably smaller” in other discrimination legislation, which has proved workable in practice. Reference is also made to Lord Sainsbury’s reply to a question about what is meant by “a significant number”:
“Ultimately, that is a question of fact for the tribunals or the courts and will depend on the circumstances of each case, but it is not expected that this question should prove more difficult to resolve than other questions of fact which are regularly faced by the courts. Sexual orientation Regulation 7 has to be phrased in those terms to be workable in practice. If we had stricter wording, referring, for example, to a majority of the religion’s followers, that could lead tribunals and courts to expect detailed statistical analysis to be submitted to them on the number of followers with religious convictions about particular requirements or the numbers without such religious convictions. I think we would all agree that that would not be practicable.”
Miss Carss-Frisk takes issue with the claimants’ contention that regulation 7(3) cannot be given such a narrow construction because it would then be subsumed within regulation 7(2) and would be unnecessary. She suggests that in one respect regulation 7(3) is wider than regulation 7(2), in that it applies to “a requirement related to sexual orientation” (regulation 7(3)(b)) as opposed to a requirement of “being of a particular sexual orientation” (regulation 7(2)(a)). The choice of wording is deliberate, so as to meet the representations made by some Churches to the effect that they were concerned not with sexual orientation per se but with sexual behaviour that was related to sexual orientation. A broader point, however, is that in the case of employment for purposes of an organised religion, regulation 7(3) itself makes clear where the balance is struck rather than leaving this extraordinarily difficult area for determination by tribunals on a case by case basis (with the burden of deciding e.g. whether the doctrines of a particular organised religion can themselves be said to be justified). To this extent the legislature has recognised that a requirement meeting the conditions of regulation 7(3) is necessarily a genuine and determining occupational requirement and has struck the balance in a manner that is submitted to be proportionate.
Miss Carss-Frisk submits that, if strictly construed as above, regulation 7(3) is a lawful implementation of article 4(1) of the Directive. The fact that it transposes a general provision through specific legislation is not objectionable. The obligation is to achieve the objective sought by the Directive, rather than to mirror the precise wording of the Directive. Nothing in the Directive prevents this approach to implementation, provided that, as is the case, the derogation from the principle of equal treatment remains within the limits of what is appropriate and necessary to achieve the aim in view.
The conditions of regulation 7(3) are also submitted to be sufficiently specific, precise and clear. The fact that the application of those criteria has to be worked out by the courts on the facts of specific cases cannot in itself amount to objectionable uncertainty. The authorities cited in support of that submission are in fact cases on the “in accordance with the law” limb of article 8(2) of the Convention, and like provisions which allow for the possibility of justification of interferences with Convention rights. For example, in Olsson v. Sweden (1988) 11 EHRR 259 at page 283, paragraph 61(a), the Strasbourg Court stated that the requirements identified by the Court as flowing from the phrase “in accordance with the law” include this:
“A norm cannot be regarded as a ‘law’ unless it is formulated with sufficient precision to enable the citizen – if need be, with appropriate advice – to foresee, to a degree that is reasonable in the circumstances, the consequences which a given action may entail; however, experience shows that absolute precision is unattainable and the need to avoid excessive rigidity and to keep pace with changing circumstances means that many laws are inevitably couched in terms which, to a greater or lesser extent, are vague.”
In addition, Miss Carss-Frisk observes that the detailed provisions of regulation 7(3) are far more certain in ambit and predictable in their effects in any individual case than if the United Kingdom had simply transposed article 4(1) of the Directive verbatim,as the claimants at times appear to be submitting should have been done. Nor is there anything novel about the approach adopted. For example, sections 7 and 19 of the Sex Discrimination Act 1975 contain similarly detailed exceptions in implementation of the Equal Treatment Directive (Council Directive 76/207/EEC). Section 7 of the 1975 Act contains an exception where sex is a genuine occupational qualification, making specific provision for a range of circumstances in which employers are permitted to discriminate on grounds of sex. Section 19(1) contains an exception for employment for purposes of an organised religion “where the employment is limited to one sex so as to comply with the doctrines of the religion or avoid offending the religious susceptibilities of a significant number of its followers”. It has never been suggested that such provisions are not an appropriate and proper implementation of a derogation expressed in general terms in article 2(2) of the Equal Treatment Directive.
For the interveners, Mr Dingemans makes clear that they support the Secretary of State’s case on regulation 7(3). He takes issue with the claimants’ suggestion that the interveners’ position on construction is inconsistent with that of the Secretary of State, and he submits that the interveners’ grounds and evidence are not to be read as seeking a broader construction of the provision. He adds the distinct point that the protection conferred by regulation 7(3) is necessary to protect the rights and freedoms of the interveners. Those with particular sexual orientations or practices should not be able to make religious organisations change to accommodate them. Both can co-exist.
Those are the main points in the rival submissions. My conclusions on them are as follows.
In relation to regulation 7(3), as in relation to regulation 7(2), in general I accept the submissions for the Secretary of State.
The main question, as it seems to me, concerns the scope of the exception. If it had as wide a scope as was submitted by Mr Singh and Mr O’Neill, then it would be open to serious objection on the grounds that they put forward. But if it is as narrow in scope as contended for by Miss Carss-Frisk, the objection advanced loses much of its force. I think it clear from the Parliamentary material that the exception was intended to be very narrow; and in my view it is, on its proper construction, very narrow. It has to be construed strictly since it is a derogation from the principle of equal treatment; and it has to be construed purposively so as to ensure, so far as possible, compatibility with the Directive. When its terms are considered in the light of those interpretative principles, they can be seen to afford an exception only in very limited circumstances.
The fact that the exception applies, by regulation 7(3)(a), only to employment “for purposes of an organised religion” is an important initial limitation. I accept Miss Carss-Frisk’s submission that that is a narrower expression than “for purposes of a religious organisation”, or the expression “where an employer has an ethos based on religion or belief”, as used in the corresponding regulations relating to discrimination on grounds of religion or belief. I also accept the example she gave, that employment as a teacher in a faith school is likely to be “for purposes of a religious organisation” but not “for purposes of an organised religion”.
The conditions in regulation 7(3)(b) impose very real additional limitations. In my view the condition in regulation 7(3)(b)(i), that the employer must apply the requirement “so as to comply with the doctrines of the religion”, is to be read not as a subjective test concerning the motivation of the employer, but as an objective test whereby it must be shown that employment of a person not meeting the requirement would be incompatible with the doctrines of the religion. That is very narrow in scope. Admittedly the alternative in regulation 7(3)(b)(ii) is wider; but even that is hemmed about by restrictive language. The condition must be applied “because of the nature of the employment and the context in which it is carried out” – which requires careful examination of the precise nature of the employment – “so as to avoid conflicting with the strongly held religious convictions of a significant number of the religion’s followers”. Again this is in my view an objective, not subjective, test. Further, the conflict to be avoided is with religious convictions, which must be strongly held; and they must be the convictions of a significant number of the religion’s followers. This is going to be a very far from easy test to satisfy in practice.
The fact that reference is made to “a significant number” rather than to all or the majority of a religion’s followers not only reflects the desirability of avoiding detailed statistical analysis, to which Lord Sainsbury referred in the Parliamentary debate, but also ensures that proper account is taken of the existence of differing bodies of opinion even within an organised religion. Sexual orientation is a matter on which some followers of a religion may hold stronger religious convictions than others. In my view it is legitimate to allow for the possibility of applying a relevant requirement even if the convictions in question are held only by a significant minority of followers.
One further point I should deal with in connection with regulation 7(3)(b) concerns its opening words, which refer to an employer applying “a requirement related to sexual orientation”. Those words may in one way make the provision wider in scope than the regulation 7(2), where the relevant occupational requirement is expressed in terms of “being of a particular sexual orientation”. I note that the choice of wording in regulation 7(3) was deliberate, so as to accommodate the concerns of some Churches about certain forms of sexual behaviour rather than sexuality as such. In my view the wording is apt to cover the point, and it may have been prudent to use such wording in order to avoid argument about the scope of the expression “being of a particular sexual orientation”. I do not consider, however, that the point has a material effect on the present analysis. The protection against discrimination on grounds of sexual orientation relates as much to the manifestation of that orientation in the form of sexual behaviour as it does to sexuality as such. I have already mentioned this when looking generally at the fundamental rights in issue in this case. The wording of the derogation in article 4(1) of the Directive, which refers to a difference of treatment “which is based on a characteristic related to” sexual orientation, is wide enough to embrace a difference of treatment based on sexual behaviour related to sexual orientation.
The conditions in regulation 7(3)(c), that either (i) the person does not meet the requirement or (ii) the employer is not satisfied, and in all the circumstances it is reasonable for him not to be satisfied, that the person meets the requirement, are the same as in regulation 7(2)(c) and do not need to be considered separately. In particular, as regards the question of perceived as opposed to actual sexual orientation (regulation 7(3)(c)(ii)), I refer back to my conclusion on regulation 7(2)(c)(ii). For the reasons given in that context, I take the view that it is lawful for the exception to apply where the employer is reasonably not satisfied that the requirement is met.
It is unnecessary for me to decide whether regulation 7(3), if narrowly construed, would apply in all the situations in which, from their evidence, it might be thought that the interveners would seek to rely upon it. Mr Dingemans very sensibly did not contend for a wider construction than that put forward on behalf of the Secretary of State. It suffices for me to note that the narrow construction that I favour would substantially limit the range of circumstances in which the exception could be relied on successfully. The narrow construction also makes it unlikely that the exception would apply in the various specific situations put forward by Mr Singh to illustrate the concerns of the claimants. I think it inappropriate to go further than that. Actual decisions on particular situations need to be made on the basis of full consideration of all the relevant facts of the case, which would be the function of a court or tribunal in applying the Regulations.
Looking at regulation 7(3) as a whole, and bearing in mind what I have said about its terms and the strict construction that they must be given, I take the view that the exception is a lawful implementation of article 4(1) of the Directive.
The exception involves a legislative striking of the balance between competing rights. It was done deliberately in this way so as to reduce the issues that would have to be determined by courts or tribunals in such a sensitive field. As a matter of principle, that was a course properly open to the legislature (an expression which I take for this purpose to include the Secretary of State, as the person who made the Regulations, as well as Parliament which approved them). I reject Mr O’Neill’s submission that it is not permissible to specify by general legislation the circumstances in which occupational requirements may be lawful. Johnston, upon which he bases the submission, was not concerned with a substantive provision of this kind, but with a procedural provision removing effective access to the tribunal where the Secretary of State had signed a national security certificate. Regulation 7(3) does not have the same effect at all. It lays down the specific conditions that have to be met and thereby avoids the need for the court or tribunal to consider some of the issues that might otherwise arise on a case by case basis under regulation 7(2). But in no way does it remove effective access to the court or tribunal, which will still have an important role in determining whether the conditions laid down are met. The fact that this may still take the court or tribunal into difficult areas does not invalidate the motivation of reducing the issues to be determined. The value of cutting down the issues is illustrated by the debate raised before me about the theological validity of the interveners’ religious beliefs, a matter which I have concluded is inappropriate for determination by the court.
The conditions laid down must themselves, of course, comply with article 4(1) of the Directive. As to that, I think it clear that a requirement meeting the conditions pursues a legitimate aim. In addition, should it be necessary, I would rely here on what I say later in this judgment about the protection of religious rights and freedoms as a justification for interference with rights under article 8 of the Convention. I reject the submission by Mr O’Neill in particular that a restriction on employment by reference to the religious convictions of followers of a religion cannot pursue a legitimate aim. As to proportionality, the balance struck in this sensitive and difficult area is in my view an appropriate one. If regulation 7(3) had the wide scope that the claimants attribute to it, the issue of proportionality would be one of real concern. But the view that I take about the narrow scope of the provision also leads me to the conclusion that it complies with the test of proportionality. For the same reason, and subject to the point already covered about its application to sexual behaviour as well as sexuality as such, I do not think that the exception in regulation 7(3) is likely to apply in practice in a wider range of circumstances than would fall within the exception in regulation 7(2), though the difference in legislative approach in relation to the two exceptions leads to some differences in the issues to be determined by a court or tribunal when considering whether the exceptions apply.
I reject the claimants’ argument that regulation 7(3) is in breach of the principle of legal certainty. As I have explained earlier, when dealing with a general submission by Mr O’Neill, the normal principles of purposive interpretation can properly be relied on by the Secretary of State in the context of a challenge to the lawfulness of implementation of a directive. They are of relevance here, in helping to ensure that an appropriately narrow construction is given to regulation 7(3). But in truth there is little need for them. The provision contains a very detailed set of conditions, and it needs little by way of purposive interpretation, and no straining of language, to read them in a way that ensures compatibility with the Directive. To the extent that they contain imprecise terms, such as the reference to a “significant number” of the religion’s followers, they ought not to present any serious problem to a tribunal in their practical application or to individuals in determining the rights afforded to them. That view is supported by the absence of any evidence of difficulty in the application of similar language in the Sex Discrimination Act 1975. There is nothing in the case-law of the Community (or, for that matter, the Convention) to suggest that a greater degree of precision is necessary. Indeed, as Miss Carss-Frisk submitted, the provisions are far more certain in ambit and predictable in their effects than if, say, article 4(1) of the Directive had been transposed verbatim. In my view there is no substance in the argument about lack of legal certainty. (I have not dealt with a further point raised by Mr O’Neill concerning the difference between “for purposes of” and “for the purposes of”, out of which nothing of substance emerged. In so far as Mr O’Neill contended, particularly in his reply, that “for purposes of” is too vague an expression, and cited for that purpose Commission v. United Kingdom [1983] ECR 3431, I reject the submission and take the view that the decision cited does not support it.)
There is some overlap as regards proportionality and legal certainty between points canvassed in the context of compatibility with the Directive and those canvassed in the specific context of compliance with article 8 of the Convention. I do not consider that anything said in relation to article 8 should lead to a different conclusion from that expressed above in relation to compatibility with the Directive.
For the reasons given above I hold that regulation 7(3) is compatible with the Directive.
That finding, coupled with my corresponding finding in relation to regulation 7(2), disposes of the challenge under the Directive both to regulation 7 and to the other regulations that incorporate the exceptions in regulation 7. There remains the short additional point in relation to regulation 20(3), as well as the separate challenge to regulation 25.
Regulation 20(3): compatibility with the Directive
Regulation 20(3) provides an exception to the prohibition of discrimination by institutions of further and higher education. The exception arises “if the discrimination only concerns training which would help fit a person for employment which, by virtue of regulation 7 …, the employer could lawfully refuse to offer the person in question”. The Amicus claimants challenge it not only because of its cross-reference to regulation 7, about which nothing further needs to be said, but also on additional grounds. They submit that regulation 20(3) goes wider than article 4(1) of the Directive in that it does not require that sexual orientation be a genuine and determining occupational requirement for the training. It does not provide that the training concerned must be directly or necessarily related to any employment to which regulation 7 might apply, but requires merely that the training “would help fit a person” for such employment. It does not tie the permitted discrimination to pursuit of a legitimate objective and compliance with the principle of proportionality. And it lacks a sufficient degree of certainty, because the expression “would help fit” is undefined and its meaning is obscure. For example, a degree in theology might qualify a person to enter the clergy but would also constitute a qualifying degree for the purposes of entering a CPE course; and a higher education course in English might qualify a person to study for a theology degree but also for a law degree.
For the Secretary of State, Miss Carss-Frisk submits that regulation 20(3) is intended to be limited in scope and should be construed strictly. It applies where the discrimination “only” concerns training which would help fit a person for employment to which could lawfully be refused by virtue of regulation 7. It does not cover training which has any purpose other than to help fit a person for employment in relation to which sexual orientation is a genuine and determining occupational requirement. Thus, for example, it does not apply to a theology degree but does cover training at a theological seminary. The expression “would help fit” is a way of referring to vocational training and has been used for many years in that connection in other legislation: see s.14 of the Sex Discrimination Act 1975 and s.13 of the Race Relations Act 1976. The intention is simply that if an employer is entitled to refuse to employ a person in a particular job because of their sexual orientation, a college is similarly entitled to refuse to enrol them on a training course that would only train them to perform that job. So the provision is simply consequential on regulation 7. Seen in that light it is within the ambit of article 4(1) of the Directive, the relevant occupational activity being “vocationaltraining” as referred to in article 3(1)(b). It meets the requirements of a legitimate aim and proportionality: it must be right that, if a person would not meet the requirement applicable to the employment, a college should be able to exclude that person from the training for that employment. As to the principle of legal certainty, similar language is to be found in existing legislation and a court or tribunal will have no difficulty in understanding or applying it.
On this issue, too, I prefer the submissions for the Secretary of State. In my view regulation 20(3) can and should be construed strictly; and, so construed, it falls within the ambit of the derogation in article 4(1) of the Directive.
Although the positioning of the word “only” may not be entirely happy, the provision is to be read on the basis that, for training to come within the exception, it must be training that would only help fit a person for a relevant employment. If training has a broader purpose, as in the case of a degree course in theology, it cannot come within the exception.
The expression “would help fit … for employment” is likewise to be strictly construed, as referring to vocational training rather than to training of a more general nature. Mr Singh makes the point that although the expression does appear in other discrimination legislation, it does so in liability-creating provisions rather than in provisions containing exceptions to protection of a fundamental right. Nevertheless, if the expression has been used without apparent difficulty for many years in other discrimination legislation as a way of referring to vocational training, there should be no problem about giving it a similarly limited construction in the context of a provision containing an exception.
Construed in that way, the exception has a narrow scope, being tied closely to training directed specifically and solely towards an employment to which an occupational requirement can lawfully be applied under regulation 7. On that basis it can readily be seen to pursue a legitimate aim and to be proportionate. Nor do I consider the wording to be so imprecise or unclear as to give rise to any breach of the principle of legal certainty.
I therefore reject the challenge to regulation 20(3).
Regulation 25: compatibility with the Directive
Regulation 25 provides that nothing in Part II or Part III of the Regulations, including therefore the prohibition on discrimination, “shall render unlawful anything which prevents or restricts access to a benefit by reference to marital status”. Its effect is that employment benefits defined by reference to marital status, such as a surviving spouse’s pension, are not prohibited by the Regulations. The Amicus claimants submit that this is in breach of the Directive. Article 3(1)(c) of the Directive prohibits discrimination on grounds of sexual orientation in “working conditions, including … pay”. That applies to employment benefits, including benefits under occupational pension schemes, which have been held to be a form of pay. Under domestic law same-sex partners are prohibited from marrying. To make employment benefits dependent on marital status is therefore either directly discriminatory or at the very least indirectly discriminatory and requiring to be justified in each individual case. There is no provision in the Directive authorising the general exception contained in regulation 25. It follows that the regulation is ultra vires.
To underline the principles on which his submissions are based, and to show that the case advanced accords with current trends in human rights law, Mr Singh has cited a number of cases from other jurisdictions. Two of them merit specific reference here.
In a judgment of 12 July 2002 in Halpern v. Attorney General of Canada (60 OR (3d) 321) the Court of Appeal for Ontario held that the common law definition of marriage, which was restricted to heterosexual couples, breached the Canadian Charter of Rights and Freedoms and should be reformulated as “the voluntary union for life of two persons to the exclusion of all others”. The judgment contained powerful observations about the importance of human dignity and, in that context, of equal rights and opportunities without discrimination on grounds of sexual orientation:
“5. Marriage is, without dispute, one of the most significant forms of personal relationships. For centuries, marriage has been a basic element of social organization in societies around the world. Through the institution of marriage, individuals can publicly express their love and commitment to each other. Through this institution, society publicly recognizes expressions of love and commitment between individuals, granting them respect and legitimacy as a couple. This public recognition and sanction of marital relationships reflect society’s approbation of the personal hopes, desires and aspirations that underlie loving, committed conjugal relationships. This can only enhance an individual’s sense of self-worth and dignity.
6. The ability to marry, and to thereby participate in this fundamental societal institution, is something that most Canadians take for granted. Same-sex couples do not; they are denied access to this institution simply on the basis of their sexual orientation.
…
107. … Exclusion perpetuates the view that same-sex relationships are less worthy of recognition than opposite-sex relationships. In doing so, it offends the dignity of persons in same-sex relationships.
108. Based on the foregoing analysis, it is our view that the dignity of persons in same-sex relationships is violated by the exclusion of same-sex couples from the institution of marriage. Accordingly, we conclude that the common-law definition of marriage as ‘the voluntary union for life of one man and one woman to the exclusion of all others’ violates s.15(1) of the Charter. The next step is to determine whether the violation can be justified under s.1 of the the Charter.
…
142. … [W]e conclude that the violation of the couples’ equality rights under s.15(1) of the Charter is not justified under s.1 of the Charter. The AGC [Attorney General of Canada] has not demonstrated that the objectives of excluding same-sex couples from marriage are pressing and substantial. The AGC has also failed to show that the means chosen to achieve its objectives are reasonable and justified in a free and democratic society.”
In similar vein is a judgment of the Constitutional Court of South Africa in Satchwell v. President of the Republic of South Africa (Case CCT 45/01, judgment of 25 July 2002). The applicant, a judge, was involved in “an intimate, committed, exclusive and permanent relationship” with a same sex partner. They were not permitted to enter into a valid marriage but lived in every respect as a married couple. The question was whether legislative provisions restricting benefits to spouses and not affording them to same-sex life partners was inconsistent with the Constitution. In the course of his judgment Madala J, with whom the rest of the court concurred, made the following observations which are pertinent to the way in which the claimants put their case here:
“16. Same-sex partners cannot be lumped together with unmarried heterosexual partners without further ado. The latter have chosen to stay as cohabiting partners for a variety of reasons, which are unnecessary to traverse here, without marrying although generally there is no legal obstacle to their doing so. The former cannot enter into a valid marriage ….
21. … [I]t becomes clear that the denial of benefits to same-sex partners while affording them to married judges is, in effect, a differentiation on the grounds of sexual orientation which is a listed ground in section 9. That denial accordingly amounts to discrimination which is presumed, in terms of section 9(5), to be unfair unless the contrary is shown. It was not suggested by the respondent that this discrimination is not unfair.
22. The benefits accorded to spouses of judges by the legislation are accorded to them because of the importance of marriage in our society and because judges owe a legal duty of support to their spouses. In terms of our common law, marriage creates a physical, moral and spiritual community of law which imposes reciprocal duties of cohabitation and support. The formation of such relationships is a matter of profound importance to the parties, and indeed to their families and is of great social value and significance. However, as I have indicated above, historically our law has only recognised marriages between heterosexual spouses. This narrowness of focus has excluded many relationships which create similar obligations and have a similar social value.
23. Inasmuch as the provisions in question afford benefits to spouses but not to same-sex partners who have established a permanent life relationship similar in other respects to marriage, including accepting the duty to support one another, such provisions constitute unfair discrimination ….”
A more directly relevant recent authority, and one upon which both sides have placed substantial reliance, is the judgment of the ECJ in KB v. National Health Service Pensions Agency (Case C-117/01, judgment of 7 January 2004). In that case the claimant, KB, complained of a violation of the principle of equal pay under article 141 EC because she was unable to nominate her transsexual partner as a beneficiary of a survivor’s pension under the NHS pension scheme: only spouses could be nominated under the scheme. The question referred was whether the exclusion of the female-to-male transsexual partner of a female member of the scheme, which limited the material dependant’s benefit to her widower, constituted sex discrimination in contravention of article 141 EC and directive 75/117. In its judgment, accepting the Commission’s submissions on this issue, the ECJ took as its starting-point what had been said in D and Sweden v. Council, stating:
“28. The decision to restrict certain benefits to married couples while excluding all persons who live together without being married is either a matter for the legislature to decide or a matter for the national courts as to the interpretation of domestic legal rules, and individuals cannot claim that there is discrimination on grounds of sex, prohibited by Community law (see, as regards the powers of the Community legislature, D v. Council, paragraphs 37 and 38).
29. In this instance, such a requirement cannot be regarded per se as discriminatory on grounds of sex and, accordingly, as contrary to Article 141 EC or Directive 75/117, since for the purposes of awarding the survivor’s pension it is irrelevant whether the claimant is a man or a woman.”
The ECJ went on, however, to indicate that the fact that a couple such as KR and partner lacked the capacity to marry could nevertheless give rise to an unlawful inequality of treatment:
“30. However, in a situation such as that before the national court, there is inequality of treatment which, although it does not directly undermine enjoyment of a right protected by Community law, affects one of the conditions for the grant of that right. As the Advocate General noted in point 74 of his Opinion, the inequality of treatment does not relate to the award of a widower’s pension but to a necessary precondition for the grant of such a pension: namely, the capacity to marry.
31. In the United Kingdom, by comparison with a heterosexual couple where neither partner’s identity is the result of gender reassignment surgery and the couple are therefore able to marry and, as the case may be, have the benefit of a survivor’s pension which forms part of the pay of one of them, a couple such as KB and R are quite unable to satisfy the marriage requirement, as laid down by the NHS Pension Scheme for the purpose of the award of a survivor’s pension.
32. The fact that it is impossible for them to marry is due to [the relevant provisions of national law] ….
33. The European Court of Human Rights has held that the fact that it is impossible for a transsexual to marry a person of the sex to which he or she belonged prior to gender reassignment surgery … was a breach of their right to marry under Article 12 of the ECHR ….
34. Legislation, such as that at issue in the main proceedings, which, in breach of the ECHR, prevents a couple such as KB and R from fulfilling the marriage requirement which must be met for one of them to be able to benefit from part of the pay of the other must be regarded as being, in principle, incompatible with the requirements of Article 141 EC.
35. Since it is for the Member States to determine the conditions under which legal recognition is given to the change of gender of a person in R’s situation … it is for the national court to determine whether in a case such as that in the main proceedings a person in KB’s situation can rely on Article 141 EC in order to gain recognition of her right to nominate her partner as the beneficiary of a survivor’s pension.”
Mr Singh submits that the reasoning in paragraphs 30 ff. of that judgment applies equally to this case. There is no material distinction between the complainants in KB and the position of the gay and lesbian couples who are likewise denied benefits because it is not possible for them to marry. Mr Singh explains that it is no part of the claimants’ case to suggest that all unmarried partners should be entitled to the same benefits as married couples. They contend only that denial of benefits to same-sex couples who, unlike heterosexual couples, are unable to comply with the condition as to marriage is unlawful discrimination.
For the Secretary of State, Miss Carss-Frisk seeks to meet the claimants’ case in two main ways. First she submits that access to benefits paid by reference to marital status falls outside the scope of the Directive and indeed outside the scope of Community competence. Secondly, and alternatively, she submits that regulation 25 is not contrary to the principle of equal treatment, in that the difference of treatment is based on marriage, not sexual orientation; is not indirectly discriminatory, since married and unmarried couples are not in a materially similar situation; and in any event is objectively justified. I propose to follow that structure when examining the detailed issues concerning regulation 25.
In support of the contention that access to benefits by reference to marital status falls outside the scope of the Directive and of Community competence, Miss Carss-Frisk relies first on recital (22) of the Directive itself, which states that “[t]his Directive is without prejudice to national laws on marital status and the benefits dependent thereon”. She submits that this gives the clearest possible indication of the position. Its purpose is to confirm the exclusion from the scope of the Directive of national laws on marital status (which in most Member States do not allow marriages between homosexual couples) and of any benefits, whether provided by an employer or the State, that are dependent on marital status. Unlike recital (13), which states that the Directive does not apply to certain State benefits, recital (22) is entirely general in its terms. Its construction is clear. Had it been intended to limit the exclusion to State benefits dependent on marital status, it would have said so in terms. In any event State benefits are excluded separately by recital (13) and article 3(3), so that recital (22) must be intended to be wider in ambit.
Reliance is also placed on a further passage in the evidence of Mme Quintin, the Acting Deputy Director General, to the House of Lords Select Committee on the European Union:
“The second element is that we do not cover areas which are very sensitive for beliefs in this context, such as related to civil law, for example. You rightly mention the marriage issue which is a verydifficult issue in a number of Member States. That is not covered by the Directive. We only cover the employment area on that. I do not think in this area it is a highly controversial issue to think that the right to have different sexual inclinations is not something which should impair employment prospects. That is why we have decided not to leave this area out of our proposals and at the same time we did not go extremely far in the material scope of non-discrimination and confine ourselves to employment related areas” (Ninth Report, page 1281).
The first part of that passage does appear to give some support for the Secretary of State’s position as to the scope of the Directive, but the remainder of the passage introduces very considerable uncertainty as to Mme Quintin’s overall meaning. In my viewthe passage does not advance matters one way or the other and I do not propose to refer to it further.
Miss Carss-Frisk submits next that the limitation on the scope of the Directive contained in recital (22) is reflected in article 3(1) of the Directive, which provides that the Directive shall apply “[w]ithin the limits of the areas of competence conferred on the Community”. This engages the additional submission that access to benefits by reference to marital status is not within Community competence at all. It is said that this was recognised by Advocate General Elmer in Case C-249/96, Grant v. South-West Trains Ltd [1998] ECR I-621. Grant concerned employment conditions which made travel concessions available to a “common law spouse” but not to a same sex partner. At paragraphs 27-34 of his Opinion, the Advocate General considered and rejected an argument that the matter was a family law issue which did not fall under the EC Treaty. He said in particular, at paragraph 28:
“Had [the discriminatory condition] specified, as the determinant criterion, that the employee and the cohabitee must have contracted marriage, that would, in my opinion, have been a restriction on the travel concessions which was not contrary to Community law, because it would be by reference to a family law concept, the content of which is laid down by the Member States.”
The ECJ did not pronounce in terms on that issue. It pointed out that the Community had not yet adopted rules relating to sexual orientation and that most Member States did not treat cohabitation by two persons of the same sex as equivalent to marriage. It concluded:
“35. It follows that, in the present state of the law within the Community, stable relationships between two persons of the same sex are not regarded as equivalent to marriages or stable relationships outside marriage between persons of opposite sex. Consequently, an employer is not required by Community law to treat the situation of a person who has a stable relationship with a partner of the same sex as equivalent to that of a person who is married to or has a stable relationship outside marriage with a partner of the opposite sex.
36. In those circumstances, it is for the legislature alone to adopt, if appropriate, measures which may affect the position.”
The lack of comparability between marriage and other forms of relationship was affirmed in Case C-122/99, D and Sweden v.Council [2001] ECR I-3419. That case concerned an application by an EC official in a registered same-sex partnership for an employment benefit available under the Staff Regulations only to married couples. The ECJ held that, although an increasing number of Member States had introduced, alongside marriage, statutory arrangements granting legal recognition to variousforms of union between partners of the same sex or of the opposite sex, such arrangements were regarded as being distinct from marriage; and that “[i]n such circumstances the Community judicature cannot interpret the Staff Regulations in such a way that legal situations distinct from marriage are treated in the same way as marriage” (para 37). Only the legislature could, where appropriate, adopt measures to alter that situation, e.g. by amending the Staff Regulations (para 38). Further, there was no infringement of the principle of equal treatment since the situations were not comparable:
“50. The existing situation in the Member States of the Community as regards recognition of partnerships between persons of the same sex or of the opposite sex reflects a great diversity of laws and the absence of any general assimilation of marriage and other forms of statutory union …
51. In those circumstances, the situation of an official who has registered a partnership in Sweden cannot be held to be comparable, for the purposes of applying the Staff Regulations, to that of a married official.”
Miss Carss-Frisk submits that the approach of the ECJ in that regard is consistent with that of the European Court of Human Rights, which has held that the position of married couples is not comparable with the position of unmarried couples, so that differences in treatment between them do not amount to discrimination within the meaning of article 14 of the conventions: see Lindsay v. United Kingdom (1986) 9 EHRR 513, and Shackell v. United Kingdom (decision on admissibility, dated 27 April 2000, in application no.45851/99). It is submitted that the decision of the Court of Appeal in Ghaidan v. Godin-Mendoza [2003] Ch 380, which I shall examine in the context of the issues under article 14 of the Convention, is not inconsistent with the approach of the Luxembourg and Strasbourg Courts concerning the non-comparability of marriage and other forms of relationship, since Ghaidan was concerned with a comparison between unmarried heterosexual couples and homosexual couples.
Miss Carss-Frisk also seeks to derive support from the decision of the ECJ in KB v. National Health Service Pensions Agency, which I have already cited. She submits that the reasoning in paragraphs 30 ff. of the judgment is restricted to transsexuals and the separate question of compatibility with article 141 of a rule preventing someone being married. It relies on the Convention case-law concerning transsexuals. By contrast, there is no authority in the case-law for the proposition that it is a breach of the Convention for same-sex couples not to be able to marry, and KB is not concerned with that issue. The case confirms in paragraph 28 that it is not in itself in breach of the principle of equal treatment to make benefits dependent on marriage. The full implications of KB remain to be worked out, but they do not affect the present case.
For the claimants, Mr Singh submits that recital (22) is not a substantive provision of the Directive and cannot limit the scope of the Directive in the way contended for by the Secretary of State. It does not provide a legal basis for enacting the exception contained in regulation 25. By virtue of article 3(1)(c) the Directive applies to occupational benefits and similar benefits. By virtue of article 3(3) it does not apply to “payments of any kind made by state schemes or similar, including social security or social protection schemes”. That exception reflects recitals (13) and (22). It covers State benefits but does not exclude occupational pension schemes and similar benefits provided by employers pursuant to, and as a benefit of, the employment relationship. Accordingly the Directive contains no general exclusion concerning access to benefits by reference to marital status. In relation to occupational pension schemes and like benefits falling within the scope of the Directive, any discrimination based on marital status has to be justified by an employer in the normal way.
It is further submitted that the Secretary of State’s arguments based on recital (22) simply evade the point. The Directive regulates discrimination on grounds of sexual orientation. Benefits which are dependent on marital status are discriminatory as against gay and lesbian people because they cannot marry their same sex partners as a matter of law. The situation of unmarried opposite sex couples is not comparable to that of gay and lesbian couples because opposite sex couples are entitled to marry. The reasoning of the ECJ in paragraphs 30 ff of the judgment in KB applies. The decision in Grant, by contrast, is of only historical interest because at that time the Community principle of equal treatment had not been extended to sexual orientation, whereas by the Directive the Community has now legislated to include sexual orientation within it.
Mr Singh submits further that the Secretary of State’s contention that distinctions between the rights of married and unmarried people are outside the scope of Community competence, on the basis that marriage is a family law concept which is regulated by the laws of the Member States, is untenable. Both the Equal Treatment Directive 76/207 and the revised Equal Treatment Directive 2002/73 state in terms that “the principle of equal treatment shall mean that there shall be no discrimination whatsoever on grounds of sex either directly or indirectly by reference in particular to marital status”. In any event a claim under the Regulations based on a failure to permit a gay or lesbian person access to a benefit by reason of his or lack of marital status would be a claim of indirect or direct sexual orientation discrimination, not marital status discrimination. This is illustrated by the reasoning of the Constitutional Court of South Africa in Satchwell, cited above.
I have not found this issue as easy to resolve as at first blush, in the light of recital (22) of the Directive, it appeared that it might be.
Miss Carss-Frisk’s argument that access to benefits by reference to marital status falls outside Community competence has verylittle support in the authorities that she cites. The high-point is the observation in paragraph 28 of the Advocate General’s Opinion in Grant, but that observation was not picked up in the judgment of the Court. On the contrary, in paragraph 36 of its judgment the Court seemed to contemplate that it would be open to the legislature – by which I understand it to have been referring to the Community legislature – to adopt measures that might render unlawful restrictions of the kind in issue in Grant itself, i.e. restrictions on benefits by reference to marital status. A similar point was made in paragraph 38 of the Court’s judgment in D and Sweden v. Council, in the context of the Community’s own Staff Regulations. It was made again in paragraph 28 of the judgment in KB. Whatever the precise significance to be attached to the further reasoning of the Court in paragraphs 30 ff. of the same judgment, it certainly shows that Community law may have something to say about discrimination by reference to marital status. That all tells against this part of Miss Carss-Frisk’s submissions. It seems to me that, although family law concepts such as the institution of marriage itself fall outside Community competence, it simply does not follow that issues of discrimination by reference to marital status also fall outside Community competence. In any event I think it right to proceed for present purposes on the basis that it is within the powers of the Community legislature to prohibit discrimination by reference to marital status.
The next, and central, question is whether the Community legislature has prohibited discrimination to which the exception in regulation 25 applies. In applying the principle of equal treatment to sexual orientation, the Directive represents an important legislative step forward as compared with the position that obtained at the time of Grant and D and Sweden v. Council. But whether it extends as far as the claimants contend depends on the meaning and effect of recital (22). The recital states in terms that the Directive “is without prejudice to national laws on marital status and the benefits dependent thereon”. I accept Miss Carss-Frisk’s submissions as to the proper interpretation of the recital. In my judgment it is of general application, covering all benefits that are dependent on marital status, including benefits such as surviving spouses’ benefits under occupational pension schemes. It is not limited to State benefits, which are dealt with separately in recital (13) and article 3(3). On the face of it, therefore, recital (22) evinces a clear intention to limit the scope of the Directive in a way with which regulation 25 corresponds.
The troubling feature about recital (22) is that it is only a recital and (if I am right that it is not limited to State benefits to which article 3(3) applies, and that it does not reflect a limitation on Community competence to which article 3(1) refers) it has no parallel in the substantive provisions of the Directive. Although it is common ground that recitals can assist in the interpretation of the substantive provisions of a directive, it is a different matter to rely on a recital alone as establishing an important limitation on the scope of a directive. I was not directed to any authority that assists on this point. Nor was I invited to consider making a reference to the ECJ under article 234 of the EC Treaty for a preliminary ruling on the general issue or on the specific question of the scope of the Directive. Those are matters that may need to be looked at further if the case goes higher. For the present, however, I take the view that I should decide the point as best I can.
The conclusion I have reached is that the Secretary of State’s submissions concerning the scope of the Directive should prevail. To hold otherwise would be to frustrate the legislative intention as it appears in recital (22). What makes me particularly cautious in that respect is that this is an area of considerable sensitivity in social and financial terms, as explained below when considering the alternative submissions on objective justification (though my conclusion that regulation 25 would in any event be lawful on that alternative basis may be thought to weaken the force of this consideration).
On the basis that regulation 25 reflects a limitation in the scope of the Directive itself, I reject Mr Singh’s attempt to circumvent that limitation by reference to the reasoning of the ECJ in the later part of its judgment in KB. The reasoning in that passage relates specifically to transsexuals and to rules on marriage that have been held to be in breach the Convention. It cannot be applied automatically to the position of homosexuals even though they, too, are unable to marry. In any event I am not satisfied that it can be applied across to a situation that the Community legislature has, ex hypothesi, decided to exclude from the scope of the Directive.
My conclusion on the first main issue means that it is not strictly necessary to consider Miss Carss-Frisk’s alternative submissions. Nevertheless it may be helpful for me to summarise the arguments and to indicate briefly my conclusions on them.
The first limb of the alternative submission for the Secretary of State is that, if access to benefits by reference to marital status is within the scope of the Directive, the exclusion is nonetheless compatible with the Directive since it is not discriminatory. There is no direct discrimination since the ground of the difference in treatment is marriage, not sexual orientation; and the difference in treatment between married and unmarried couples does not amount to indirect discrimination since married and unmarried couples are not in a materially similar situation. Reliance is placed on the same strand of case-law as has been considered above in the context of the submissions on Community competence, namely Grant, D and Sweden and KB.
Mr Singh, on the other hand, submits that where benefits are dependent on marital status they are directly discriminatory because they are dependent upon a condition with which only opposite sex partners can comply: cf. KB (benefits based on marital status directly discriminatory against employee in a relationship with a transsexual). At the very least such a provision is indirectly discriminatory unless objectively justified.
I am inclined to agree with the submissions for the Secretary of State both as to the absence of direct discrimination and as to the absence of indirect discrimination. The consistent approach of the ECJ, up to and including paragraphs 28-29 of KB, has been to hold that married partners are not in a comparable position to same-sex partners. It is true that until the Directive came into force there was no prohibition of discrimination on grounds of sexual orientation in Community law. There is also some force in Mr Singh’s submission that the application of a condition with which same-sex partners are unable to comply because they are precluded from marrying is discriminatory. I am not persuaded, however, that those considerations or the later passage in KB, upon which I have already commented, justify the conclusion that the previous statements of the ECJ as to the lack of comparability between marriage and other relationships no longer hold good.
The second limb of the alternative submission for the Secretary of State is that the maintenance of a difference of treatment between married and unmarried couples with regard to access to benefits is objectively justified and therefore does not give rise to any unlawful discrimination. Attention is drawn to cases in which the ECJ has stated that Member States have a broad margin of discretion in relation to national legislation in the field of social policy. In Case C-167/97, R v. Secretary of State for Employment, ex parte Seymour-Smith [1990]2 AC 554, in which the issue was whether a qualifying period of two years’ continuous employment for the right not to be unfairly dismissed amounted to unlawful discrimination against women, the fifth question referred by the national court concerned the legal conditions for establishing objective justification for the purposes of indirect discrimination. The ECJ held (at page 599):
“71. It cannot be disputed that the encouragement of recruitment constitutes a legitimate aim of social policy.
72. It must also be ascertained, in the light of all the relevant factors and taking into account the possibility of achieving the social policy in question by other means, whether such an aim appears to be unrelated to any discrimination based on sex and whether the disputed rule, as a means to its achievement, is capable of achieving that aim.
73. In that connection, the United Kingdom Government maintains that a member state should merely have to show that it was reasonably entitled to consider that the measure would advance a social policy aim. It relies to that end on Nolte v. Landesversicherungsanstalt Hanover (Case C-317/93) [1995] ECR I-4625.
74. It is true that in the Nolte case, at p.4660, para 33, the court observed that, in choosing the measures capable of achieving the aims of social policy, the member states have a broad margin of discretion.
75. However, although social policy is essentially a matter for the member states under Community law as it stands, the fact remains that the broad margin of discretion available to the member states in that connection cannot have the effect of frustrating the implementation of a fundamental principle of Community law such as that of equal pay for men and women.
…
76. Accordingly the answer to the fifth question must be that … it is for the member state, as the author of the allegedly discriminatory rule, to show that the said rule reflects a legitimate aim of its social policy, that that aim is unrelated to any discrimination based on sex, and that it could reasonably consider that the means chosen were suitable for attaining that aim.”
It is submitted that the exclusion of benefits payable by reference to marital status is justified on the following grounds:
i) The Government’s policy is to support marriage, a social institution the importance of which is recognised by article 12 of the Convention (and it is noted that the Strasbourg Court held in Shackell, above, that the promotion of marriage by way of limited benefits for surviving spouses could not be said to exceed the margin of appreciation afforded to the Government).
ii) It is unrealistic to suggest, as the claimants do, that the only issue is whether benefits should also be payable to same-sex couples. If benefits were payable to unmarried homosexual couples, it would be discriminatory to deny them to unmarried heterosexual couples. Not all unmarried heterosexual couples are free to marry; and why should heterosexuals be compelled to marry in order to gain access to benefits when homosexual couples do not have to? Ghaidan v. Godin-Mendoza (see below in the context of article 14 of the Convention) illustrates how discrimination may arise if unmarried homosexual couples are treated differently from unmarried heterosexual couples. In the context of objective justification, the State is entitled to take the view that if benefits were extended to same-sex couples, fairness would require an extension to unmarried heterosexual couples. It would otherwise leave employers open to challenge.
iii) The practical consequences of requiring employers to extend, to unmarried employees and their partners, benefits currently limited to married couples would be considerable. It would be necessary to set workable criteria to define the class of beneficiaries and to build in safeguards to prevent false claims.
iv) It would also lead to a very great increase in costs. Mr Andrew Johnston of the Government Actuary’s Department has produced cost estimates showing an annual cost of the order of £300 million and potentially as high as £1.8 billion or more.
v) A Bill to provide for a civil partnership scheme for same-sex couples was announced in the Queen’s Speech in November 2003. The Bill itself was published after the conclusion of the hearing in this case. It includes provision for the legal rights and responsibilities of those who enter into civil partnerships to include equivalent treatment to married couples for a range of employment-related benefits. The intention is that if this is enacted, the Regulations will be amended accordingly. It is submitted on behalf of the Secretary of State that it would be wholly disproportionate to require employers to extend employment benefits to all unmarried couples because of a disparate impact on homosexual couples that will shortly be eliminated by appropriate legislation. Even where a State has decided that a change in the law is necessary to comply with the Convention (which is not the case here), it has been recognised that the State is entitled to such time as is reasonable to make the necessary change: R (Hooper) v. Secretary of State for Work and Pensions [2003] EWCA Civ 813 at paragraphs 70-78 of the judgment, citing relevant Strasbourg case-law.
Mr Singh’s response on the issue of objective justification is, first, that it is not open to the Secretary of State to rely on any general justification for regulation 25. There is no provision of the Directive allowing for an exemption based on a State-wide general justification (as compared e.g. with discrimination on grounds of age, in relation to which general provisions of this nature are permitted by Article 6). Thus there can be no general exclusion; any objective justification must depend upon proof by an employer in an individual case.
Mr Singh makes the further submission that the matters relied upon by the Secretary of State would not in any case justify the exception in regulation 25. Discrimination on grounds of sexual orientation requires particularly serious reasons if justification is to be made out. Modern human rights jurisprudence acknowledges the importance of recognising and valuing same-sex relationships equally with opposite sex relationships. As to each of the Secretary of State’s assertions on justification, the claimants respond as follows:
i) A policy to support opposite sex marriage and thus to decline to confer the same dignity and status on same-sex relationships cannot now be regarded as a legitimate aim.
ii) The particular basis upon which the challenge is made, by reference to the imposition of a condition as to marriage with which same-sex couples are unable to comply, is emphasised. If the claims succeeded, it does not follow that benefits would have to be given to unmarried heterosexual couples. That would be a matter for the Government to consider, but would not be the necessary outcome of the case.
iii) There is no evidence that practical difficulties would be caused by extending benefits to same-sex couples. Workable criteria for entitlement to benefits could be adopted, e.g. by requiring the nomination of a specific partner. In any event a discriminatory criterion can hardly be justified by simplicity alone.
iv) There is no compelling evidence as to cost. The Government’s estimates depend on the assumption that, if benefits were not limited by reference to marital status, they would apply to all unmarried partners. The claimants’ case, however, is based on discrimination between married couples and same-sex couples. The claimants’ expert evidence, in the form of a report by Mr Bryn Davies, a consulting actuary, is that if any extension were limited to same-sex couples, the overall cost would be very much lower, lying between £200 million and £400 million (around 0.5% of the ongoing cost of occupational pension schemes, or 0.1% of total pensionable payroll). Additional evidence filed by the claimants includes a report commissioned by the Local Government Employers’ Association which suggests that an extension to cover financially dependent same-sex partners ought not to result in an increase in the current level of employer contribution rates.
v) The introduction of a Civil Partnership bill cannot on any reckoning provide justification for present discrimination.
In the circumstances I do not think it necessary to set out detailed conclusions on the issue of objective justification. In brief, I take the view, first, that it is permissible for an exception of this kind to be contained in general legislation, based on an objective justification at the national level, rather than requiring individual employers to justify derogations on a case by case basis. Such an approach falls within the discretion of a Member State as to the manner of implementation, even in the absence of express provision to that effect in the Directive. As to the particular exception, the considerations put forward by the Secretary of State are compelling and include aims of social policy in respect of which a broad margin of discretion is enjoyed by the Member State. The exception in this one area cannot be said to have the effect of frustrating the implementation of the fundamental principle of equal treatment. In my judgement an objective justification for regulation 25 is made out.
The Bill to provide for civil partnerships between same-sex couples does not in my view have any material effect on the analysis, but it does make the challenge to regulation 25 of much less significance than would otherwise be the case. Given the way in which the claimants’ case is put, the proposed legislation, coupled with the intended amendment to the Regulations, should meet the claimants’ main concerns on this issue.
In conclusion, the challenge to regulation 25 fails to get over the first hurdle; but even if it did get beyond that point, it would fail on each of the alternative bases that I have considered.
Lowering of existing standards of protection
The NUT contends that regulation 7 and the regulations incorporating the exceptions in it are ultra vires because they represent a lowering of the standards of protection that applied to employees who suffered discrimination on grounds of sexual orientation before the Regulations came into force. This is said to be contrary to article 8(2) of the Directive, which provides that “the implementation of this Directive shall under no circumstances constitute grounds for a reduction in the level of protection against discrimination already afforded by Member States in the field covered by this Directive”. It is also stated in recital (28) that the implementation of the Directive “should not serve to justify any regression in relation to the situation which already prevails in each Member State”.
Mr O’Neill’s argument runs essentially as follows. Discrimination on grounds of sexual orientation can amount to interference with an employee’s or prospective employee’ rights under article 8(1) of the Convention. Where such discrimination is by a public authority employer, it has been possible to bring a claim under s.6 of the Human Rights Act 1998 since the coming into force of that Act in October 2000. Between that time and the coming into force of the Regulations, it was not possible to justify any such interference under article 8(2) because the interference was not “in accordance with the law”: there was no provision of national law permitting an exception from the general protection conferred by article 8(1). The effect of the Regulations, however, is to provide the possibility of justification in cases to which the exceptions in regulation 7 and related regulations apply. The public authority can point to those provisions as meeting the “in accordance with the law” requirement of article 8(2) of the Convention and, subject to the principle of proportionality, as justifying the discrimination. Thus the effect of the regulations is to turn what was previously an absolute right not to be discriminated against into a qualified right. The previous level of protection is therefore cut down, in breach of article 8(2) of the Directive.
Miss Carss-Frisk’s response is that nothing in the Regulations reduces existing protection or purports to do so. The Regulations provide further and better rights. The exceptions challenged in these proceedings do not cut down existing rights but specify the circumstances in which the new prohibitions contained in the Regulations do not apply. There is no express or implied amendment of earlier legislation. Thus, if and to the extent that any employees had pre-existing rights under domestic law (e.g. under the Human Rights Act 1998 where the employer is a public authority) in respect of discrimination on the grounds of sexual orientation, such rights are unaffected by the Regulations.
I accept Miss Carss-Frisk’s submissions. To treat the Regulations as reducing the pre-existing level of protection seems to me to require a distorted view of their effect. They add to existing rights, albeit that the exceptions limit the additional rights that they confer. Even if, in a claim under article 8 of the Convention, the exceptions could now be relied on in the context of justification, as contemplated by Mr O’Neill’s submissions, I do not consider that they could properly be said thereby to give rise to a reduction in the level of protection. They would at most affect the detailed application of article 8 of the Convention rather than affecting the level of protection afforded by that article. In any event I think it plain that this is not the kind of point at which article 8(2) of the Directive is directed. I therefore reject this separate ground of challenge.
Compatibility with the Convention: article 8
The Amicus claimants contend that the impugned regulations are incompatible with the Convention and cannot be read and given effect to in a way that renders them compatible (see s.3(1) of the Human Rights Act 1998). The making of subordinate legislation incompatible with Convention rights is unlawful under s.6 of the 1998 Act. There is no question in this case of any incompatibility being unavoidable by reason of the provisions of primary legislation. Accordingly the incompatibility with the Convention is a separate ground for quashing the regulations.
This distinct argument of breach of s.6 of the 1998 Act is not advanced by the NUT. To the extent that the NUT relies on the Convention, it is in the context of (i) the relevant principles of Community law and (ii) the contention that the Regulations reduce the level of existing protection under national law. I have dealt sufficiently with both those topics.
Mr Singh places reliance first on article 8, which provides that:
“(1) Everyone has the right to respect for his private and family life, his home and his correspondence.
(2) There shall be no interference by a public authority with the exercise of this right except such as is in accordance with the law and s necessary in a democratic society in the interests of national security, public safety or the economic well-being of the country, for the prevention of disorder or crime, for the protection of health or morals, or for the protection of the rights and freedoms of others.”
It is submitted that discrimination based on sexual orientation in the employment context will violate an employee’s article 8(1) rights unless justified under article 8(2): see Smith and Grady v. United Kingdom (2000) 29 EHRR 493. A legislative provision that permits such discrimination will likewise be in breach of article 8 unless justified. The provisions in this case are not justified, because they are not “in accordance with the law” and they are not “necessary in a democratic society”.
The provisions are said not to be “in accordance with the law” because they are ultra vires for the reasons already given; and, in the case of regulations 7(3) and 20(3) in particular, because they lack legal certainty: it is impossible for a reasonable person to know from a reading of the legislation in what circumstances discrimination will be lawful. In relation to the requirement of legal certainty, reference is made to the judgment of the Strasbourg Court in The Sunday Times v. United Kingdom (1979) 2 EHRR 245 at page 271, para 49:
“[A] norm cannot be regarded as a ‘law’ unless it is formulated with sufficient precision to enable the citizen to regulate his conduct: he must be able – if need be with appropriate advice – to foresee, to a degree that is reasonable in the circumstances, the consequences which a given action may entail. Those consequences need not be foreseeable with absolute certainty: experience shows this to be unattainable. Again, whilst certainty is highly desirable, it may bring in its train excessive rigidity and the law must be able to keep pace with changing circumstances. Accordingly, many laws are inevitably couched in terms which, to a greater or lesser extent, are vague and whose interpretation and application are questions of practice.”
As to the submission that the provisions are not “necessary in a democratic society”, the claimants point to the requirement of very weighty reasons if a justification is to be made out. For example, the Strasbourg Court said in the context of sexual orientation in Smith and Grady (pages 529-530):
“87. … Given the matters at issue in the present case, the Court would underline the link between the notion of ‘necessity’ and that of a ‘democratic society’, the hallmarks of the latter including pluralism, tolerance and broadmindedness.
88. … A margin of appreciation is left open to Contracting States in the context of this assessment, which varies according to the nature of the activities restricted and of the aims pursued by the restrictions.
89. Accordingly, when the relevant restrictions concern ‘a most intimate part of the individual’s private life’, there must exist ‘particularly serious reasons’ before such interferences can satisfy the requirements of Article 8(2) of the Convention.”
The claimants contend that, whilst the right to manifest religious beliefs might constitute a legitimate aim for the purposes of article 8(2), it does not provide a sufficiently weighty justification for the interference permitted by regulation 7(3) in particular. In my general discussion of the fundamental rights in issue in this case I have referred already to article 9 of the Convention and to what the claimants say about it. It is submitted that, making due allowance for the article 9 rights of others, regulation 7(3), in particular, involves a disproportionate interference with the right not to be discriminated against on grounds of sexual orientation. A fair balance is maintained by regulation 7(2); regulation 7(3) goes too far.
Mr Singh also submits that justification has to be considered in the context of the particular case. The Strasbourg Court stated in The Sunday Times v. United Kingdom (above) at page 281, para 65:
“[T]he Court’s supervision under Article 10 covers not only the basic legislation but also the decision applying it. It is not sufficient that the interference involved belongs to that class of the exceptions listed in Article 10(2) which has been invoked; neither is it sufficient that the interference was imposed because its subject-matter fell within a particular category or was caught by a legal rule formulated in general or absolute terms: the Court has to be satisfied that the interference was necessary having regard to the facts and circumstances prevailing in the specific case before it.”
Regulation 7(3), submits Mr Singh, precludes full consideration of the facts and circumstances of a specific case. The legislative approach does not enable issues of proportionality to be determined properly.
For the Secretary of State, Miss Carss-Frisk submits that the essential object of article 8 is to protect individuals against arbitrary interference by public authorities, but that it may also give rise to positive obligations: see the summary at paragraph 16 of the judgment of the Court of Appeal in Anufrijeva v. London Borough of Southwark [2003] EWCA Civ 1406. The Regulations do not interfere with any article 8 rights. They afford a specific form of statutory remedy to individuals who suffer discrimination on grounds of sexual orientation in the employment field. The fact that there are limits to their scope and that they do not cover all cases of such discrimination does not mean that they interfere with article 8 rights. Any right or remedy previously available under article 8 remains available (see the separate argument about lowering of standards of protection).
On a proper analysis, submits Miss Carss-Frisk, the claimants’ case amounts to an assertion (though this is not the way that the claimants express it) that there is a positive obligation on the State to provide additional protection. But it cannot be said that article 8 positively requires such action in circumstances where, ex hypothesi, it is not required by the Directive, which represents the EU consensus as to what is required in this field. In any event, if there is a failure to fulfil a positive obligation, that does not render the Regulations ultra vires. They implement the Directive. If additional legislation is required, that is a separate matter; and it cannot be raised in these proceedings since, by virtue of s.6(6) of the 1998 Act, an omission to legislate cannot amount to an unlawful act under s.6(1).
It is further submitted that, if there is an interference with article 8(1) rights, it is justified under article 8(2). The exceptions in the impugned regulations are in accordance with the law. They are contained in a statutory instrument approved by Parliament and the contention that they lack legal certainty is incorrect for reasons already covered. As to their being necessary in a democratic society, they exist in order to protect the rights and freedoms of employers and, in the case of regulation 7(3), of followers of organised religions. They have a legitimate aim. The rights of others under article 9 are relied on. But even if article 9 is not engaged, the reference in article 8(2) to “the rights and freedoms of others” is not confined to rights arising under other specific provisions of the Convention: see Olsson v. Sweden (1988) 11 EHRR 259 at page 285, para 65, and Bowman v. United Kingdom (1998) 26 EHRR 1 at page 17, para 38. So too a State can take into account religious sensitivities without express reliance on article 9: see Otto-Preminger Institute v. Austria (1994) 19 EHRR 34 at page 57, para 48, and Wingrove v. United Kingdom (1996) 24 EHRR 1 at page 28, para 48. Both of those were cases involving the striking of a balance between freedom of expression and religious feelings. They were not, as Mr O’Neill sought to contend in another context, aimed fundamentally at the protection of public order. In both cases it was recognised that in such an area the State has a wide margin of appreciation (see Otto-Preminger at page 58, para 50; Wingrove at page 30, para 58). Thus it was entirely proper in the present case for the State to seek to balance the rights of homosexuals against those of followers of organised religions. The strength of feelings on both sides is amply demonstrated by the claims and interventions in these proceedings. The balance struck is proportionate.
It seems to me that the issue of justification under article 8(2) of the Convention, if it arises at all, involves very much the same issues as have already been considered in the context of the challenge to the compatibility of the regulations with the Directive. For the reasons given in that context I consider that the requirements of article 8(2) are also met. In my view the regulations meet a legitimate aim and are proportionate. They also meet the requirement of legal certainty. The additional points made by Miss Carss-Frisk here are not only relevant to the case under article 8(2) but also help to reinforce the conclusions I have already expressed in connection with compatibility with the Directive.
I also reject Mr Singh’s submission that the legislative approach in regulation 7(3) is impermissible because justification has to be considered by reference to the facts and circumstances of a particular case. Again the point is really the same as that covered in connection with compatibility with the Directive; but there is nothing in article 8 of the Convention to preclude the adoption of a general legislative measure such as regulation 7(3).
In my judgment, however, the claimants’ case does not get as far as article 8(2). I accept the submissions for the Secretary of State that the Regulations do not interfere with rights under article 8(1) at all. They add to existing rights. The exceptions of which complaint is made limit the scope of what is added, but do not interfere with any rights. The point is essentially the same as that already considered in relation to Mr O’Neill’s argument that the exceptions reduce the existing level of protection in national law.
The claimants’ case is not put in terms of a failure to fulfil a positive obligation under article 8; and, for the reasons advanced by Miss Carss-Frisk, a case could not be sustained in those terms.
For all those reasons the case under article 8 of the Convention fails.
Compatibility with the Convention: article 14
The other provision of the Convention with which the regulations are alleged to be incompatible is article 14, which reads:
“The enjoyment of the rights and freedoms set forth in this Convention shall be secured without discrimination on any ground such as sex, race, colour, language, religion, political or other opinion, national or social origin, association with a national minority, property, birth or other status.”
It was held by the Court of Appeal in Ghaidan v. Godin-Mendoza [2003] Ch 380 that sexual orientation is now clearly recognised as an impermissible ground of discrimination, on the same level as the examples specifically set out in the text of article 14 (see also, for a decision of the Strasbourg court, Salgueiro da Silva Mouta v. Portugal (2001) 31 EHRR 47 at paras 28 and 36). The issue in Ghaidan was whether it amounted to unlawful discrimination on grounds of sexual orientation under article 14 to afford a statutory tenancy to the survivor of a heterosexual relationship (whether a surviving spouse or “a person who was living with the original tenant as his or her wife or husband”) when the survivor of an equivalent homosexual relationship was limited to a less beneficial assured tenancy. The court held that this was a breach of article 14 and that, in order to remedy the breach, the relevant statutory provision could and should be interpreted in such a way as to confer the same protection on same-sex partnerships as on heterosexual partnerships.
The court in Ghaidan applied the fourfold test laid down in Wandsworth London Borough Council v. Michalak [2003] 1 WLR 617: (i) do the facts fall within the ambit of one or more of the substantive Convention provisions? (ii) if so, was there different treatment as respects that right between the complainant on the one hand and other persons put forward for comparison (“the chosen comparators”) on the other? (iii) were the chosen comparators in an analogous situation to the complainant’s situation? (iv) if so, did the difference have an objective and reasonable justification: in other words, did it pursue a legitimate aim and did the differential treatment bear a reasonable relationship of proportionality to the aim sought to be achieved? The submissions on behalf of the claimants did not follow that structure but can usefully be considered by reference to it.
As to (i), in order for article 14 to be engaged, it is not necessary to show a breach of a substantive provision of the Convention. It is sufficient that the facts fall within the ambit of one of the substantive provisions. In this case they are said to fall within the ambit of article 8 of the Convention, which I have already considered, and of articles 1 and 2 of the First Protocol. Article 1 of the First Protocol concerns peaceful enjoyment of possessions and is potentially relevant to the article 14 challenge to regulation 25 (access to benefits by reference to marital status). Article 2 of the First Protocol concerns the right to education and is potentially relevant to the article 14 challenge to regulation 20(3).
As to (ii) and (iii), Mr Singh did not spell out the difference in treatment relied upon beyond the general point that in areas covered by the exceptions the Regulations do not prohibit discrimination on grounds of sexual orientation; nor the identity of the chosen comparators, save perhaps in relation to regulation 25 where the comparison is made between same-sex couples and married couples.
As to (iv), Mr Singh emphasises that it is the discrimination that has to be justified. This is important as regards the Secretary of State’s reliance on social policy and margin of discretion. An argument that the discrimination in Ghaidan fell within the legitimate ambit of the state’s discretion or judgment met short shrift: see per Buxton LJ at page 391, para 19, and per Keene LJ at page 397, para 44. For reasons already given elsewhere, it is submitted that any discrimination in the impugned regulations is not justified.
Miss Carss-Frisk’s submissions on article 14 are robust and to the point. She says that the claimants have failed to identify how the regulations discriminate against any class of persons in the enjoyment of their Convention rights or, if so, on what ground. The regulations are about granting rights, not taking anything away; they provide rights and do not interfere with them.
I agree with Miss Carss-Frisk. The Regulations do not produce any difference of treatment in the enjoyment of rights falling within the ambit of the Convention; they simply confer certain rights not to be discriminated against. In any event, to the extent that a comparison is made between same-sex couples and married couples, the fact is that, as discussed when considering the compatibility of regulation 25 with the Directive, same-sex couples and married couples are not in an analogous situation. Those matters are sufficient to dispose of the claim under article 14, and in the circumstances I think it unnecessary to say anything further about it
Compatibility with the principle of legality
The Amicus claimants have a separate argument, as ground 2 of their claim, that the impugned regulations are in breach of the common law principle of legality. The argument runs along the lines that the courts will presume that Parliament did not intend a statutory power to be used so as to interfere unjustifiably with a fundamental right; and if subordinate legislation cannot be construed in a way that makes it compatible with fundamental rights, it will be declared ultra vires (see e.g. R v. Lord Chancellor, ex parte Witham [1998] QB 575). The matters relied on as establishing such incompatibility with fundamental rights are the same as those considered above in the context of the Convention.
It appears that this line of argument was developed in order to meet any possible submission on behalf of the Secretary of State or interested parties that for present purposes the claimants are not themselves “victims” within s.7(1) of the Human Rights Act 1998 are therefore unable to rely on s.6 of the Act and the provisions of the Convention engaged by that section. In the event no such submission has been made. It is therefore unnecessary for me to consider the alternative line of argument any further.
Conclusion
I have found against the claimants on each of the grounds of challenge that they have pursued. Accordingly all the claims will be dismissed.
Amicus MSF Section, R (on the application of) v Secretary of State for Trade and Industry
[2004] EWHC 860 [2007] ICR 1176, [2004] ELR 311, [2004] IRLR 430, [2004] Pens LR 261
….
Richards J.
(4) Are the answers to parts (1) (2) and (3) of this question affected (and if so how) by whether:
(a) the funds held by the trustees are insufficient to meet in full the cost of equalising benefits so as to reflect the principle of equal pay laid down by Article 119; or
(b) the employer is unable to provide any further funds to the trustees of the scheme; or
(c) the effect of equalising benefits will or may be to achieve equality for one class of beneficiary (for instance, persons in receipt of a pension) only if the benefits of another class (for instance, current employee members of the scheme) are reduced?
2. In relation to claims to benefits under a contracted-out scheme, what is the precise effect of point 5 of the operative part of the judgment of 17 May 1990 in Case C-262/88 Barber v Guardian Royal Exchange Assurance Group (Official Journal C 146 of 15 June 1990, p. 8) that “The direct effect of Article 119 of the Treaty may not be relied upon in order to claim entitlement to a pension, with effect from a date prior to that of this judgment, except in the case of workers or those claiming under them who have before that date initiated legal proceedings or raised an equivalent claim under applicable national law”? In particular (and subject to the exception in respect of proceedings initiated prior to the date of the judgment in Barber):
(1) Can the direct effect of Article 119 EEC be relied upon by employees in relation to such a claim:
(a) only in respect of service on or after 17 May 1990 (the date of the judgment)? or
(b) also in respect of service prior to 17 May 1990, and if so, in respect of the whole period of such service, or some and if so what part of such service?
(2) If the answer to (1) is (b), can the direct effect of Article 119 EEC be relied upon in relation to such a claim:
(a) only by employees whose service under the scheme ended on or after 17 May 1990? or
(b) also by employees
(i) whose service under the scheme ended prior to 17 May 1990 and who were entitled under the rules of the scheme to payment of instalments of pension prior to 17 May 1990?
(ii) whose service under the scheme ended prior to 17 May 1990 but who were entitled under the rules of the scheme to payment of instalments of pension (a deferred pension) only on or after 17 May 1990?
(3) If the answer to (2) is (b)(i), can the direct effect of Article 119 be relied upon by such employees only in relation to instalments of pension payable on or after 17 May 1990 or also in relation to instalments of pension payable prior to that date?
(4) Do the principles laid down in answer to (1) to (3) apply equally in relation to claims to benefits by dependants of employees? In particular, to what extent and in respect of what period of service are widows and widowers (a) widowed on or after 17 May 1990, and (b) widowed prior to 17 May 1990, entitled to rely upon the direct effect of Article 119 in relation to claims to survivors’ benefits?
(5) Do the principles laid down in answers (1) to (4) apply, and if so how, to benefits which do not depend on the length of actual pensionable service?
3. Do the principles laid down in answer to Question 2 apply equally in respect of schemes and periods of service which are not contracted-out?
4. Is it compatible with Article 119 to provide benefits or payments under a scheme calculated by reference to actuarial considerations (including, in particular, actuarial assumptions as to life expectancy) which produce differing results as between men and women? In particular:
(a) Can such considerations be used in the calculation of the benefits payable to an employee
(i) in respect of the cash sum payable by way of commutation of part of the annual pension?
(ii) in respect of a reversionary pension payable to a dependant in exchange for the surrender of part of the annual pension?
(iii) by way of a reduced pension where the employee chooses to retire early and to start receiving pension instalments before normal pension age?
(b) Where the trustees of a scheme pay a capital sum to a third party in order to secure the payment of pension benefits by the third party to an employee or dependant in respect of whom the capital sum is paid, are the trustees entitled or required:
(i) to pay a capital sum which is equal as between men and women but which will purchase pension benefits which are unequal as between men and women?
(ii) to adopt some other (and if so, what) courses or course?
(c) In the light of the answers given to (a) and (b), together with the answers given to Question 2, are the trustees of a scheme required to review and recalculate determinations made by reference to such actuarial considerations in relation to events prior to 17 May 1990, and if so in respect of what period?
5. (1) In circumstances where a scheme is not funded exclusively by employers’ contributions but is also funded by employees’ contributions, being (i) contributions required of employees under the rules of the scheme and/or (ii) voluntary contributions additional to those required under the rules of the scheme, does the principle of equality laid down by Article 119 apply:
(a) only to benefits payable out of those assets of the fund which are attributable to employers’ contributions? or
(b) also to benefits payable out of those assets of the fund which are attributable to (i) normal scheme contributions and/or (ii) additional voluntary contributions?
(2) When an employee has transferred from one scheme to another (for example on a change of job) and liability has been accepted by the receiving scheme for the payment of benefits in return for a transfer payment from the trustees of the former scheme, does Article 119 apply so as to require those benefits to be increased by the scheme where necessary to reflect the principle of equality? If so how do the principles laid down in answer to Question 2 apply in such circumstances?
6. Does Article 119 apply to schemes which have at all times had members of only one sex so as to entitle a member to additional benefits to which that member would have been entitled as a result of Article 119, had the scheme had a member or members of the other sex?
Question 1(1)
17 By the first part of the first question the High Court asks, first, whether an employee’ s dependants may, like the employee himself, rely on the direct effect of Article 119 of the Treaty and, second, whether that article may be relied on not only against the employer but also against the trustees of an occupational pension scheme.
18 As regards the first part of the question, the Court, in its judgment of 6 October 1993 in Case C-109/91 Ten Oever v Stichting Bedrijfspensioenfonds voor het Glazenwassers-en Schoonmaakbedrijf [1993] ECR I-4879, held that a survivor’ s pension provided for by an occupational pension scheme falls within the scope of Article 119. It also held that the fact that such a pension, by definition, is not paid to the employee but to the employee’ s survivor does not affect that interpretation because, such a benefit being an advantage deriving from the survivor’ s spouse’ s membership of the scheme, the pension is vested in the survivor by reason of the employment relationship between the employer and the survivor’ s spouse and is paid to the survivor by reason of the spouse’ s employment (paragraph 13).
19 It follows that since the right to payment of a survivor’ s pension arises at the time of the death of the employee affiliated to the scheme, the survivor is the only person who can assert it. If the survivor were to be denied this possibility, this would deprive Article 119 of all its effectiveness as far as survivors’ pensions are concerned.
20 As regards the question whether Article 119 may be relied on against the trustees of an occupational pension scheme, the Court in the Barber judgment, after finding that pensions paid under such schemes fall within the scope of Article 119, held that this conclusion remains valid even where the scheme has been set up in the form of a trust and is administered by trustees who are formally independent of the employer, since Article 119 also applies to consideration received indirectly from the employer (paragraphs 28 and 29).
21 The employer cannot therefore avoid the obligations incumbent on him under Article 119 by setting up the occupational pension scheme in the legal form of a trust.
22 The trustees themselves, although not party to the employment relationship, are required to pay benefits which do not thereby lose their character of pay within the meaning of Article 119. They are therefore bound, in so doing, to do everything within the scope of their powers to ensure compliance with the principle of equal treatment.
23 It is true that the trustees’ obligations towards the members of the scheme and their dependants are laid down in the trust deed which is governed by national law. However, as the United Kingdom rightly points out, the effectiveness of Article 119 would be considerably diminished and the legal protection required to ensure real equality would be seriously impaired if an employee or an employee’ s dependants could rely on that provision only as against the employer, and not against the trustees, who are expressly charged with performing the employer’ s obligations.
24 The answer to the first part of the first question must therefore be that the direct effect of Article 119 of the Treaty may be relied on by both employees and their dependants against the trustees of an occupational pension scheme who are bound, in the exercise of their powers and performance of their obligations as laid down in the trust deed, to observe the principle of equal treatment.
Question 1(2)
25 By the second part of its first question the High Court asks whether, where certain rules of the scheme are incompatible with the principle of equal pay, the trustees must administer the scheme without regard to those rules, or whether the employer and the trustees must amend them so as to make them compatible with Article 119. The High Court also asks whether the only way of bringing about equal treatment is in any event to increase the benefits of the disadvantaged class, or whether such equality may also be achieved by reducing the benefits of the advantaged class.
26 As regards the first part of the question, it must be remembered that the principle of equal pay is one of the foundations of the Community and that Article 119 creates rights for individuals which the national courts must safeguard. Article 119 being mandatory in nature, the prohibition of discrimination between men and women applies not only to the acts of public authorities but also to all contracts between private individuals and to all collective agreements intended to regulate paid employment (see the judgment of 8 April 1976 in Case 43/75 Defrenne v Sabena [1976] ECR 455, paragraphs 12 and 39).
27 Employers and trustees cannot therefore be allowed to rely on the rules of their pension scheme, or those contained in the trust deed, in order to evade their obligation to ensure equal treatment in the matter of pay.
28 In so far as the relevant rules of national law prohibit them from acting beyond the scope of their powers or in disregard of the provisions of the trust deed, employers and trustees are bound, in order to ensure compliance with the principle of equal treatment, to use all the means available under domestic law, such as recourse to the national courts, especially where, as seems to be the case in this instance, involvement of the national courts is necesary to amend the provisions of the pension scheme or of the trust deed.
29 Furthermore, the Court has consistently held that national courts are bound to provide the legal protection which individuals derive from the direct effect of provisions of the Treaty (see the judgment of 19 June 1990 in Case C-213/89 The Queen v Secretary of State for Transport, ex parte Factortame Limited and Others [1990] ECR I-2433, paragraph 19). They are therefore bound, particularly in the context of Article 119, to the full extent of their discretion under national law, to interpret and apply the relevant domestic provisions in conformity with the requirements of Community law and, where this is not possible, to disapply any incompatible domestic provisions (see the judgment of 4 February 1988 in Case 157/86 Murphy and Others v Bord Telecom Eireann [1988] ECR 673, paragraph 11).
30 As regards the second part of the question, concerning the method to be used to achieve equal treatment, in paragraph 15 of the Defrenne judgment, cited above, where there was a claim in the main proceedings for compensation for discrimination in relation to pay, the Court ruled, in view of the connection between Article 119 and harmonization of working conditions while maintaining improvement, against the argument that compliance with Article 119 could be achieved otherwise than by raising the lowest salaries.
31 Moreover, in paragraphs 18 to 20 of its judgment of 7 February 1991 in Case
C-184/89 Nimz v Freie und Hansestadt Hamburg [1991] ECR I-297 the Court held that the national court must set aside any discriminatory provision of national law, without having to request or await its prior removal by collective bargaining or by any other constitutional procedure, and to apply to members of the disadvantaged group the same arrangements as those enjoyed by the other employees, arrangements which, failing correct implementation of Article 119 in national law, remain the only valid point of reference.
32 It follows that, once the Court has found that discrimination in relation to pay exists and so long as measures for bringing about equal treatment have not been adopted by the scheme, the only proper way of complying with Article 119 is to grant to the persons in the disadvantaged class the same advantages as those enjoyed by the persons in the favoured class.
33 The situation is different as regards periods of service completed after the entry into force of rules to eliminate discrimination, since Article 119 does not then preclude measures to achieve equal treatment by reducing the advantages of the persons previously favoured. Article 119 merely requires that men and women should receive the same pay for the same work without imposing any specific level of pay.
34 Finally, as regards periods of service prior to 17 May 1990, the date of the Barber judgment, it is sufficient here to say, as will be explained below in reply to the second question, that the Barber judgment excluded application of Article 119 to pension benefits payable in respect of those periods, so that employers and trustees are not required to ensure equal treatment as far as those benefits are concerned.
35 It follows that, as far as those latter periods are concerned, Community law imposed no obligation which would justify retroactive reduction of the advantages enjoyed by women.
36 The answer to be given to the second part of the first question must therefore be that in so far as national law prohibits employers and trustees from acting beyond the scope of their respective powers or in disregard of the provisions of the trust deed, they are bound to use all the means available under domestic law, such as recourse to the national courts, in order to eliminate all discrimination in the matter of pay. Moreover, as regards periods of service completed after the Court’ s finding of discrimination but before the entry into force of the measures designed to eliminate it, correct implementation of the principle of equal pay requires that the disadvantaged employees should be granted the same advantages as those previously enjoyed by the other employees. However, as regards periods of service subsequent to the entry into force of those measures, Article 119 does not preclude equal treatment from being achieved by reducing the advantages which the advantaged employees used to enjoy. Finally, as regards periods of service prior to 17 May 1990, the date of the Barber judgment, Community law imposed no obligation which would justify retroactive reduction of the advantages enjoyed by the favoured employees.
Question 1(3)
37 The third part of the High Court’ s first question concerns the respective liabilities of the employer and the trustees if it is established that the direct effect of Article 119 of the Treaty can be relied on against both the employer and the trustees.
38 Although Article 119 imposes on employers an obligation of result whereby men and women must receive the same pay for the same work, neither that article nor any other provision of Community law regulates the way in which that obligation is to be implemented by employers or by the trustees of an occupational pension scheme acting within the limits of their powers.
39 It follows that the national court, whose duty it is to ensure ultimate performance of the obligation of result, may, in order to do so, make use of all means available to it under domestic law. Thus, it may order the employer to pay additional sums into the scheme, order that any sum payable by virtue of Article 119 must first be paid out of any surplus funds of the scheme or order that the sums to which members are entitled must be paid by the trustees out of the scheme’ s assets, even if no claim has been made against the employer or the employer has not reacted to such a claim.
40 The answer to the third part of the first question must therefore be that the national court is bound to ensure correct implementation of Article 119, taking due account of the respective liabilities of employers and trustees under the rules of domestic law.
Question 1(4)
41 The fourth part of the High Court’ s first question concerns the effect on the answers to the first three parts if the funds held by the trustees for the purposes of equalizing benefits are insufficient.
42 The fact that there are difficulties in applying the principle of equal pay because the funds held by the trustees are insufficient or the employer cannot provide additional funds is a problem to be resolved in accordance with national law which cannot affect the answers given to the previous questions. However, as the United Kingdom rightly points out, the national law in question must be applied in accordance with the principle of equal pay.
43 The answer to the fourth part of the first question must therefore be that any problems arising because the funds held by the trustees are insufficient to equalize benefits must be resolved on the basis of national law in the light of the principle of equal pay and that such problems cannot affect the answers to the previous questions.
Question 2(1)
44 By the first part of the second question, the Court is asked to state the precise scope of the temporal limitation on the effects of the Barber judgment.
45 The Court has already pointed out in its judgment in the Ten Oever case, cited above, that the limitation in question was imposed in the specific context of benefits (in particular, pensions) provided for by private occupational schemes which were held to be pay within the meaning of Article 119 of the Treaty (paragraph 16).
46 That ruling took account of the fact that it is a characteristic of this form of pay that there is a time-lag between the accrual of entitlement to the pension, which occurs gradually throughout the employee’ s working life, and its actual payment, which is deferred until a particular age (paragraph 17).
47 The Court also took into consideration the way in which occupational pension funds are financed and thus of the accounting links existing in each individual case between the periodic contributions and the future amounts to be paid (paragraph 18).
48 Given the reasons explained in paragraph 44 of the Barber judgment for limiting its effects in time, it must be made clear that equality of treatment in the matter of occupational pensions may be claimed only in relation to benefits payable in respect of periods of service subsequent to 17 May 1990, the date of the Barber judgment, subject to the exception in favour of workers or those claiming under them who have, before that date, initiated legal proceedings or raised an equivalent claim under the applicable national law (paragraph 19).
49 The answer to the first part of the second question must therefore be that by virtue of the Barber judgment the direct effect of Article 119 of the Treaty may be relied upon, for the purpose of claiming equal treatment in the matter of occupational pensions, only in relation to benefits payable in respect of periods of service subsequent to 17 May 1990, subject to the exception in favour of workers or those claiming under them who have, before that date, initiated legal proceedings or raised an equivalent claim under the applicable national law.
Question 2(2) and (3)
50 The second and third parts of the second question do not call for reply since they assume a different answer to the first part, namely that equal treatment may also be required in relation to benefits payable in respect of periods of service prior to 17 May 1990.
Question 2(4)
51 By the fourth part of the second question the Court is asked whether, and how, the temporal limitation on the effects of the Barber judgment applies to survivors’ pensions.
52 As was pointed out above in paragraph 18, survivors’ pensions provided for by occupational schemes fall within the scope of Article 119 of the Treaty.
53 Moreover, survivors’ pensions are, like the determination of retirement age, among the exceptions provided for by Article 9 of Council Directive 86/378/EEC of 24 July 1986 on the implementation of the principle of equal treatment for men and women in occupational social security schemes (OJ 1986 L 225, p. 40). It was precisely the existence of those exceptions which led the Court to hold that the Member States and parties concerned were reasonably entitled to consider that Article 119 did not apply in this context and consequently to limit the effects in time of the Barber judgment (paragraphs 42 and 43).
54 That limitation is therefore also applicable to survivors’ pensions.
55 Since a survivor’ s pension is an advantage stemming from the survivor’ s spouse’ s membership of the occupational scheme, the pension vesting in the survivor by reason of the employment relationship between the employer and the survivor’ s spouse, and since the pension is financed by contributions paid by the survivor’ s spouse during that spouse’ s working life, a survivor may claim equal treatment in this matter only in relation to periods of service subsequent to 17 May 1990.
56 The answer to the fourth part of the second question must therefore be that the limitation of the effects in time of the Barber judgment applies to survivors’ pensions and that consequently equal treatment in this matter may be claimed only in relation to periods of service subsequent to 17 May 1990.
Question 2(5)
57 By the fifth part of its second question the national court asks whether, and how, the limitation of the effects in time of the Barber judgment applies to benefits payable under occupational social security schemes which are not linked to the length of actual service.
58 The problem for the national court relates, as appears from the file, to benefits such as a lump-sum payment in the event of an employee’ s death during his employment.
59 Since such a benefit is payable solely by reason of an employment relationship existing at the time of the event triggering payment of the benefit, irrespective of the length of previous periods of service, the limitation of the effects in time of the Barber judgment applies only where that operative event occurred before 17 May 1990. After that date, such benefits must be granted in accordance with the principle of equal treatment without any need to distinguish between periods of service prior to the Barber judgment and periods of service subsequent to that judgment.
60 The answer to be given to the fifth part of the second question must therefore be that the limitation of the effects in time of the Barber judgment is applicable to benefits not linked to the length of actual service only where the operative event occurred before 17 May 1990.
Question 3
61 By its third question the High Court asks whether the Barber judgment, and more particularly the limitation of its effects in time, concern not only contracted-out occupational pension schemes but also non-contracted-out occupational pension schemes.
62 The Court has already held in its judgment of 14 December 1993 in Case C-110/91 Moroni v Collo GmbH [1993] ECR I-6591 that the Barber judgment also applies to the German type of supplementary occupational scheme at issue in that case.
63 However, in arriving at that conclusion, the Court, while accepting that the facts of Barber concerned a contracted-out occupational scheme, pointed out that, in ruling that pensions paid under such a scheme fell within the scope of Article 119, it had applied the same criteria as those to which it had referred in its earlier case-law to distinguish statutory social security schemes from occupational pension schemes (paragraphs 12 and 13).
64 Thus, in paragraphs 7 and 8 of its judgment of 25 May 1971 in Case 80/70 Defrenne v Sabena [1971] ECR 445, the Court held that the concept of pay could not cover social security schemes or benefits, such as retirement pensions, which were directly governed by statute to the exclusion of any element of negotiation within the undertaking or occupational sector concerned, and which were obligatorily applicable to general categories of workers. Such schemes give workers the benefit of a statutory scheme, to whose financing the contributions of workers, employers and possibly the public authorities are determined not so much by the employment relationship between employer and workers as by considerations of social policy.
65 In its judgment of 13 May 1986 in Case 170/84 Bilka-Kaufhaus GmbH v von Hartz [1986] ECR 1607, concerning a German occupational scheme, the Court held that, although adopted in accordance with the provisions laid down by German legislation, the scheme was the result of negotiation between the employer and the employees’ representatives, supplemented the statutory social security scheme and received no financial support from the State. A scheme with such characteristics therefore fell within the scope of Article 119 of the Treaty.
66 There is no doubt that all those identifying characteristics are likewise present in non-contracted-out occupational schemes.
67 Such schemes are also the result of negotiation between employers and employees or their representatives, or of a unilateral decision of the employer. They are also funded entirely by the employer or by both the employer and the employees, with no contributions from the State.
68 Furthermore, such schemes are not compulsory for general categories of workers. They concern only the workers employed by particular undertakings, membership of the schemes flowing automatically from the employment relationship with a specific employer. Finally, although the schemes in question are set up in accordance with national legislation, they are governed by their own specific rules.
69 Lastly, the Court dealt in the Barber judgment for the first time with the question of how inequality of treatment arising from the setting of different retirement ages for each sex was to be assessed with reference to Article 119. There is no question that such differentiation is not peculiar to contracted-out occupational schemes. On the contrary, it is to be found in other types of occupational schemes and produces the same discriminatory effects.
70 It follows that the scope of the principles laid down in the Barber judgment cannot be regarded as being limited to contracted-out occupational schemes and that those principles also concern non-contracted-out occupational schemes like the German type of supplementary occupational scheme dealt with in the Moroni judgment cited above.
71 The answer to the third question must therefore be that the principles laid down in the Barber judgment, and more particularly the limitation of its effects in time, concern not only contracted-out occupational schemes but also non-contracted-out occupational schemes.
Question 4
72 The essence of the High Court’ s fourth question is whether Article 119 precludes actuarial factors differing according to sex from being taken into account in occupational pension schemes and, if so, how the limitation of the effects in time of the Barber judgment applies in this context.
73 The actuarial factors in question are essentially those linked to demographic assumptions. Since women live on average longer than men, their future pensions are more costly than those of men and require the employer to pay higher contributions.
74 As a result of such actuarial factors being taken into account, the sums to which male employees are entitled, in particular where part of the pension is converted into a capital sum or where acquired rights are transferred, are lower than those to which female employees are entitled.
75 In answering the question whether such differences are compatible with Article 119, the first question is whether transfer benefits and capital-sum benefits constitute pay within the meaning of that article.
76 In its judgment of 22 December 1993 in Case C-152/91 Neath v Hugh Steeper Ltd [1993] ECR I-6935, the Court has already ruled that the use of actuarial factors differing according to sex in funded defined-benefit occupational pension schemes does not fall within the scope of Article 119 of the Treaty.
77 In arriving at that conclusion the Court first reiterated that the concept of pay, within the meaning of the second paragraph of Article 119, comprises any consideration, whether in cash or in kind, whether immediate or future, provided that the worker receives it, albeit indirectly, from his employer in respect of his employment (paragraph 28).
78 It then found that the assumption underlying that approach was that the employer commits himself, albeit unilaterally, to pay his employees defined benefits or to grant them specific advantages and that the employees in turn expect the employer to pay them those benefits or provide them with those advantages. Anything that is not a consequence of that commitment and does not therefore come within the corresponding expectations of the employees falls outside the concept of pay (paragraph 29).
79 In the context of defined-benefit occupational pension schemes, such as those in question in the Neath case and in the present case, the employer’ s commitment to his employees concerns the payment, at a given moment in time, of a periodic pension for which the determining criteria are already known at the time when the commitment is made and which constitutes pay within the meaning of Article 119. However, that commitment does not necessarily have to do with the funding arrangements chosen to secure the periodic payment of the pension, which thus remain outside the scope of Article 119 (paragraph 30).
80 Since the schemes involved are contributory schemes, that funding is provided through the contributions paid by the employees and those paid by the employers. The contributions paid by the employees are an element of their pay since they are deducted directly from their salaries, which, by definition, constitute pay (see the judgment of 11 March 1981 in Case 69/80 Worringham and Humphreys v Lloyds Bank [1981] ECR 767). The amount of those contributions must therefore be the same for all employees, male and female, which is indeed so in the instant case. This is not so in the case of the employer’ s contributions which ensure the adequacy of the funds necessary to cover the cost of the pensions promised, so securing their payment in the future, that being the substance of the employer’ s commitment (paragraph 31).
81 The Court accordingly concluded that, unlike periodic payment of pensions, inequality of employers’ contributions to funded defined-benefit schemes, due to the use of actuarial factors differing according to sex, is not struck at by Article 119 (paragraph 32).
82 The Court considered that this conclusion necessarily extended to the specific aspects raised in the questions submitted, which, as in the present case, concerned the conversion of part of the periodic pension into a capital sum and the transfer of pension rights, whose value depends on the funding arrangements that are chosen (paragraph 33).
83 In order to provide a complete reply to the High Court’ s questions it must be added that in the other two situations under consideration, namely where a reversionary pension is payable to a dependant in return for the surrender of part of the annual pension and where a reduced pension is paid when the employee opts for early retirement, the funding arrangements chosen must also be taken into account. Since those arrangements are not covered by Article 119, any inequality of the amounts of those benefits, arising from the use of actuarial factors in the funding of the scheme, is not struck at by that article.
84 That being so, the part of the fourth question relating to the possible application to the present case of the limitation of the effects in time of the Barber judgment does not call for reply.
85 The answer to the fourth question must therefore be that the use of actuarial factors varying according to sex in funded defined-benefit occupational pension schemes does not fall within the scope of Article 119 of the Treaty. Consequently, inequalities in the amounts of capital benefits or substitute benefits whose value can be determined only on the basis of the arrangements chosen for funding the scheme are likewise not struck at by Article 119.
Question 5(1)
86 By the first part of its fifth question the High Court asks whether the principle of equal treatment laid down in Article 119 applies to all pension benefits paid by occupational schemes or whether a distinction is to be drawn according to the kind of contributions to which those benefits are attributable, namely employers’ contributions or employees’ contributions, the latter being either compulsory or voluntary.
87 In the Barber judgment the Court held that pensions paid by occupational schemes constitute a consideration offered to workers by the employer by reason of the workers’ employment. They are therefore to be regarded as pay within the meaning of Article 119 since they are wholly financed by the employer, or by both the employer and the workers, without any contribution on the part of the public authorities in any circumstances (paragraph 25).
88 It follows that Article 119 applies to all benefits payable to an employee by an occupational pension scheme, irrespective of whether the scheme is contributory or non-contributory. Whether contributions are payable by the employer or the employees has no bearing on the concept of pay when applied to occupational pensions, which must conform to the principle of equal treatment in their entirety, whatever the source of their funding.
89 This is so here a fortiori since the documents show that, as a matter of accounting, once the employer’ s and the employees’ contributions have been paid into the scheme, they are managed as a single fund and it is no longer possible to distinguish them.
90 However, the situation is different in the case of additional voluntary contributions paid by employees to secure additional benefits such as, for example, an additional fixed pension for the member or the member’ s dependants, an additional tax-free lump sum or additional lump-sum benefits on death.
91 The order for reference shows that these additional benefits are calculated separately, solely on the basis of the value of the contributions paid, which are credited to a special fund managed by the trustees as a distinct fund, separate from that created by the employer’ s and employees’ contributions under the normal occupational pension scheme.
92 Given also the fact that, as the order for reference again shows, section 12 of the Social Security Act 1986 requires occupational schemes only to provide the necessary administrative framework to enable members who so wish to pay additional contributions to secure benefits additional to those which they are entitled to expect by reason of their employment, such benefits cannot be regarded as pay within the meaning of Article 119.
93 The answer to the first part of the fifth question must therefore be that the principle of equal treatment laid down in Article 119 applies to all pension benefits paid by occupational schemes, without any need to distinguish according to the kind of contributions to which those benefits are attributed, namely employers’ contributions or employees’ contributions. However, in so far as an occupational pension scheme does no more than provide the membership with the necessary arrangements for management, additional benefits stemming from contributions paid by employees on a purely voluntary basis are not covered by Article 119.
Question 5(2)
94 The essence of the second part of the High Court’ s fifth question is whether, in the event of the transfer of pension rights from one occupational scheme to another owing to a worker’ s change of job, the second scheme is obliged, on the worker reaching retirement age, to increase the benefits it undertook to pay him when accepting the transfer so as to eliminate the effects, contrary to Article 119, suffered by the worker in consequence of the inadequacy of the capital transferred, this being due in turn to the discriminatory treatment suffered under the first scheme.
95 The rights accruing to the worker from Article 119 cannot be affected by the fact that he changes his job and has to join a new pension scheme, with his acquired pension rights being transferred to the new scheme.
96 Consequently, when the worker enters retirement he is entitled to expect the scheme of which he is then a member to pay him a pension calculated in accordance with the principle of equal treatment.
97 Where, particularly in consequence of insufficient funding, this does not happen, the paying scheme should in principle do everything to bring about a situation of equality, if need be by making a claim under national law for the necessary additional sums from the scheme which made an inadequate transfer.
98 However, since in the Barber judgment the Court limited the direct effect of Article 119 so as to allow it to be relied upon in claims for equal treatment in the matter of occupational pensions only in relation to benefits payable in respect of periods of service subsequent to 17 May 1990, neither the scheme which transferred rights nor the scheme which accepted them is required to take the financial steps necessary to bring about a situation of equality in relation to periods of service prior to 17 May 1990.
99 The answer to the second part of the fifth question must therefore be that in the event of the transfer of pension rights from one occupational scheme to another owing to a worker’ s change of job, the second scheme is obliged, on the worker reaching retirement age, to increase the benefits it undertook to pay him when accepting the transfer so as to eliminate the effects, contrary to Article 119, suffered by the worker in consequence of the inadequacy of the capital transferred, this being due in turn to the discriminatory treatment suffered under the first scheme, and it must do so in relation to benefits payable in respect of periods of service subsequent to 17 May 1990.
Question 6
100 By the sixth question the High Court asks whether Article 119 is also applicable to schemes which have at all times had members of only one sex.
101 In its judgment of 27 March 1980 in Case 129/79 Macarthys Ltd v Smith [1980] ECR 1275 the Court held that comparisons in cases of actual discrimination falling within the scope of the direct application of Article 119 are confined to parallels which may be drawn on the basis of concrete appraisals of the work actually performed by employees of different sex within the same establishment or service (paragraph 15).
102 The Court accepted that such comparisons are also possible between workers of different sex performing the same work but at different periods. In such a case, however, it will be for the national court to decide whether any difference of treatment may be explained by factors which are unconnected to any discrimination on grounds of sex (paragraphs 11 and 12).
103 It follows that a worker cannot rely on Article 119 in order to claim pay to which he could be entitled if he belonged to the other sex in the absence, now or in the past, in the undertaking concerned of workers of the other sex who perform or performed comparable work. In such a case, the essential criterion for ascertaining that equal treatment exists in the matter of pay, namely the performance of the same work and receipt of the same pay, cannot be applied.
104 The answer to the sixth question must therefore be that Article 119 of the Treaty is not applicable to schemes which have at all times had members of only one sex.
Costs
105 The costs incurred by the Danish, Dutch and German Governments, Ireland, the United Kingdom and the Commission of the European Communities, which have submitted observations to the Court, are not recoverable. Since these proceedings are, for the parties to the main proceedings, a step in the action pending before the national court, the decision on costs is a matter for that court.
On those grounds,
THE COURT,
in answer to the questions submitted to it by the High Court of Justice, by order of 23 July 1991, hereby rules:
1. The direct effect of Article 119 of the EEC Treaty may be relied on by both employees and their dependants against the trustees of an occupational pension scheme who are bound, in the exercise of their powers and performance of their obligations as laid down in the trust deed, to observe the principle of equal treatment.
2. In so far as national law prohibits employers and trustees from acting beyond the scope of their respective powers or in disregard of the provisions of the trust deed, they are bound to use all the means available under domestic law, such as recourse to the national courts, in order to eliminate all discrimination in the matter of pay.
3. As regards periods of service completed after the Court’ s finding of discrimination but before the entry into force of the measures designed to eliminate it, correct implementation of the principle of equal pay requires that the disadvantaged employees should be granted the same advantages as those previously enjoyed by the other employees. However, as regards periods of service subsequent to the entry into force of those measures, Article 119 does not preclude equal treatment from being achieved by reducing the advantages which the advantaged employees used to enjoy. Finally, as regards periods of service prior to 17 May 1990, the date on which the judgment in Case C-262/88 Barber v Guardian Royal Exchange Assurance Group was delivered, Community law imposed no obligation which would justify retroactive reduction of the advantages enjoyed by the favoured employees.
4. The national court is bound to ensure correct implementation of Article 119, taking due account of the respective liabilities of the employers and trustees under the rules of domestic law.
5. Any problems arising because the funds held by the trustees are insufficient to equalize benefits must be resolved on the basis of national law in the light of the principle of equal pay and such problems cannot affect the answers to the previous questions.
6. By virtue of the Barber judgment the direct effect of Article 119 of the Treaty may be relied upon, for the purpose of claiming equal treatment in the matter of occupational pensions, only in relation to benefits payable in respect of periods of service subsequent to 17 May 1990, subject to the exception in favour of workers or those claiming under them who have, before that date, initiated legal proceedings or raised an equivalent claim under the applicable national law.
7. The limitation of the effects in time of the Barber judgment applies to survivors’ pensions and consequently equal treatment in this matter may be claimed only in relation to periods of service subsequent to 17 May 1990.
8. The limitation of the effects in time of the Barber judgment is applicable to benefits not linked to the length of actual service only where the operative event occurred before 17 May 1990.
9. The principles laid down in the Barber judgment, and more particularly the limitation of its effects in time, concern not only contracted-out occupational schemes but also non-contracted-out occupational schemes.
10. The use of actuarial factors varying according to sex in funded defined-benefit occupational pension schemes does not fall within the scope of Article 119 of the Treaty. Consequently, inequalities in the amounts of capital benefits or substitute benefits whose value can be determined only on the basis of the arrangements chosen for funding the scheme are likewise not struck at by Article 119.
11. The principle of equal treatment laid down in Article 119 applies to all pension benefits paid by occupational schemes, without any need to distinguish according to the kind of contributions to which those benefits are attributed, namely employers’ contributions or employees’ contributions. However, in so far as an occupational pension scheme does no more than provide the membership with the necessary arrangements for management, additional benefits stemming from contributions paid by employees on a purely voluntary basis are not covered by Article 119.
12. In the event of the transfer of pension rights from one occupational scheme to another owing to a worker’ s change of job, the second scheme is obliged, on the worker reaching retirement age, to increase the benefits it undertook to pay him when accepting the transfer so as to eliminate the effects, contrary to Article 119, suffered by the worker in consequence of the inadequacy of the capital transferred, this being due in turn to the discriminatory treatment suffered under the first scheme, and it must do so in relation to benefits payable in respect of periods of service subsequent to 17 May 1990.
13. Article 119 of the Treaty is not applicable to schemes which have at all times had members of only one sex.
Walker v Innospec Ltd & Ors (Rev 1)
[2017] UKSC 47 (12 July 2017)
LORD KERR: (with whom Lady Hale and Lord Reed agree)
1. John Walker, the appellant in these proceedings, started to work for Innospec Ltd on 2 January 1980. From the beginning of his employment, he was required to become a member of the firm’s contributory pension scheme. He continued to pay into the scheme throughout the time that he was employed by Innospec. His employment continued until Mr Walker accepted early retirement on 31 March 2003. He would have reached normal retirement age, as prescribed by the pension scheme, in 2007.
2. Under the terms on which Mr Walker could take early retirement, he was able to maximise his pension to the level that it would have reached if he had retired in 2007. The concessions made by his employer which allowed him to do so were not made in exchange for any waiver by him of his future pension rights.
3. Mr Walker is gay. He has lived with his male partner since 1993. They applied for a civil partnership on 5 December 2005 (the same day the Civil Partnership Act 2004 came into force) and their civil partnership was registered on 23 January 2006. They are now married.
4. Shortly after the civil partnership was registered, Mr Walker asked Innospec to confirm that, in the event of his death, they would pay the spouse’s pension, which the scheme provides for, to his civil partner. They refused, because his service predated 5 December 2005. The basis of the refusal (which was confirmed after Mr Walker and his partner married) is paragraph 18 of Schedule 9 to the Equality Act 2010. This provision must be considered in greater detail later in this judgment but, in broad outline, it provides an exception to the general non-discrimination rule implied into occupational pension schemes. Under this exception, it is lawful to prevent or restrict access to a benefit, facility or service to a person (a) where the right to that benefit etc accrued before 5 December 2005, or (b) which is payable in respect of periods of service before that date.
5. If Mr Walker was married to a woman, or, indeed, if he married a woman in the future, she would be entitled on his death to the pension provided by the scheme to a surviving spouse. When the claim was issued, the value of that “spouse’s pension” was about £45,700 per annum. As things stand at present, Mr Walker’s husband will be entitled to a pension of about £1,000 per annum (the statutory guaranteed minimum).
The proceedings
6. In November 2011, Mr Walker lodged a claim in the Employment Tribunal (ET) against his employers, alleging that they had discriminated against him on the ground of his sexual orientation. On 13 November 2012, the ET unanimously decided that there had been both direct and indirect discrimination on that ground. It had been argued on behalf of the respondents that there had not been direct discrimination and that, although the operation of the pension scheme amounted to indirect discrimination, this was justified. Both arguments were rejected by the ET. The discrimination was direct, the ET said, in that it involved unequal treatment of straightforwardly comparable individuals viz heterosexual married couples and same sex couples who had entered a lifetime commitment to each other. It was likewise indirect discrimination because an unwarranted requirement had been imposed in respect of the couple of the same gender. The proffered justification by the respondents (that it was necessary to have the restriction in place in order to ensure proper funding of the scheme) was found by the ET to be unsupported by sufficiently cogent evidence.
7. The ET concluded that paragraph 18 could and should be read in a manner which would render it compliant with Council Directive 2000/78/EC of 27 November 2000 [2000] OJ L 303/16 (the Framework Directive). This establishes a general framework for equal treatment in employment and occupation. It therefore upheld Mr Walker’s claim on liability and fixed a date for a remedies hearing.
8. Innospec appealed. Its arguments on direct and indirect discrimination failed. The Employment Appeal Tribunal (EAT) rejected the argument that because, as a matter of status, a spouse is entitled to a pension or survivor’s benefit without the restriction which paragraph 18 places upon a civil partner, they were not comparable: [2014] ICR 645. The EAT’s dismissal of the argument drew on section 23(3) of the Equality Act 2010 which provides that if the protected characteristic is sexual orientation, the fact that one person “is a civil partner while another is married is not a material difference between the circumstances relating to each case” and on the statement of Lady Hale in Bull v Hall [2013] UKSC 73; [2013] 1 WLR 3741, para 29, to the effect that the “criterion of marriage or civil partnership [should be regarded] as indissociable from the sexual orientation of those who qualify to enter it”. On the question of indirect discrimination, the EAT held that the ET was entitled to conclude that Innospec had failed to produce any cogent evidence on the issue of justification but had merely relied on generalised assertions. It had thus failed to show that the indirect discrimination was proportionate.
9. The EAT allowed Innospec’s appeal, however. It held that the Framework Directive did not have retrospective effect to render unlawful inequalities based on sexual orientation that arose before the last date for its transposition. After that date the Directive provided a basis for ensuring equal treatment between those with different sexual orientation but not before. Paragraph 18 was therefore not incompatible with the Directive.
10. The EAT further held that if, contrary to its view, paragraph 18 was, on its face, incompatible with the Directive, it was not open to it to interpret that provision in a way that rendered it compatible. The plain purpose of the paragraph was to create an exception. To nullify that exception would run directly contrary to the “grain” of the legislation (Ghaidan v Godin-Mendoza [2004] 2 AC 557). It was also held that paragraph 18 could not be disapplied. In reaching that conclusion, the EAT referred to the judgment of Lord Mance in R (Chester) v Secretary of State for Justice [2013] UKSC 63; [2014] AC 271, at paras 61-62 where he said:
“The Court of Justice has accepted that, although the Treaty contemplates that the general principle of non-discrimination underlying article 13 EC will be implemented by Directives, member states will be bound thereby to discontinue, disregard or set aside measures so far as they involve discrimination on a basis contrary to article 13 at least after the time for transposition of such a Directive: Kücükdeveci v Swedex GmbH and Co KG (Case C-555/07) [2010] All ER (EC) 867, Römer v Freie und Hansestadt Hamburg (Case C-147/08) [2011] ECR I-3591, para 61 … however, for the general principle of non-discrimination to apply, the context must fall within the scope of Community or now Union law …”
The EAT considered that Mr Walker’s claim, in so far as it related to an asserted entitlement to spousal pension, could not be brought within the scope of European Union (EU) law in respect of the period prior to the time limit for transposing the Framework Directive.
11. Mr Walker appealed the EAT’s decision. In the Court of Appeal the Secretary of State argued that the EAT was wrong in its conclusion on direct discrimination. In effect, he repeated the argument advanced by Innospec to the EAT that civil partners and married persons are not “in a comparable position” in respect of pension rights because paragraph 18 itself created a difference in status between the two groups. That argument was rejected, Lewison and Underhill LJJ finding that civil partnership and marriage were indeed comparable situations in the UK and Lord Dyson MR agreeing with both: [2016] ICR 182.
12. The Court of Appeal nevertheless dismissed Mr Walker’s appeal. At the outset, Lewison LJ identified what he described as two relevant principles of EU law. These were said to be the “no retroactivity” principle and the “future effects” principle. Lewison LJ described the first of these principles as prescribing that “EU legislation does not have retroactive effect unless, exceptionally, it is clear from its terms or general scheme that the legislator intended such an effect, that the purpose to be achieved so requires and that the legitimate expectations of those concerned are duly respected” – para 5 of his judgment. Because the Court of Appeal found that to require payment of a spouse’s pension to Mr Walker’s husband, after Mr Walker’s death, would be to give the Framework Directive retrospective effect, it concluded that the no retroactivity principle precluded this. The second principle was said to be that amending legislation applies immediately to the future effects of a situation which arose under the law as it stood before amendment, unless there was a specific provision to the contrary – again para 5.
13. The application of those principles by the Court of Appeal is central to their decision. They underpin critically their conclusion that the Framework Directive’s prohibition of discrimination on grounds of sexual orientation applies only to pension payable in the future in respect of service and/or contributions paid prior to 2 December 2003, the deadline for its transposition. In turn that conclusion depends vitally on the Court of Appeal’s analysis of the EU cases which, it says, articulate the no retroactivity and future effects principles.
The issues in broad outline
14. The appellant identified three principal issues. The first is whether the differential treatment provided for by paragraph 18 of Schedule 9 is compatible with the Framework Directive.
15. The second issue is whether, if the differential treatment is not compatible with the Framework Directive, the appellant’s claim must nonetheless fail because paragraph 18 must be given effect, or whether, as the appellant contends, the paragraph must be disapplied because of its inescapable conflict with the Directive.
16. The final issue raised by the appellant is whether a declaration of incompatibility under section 4 of the Human Rights Act 1998 should be made by this court, declaring that paragraph 18 is incompatible with article 14, read with article 8 and/or article 1 of the First Protocol of the European Convention on Human Rights and Fundamental Freedoms (ECHR).
Some general considerations
17. Until the beginning of this century there was no legal prohibition on discrimination on the grounds of sexual orientation at work. Since then, the legal status of gay and lesbian employees has been transformed, mainly because of two developments. The first was the introduction of equal treatment legislation by the European Union. The Framework Directive’s prohibition of discrimination in the field of employment and occupation extended to unequal treatment on the ground of sexual orientation. The deadline for transposing the Directive into domestic law was 2 December 2003 and the UK did this initially by way of regulations (the Employment Equality (Sexual Orientation) Regulations 2003) (SI 2003/1661)) and subsequently in primary legislation now incorporated into the Equality Act 2010. Part 5 of that Act prohibits direct and indirect discrimination on grounds of sexual orientation in the context of employment.
18. The second development is domestic in origin. Parliament has legislated to recognise same-sex unions, first by introducing civil partnerships equivalent to marriage (the Civil Partnership Act 2004) and subsequently by legalising same-sex marriage itself (the Marriage (Same Sex Couples) Act 2013). The recognition of same-sex partnerships, which is not required by EU law, was motivated by an appreciation that formal equality for same-sex couples will always be deficient if they are unable to avail themselves of the legal benefits attendant on marriage. In her foreword to the consultation paper preceding the introduction of the Civil Partnership Act 2004, Jacqui Smith, the Minister of State for Industry and the Regions and Deputy Minister for Women and Equality, noted:
“Many [same-sex couples] have been refused a hospital visit to see their seriously ill partner, or have been refused their rightful place at their partner’s funeral. Others find themselves unable to access employment benefits reserved only for married partners. Couples who have supported each other financially throughout their working lives often have no way of gaining pension rights. Grieving partners can find themselves unable to stay in their shared home or to inherit the possessions they have shared for years when one partner dies suddenly without leaving a will. In so many areas, as far as the law is concerned, same-sex relationships simply do not exist. That is not acceptable.”
19. Although EU law does not impose any requirement on member states to recognise same-sex partnerships, the European Court of Justice has held that if a status equivalent to marriage is available under national law, it is directly discriminatory contrary to the Framework Directive for an employer to treat a same-sex partner who is in such a partnership less favourably than an opposite-sex spouse (Maruko v Versorgungsanstalt der Deutschen Bühnen (Case C-267/06) [2008] 2 CMLR 32). Thus in the UK it is unlawful as a matter of both EU and domestic law for an employer to deny a same-sex civil partner or spouse of an employee a benefit that would be provided to a spouse of the opposite sex.
20. That is not an end of the matter, however. When it introduced civil partnerships, Parliament also decided to include an exception to the prohibition on discrimination in the context of employment. That is now contained in paragraph 18 of Schedule 9 of the Equality Act 2010, which provides in its current form:
“(1) A person does not contravene this Part of this Act, so far as relating to sexual orientation, by doing anything which prevents or restricts a person who is not [within sub-paragraph (1A)] from having access to a benefit, facility or service –
(a) the right to which accrued before 5 December 2005 (the day on which section 1 of the Civil Partnership Act 2004 came into force), or
(b) which is payable in respect of periods of service before that date.”
21. Mr Walker does not come within section 1A. (It concerns either (a) a man who is married to a woman, or (b) a woman who is married to a man, or (c) someone married to a person of the same sex in a relevant gender change case.) If the effect of the Framework Directive is to prohibit discrimination on the ground of sexual orientation with regard to the payment of pensions in respect of periods of service before 5 December 2005, paragraph 18 is plainly incompatible with it. The essential question, therefore, is whether that is the effect of the Directive.
The rule against retroactive legislation
22. The general rule, applicable in most modern legal systems, is that legislative changes apply prospectively. Under English law, for example, unless a contrary intention appears, an enactment is presumed not to be intended to have retrospective effect. The logic behind this principle is explained in Bennion on Statutory Interpretation, 6th ed (2013), Comment on Code section 97:
“If we do something today, we feel that the law applying to it should be the law in force today, not tomorrow’s backward adjustment of it. Such, we believe, is the nature of law. ‘… those who have arranged their affairs … in reliance on a decision which has stood for many years should not find that their plans have been retrospectively upset’.”
23. EU law is no different in this respect. As the Court of Appeal observed, the Court of Justice of the European Union (CJEU) has developed two principles to establish the temporal application of EU legislation – the “no retroactivity” principle and the “future effects” principle. These were described by the CJEU in Land Nordrhein-Westfalen v Pokrzeptowicz-Meyer (Case C-162/00) [2002] 2 CMLR 1, paras 49-50 as follows:
“According to settled case law, in order to ensure observance of the principles of legal certainty and the protection of legitimate expectations, the substantive rules of Community law must be interpreted as applying to situations existing before their entry into force only in so far as it clearly follows from their terms, their objectives or their general scheme that such effect must be given to them (see, in particular, Bout (Case C-21/81) [1982] ECR 381, para 13, and GruSa Fleisch (Case C-34/92) [1993] ECR I-4147, para 22).
It also follows from settled case law that new rules apply immediately to the future effects of a situation which arose under the old rules (see, among other cases, Licata v Economic and Social Committee (Case C-270/84) [1986] ECR 2305, para 31). In application of that principle the Court has held, in particular, that since the Act concerning the conditions of accession of the Republic of Austria, the Republic of Finland and the Kingdom of Sweden and the adjustments to the Treaties on which the European Union is founded (OJ 1994 C 241, p 21, and OJ 1995 L 1, p 1) contains no specific conditions whatsoever with regard to the application of article 6 of the EC Treaty (now, after amendment, article 12 EC), that provision must be regarded as being immediately applicable and binding on the Republic of Austria from the date of its accession, with the result that it applies to the future effects of situations arising prior to that new member state’s accession to the Communities (Case C-122/96) Saldanha and MTS [1997] ECR I-5325, para 14).”
24. The policy behind the no retroactivity principle is thus similar to that described in Bennion – the need to ensure “legal certainty” and to protect the “legitimate expectations” of those who have relied on the law as it previously stood. The future effects principle is simply the other side of the same coin. It is a method developed by the CJEU to avoid any retrospective effect and to ensure the immediate prospective application of legislation to ongoing legal relationships. The principle is necessary because it is not always easy to identify the point at which a right accrues. Employment provides a paradigm example. How should a new EU provision be applied to an ongoing employment relationship that had begun before the provision came into force? In Land Nordrhein-Westfalen, the CJEU answered that question by holding that “the application of a new rule … from the date of its entry into force, to a contract of employment concluded prior to its entry into force, cannot be regarded as affecting a situation arising prior to that date (para 52).” As Advocate General Jacobs explained at para 59 of his Opinion:
“Applying a legal provision to a fixed-term employment contract which has not finally ended by the time that provision enters into force does not involve the retroactive application of the law; it entails only the immediate application of that provision to the effects in the future of situations which have arisen under the law as it stood before amendment.”
25. The CJEU draws a distinction, therefore, between the retroactive application of legislation to past situations (which is prohibited unless expressly provided for) and its immediate application to continuing situations (which is generally permitted). The distinction was elucidated by Advocate General Jacobs in Andersson v Svenska Staten (Case C-321/97) [2000] 2 CMLR 191, para 57:
“Retroactive effect consists in the application of the rule to situations which were permanently fixed before that rule came into force. Immediate effect, which, in principle, works likewise according to the principle tempus regit actum, consists in applying the rule to situations which are continuing.”
26. The application of these principles presents a challenge when one is dealing with entitlement to an occupational retirement pension. Conventionally, the right to a pension accumulates over decades. During the time that the right is accruing, actuarial assumptions are made based on existing legal conditions, notwithstanding that the pension is payable in the future. Those assumptions are upset when, because of changes in social values, a new equal treatment provision is introduced. It is not immediately easy to identify the point at which entitlement to a pension becomes “permanently fixed” – whether for example at the date of retirement or when the pension is paid.
The Directive
27. So far as are material to the circumstances of this case, the relevant passages from Recitals 11 and 12 of the Framework Directive are these:
“(11) Discrimination based on religion or belief, disability, age or sexual orientation may undermine the achievement of the objectives of the EC Treaty, in particular the attainment of a high level of employment and social protection, raising the standard of living and the quality of life, economic and social cohesion and solidarity, and the free movement of persons.
(12) To this end, any direct or indirect discrimination based on religion or belief, disability, age or sexual orientation as regards the areas covered by this Directive should be prohibited throughout the Community. …”
Article 1 provides that “The purpose of this Directive is to lay down a general framework for combating discrimination on the grounds of religion or belief, disability, age or sexual orientation as regards employment and occupation, with a view to putting into effect in the member states, the principle of equal treatment”. Article 2 provides:
“1. For the purposes of this Directive, the ‘principle of equal treatment’ shall mean that there shall be no direct or indirect discrimination whatsoever on any of the grounds referred to in article 1.
2. For the purposes of paragraph 1:
(a) direct discrimination shall be taken to occur where one person is treated less favourably than another is, has been or would be treated in a comparable situation, on any of the grounds referred to in article 1;
(b) indirect discrimination shall be taken to occur where an apparently neutral provision, criterion or practice would put persons having a particular … sexual orientation at a particular disadvantage compared with other persons unless:
(i) that provision, criterion or practice is objectively justified by a legitimate aim and the means of achieving that aim are appropriate and necessary …”
The appellant’s arguments
28. For the appellant, Mr Martin Chamberlain QC submits that the Court of Appeal has fundamentally misconstrued the nature of the issues involved in the jurisprudence of the CJEU. Mr Chamberlain argues that the line of cases on which the Court of Appeal relied are all concerned with temporal limitations imposed on claims for equal pay for men and women, not for claims for equal treatment in relation to pension entitlement for heterosexual and gay men and women. Moreover, that limitation was, he says, introduced as an exceptional measure to deal with the consequence of the abrupt, financially catastrophic impact that retrospective entitlement to equality of pay would have had on the economies of many member states of the EU.
The cases considered by the Court of Appeal
29. In Defrenne v Sabena (Case 43/75) [1976] ECR 455; [1981] 1 All ER 122 (Defrenne II) the court held that article 119 had direct effect and could be relied on from the date by which it had required member states to implement the principle of equal pay (1 January 1962). The court recognised, however, that this would have far-reaching economic consequences. In light of these and the anticipated impact of large numbers of backdated claims, the court exceptionally limited the effect in time of its judgment, so that the direct effect of article 119 could not be relied on to support claims for pay periods before the judgment date (except those that had already been launched by that date). That this was a pragmatic decision, inspired by the combination of unusual circumstances surrounding the application of article 119, is clear from the final part of the judgment. In para 70 it referred to the fact that many undertakings could not have foreseen that they might become liable for claims from the date that member states were required to implement the principle of equal pay and that many might be driven to bankruptcy in consequence. Then at paras 72-74, the court said this:
“72. However, in the light of the conduct of several of the member states and the views adopted by the Commission and repeatedly brought to the notice of the circles concerned, it is appropriate to take exceptionally into account the fact that, over a prolonged period, the parties concerned have been led to continue with practices which were contrary to article 119, although not yet prohibited under their national law.
73. The fact that, in spite of the warnings given, the Commission did not initiate proceedings under article 169 against the member states concerned on grounds of failure to fulfil an obligation was likely to consolidate the incorrect impression as to the effects of article 119.
74. In these circumstances, it is appropriate to determine that, as the general level at which pay would have been fixed cannot be known, important considerations of legal certainty affecting all the interests involved, both public and private, make it impossible in principle to reopen the question as regards the past.”
30. It is clear from these passages that the CJEU was not propounding a general rule relating to the retrospective application of legislation. Rather, it was expressing an exception to the general rule that judicial decisions will generally have retrospective application. The statement in para 5 of Lewison LJ’s judgment (see para 12 above) that “EU legislation does not have retroactive effect unless, exceptionally, it is clear from its terms or general scheme that the legislator intended such an effect,” though no doubt correct, is not supported in any way by Defrenne II. Moreover, the statement that the legitimate expectations of those concerned are required to be “duly respected” must also be approached with some caution in the context of judicial decisions, which are generally retroactive. In Defrenne II, it was the combination of the expectations of undertakings (fuelled as they were by the inaction of the Commission) and the circumstance that considerable financial hardship might accrue which led the court to take the exceptional course which it did.
31. Bilka-Kaufhaus GmbH v Weber von Hartz (Case C-170/84) [1986] ECR 1607; [1986] 2 CMLR 701 determined that benefits under an occupational pension scheme amounted to “pay” within the meaning of article 119, being “consideration received by the worker from the employer in respect of his employment” (para 22). The issue whether there was entitlement to benefits deriving from service before article 119 should have been implemented in Germany did not arise.
32. Barber v Guardian Royal Exchange Assurance Group (Case C-262/88) [1990] ECR I-1889; [1991] 1 QB 344 involved a different question from that in Bilka-Kaufhaus. The issue in Barber was whether benefits under contracted-out schemes fell within “pay” for the purposes of article 119. The court held that they did – para 28. Under the cross heading, “Effects of this judgment ratione temporis” the court considered in paras 40-44 the question whether the judgment should be restricted in relation to any retrospective effect. Some passages from these paragraphs are of significance in understanding whether this case has any bearing on the principle of non-retroactivity of legislation. At para 40 the court recorded the submissions of the Commission and the UK government:
“40. … the Commission has referred to the possibility for the court of restricting the effect of this judgment ratione temporis in the event of the concept of pay, for the purposes of the second paragraph of article 119 of the Treaty, being interpreted in such a way as to cover pensions paid by contracted-out private occupational schemes, so as to make it possible to rely on this judgment only in proceedings already pending before the national courts and in disputes concerning events occurring after the date of the judgment. For its part the United Kingdom emphasised at the hearing the serious financial consequences of such an interpretation of article 119. The number of workers affiliated to contracted-out schemes is very large in the United Kingdom and the schemes in question frequently derogate from the principle of equality between men and women, in particular by providing for different pensionable ages.”
33. Referring to its judgment in Defrenne II, the court then made clear in para 41 that taking the course that the Commission and the UK government had invited it to follow was only possible as an exceptional measure. It said that “it may, by way of exception, taking account of the serious difficulties which its judgment may create as regards events in the past, be moved to restrict the possibility for all persons concerned of relying on the interpretation which the court, in proceedings on a reference to it for a preliminary ruling, gives to a provision.” (emphasis added)
34. Another factor in play in the court’s decision to restrict the effect of its judgment was that, because of earlier Directives, “the member states and the parties concerned were reasonably entitled to consider that article 119 did not apply to pensions paid under contracted-out schemes and that derogations from the principle of equality between men and women were still permitted in that sphere” – para 43. This factor carries echoes of the situation which pertained in Defrenne II. As in that case, the decision in Barber does not constitute an example of a general principle of non-retroactivity for EU legislation. It is, rather, an instance of curtailing what would otherwise be the logical application of the judgment to existing and precedent situations for essentially practical reasons.
35. The scope of the Barber limitation was considered in Ten Oever v Stichting Bedrijfspensioenfonds voor het Glazenwassers- en Schoonmaakbedrijf (Case C-109/91) [1993] ECR I-4879; [1995] ICR 74. That case related to an occupational pension scheme. Until 1 January 1989 rules of the scheme provided for survivors’ pensions for widows only, but after that date widowers also were entitled to pensions. After the death in October 1988 of the applicant’s wife, who had been a member of the scheme, he requested but was refused the grant of a widower’s pension. He brought proceedings for a declaration that he was entitled to the pension because such a pension was to be treated as “pay” within the meaning of article 119 of the EEC Treaty and that no discrimination between men and women was permissible. The national court referred to the Court of Justice the questions whether “pay” in article 119 covered non-statutory benefits to surviving relations and, if so, from what date the applicant could claim a widower’s pension.
36. Various possible interpretations of the effect of the Barber limitation were considered by the judge rapporteur and the Advocate General – see AG10. One of these was “to apply equal treatment to all pension payments made after 17 May 1990 [the date of the Barber judgment], including benefits or pensions which had already fallen due and … irrespective of the date of the periods of service during which the pension accrued.” Advocate General Van Gerven explained in AG13-17 why he considered that it was not appropriate to do so. An important passage appears at AG13:
“Before I take my position on the effect in time of Barber v Guardian Royal Exchange Assurance Group (Case C-262/88) [1990] ICR 616, I consider it important to clarify the rationale which led the court to introduce that limitation into its judgment. That that is an unusual step needs no demonstration, given the declaratory character which in principle attaches to the court’s interpretation of Community law pursuant to article 177 of the EEC Treaty: … That was formulated by the court in Amministrazione delle Finanze dello Stato v Denkavit Italiano Srl (Case 61/79) [1980] ECR 1205, 1223-1224, paras 16-18 and Amministrazione delle Finanze dello Stato v Meridionale lndustria Srl (Cases 66/79, 127/79, 128/79) [1980] ECR 1237, 1260-1261, paras 9-11:
‘The interpretation which, in the exercise of the jurisdiction conferred on it by article 177, the Court of Justice gives to a rule of Community law clarifies and defines where necessary the meaning and scope of that rule as it must be or ought to have been understood and applied from the time of its coming into force. It follows that the rule as thus interpreted may, and must, be applied by the courts even to legal relationships arising and established before the judgment ruling on the request for interpretation, provided that in other respects the conditions enabling an action relating to the application of that rule to be brought before the courts having jurisdiction, are satisfied.
As the court recognised in its judgment of 8 April 1976 in Defrenne v Sabena (Case C-43/75) [1976] ECR 455, it is only exceptionally that the court may, in application of the general principle of legal certainty inherent in the Community legal order and in taking account of the serious effects which its judgment might have, as regards the past, on legal relationships established in good faith, be moved to restrict for any person concerned the opportunity of relying on the provision as thus interpreted with a view to calling in question those legal relationships’ …” (emphasis added)
37. Once again, the exceptionality of restricting the full availability of a right declared by the CJEU as deriving from an EU measure is emphasised. AG Van Gerven was clearly heavily influenced to the view that a restriction on the availability of the right was essential because of the dire financial consequences that would otherwise follow. They had been described in the Judge Rapporteur’s report at p 86. If the option discussed above had been chosen, “the additional financial impact on occupational pension schemes would be at least £45 billion, and [under another canvassed option] £33 billion. [To these figures would have to be] added approximately £2 billion per annum required in any event to meet the effect of equalisation of pensions for the future.” It is unsurprising, therefore, that in para 26, AG Van Gerven stated that the financial consequences of allowing article 119 to have retroactive effect would be “catastrophic”.
38. It is important to recognise, however, that AG Van Gerven accepted that a literal reading of the Barber judgment would apply equal treatment to all pension payments made after 17 May 1990, including those which had already fallen due irrespective of the date of the periods of service during which the pension accrued. At para 19 he said:
“On a literal reading, it may indeed be asserted that the effects of an occupational pension are only fully exhausted once the pension has been paid in full to the retired employee. [He then explained why that could not be permitted by continuing …] Such a reading would mean that the temporal limitation of the judgment decided on by the Court would have almost no significance and that the useful effect of the limitation imposed by the Court would largely vanish.”
39. The Advocate General expanded on his reasons for adopting the more restrictive interpretation of Barber in para 21:
“The fact that the good faith of the parties concerned, in particular of employers and occupational pension funds, is to be taken into account means that, before Barber, those parties, in the belief that article 119 … was not applicable, could promise pensions and make payments based on a different pensionable age for men and women. The financial balance of the pension schemes concerned could therefore be maintained on that basis before the judgment. Only in respect of periods of service after Barber did employers know that, in administering occupational pension schemes and calculating the contributions to be made to them, account had to be taken of a pensionable age which was the same for men and women. If no account were taken of their good faith and that of pension scheme administrators, that would entail serious financial problems for pension schemes. All these factors argue in favour of not allowing obligations entered into and payments made before the date of the Barber judgment to be affected.”
40. The court accepted the more restrictive definition, stating at para 19:
“Given the reasons explained in Barber [1990] ICR 616, 672, para 44, for limiting its effects in time, it must be made clear that equality of treatment in the matter of occupational pensions may be claimed only in relation to benefits payable in respect of periods of employment subsequent to 17 May 1990, the date of the judgment in Barber, subject to the exception in favour of workers or those claiming under them who have, before that date, initiated legal proceedings or raised an equivalent claim under the applicable national law.”
41. The court thus allied itself closely to the reasons in Barber (discussed in paras 33 and 34 above) for espousing and extending to occupational pension schemes a similar restriction on the retroactive effect of article 119.
42. Vroege v NCIV Instituut voor Volkshuisvesting BV (Case C-57/93) [1994] ECR I-4541; [1995] 1 CMLR 881, concerned a pension scheme that until 1990 did not admit married women. Among the questions referred to the CJEU was whether the Barber limitation applied to Mrs Vroege’s claim for equal access to the scheme. The court said that it was “important to remember the context in which it was decided to limit the effects in time of the Barber judgment” (para 20), and reaffirmed the two “essential criteria” for such a limitation, viz, “the general principle of legal certainty … and the serious difficulties which its judgment may create as regards the past for legal relations established in good faith” (para 21), both of which had been met in Barber (paras 22-25). On that basis, it stated that the Barber limitation “concerns only those kinds of discrimination which employers and pension schemes could reasonably have considered to be permissible owing to the transitional derogations for which Community law provided and which were capable of being applied to occupational pensions” – para 27.
43. The Court of Appeal in the present case understood the decision in Ten Oever to establish a general principle of EU law, to the effect that entitlement to a survivor’s pension is “permanently fixed” as it is earned. It concluded that the same principle could be applied where the law is changed not by a judgment, but by legislation. It was influenced to this view by the opinion that the same policy considerations lay behind the no retroactivity principle and the CJEU’s power to limit the retrospective application of its judgments. To an extent, the same policy considerations are in play. In both scenarios one can acknowledge the need to ensure legal certainty and to protect the legitimate expectations of those who rely on the law as it was thought to be.
44. But it is vital to keep the two concepts distinct. “No retroactivity” and “future effects” are principles of law which apply to all EU legislation, unless a contrary intention can be found. The Barber exception is an example of a technique used by the CJEU to limit the generally retroactive application of its judgments, which it will only exercise in the most exceptional circumstances and where the impact would be truly “catastrophic”. The court limits the temporal application of its judgments in cases where reliance has been placed on a different understanding of the law and legitimate expectations may be upset, but only in the most special circumstances. Therefore, how the court exceptionally applies a temporal limitation to one of its rulings has no inevitable bearing on the temporal application of legislation as a matter of principle.
45. Mr Chamberlain submits that all the cases considered by the Court of Appeal and the EAT, in so far as they concerned article 119, involved the application of the exceptional limitations imposed in Defrenne II and Barber. None expressed a general rule that immediate application of EU legislation at the point of enactment should normally be avoided. On the contrary, the consistent theme of the CJEU jurisprudence was that rights established by legislation should be activated at the time that they were stated to exist.
46. I agree with Mr Chamberlain’s analysis of the relevant jurisprudence and I turn now to consider his principal argument that two recent decisions of the Grand Chamber of the CJEU (which troubled the Court of Appeal because of their perceived incongruence with what that court considered to be the fundamental principles governing retroactivity) put success for Mr Walker’s claim beyond doubt. Those decisions are Maruko v Versorgungsanstalt der Deutschen Bühnen [2008] ECR I-1757; [2008] All ER (EC) 977; (Maruko) and Römer v Freie und Hansestadt Hamburg (Case C-147/08) [2011] ECR I-3591, [2013] 2 CMLR 11 (Römer).
Maruko
47. The claimant in Maruko was a registered life partner of a designer of theatrical costumes who had been a member of the German theatre pension institution (VddB). After his partner’s death in 2005, the VddB refused Mr Maruko the pension which would have been paid automatically to a surviving spouse. He brought a claim before the Bavarian Administrative Court, which referred several questions to the Court of Justice. The most pertinent of these for present purposes is the fifth. This was whether entitlement to the survivor’s benefits should be restricted to the period from 17 May 1990 in the light of Barber, as considered in Coloroll Pension Trustees Ltd v Russell (Case C-200/91) [1995] All ER (EC) 23; [1994] ECR I-4389. The spouse’s pension in issue arose from Mr Maruko’s service and contributions during a period that started in 1959 and ended (in all likelihood) before 2003.
48. Although the question proceeded on the premise that any limitation to the relevant period of service would be from the date of the Barber judgment, the CJEU’s summary of the issue makes it clear that it considered that wider considerations were potentially at stake, for it said at para 74 that the referring court “seeks to know whether … entitlement to the survivor’s benefit … must be restricted in time and in particular to periods subsequent to [the Barber judgment]”.
49. The pension fund in the Maruko case presented an argument similar to that advanced by the Secretary of State in the present appeal. It suggested that, to take account of service before the Framework Directive’s implementation deadline would give the Directive retrospective effect. The court summarised that argument in para 75:
“The VddB considers that the case which led to the judgment in Barber’s case differs, on its facts and in law, from the case in the main proceedings and that Directive 2000/78 cannot be given retroactive effect by means of a decision that the Directive applied at a date prior to the date of expiry of the period allowed to member states for its transposition.”
50. At paras 77-79, the CJEU unambiguously rejected that argument:
“77. It is clear from the case law that the court may, exceptionally, taking account of the serious difficulties which its judgment may create as regards events in the past, be moved to restrict the possibility for all persons concerned of relying on the interpretation which the court gives to a provision in response to a reference for a preliminary ruling. A restriction of that kind may be permitted only by the court, in the actual judgment ruling upon the interpretation sought (see inter alia Barber at para 41; and Meilicke v Finanzamt Bonn-Innenstadt (Case C-292/04) [2007] 2 CMLR 19 at para 36).
78. There is nothing in the documents before the court to suggest that the financial balance of the scheme managed by VddB is likely to be retroactively disturbed if the effects of this judgment are not restricted in time.
79. It follows from the foregoing that the answer to the fifth question must be that there is no need to restrict the effects of this judgment in time.”
51. The material ruling of the court was that “The combined provisions of articles 1 and 2 of Directive 2000/78 preclude legislation such as that at issue in the main proceedings under which, after the death of his life partner, the surviving partner does not receive a survivor’s benefit equivalent to that granted to a surviving spouse”. The effect of this, as regards Mr Walker and his husband, is unmistakable. If he survives Mr Walker, his husband is entitled to a spouse’s pension on the same basis as would a wife.
Römer
52. This was a case of a pensioner who had been in a registered life partnership. His claim was for the same supplementary pension payments that were given to married pensioners. His pension rights arose from contributions paid during a period of service from 1950 until 31 May 1990. The CJEU held that he was entitled to equal treatment if German life partnerships were comparable to marriage.
53. One of the supplementary questions which the court considered was whether, if Mr Römer was entitled to pension payments, their amount should be calculated only by reference to the contributions that were made after the Barber judgment. Advocate General Jääskinen approached this question on the basis that any limitation of the period of service to be considered would require a restriction on the otherwise natural application of the principle that contemporaneous discrimination was forbidden unless exceptional circumstances would justify such a restriction (AG157-158). As it happened, no party had requested one in the Römer case, and it was, moreover, “by no means apparent from the documents in the case that the financial balance of the supplementary pension scheme managed by the defendant in the main proceedings risks being retroactively disturbed by the lack of such limitation.” (AG159)
54. In the circumstances, the CJEU held that Barber had no bearing on Mr Römer’s entitlement. Neither the Federal Republic of Germany nor the Freie und Hansestadt Hamburg had suggested any limitation in time of the effects of the present judgment and no evidence submitted to the court indicated that they should be so limited.
55. From this it is clear that, unless evidence establishes that there would be unacceptable economic or social consequences of giving effect to Mr Walker’s entitlement to a survivor’s pension for his husband, at the time that this pension would fall due, there is no reason that he should be subjected to unequal treatment as to the payment of that pension.
The decisions of the EAT and the Court of Appeal
56. Mr Chamberlain submitted that the EAT wrongly took AG Van Gerven’s description of pension benefits in Ten Oever as “deferred pay” as equating the time at which a pension right accrues with the time at which any discrimination in the provision of resulting benefits is to be judged. I agree that the EAT was wrong to do so. The point of unequal treatment occurs at the time that the pension falls to be paid. If Mr Walker married a woman long after his retirement, she would be entitled to a spouse’s pension, notwithstanding the fact that they were not married during the time that he was paying contributions to his pension fund. Whether benefits referable to those contributions are to be regarded as “deferred pay” is neither here nor there, so far as entitlement to pension is concerned. Mr Walker was entitled to have for his married partner a spouse’s pension at the time he contracted a legal marriage. The period during which he acquired that entitlement had nothing whatever to do with its fulfilment.
57. As AG Jääskinen said in Römer at AG160:
“In the hypothetical case that Mr Römer had been able to enter into a marriage in October 2001, instead of a life partnership, the Freie und Hansestadt Hamburg would have had to increase the supplementary pension paid to him … The financing of the retirement scheme concerned must have been planned taking into account the possibility of changes in the marital status of pensioners.”
58. Likewise, the financing of Innospec’s retirement scheme should have been planned taking into account a possible change in Mr Walker’s marital status. He could not have been denied entitlement to a spouse’s pension if, perfectly legally, he married a woman after he retired. His marriage to his current partner is just as legal as would be a heterosexual marriage. His entitlement to a spouse’s pension is equally well-founded.
59. The Court of Appeal considered that the Barber case explained how the future effects principle should be applied to the Framework Directive. At para 11 of his judgment, Lewison LJ said of the exception in Barber, “The concept underpinning this limitation on the effect of the judgment is, in my judgment, the same concept that distinguishes between situations that are permanently fixed or established and those that are not.” In fact, none of the Barber line of cases mentions the future effects principle. As Mr Chamberlain submitted, this is because that principle is concerned with the effects of legislation, whereas Barber and Ten Oever dealt with temporal limitations on judgments.
60. The approach of the Court of Appeal led it to the same conclusion as the EAT, in equating the time at which a right to a pension accrues with the time at which discrimination in the provision of benefits is to be judged. The implication of this approach was considered by Professor Wintemute in an article in (2014) 43 ILJ 506, 510, commenting on the EAT judgment when he said:
“The implication of the EAT’s analogy was that, from 1980 to 2003, Mr Walker had been paid the lower ‘gay wage’ (one with no expectation that a survivor’s pension would ever be paid to the employee’s surviving partner despite the employee’s equal contributions to the pension scheme), rather than the higher ‘heterosexual wage’ (one with an expectation that a survivor’s pension might be paid to the employee’s surviving spouse based on the employee’s contributions to the pension scheme).”
61. This illustrates the essential flaw in the approach of the EAT and the Court of Appeal. The salary paid to Mr Walker throughout his working life was precisely the same as that which would have been paid to a heterosexual man. There was no reason for the company to anticipate that it would not become liable to pay a survivor’s pension to his lawful spouse. The date when that pension will come due, provided Mr Walker and his partner remain married and his partner does not predecease Mr Walker, is the time at which denial of a pension would amount to discrimination on the ground of sexual orientation.
62. Dealing with Maruko Lewison LJ said that the fifth question which the referring court had posed (set out at para 47 above) was “very puzzling” – para 37. He suggested (at para 40) that the court had given “an unnecessary answer to the wrong question.” Undoubtedly, the referring court’s reference to 17 May 1990 was misplaced – how could that date, being the date of the Barber judgment on equal pay under article 119, have any possible relevance to the temporal application of the judgment in Maruko on equal treatment under the Framework Directive? But the Court plainly understood the referring court as asking essentially whether the effect of its judgment should be “limited in time”. That question is only puzzling or unnecessary if one proceeds on the assumption that there is a general rule that the time at which a pension right accrues should be equated with the time at which discrimination in the provision of resulting benefits occurs. For the reasons given earlier, I do not consider that this is correct. The response given to the fifth question in Maruko is therefore perfectly explicable and provides the inescapable answer in Mr Walker’s case.
63. In order to deal with the Court of Appeal’s treatment of the Römer decision, it is necessary to say a little more about the questions referred to the CJEU in that case. The fifth question had two parts which the CJEU interpolated as 5(a) and (b). Question 5(a) asked whether, if the domestic legislation contravened the Framework Directive, Mr Römer was entitled to supplementary pension payments in line with married people before that legislation was amended. This was answered affirmatively by the court – see paras 53-56. Question 5(b) was whether, if the domestic legislation contravened the Directive, Mr Römer was entitled to backdated supplementary pension payments even for the period before the transposition deadline for the Framework Directive. Question 6 was whether, if Mr Römer was entitled to supplementary pension payments, the amount of those payments should be calculated by reference to the contributions made after the Barber judgment.
64. Mr Römer had conceded that the answer to question 5(b) might be that he could only receive backdated supplementary payments from 2003. But, as far as question 6 was concerned, “his pension payments should, in any event, be calculated from that date on the basis of all the contributions he has paid, irrespective of their date.” A-G Jääskinen – AG142. The CJEU accepted that Mr Römer was not entitled to payments that were due to be paid before 2003 (because the Directive had not been implemented before then) but that when it came to the calculation of the quantum of the pension payments, the fact that the contributions underpinning the entitlement had been paid before then made no difference – para 66.
65. Put simply, Mr Römer could not claim pension payments before 2003 but the pension due to him after that date should be calculated on the basis of all the years during which entitlements to them had been built up. Translating that to Mr Walker’s case, the message is clear. He could not have claimed entitlement to the payment of the pension before the transposition of the Directive into UK law but, once that happened, the rate of his pension was to be based on all the years of his service, even those which preceded the date of the transposition.
66. The Court of Appeal misunderstood Römer. At para 43, Lewison LJ said that the CJEU had held that entitlement to equal treatment did not become part of EU law until the time limit for transposing the Directive had expired. On that basis, the “answer to question 5 was plainly a negative answer: the entitlement did not apply before the deadline for transposing the Directive” (para 44). It was, of course, true that entitlement did not arise until the Directive had to be transposed, but this does not address the question of what the entitlement was after the deadline was reached. Lewison LJ thought that question 6 was conditional on an affirmative answer to question 5” and since, in his estimation, a negative answer had been given to question 5, question 6 was irrelevant. This was, I am afraid, wrong.
67. In the first place, both parts of question 5 had not been given a negative answer. Question 5(a) had been answered affirmatively. More importantly, question 6 remained supremely relevant to Mr Walker’s case. His entitlement to a spouse’s pension did not materialise until after the transposition of the Directive but the response to question 6 provided the key to the nature of the right that Mr Walker then acquired. It was entitlement to a pension calculated on the basis of his years of service before the Directive was transposed.
Parris v Trinity College Dublin
68. The case Parris v Trinity College Dublin (Case C-443/15) [2017] Pens LR 3 was a reference to the CJEU from the Labour Court in Ireland. It also concerned a claim for a survivor’s pension under the Framework Directive. Dr Parris had entered a civil partnership with his partner of 30 years in the UK on his 63rd birthday in 2009. This civil partnership was not recognised in Ireland until a change in the law on 12 January 2011. Dr Parris had been employed as a lecturer by Trinity College Dublin (TCD) from 1972 to 2010. He took early retirement in 2010. He had been a member of TCD’s non-contributory occupational pension scheme. The scheme provided a survivor’s pension, but only where the marriage or civil partnership took place before the member’s 60th birthday. The questions referred to the CJEU concerned whether TCD’s refusal to provide the survivor’s pension to Dr Parris’ civil partner, by reference to that rule, constituted indirect discrimination on sexual orientation grounds, direct age discrimination, and/or discrimination on a combination of those grounds.
69. The questions referred did not concern Dr Parris’s period of service. In fact, his employment almost entirely predated the deadline for transposing the Framework Directive, and had ended before Ireland’s recognition of civil partnerships. The UK nevertheless made submissions to the CJEU which broadly mirror those of the Secretary of State in the present appeal. It was submitted that since Dr Parris’s pension entitlements were based almost entirely on periods of service completed before the coming into force of the Directive, they could not be subject to the principle of equal treatment.
70. Advocate General Kokott rejected those submissions. At paras 39-42 of her Opinion she said
“39. … that objection is unfounded. For it is settled case law that a new rule of law applies from the entry into force of the act introducing it, and, while it does not apply to legal situations that have arisen and become definitive under the old law, it does apply to their future effects, and to new legal situations. It is otherwise, subject to the principle of the non-retroactivity of legal acts, only if the new rule is accompanied by special provisions which specifically lay down its conditions of temporal application.
40. Those principles also apply to the temporal application of Directive 2000/78. A restriction of the temporal scope of that Directive, in derogation from the aforementioned general principles, would have required an express stipulation to that effect by the EU legislature. No such special provision has been made, however.
41. Consequently, the Court has already declared Directive 2000/78 to be applicable to cases concerning occupational and survivor’s pension schemes the entitlements under which had arisen – much as they did here – long before the entry into force of that Directive and any contributions or reference periods in respect of which also predated the entry into force of that Directive. Unlike in Barber, for example, concerning article 119 of the EEC Treaty (now article 157 TFEU), the Court expressly did not apply a temporal restriction to the effects of its case law relating to occupational pension schemes under Directive 2000/78. I would add that there was, moreover, no longer any need for such a temporal restriction, since it had become sufficiently apparent to all the interested parties since the judgment in Barber that occupational pensions fall within the EU-law concept of pay and are subject to any prohibitions on discrimination.
42. It is true that the Court has held that the prohibition on discrimination contained in Directive 2000/78 cannot give rise to claims for payments in respect of periods in the past that predate the time limit for transposing that Directive. However, the recognition of the right to a future survivor’s pension, at issue in the present case, is unaffected by that principle because such recognition is concerned only with future pension scheme payments, even though the calculation of those payments is based on periods of service completed or contributions made in the past.”
71. These statements are entirely consistent with the analysis of Maruko and Römer which Mr Chamberlain offered and which I accept. The CJEU held that Dr Parris’s case did not amount to discrimination at all, citing the principle in Maruko that legislation treating surviving civil partners less favourably than surviving spouses will amount to direct discrimination if the two are in comparable situations under national law, but noting that the rule in issue in Dr Parris’s case applied equally to opposite-sex marriages and same-sex civil partnerships. His inability to meet the qualifying criterion for the survivor’s pension resulted from the lack of provision for same-sex partnerships under Irish law at the time of his 60th birthday and it was for member states to decide both whether to make such provision and, if so, whether to make it retrospective. The CJEU did not, therefore, need to address the UK government’s argument that Dr Parris’s claim fell outside the temporal scope of the Directive but nothing in its judgment cast doubt on AG Kokott’s clearly expressed opinion that the submissions of the UK were incompatible with Maruko and Römer.
Conclusion on the first issue
72. I would therefore hold that Mr Walker’s husband, provided he does not predecease him, and that they remain married at the time of Mr Walker’s death, is entitled under the Framework Directive to a spouse’s pension calculated on the basis of all the years of Mr Walker’s service with Innospec. On that account, paragraph 18 of Schedule 9 is incompatible with the Framework Directive. In particular, paragraph 18(1)(b) which authorises a restriction of payment of benefits based on periods of service before 5 December 2005 cannot be reconciled with what I consider to be the plain effect of the Directive.
Must effect be given to paragraph 18 or should it be disapplied – the second issue?
73. The appellant claims that, applying the principles established by Kücükdeveci v Swedex GmbH and Co KG (Case C-555/07) [2010] 2 CMLR 33, paragraph 18 must be disapplied. As Lord Mance explained in R (Chester) v Secretary of State for Justice in the passage cited at para 10 above, for the general principle of non-discrimination to apply, the context must fall within EU law. Both the EAT and the Court of Appeal considered that non-discrimination did not become a fundamental principle of EU law until the transposition deadline of the Framework Directive – Lewison LJ at para 49 and Underhill LJ at para 59.
74. Mr Chamberlain submits that this is incorrect, arguing that the CJEU did not say that non-discrimination only became a general principle of EU law in 2003. Its relevant finding was that Mr Römer’s claim for equal pension benefits only came within the material scope of EU law from that time. Whether that is right or not need not be decided finally in this case because Mr Chamberlain’s second argument disposes of the issue. That is that non-discrimination on grounds of sexual orientation is now a principle of EU law. It follows that any contemporary denial to his husband of a spouse’s pension, calculated on all the years of Mr Walker’s service, would be incompatible with the Framework Directive. In so far as paragraph 18 authorises that, it must be disapplied on the basis of the principles articulated in Kücükdeveci and Chester.
The third issue
75. In light of my conclusion on the first two issues, it is not necessary to decide the third issue, viz whether paragraph 18 is incompatible with Mr Walker’s rights under article 14 of ECHR, when read together with article 8 and article 1 of the First Protocol.
Final conclusion
76. I would allow Mr Walker’s appeal and declare that, in so far as it authorises a restriction of payment of benefits based on periods of service before 5 December 2005, paragraph 18 of Schedule 9 to the 2010 Act is incompatible with the Framework Directive and must be disapplied. I would make a further declaration that Mr Walker’s husband is entitled to a spouse’s pension calculated on all the years of his service with Innospec, provided that at the date of Mr Walker’s death, they remain married.
LORD CARNWATH AND LORD HUGHES:
77. We agree that Mr Walker’s appeal should be allowed, but on more limited grounds. This appeal was heard at the same time as the appeal in O’Brien v Ministry of Justice [2017] UKSC 46, in which the court has decided to refer to the European court a question relating to the pension entitlement of part-time workers. As explained in the judgment of Lord Reed, that arises from a difference among the members of the court as to the interpretation of the Ten Oever line of authority (as he describes it – para 20). In so far as Lord Kerr’s reasoning in the present case (in particular, paras 35-46) turns on his interpretation of that line of authority, we prefer to await the authoritative ruling of the European court.
78. The present case is in our view distinguishable substantially for the reasons given by Lord Kerr at paras 56-58. On any view Mr Walker had earned a right to a pension for his spouse. That right, and the possibility of a change in his marital status, should have been taken into account in the financing of the scheme. The question who qualified as his spouse fell to be answered at a date when it was unlawful under the Directive to discriminate as between heterosexual and same-sex marriages. At that time, as Lord Kerr says (para 56), he was entitled to have for his married partner a spouse’s pension; “The period during which he acquired that entitlement had nothing whatever to do with its fulfilment.” To the extent that paragraph 18 of Schedule 9 to the Equality Act 2010 restricted that right it was incompatible with European law, and must be disapplied.
PA Guidance Notes
EQUAL PENSION TREATMENT IN OCCUPATIONAL PENSION SCHEMES
GUIDANCE NOTES
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Equal Pension Treatment in
Occupational Benefit Schemes
Guidance Notes
Introduction
s.69 1. Part VII of the Pensions Act 1990 (the “Act”), first became effective from 1st
January 1993 and provided for the equal treatment of men and women in
occupational benefit schemes. This requirement is referred to in Part VII of
the Act and in these Guidance Notes as “the principle of equal pension
treatment ”.
2. Part VII originally gave effect to:
Article 141 (previously Article 119) of the Treaty of Rome which provides
for equal pay for men and women. The European Court of Justice on 17
May 1990 ruled in Case G282/88 (Barber v Guardian Royal Exchange
Assurance Group) that benefits under occupational pension schemes
come within the scope of this article.
Council Directive 86/378/EC of 24 July 1986 specifically provides for the
implementation of the principle of equal treatment in occupational social
security schemes.
3. Since the introduction of Part VII the principle of equal pension treatment
has been extended as a result of decisions of the European Court of Justice,
EC Council Directives and Irish social partnership agreements. The new Part
VII implements Council Directives 2000/43/EC (the “Race Directive”) and
2000/78/EC (the “Employment Directive”) as they apply to occupational
pensions. These Directives relate to discrimination on grounds of sexual
orientation, religion, age, race and disability. Part VII also prohibits
discrimination on grounds of marital, family or traveller status.
4. These developments have now been formally introduced into the Act by
virtue of the Social Welfare (Miscellaneous Provisions) Act, 2004 and the
Equality Act 2004. Amendments introduced by the Social Welfare
(Miscellaneous Provisions) Act 2004 are effective from 5th April 2004 and the
amendments introduced by the Equality Act, 2004 are effective from 19th July
2004. In certain circumstances these amendments can have retrospective
effect (see paragraphs 96-98).
5. Part VII is the only part of the Act which applies to other arrangements in
addition to occupational pension schemes. Part VII applies to occupational
benefit schemes which include arrangements for the self-employed such as
retirement annuity contracts.
Employment contracts
s.81C, 81D 6. Part VII is the only part of the Act which covers in a limited way
employment contract terms and terms of collective agreements.
Equal Pension Treatment in
Occupational Benefit Schemes
PART I
The Principle of Equal Pension Treatment
This Part of the Notes provides a general overview of
the principle of equal pension treatment in occupational benefit schemes and
explains the key terms used in the legislation.
PRINCIPLE OF EQUAL PENSION TREATMENT
s.66(2),s.70 7. The principle of equal pension treatment has now been extended so that
there may not be discrimination between persons on any of the following
grounds:
(a) Gender,
(b) Marital Status,
(c) Family Status,
(d) Sexual orientation,
(e) Religious beliefs,
(f) Age,
(g) Disability,
(h) Race,
(i) Membership of the Traveller Community.
These grounds are referred to as “discriminatory grounds” in Part VII of the
Act and in these Guidance Notes.
s.69, 70, 8. Every scheme must comply with the principle of equal pension treatment.
78 & 79 The principle of equal pension treatment is that there may not be
discrimination between persons on any of the discriminatory grounds. The
principle also applies to access to, as well as the exercise of any discretion
under, a scheme. The principle applies to members’ dependants as it applies
in relation to members (although see paragraphs 51 and 52). Therefore, on
the gender ground, widows and widowers must be provided with the same
surviving spouse benefits.
s.68, s.70 9. Part VII also expressly prohibits “indirect discrimination”, being rules
which are seemingly neutral in their application, but in fact impact more
heavily on one category of person than another.
s.65(3) 10. Part VII also prohibits victimisation (such as dismissal or other adverse
treatment) as a result of involvement in matters related to discrimination or
alleged discrimination.
s.80, s.74, 11. The effect of a rule of an occupational benefit scheme failing to comply
s.81 with the principle of equal pension treatment is to render that provision null
and void and such a scheme will be obliged to provide the more favourable
treatment to the person who did not previously benefit from that more
favourable treatment (“levelling-up”) until a formal change is made. When
the change is made it is possible to equalise the future treatment of both
persons (current or prospective members) at the less favourable level
(“levelling down”). Further, it is an offence for a person to act (or to seek to
have another person act) in breach of the principle of equal pension
treatment.
Equal Pension Treatment in
Occupational Benefit Schemes
PART II
Discrimination, Discriminatory Grounds, Permitted Exceptions and Victimisation
This Part of the Notes explains the discriminatory grounds
and the acts which constitute unlawful discrimination
Introduction
s.68, s.70 12. The principle of equal pension treatment requires that there be no
s.78, s.79, discrimination between persons based on any of the discriminatory grounds
(see paragraphs 13 – 18).The principle of equal pension treatment also
prohibits indirect discrimination (see paragraphs 20 – 22). The principle of
equal pension treatment extends to access to and the exercise of any
discretion under a scheme.
Discrimination
s.66(1)(a), 13. Discrimination occurs where a person (“X”) is treated less favourably
s.67 than another person (“Y”) is, has been or would be treated in a comparable
situation and such less favourable treatment is due to a discriminatory
ground. The discriminatory ground may exist in the present, the past or the
future, or be imputed to X.
s.66(1)(b) 14. Discrimination also occurs where one person (“X”) is associated with
another person (“Z”), and by virtue of such association, X receives (or has
received) less favourable treatment than a person in a comparable situation
(“Y”) but who is not associated with Z and it would constitute discrimination as
described in paragraph 13 above if Z received less favourable treatment.
s.65 15. Any instruction to discriminate will also constitute discrimination and is
thereby prohibited.
s.70(3) 16. Different occupational benefits may be provided to different members
provided this does not constitute less favourable treatment on one of the
discriminatory grounds.
17. Any allegation of less favourable treatment must be based on one of the
discriminatory grounds, rather than for some other reason (e.g. job
description) (A Worker v. Mid Western Health Board [1996] E.L.R. 1).
Example
X is associated with Z who is a member of the Traveller Community and as
a result of this association X accrues benefits under a defined benefit
scheme on a 1/80th basis. Y however is not associated with Z and accrues
benefits on a 1/60th basis. X is discriminated against where:
(i) X is treated less favourably than Y because of X’s association with Z;
and
(ii) provided that it would be discrimination if Z (as a member of the
Traveller Community) were to receive the same less favourable treatment
that X has received.
Example
If Sheila is excluded from her employer’s pension scheme because she is
female discrimination has occurred on the gender ground if a male
employee in a comparable situation is, has been or would be admitted to
the scheme.
18. It is not necessary for there to be an actual comparator, a hypothetical
comparator is all that is required.
Procuring discrimination
s.74 19. It is an offence for a person to procure (or attempt to procure) another
person to do anything which breaches the principle of equal pension
treatment or which constitutes victimisation under the terms of the Act.
Indirect discrimination
s.68(1) 20. Indirect discrimination occurs where a seemingly neutral rule of a scheme
puts persons at a disadvantage based on one of the discriminatory grounds,
compared with other persons. Such other persons, who are not so
disadvantaged, may be members of, or potential future entrants to, the
scheme in question.
s.68(2) 21. Any rule which constitutes indirect discrimination is prohibited, unless it is
objectively justified by a legitimate aim. These objective factors must bear no
relation to the discriminatory ground which has been alleged to be infringed;
they must relate to, for example, a genuine economic need of the business
and the means used for attaining that aim must be appropriate and
necessary.
a3 SI 337/04 22. The person who asserts that any such rule is objectively justified must
prove that justification.
DISCRIMINATORY GROUNDS
The following paragraphs set out in detail the nine discriminatory grounds.
Gender Ground
s.66(2)(a), 23. Discrimination on the gender ground occurs where a woman is treated
s.67(1)(a) less favourably than a man or vice versa. It also occurs where survivors’
benefits are provided on a differing basis for male and female dependants.
s.71 24. The following differing treatments of employees on the gender ground do
not infringe the principle of equal pension treatment:
Greater employer contributions made under a defined contribution
scheme in respect of employees of one gender, where they are made
in order to remove or limit pre-existing differences between the
genders in the amount or value of benefits provided or to ensure the
adequacy of funds to cover the cost of benefits under a defined benefit
scheme.
Greater employer contributions made under a defined benefit scheme
in respect of employees of one gender, where they are made in order
to ensure the adequacy of funds to cover the cost of benefits under a
defined benefit scheme.
Gender based differences in the amount or value of:
(i) benefits under a defined contribution scheme, where such
differences are justifiable on actuarial grounds, or
(ii) certain elements of benefits provided under a defined benefit
scheme, to the extent that the difference results from using
actuarial factors which differ according to sex at the time when
the funding of such scheme is implemented, such as:
(a) the conversion into a capital sum of part of a periodic
pension,
(b) transfer of occupational benefits,
(c) a reversionary pension payable to a dependant in
return for the surrender of part of a pension, or
(d) a reduced pension on early retirement.
Differing treatment of self-employed persons regarding optional
benefits available under a scheme;
Differing treatment as regards additional benefits (being benefits
which members choose) and which secure additional benefits to those
ordinarily provided under the scheme; or
Differing rights to claim a flexible pension age, provided other
conditions are the same for men and women.
Marital Status Ground
s.66(2)(b) 25. Discrimination occurs between persons based on the marital status
s.67(1)(b) ground where the less favourable treatment is based on the fact that one
person is single, married, separated, divorced or widowed.
s.75(1), 26. The following differing treatments are permitted without infringing the
s.72(2) principle of equal pension treatment:
s.72(3)
Differing treatment required under or acts done in compliance with the
Maternity Protection Act, 1994 (as amended) or the Adoptive Leave Act,
1995; and
If a member with marital status dies the spouse and children of such
member may receive more favourable benefits than the benefits payable
to the dependants of an unmarried member provided there is no breach of
the principle of equal pension treatment on the gender ground.
Family Status Ground
s.66(2)(c) 27. Discrimination occurs between two persons on the family status ground
s.67(1)(c) where the less favourable treatment is based on the fact that one has family
status and the other does not.
s.65 28. Family status is defined as being a parent (or being a person in loco
parentis) to a person under the age of 18, or being a parent or resident
primary carer to a person over 18 with a disability such that s/he needs
continuing, regular or frequent support.
s.75(1) 29. The following differing treatments are permitted without infringing the
s.72(2) principle of equal pension treatment:
s.72(3)
Differing treatment required under or acts done in compliance with the
Maternity Protection Act, 1994 (as amended) or the Adoptive Leave
Act, 1995; and
If a member with family status dies his or her partner and children may
receive more favourable benefits than the benefits payable on the
death of a member without family status provided there is no breach of
the principle of equal pension treatment on the gender ground.
Example 1
Positive discrimination in favour of married people is permitted so
long as the same benefit is provided in respect of male and female
members of the scheme, e.g. it is permissible to pay a spouse’s death
in service pension but to provide no equivalent benefit for unmarried
or same sex partners.
Example 2
If a member with marital status dies and his or her spouse
subsequently dies a scheme may provide a children’s pension without
providing similar benefits for the children of an unmarried member.
Example 3
If a member with marital status dies and his or her spouse
subsequently dies a scheme may provide for increased children’s
pensions without providing for corresponding increases to pensions
payable to the children of an unmarried member.
Sexual Orientation Ground
s.66(2)(d) 30. Discrimination on the sexual orientation ground occurs where one person
s.67(1)(d) is accorded less favourable treatment than another person due to differing
sexual orientation, which includes heterosexuality, homosexuality and
bisexuality. This ground is separate and distinct from the gender/sex ground.
s.72(3) 31. It would be discrimination to provide death benefits to unmarried
heterosexual partners, but not to provide equivalent death benefits for
unmarried same sex partners. However, because of the marital status
exemption it would not be discrimination on the sexual orientation ground to
provide death benefits for spouses but not to provide equivalent death
benefits for same sex partners, provided this does not breach the principle of
equal pension treatment on the gender ground.
Religion Ground
s.66(2)(e) 32. Discrimination on the religion ground occurs where less favourable
s.67(1)(e) treatment is based on the fact that persons have different religious beliefs or
that one person has a religious belief and the other person does not.
Religious belief is stated to include a religious background or outlook.
Age Ground
s.66(2)(f) 33. Discrimination on the age ground occurs where less favourable treatment
s.66(3) is based on the fact that persons are of different ages. However, this ground
Example 1
It is permissible to provide a dependant’s pension to the partner of a
deceased member with family status without providing similar benefits to
the partner of a deceased member without family status.
Example 2
If a member with family status dies and his or her spouse subsequently dies
a scheme may provide a children’s pension without providing similar
benefits for the children of a member without family status.
Example 3
A scheme may not provide for a higher accrual/contribution rate for
parents than for non-parents.
s.67(1)(f) only applies to persons over the maximum age for which there is an obligation
to attend school. At present the obligation to attend school applies (under the
Education (Welfare) Act, 2000) to all minors aged less than 16 years or who
have not completed 3 years of post-primary education, whichever occurs the
later).
s.72(1) 34. It is not a breach of the principle of equal pension treatment on the age
ground for account to be taken of age in the following circumstances:
to fix a particular age or qualifying service (or a mixture of both) as a
condition for admission to a scheme, entitlement to benefits under the
scheme, or to use age related criteria for actuarial calculations.
s.72(1)(e) for schemes to fix age or qualifying service, or a combination of both as a
condition to the accrual of rights under a defined benefit scheme, or to
use age as a criterion for calculating the level of contributions to a defined
contribution scheme, provided, that the imposition of such conditions is
appropriate and necessary to the pursuit of a legitimate objective of the
employer. Legitimate employment policy, labour market and vocational
training objectives are cited in the Act as examples of legitimate
objectives which may be pursued by imposing such preconditions. (see
paragraphs 120 to 121 below).
s.77 35. The provisions of the Act relating to discrimination on the age ground do
not apply to Defence Forces employments.
s.75(2), 36. Acts done in compliance with the following statutory provisions will not
s.75(3) breach the principle of equal pension treatment on the age ground:
s.75(4)
(a) section 5 of the Air Navigation and Transport Act, 1946;
(b) section 12 of the Merchant Shipping Act, 1947;
(c) section 29 of the Transport (Miscellaneous Provisions) Act, 1971;
(d) section 3 of the Merchant Shipping (Certification of Seamen) Act,
1979;
(e) section 5 of the Irish Aviation Authority Act, 1993;
(f) the Protection of Young Persons (Employment) Act, 1996;
(g) the National Minimum Wage Act, 2000;
(h) section 3 of the Redundancy Payments Act, 1971, as amended by
section 5 of the Redundancy Payments Act, 1979;
(i) paragraph 1 of Schedule 3 to the Redundancy Payments Act, 1967.
Disability Ground
s.66(2)(g) 37. Discrimination on the disability ground occurs where:
s.67(1)(g)
(a) one person has a disability and the other person does not; or
(b) where both persons have different disabilities;
and one person receives less favourable treatment than the other.
s.73(1) 38. Rules of schemes may provide for differences in treatment of disabled
members who cannot do the same amount of work as a member without that
disability provided such action does not breach the principle of equal pension
treatment on the gender ground. A person without that disability is not entitled
to this more favourable treatment.
s.77 39. The provisions of the Act relating to discrimination on the disability
ground do not apply to Defence Forces employments
s.75(2) 40. Acts done in compliance with the following statutory provisions will not
breach the principle of equal pension treatment on grounds of disability:
(a) section 5 of the Air Navigation and Transport Act, 1946;
(b) section 12 of the Merchant Shipping Act, 1947;
(c) section 29 of the Transport (Miscellaneous Provisions) Act, 1971;
(d) section 3 of the Merchant Shipping (Certification of Seamen) Act,
1979;
(e) section 5 of the Irish Aviation Authority Act, 1993.
s.73(3) 41. Schemes may have rules providing more favourable occupational
benefits to be paid to a member with a disability where the member avails of
early retirement on grounds of that disability. A person without that
s.73(2) disability is not entitled to this more favourable treatment.
Ground of Race
s.66(2)(h) 42. Discrimination on grounds of race occurs where less favourable
s.67(1)(h) treatment is based on the fact that one person is of a different race, colour,
nationality or ethnic or national origin, or a combination of any of those factors
and another person is not.
Traveller Community Ground
s.66(2)(i) 43. Discrimination on the Traveller community ground occurs where less
s.67(1)(i) favourable treatment is based on the fact that one person is a member of the
Travelling community and another person is not.
Victimisation
s.65(3) 44. Victimisation occurs where an employee is dismissed or otherwise
treated adversely by the employer where the employee:
(i) notifies the Director of the Equality Tribunal or the Pensions Authority
of an alleged breach of Part VII;
(ii) complains of a breach of the principle of equal pension treatment to
his employer;
(iii) institutes proceedings (including appeals) for failure to comply with the
principle of equal pension treatment;
(iv) has represented or supported another employee in proceedings under
Part VII;
(v) compares his work to that of another employee for the purposes of
Part VII;
(v) has been a witness in proceedings brought under Part VII; or
(vi) gives notice of an intention to take any of the above-mentioned steps.
Equal Pension Treatment in
Occupational Benefit Schemes
PART III
Practical Application of the Principle of Equal Pension Treatment
This Part of the Notes sets out some of the practical considerations in applying
the principle of equal pension treatment.
General
45. In this section guidance is given on how the principle of equal pension
treatment affects the main rules that govern the provision of pensions under
occupational pension schemes only.
Each TOPIC is considered by reference to each Discriminatory ground.
ELIGIBILITY FOR SCHEME MEMBERSHIP/BENEFITS
General principles
s.70, 78 46. The principle of equal pension treatment prohibits employers from
treating persons differently on discriminatory grounds in deciding:
the manner in which employees are afforded access to an employer’s
scheme;
who may become a member of a scheme;
whether membership is compulsory or optional; and
eligibility criteria such as age of entry, length of service to qualify for
benefits etc.
47. Different occupational benefits are permissible for different categories of
member provided that the different treatment does not constitute a breach of
the principle of equal pension treatment.
48. There are exceptions to these basic principles for discrimination on the
age, marital status, family status and sexual orientation grounds.
Exceptions for the Age ground
49. The principle of equal pension treatment on the age ground has little
practical impact on occupational pension schemes because of the significant
differing treatments allowed under the Act.
s.72(1) 50. Providing that there is no discrimination on the gender ground differing
treatments are permitted for persons with different ages or lengths of
qualifying service in deciding:
to fix a particular age or qualifying service (or a mixture of both) as a
condition for admission to a scheme, entitlement to benefits under the
scheme, or to use age related criteria for actuarial calculations.
s. 72(1)(a)
Example 1
A scheme may fix an entry requirement of attaining age 25 years and 2
years service prior to admission, provided that there is no
discrimination on the gender ground (and subject to PRSA access
obligations under section 121 of the Pensions Act). A scheme may
also fix a maximum age for entry to the scheme eg age 60 in a scheme
with an NRD of 65.
s.72(1) (b)
s.72(1)(e) for schemes to fix age or qualifying service, or a combination of both as a
condition to the accrual of rights under a defined benefit scheme, or to
use age as a criterion for calculating the level of contributions to a defined
contribution scheme, provided, that the imposition of such conditions is
appropriate and necessary to the pursuit of a legitimate objective of the
employer. Legitimate employment policy, labour market and vocational
training objectives are cited in the Act as examples of legitimate
objectives which may be pursued by imposing such preconditions. (see
paragraphs 120 to 121 below.)
s.72(1)(e)(i)
s.72(1)(e)(ii)
Example 3
Provided an employer can show a legitimate objective is met by the
scheme design, a scheme may provide that in relation to a defined
contribution scheme on attaining the age of 45 and completing 10
years service employer contributions and employee contributions will
be increased provided that there is no discrimination on the gender
ground (and subject to PRSA access obligations).
Example 4
Provided an employer can show a legitimate objective is met by the
scheme design, it may be possible to provide different scales of
contributions for different employees, e.g. for a defined contribution
scheme the following sliding scales:
Regional Headquarters
Less than 30 years 5% 10%
30 – 40 10% 15%
40 – 60 15% 30%
Example 2
A scheme may fix an entry requirement of attaining age 25 years and 2
years service for staff and a requirement of attaining age 35 and 10
years service for management prior to admission, provided that there
is no discrimination on the gender ground (and subject to PRSA access
obligations).
s.72(1)(e)(ii)
Exceptions for the Marital Status and Sexual Orientation grounds
s.72(3) 51. Schemes are permitted to provide more favourable death benefits to
spouses of deceased married members than would apply to the partners of
unmarried members including same sex partners. Such spouses could be
declared to be eligible for death benefits for which other persons are not
eligible.
Exceptions for the Marital Status and Family Status grounds
s.72(2) 52. Provided there is no breach of the principle of equal pension treatment
on the gender ground, a scheme may restrict eligibility for death benefits to
dependants of members with marital status and/or family status. See
paragraphs 26 and 29 above.
Indirect discrimination
s.68 53. Eligibility provisions can be a source of indirect discrimination claims.
Historically the exclusion of part-timers from schemes (now broadly speaking
no longer permitted following the enactment of the Protection of Employees
(Part-time Work) Act, 2001) created significant claims for indirect
discrimination. The indirect discrimination arose in cases where, for example,
such an exclusion impacted on many more persons of one gender than would
have been proportionate to the make up of the employer’s workforce
generally.
Section 68 provides that indirect discrimination occurs where an apparently
neutral rule of a scheme puts a member or prospective member with a
relevant characteristic in relation to any of the discriminatory grounds at a
particular disadvantage compared with other members or prospective
members, unless the rule is objectively justified by a legitimate aim and the
means of achieving that aim are appropriate and necessary.
Example 5
Provided an employer can show a legitimate objective is met by the
scheme design, it may be possible in the case of a defined benefit
scheme to provide different rates of accrual (of final pensionable
salary for each year of service) for different categories of employee,
e.g. the following scales
Years of completed pensionable service Accrual rate
1 – 10 1/100th
10 –10 1/60th
` 20 – 40 1/50th
Access – Reinstatement and backdating contributions
s.80(5) 54. Where access to an occupational pension scheme has been denied and
this is being corrected, the backdated admission of a member shall be subject
to the payment by the member of “appropriate back contributions” to the
scheme (see paragraphs 115 and 116).
RETIREMENT AGES
General principles
s.70 55. The principle of equal pension treatment prohibits employers from
treating persons differently on discriminatory grounds in deciding on the
normal pensionable age for members of a scheme.
s.70(3) 56. Different occupational benefits are permissible for different categories of
member provided that the different treatment does not constitute a breach of
the principle of equal pension treatment.
s.80, 57. Where there is inequality the discriminatory rule is null and void, and
s.81 must be addressed by levelling up (i.e. providing the more favourable
treatment to all affected members in this case by giving the members the
earlier normal pension age) until the scheme rules are changed to comply
with the principle of equal treatment (see paragraphs 112 and 113).
Exception for Age ground
s.72(1)(c)
s.72(1)(d), 58. It is not discrimination on the age ground to fix different ‘retirement ages’
s.72(4) for different employees or groups of employees provided it is not a breach on
the gender ground.
CONTRIBUTIONS
General principles
s.70 59. The principle of equal pension treatment prohibits a rule from treating
members differently on discriminatory grounds in providing:
for the level of contributions payable by members to a scheme; and
for the level of employer contributions to a defined contribution scheme.
s.70(3) 60. Different occupational benefits can be provided in respect of different
members so long as the principle of equal treatment is not breached. In the
context of a defined contribution scheme, different contribution rates are
permissible for different categories of member, provided that the different
treatment does not constitute a breach of the principle of equal pension
treatment.
Exceptions for Gender Ground
s.71(1)(a)(i) 61. It is not a breach of the principle of equal pension treatment on the
gender ground for an employer to vary the contributions paid to a defined
contribution scheme for male and female members to the extent that
difference arises from removing or limiting the difference in the amount or
value of the benefits expected to be provided under the scheme.
s.71(1)(a)(ii) 62. In the event that an employer determines the contributions to a defined
benefit scheme by reference to either particular members or persons of a
particular gender, the Act confirms that a difference in the level of contribution
on the basis of gender is permitted if the purpose behind the difference is to
ensure the adequacy of funds necessary to cover the cost of the benefits
under the scheme.
s.71(1)(c) 63. It is not a breach of the principle of equal pension treatment on the
s.81A(1) gender ground for a scheme to treat women differently in connection with
pregnancy and childbirth, provided that such treatment including as to
contributions is consistent with the requirements of section 81A of the Act.
DISCRETIONARY BENEFITS
General principles
s.79 64. The principle of equal pension treatment applies to the exercise of a
discretion by a person in the granting of an occupational benefit under a
scheme.
65. This statutory requirement is unlikely to make any difference to trustees
of occupational pension schemes whose duties under trust law would in
almost all cases prohibit discrimination between different categories of
member on discriminatory grounds.
66. This requirement may impact on decision makers who are not bound by
trust law such as employers and decision makers in schemes which are not
established under trust. Any such persons must now have regard to the
requirements of Part VII in considering the exercise of a discretion (e.g.
regarding increases to pensions in payment).
Example
In exercising a discretion to grant increases to pensions in payment
Trustees must take care not to cause discrimination. If the majority of
lower paid pensioners are female, a decision to grant increases only to
pensions below a specified amount may give rise to a claim of
discrimination on the gender ground.
Example
A defined contribution scheme may provide for a higher employer
contribution rate for salaried staff than for hourly paid staff.
ANNUITY RATES
General principles
s.70 67. The principle of equal pension treatment prohibits a scheme from treating
members differently on discriminatory grounds in deciding the capital cost
associated with a certain amount of benefit secured (i.e. the “annuity rate”).
However, there are exceptions on the age and gender grounds.
68. Particular examples would be:
in the case of a defined contribution scheme, by the application of
different annuity rates for different categories of member;
in the case of a defined benefit scheme, by granting differing service
credits in respect of transfer payments received or differing transfer
payments (paid out in respect of deferred benefits) to different members.
Exceptions for Gender Ground
s.71(1)(b) 69. It is permissible to use annuity rates which differentiate by gender in
calculating:
the benefits provided under a defined contribution scheme to the extent
that the difference is justifiable on actuarial grounds;
the amount of:
o a transfer payment in respect of occupational benefits provided
under a defined benefit scheme; or
o a reversionary pension payable to a dependant following
surrender of part of the member’s defined benefit pension;
to the extent that the difference results from the effects of the use of actuarial
factors differing according to gender at the time when the funding of the
scheme is implemented.
Exceptions for Age Ground
s.72(1)(f) 70. It is permissible to use differing factors attributable to different ages in
actuarial calculations, including those relating to annuity rates and similar
calculations.
LEAVING SERVICE
General principles
s.70 71. The principle of equal pension treatment prohibits a scheme from treating
members differently on discriminatory grounds in determining what benefit
options are available to members and how those benefits are calculated.
72. Benefits on leaving service other than by retirement normally take the
form of one or more of the following: a refund of members’ contributions, a
deferred benefit, or a transfer payment to an alternative pension arrangement.
s.70(3) 73. Differing treatment as to the availability of refunds of contributions and/or
transfer payments is possible, so long as it does not amount to direct or
indirect discrimination on a discriminatory ground.
74. The amount of a transfer value under a defined contribution scheme is
determined by the value of the member’s account. For differences in transfer
payments in a defined benefit scheme see Annuity Rates above.
Exceptions for Gender Ground
s.71(1)(b) 75. It is permissible to use actuarial calculation factors which differ according
to gender in determining the amount of:
the deferred benefit which can be secured by the application of the value
of the members account in a defined contribution scheme;
the transfer payment which is payable in respect of a member’s deferred
benefit entitlements in a defined benefit scheme;
the service credit to be awarded in respect of a transfer payment received
into a defined benefit scheme.
Exception for Age Ground
s.72(1)(f) 76. It is permissible to use differing factors attributable to different ages in
actuarial calculations, including those relating to annuity rates and similar
calculations.
DEFINED BENEFIT SCHEMES
ACCRUAL RATE
General principles
s.70 77. Benefits under a defined benefit scheme are usually of a fixed amount or
based on salary and length of service. Rules of a defined benefit scheme
Example
In the case of a defined contribution scheme where male and female
comparators have retirement accounts of the same value, it is permissible
for the male member to receive a higher annual pension.
In the case of early retirements from a defined benefit scheme where
male and female comparators are entitled to the same pension at normal
retirement age, it is permissible to reduce the male member’s pension to a
lesser extent than the female member’s pension.
should not contain different accrual rates for such benefits where such
differences would constitute a breach of the principle of equal pension
treatment.
Exception for Age Ground
s.72(1)(e) 78. It is permissible however for a defined benefit scheme to fix different
ages or qualifying service, or a combination of both, as conditions for different
accrual rates for different employees or categories of employee provided:
(a) in the context of the relevant employment to do so is appropriate and
necessary by reference to a legitimate objective of the employer, including
legitimate employment policy, labour market and vocational training
objectives; and
(b) such different accrual rates do not result in a breach of the principle of
equal pension treatment on the gender ground.
COMMUTATION/GRATUITIES
General principles
s.70 79. Usually a retirement lump sum is available as an option in lieu of an
equivalent amount of pension. For members of public sector schemes which
provide a set lump sum gratuity in addition to the pension entitlement (and
other schemes where members have no option but to take a lump sum in lieu
of pension), the amount of the lump sum should be the same for members
who have the same accrued pension entitlements.
Exceptions for Gender Ground
s.71(1)(b) 80. The amount of pension surrendered in exchange for a lump sum payable
may vary as between male and female scheme members, if the amount is
determined on the basis of actuarial calculation factors that differ according to
gender. Such differences are permissible where a member may voluntarily
opt for a lump sum in lieu of an equivalent amount of pension.
s.71(1)(b) 81. Differences in the value of certain benefits are also permitted where they
arise as a result of the application of different actuarial factors based on
gender. Such actuarial differences are permitted in the case of the
conversion into a capital sum of part of a periodic pension.
Exceptions for Disability Ground
s.72(3) 82. A scheme may provide, subject to Revenue requirements, for
accelerated commutation for a member taking early retirement due to serious
ill-health.
SURVIVORS’ BENEFITS
General principles
83. The purpose of survivors’ benefits is to provide for those who had been
dependent on the earnings of the member before his or her death. The
principle of equal pension treatment requires that the same benefits (either in
the form of pensions and/or lump sums) be provided for spouses and
dependants in respect of both male and female members of a scheme in the
event of a member’s death.
Exceptions for Marital Status and Family Status Grounds
s.72(2) 84. Provided there is no breach of the principle of equal pension treatment on
the gender ground a scheme may provide more favourable benefits:
(a) on the death of a deceased member with family status and/or marital
status; or
(b) to children, on the subsequent death of such member’s
spouse/partner,
than would apply in respect of members without family status or of a different
marital status. (See paragraphs 26 and 29 for examples).
Exceptions for Marital Status and Sexual Orientation Grounds
s.72(3) 85. It is permissible for a scheme to pay spouse’s benefits without breaching
the principle of equal pension treatment on the grounds of marital status
and/or sexual orientation provided this would not result in a breach of the
principle of equal pension treatment on the gender ground.
EARLY AND LATE RETIREMENT TERMS
General principles
86. The amount of pension payable from normal pensionable age is normally
adjusted to take account of early or late retirement. This means reducing the
accrued pension by reference to an appropriate actuarial calculation factor in
the case of early retirement and increasing the accrued pension in the case of
late retirement.
87. The principle underlying this process is that the value of the reduced
early retirement pension (or increased late retirement pension) is the same as
the value of the accrued pension at normal pensionable age and that the
impact of early or late retirement on the individual is financially neutral.
Example
Positive discrimination in favour of married people is permitted as long
as the same benefit is provided in respect of male and female members
of the scheme, e.g. it is permissible to pay a spouse’s death in service
benefit but to provide no equivalent benefit for unmarried or same-sex
partners.
Exception for Gender Ground
s.71(1)(b) 88. As the value of the benefits is based on the life expectancy of the
recipient, the adjustment may vary as between men and women if it is
determined using actuarial calculation factors which differ according to
gender.
s.70(3), 89. Variations in early retirement terms are permissible where early
s.71(1)(b)(ii) retirement is a voluntary option for members.
(IV)
Exception for Disability Ground
s.73(3) 90. Schemes may have rules providing more favourable occupational
benefits to be paid to a member with a disability where the member avails of
early retirement on grounds of that disability. A person without a disability is
s.73(2) not entitled to this more favourable treatment.
VOLUNTARY CONTRIBUTIONS TO PURCHASE DEFINED BENEFITS
General principles
s.70 91. Such variation in early or late retirement terms for men and women is not
permissible where early or late retirement is mandatory. It is common practice
for many defined benefit schemes to allow members to purchase additional
years of service. Where this option is provided it must be provided without
discrimination on any discriminatory ground subject to paragraphs 92 and 93
below.
Exception for Gender Ground
s.71(1)(e), 92. It is not discrimination to provide different treatment to male and female
71(2) members in relation to the purchase of additional years of service.
s.71(2) 93. The underlying principle governing these arrangements is that the
individual who opts to purchase additional benefits would normally bear the
full actuarial cost of the additional benefits provided in his/her case. The cost
of providing these benefits may vary as between male and female members if
actuarial calculation factors which differ according to gender are used in
determining the cost. This is permissible, given the fact that the purchase of
additional benefits is optional for members.
Equal Pension Treatment in
Occupational Benefit Schemes
PART IV
Non-Compliance and Complaints
This Part of the Notes explains some prescribed instances of non-compliance with the
principle of equal treatment and details of the complaints procedures.
NON-COMPLIANCE AND COMPLAINTS
NON-COMPLIANCE
94. In this section guidance is given as to the consequences for the
administration of a scheme of non-compliance with the principle of equal
pension treatment.
Effect of the Act where there is non-compliance
s.80 95. A rule of a scheme which does not comply with the principle of equal
pension treatment is rendered null and void by the Act to the extent that it
infringes the principle.
Time limits for Gender Ground
s.80(1) 96. Rules are made null and void from different effective dates depending on
the date the rule was made and the matter addressed by the rule. The main
time limits are:
Discriminatory Rule on access is null and void from 8 April 1976 or if
later the date on which it purports to come into force;
Other Discriminatory Rules (except for self-employed and rules made
post 5 April 2004) are null and void from 17 May 1990 (or earlier if
proceedings were started before that date but in any event not earlier than
8 April 1976).
97. Effective dates for other discriminatory rules on the gender ground are:
Discriminatory Rule applicable to self-employed persons is null and
void from 1 January 1993 or if later the date on which it purports to come
into force;
Discriminatory Rule made post 5 April 2004 (a rule which is stated to
come into force on or after 5 April 2004) is null and void with effect from
the date on which it purports to come into force;
Time limits for other Grounds
s.81(1),(2) 98. Discriminatory rules on all grounds, except gender grounds, are made
null and void from different effective dates depending on the date the rule was
made and the matter addressed by the rule.
Discriminatory Rule on ground of race is null and void from the date on
which it purports to have effect not being a date earlier than 19 July 2003;
Discriminatory Rule on any other ground apart from gender and race
is null and void from the date on which it purports to have effect not being
a date earlier than 2 December 2003.
FAMILY LEAVE
s.81B(1) 99. Occupational benefit schemes are required by the principle of equal
pension treatment to ensure that a member:
continues in membership of a scheme; and
continues to accrue rights under a scheme;
during any period of qualifying family leave in the same manner as if he or
she were at work and being paid normally during that period. A rule which is
inconsistent with this requirement under the Act does not comply with the
principle of equal pension treatment.
s.81B(2) 100. Where a rule is inconsistent with the principle of equal pension
treatment the trustees or the employer must take such measures as are
necessary to ensure that the member is treated by the scheme as if he were
at work and being paid during the period of qualifying family leave.
101. There is no obligation to remunerate or provide superannuation benefits
by reference to a period of family leave which is not qualifying family leave.
s.75(1) 102. Nothing in the Act makes unlawful any act done in compliance with the
Maternity Protection Act, 1994 or the Adoptive Leave Act, 1995.
MATERNITY ABSENCE
s.81A(2) 103. Occupational benefit schemes are required by the principle of equal
pension treatment to ensure that a member:
continues in membership of a scheme; and
continues to accrue rights under a scheme;
during any period of qualifying maternity absence in the same manner as if
she were at work and being paid normally during that period. A rule which is
inconsistent with this requirement under the Act does not comply with the
principle of equal pension treatment.
s.81A(3) 104. Where a rule is inconsistent with the principle of equal pension
treatment the trustees or the employer must take such measures as are
necessary to ensure that the member is treated by the scheme as if she were
at work and being paid during the period of qualifying maternity absence.
s.22 MPA94 105. In addition to the above requirements the member will usually have
rights under the Maternity Protection Act, 1994 (as amended by the Maternity
Protection (Amendment) Act, 2004. Section 22 of the MPA94 provides that
where an employee is on maternity absence she shall be deemed to have
been in employment for that period and such absence will not affect any right
related to the employee’s employment (other than remuneration).
106. There is no obligation to remunerate or provide superannuation benefits
by reference to any period of maternity absence which is not qualifying
maternity absence.
s.81A(1) 107. Nothing in the Act:
prevents a scheme from providing special more favourable treatment for
women in connection with pregnancy or childbirth;
makes unlawful any act done in compliance with the Maternity Protection
Act, 1994 or the Adoptive Leave Act.
COLLECTIVE AGREEMENTS
s.81C 108. The Act extends in certain limited aspects to:
collective agreements relating to employees;
employment regulation orders and registered employment agreements
under the Industrial Relations Act,1946.
109. A rule or term of an agreement or collective order which would not if it
were a rule of a scheme comply with the principle of equal pension treatment,
is to the extent that it does not comply, null and void. The requirements to
level up (see paragraph 112), provide backdated access (subject to payment
of contributions) (see paragraphs 114 to 116), and the preservation of rights
prior to the rule becoming null and void described in paragraphs 96 to 98
apply to such a rule or term.
EMPLOYMENT CONTRACTS
s.81D 110. The Act extends in certain limited aspects to a term (express or implied)
of an employment contract which would not if it were a rule of a scheme
comply with the principle of equal pension treatment. Such a term is, to the
extent that it does not comply, null and void. The requirements to level up
(see paragraph 112), provide backdated access (subject to payment of
contributions – see paragraphs 114 to116), and the preservation of rights
prior to the rule becoming null and void described in paragraphs 96 to 98
apply to such a rule or term.
ADDRESSING NON-COMPLIANCE
Implementing Equalisation
s.80(3) 111. Subject to certain limited exceptions for employees who have left
service and other transitional provisions (see paragraphs 117 and 118 below),
where a Rule of a scheme is rendered null and void on the gender ground the
different treatment must be removed in the manner set out in paragraphs 112
to 116 below.
Levelling up and levelling down
s.80(1), 112. Where a rule is rendered null and void for breach of the principle of
s.81(1), equal pension treatment, the more favourable treatment must be provided to
s.81(2) both X and Y in respect of the appropriate period of membership in the
scheme with effect from the relevant date (see paragraphs 96 to 98).
(“Levelling Up”).
113. The differing treatment may be equalised on the less favourable basis
but only with effect from the date on which the scheme rule is amended to
comply with the principle of equal pension treatment (“Levelling Down”).
Access and back dated contributions
s.80(1), 114. Where a person has been denied access to a scheme in breach of
s.81(1) the principle of equal treatment the more favourable terms of access must
s.81(2) apply with effect from the relevant date (see paragraphs 96 to 98) until such
time as the eligibility requirements are equalised.
115. If the scheme requires the payment of member contributions as a
condition of membership the back dated admission of a person as a member
is subject to payment of those contributions.
s 80(6) 116. The amount of contributions payable depends on the wording of the
scheme. If the scheme rules so provide the amount of contributions due is
calculated for the period concerned at the appropriate contribution rate
applying during the period by reference to the salary at the time the
contributions are being paid. If the scheme rules do not so provide, the
amount of contributions are to be calculated in accordance with the rules of
the scheme from the beginning of the period.
Gender discrimination may continue for certain deferred members
s 80(3) 117. Where a rule of a Scheme related to employed persons is rendered null
and void on the gender ground the discriminatory rule may remain in force in
respect of the rights and obligations of certain groups of Members who left
service or became pensioners on or before 31 December 1998 (or for rules
relating to retirement ages on or before 31 December 2017) as follows:
(a) who left service or retired before 17 May 1990 the Rule may remain
unequal;
(b) who left service or retired between 17 May 1990 and 31 December
1998, equalisation is required in respect of the period between 17 May 1990
and 31 December 1998 but provisions may remain unequal in respect of
service prior to 17 May 1990;
(c) in respect of rules relating solely to retirement ages, who left service
or retired between 17 May 1990 and 31 December 2017, equalisation is
required in respect of the period between 17 May 1990 and 31 December
2017 but provisions may remain unequal in respect of service prior to 17 May
1990;
(d) with effect from 1 January 1999 in respect of employees leaving or
retiring on or after that date, a discriminatory rule (other than a rule on
retirement ages where the relevant date is 1 January 2018) must be
equalised in respect of all of an employee’s service including service prior to
17 May 1990.
Gender Ground – discrimination may continue for periods prior to 1
January 1993 for Self-Employed Persons
s.80(4) 118. Where a rule of a scheme for self-employed persons is null and void on
the gender ground, the discriminatory rule may remain in force in respect of a
person’s rights and obligations relating to a period of membership before 1
January 1993.
Other discriminatory grounds – rights in respect of service prior to
application of the principle
s.81(4) 119. Where a rule of a scheme is rendered null and void on discriminatory
grounds other than the gender ground, the discriminatory rule may remain in
force in respect of a member’s rights and obligations in relation to a period of
membership of the scheme before the date on which the rule became null
and void.
Objective Justification
s.68(2), 120. Objective justification may be a defence where indirect discrimination or
s.72(1)(f) discrimination on the age ground is alleged. However, it is important to note
that while very similar language is used, the tests in each case are not
identical.
Indirect discrimination cases
s.68(2) 120(a). An objective justification asserted by an employer in defence to a
claim of indirect discrimination must be based on objective non-discriminatory
grounds, i.e. a discriminatory ground may not be invoked to assert an
objective justification. Likewise if the aim itself is discriminatory, the defence
cannot be invoked. The Act provides that the discrimination must be justified
by reference to a “legitimate aim and the means of achieving that aim are
appropriate and necessary”.
Direct discrimination cases
s.72(1)(e) 120(b). Two of the age ground exceptions are qualified in slightly different
terms. The Act provides in these cases that there is no breach of the principle
of equal pension treatment if the differing treatment is “appropriate and
necessary by reference to a legitimate objective of the employer, including
legitimate employment policy, labour market and vocational training
objectives.”
121. The test in each of the statutory provisions is objective and therefore
cases on these points will turn on the particular facts involved. It is not
possible therefore to provide general guidance as to what constitutes an
objective justification. The text box provides summary details of the current
relevant cases from other jurisdictions on this area.
OBJECTIVE JUSTIFICATION – SOME CASES AND EXAMPLES
INDIRECT DISCRIMINATION
The Bilka-Kaufhaus (ECJ 1986) case determined that indirect discrimination may be
permissible where as a matter of fact it was found that the discriminatory measures
were based on “objectively justified economic grounds. If the national court finds
that the measures chosen … correspond to a real need on the part of the undertaking,
are appropriate with a view to achieving the objectives pursued and are necessary to
that end, the fact that the measures [result in indirect gender discrimination] is not
sufficient to show that they constitute an infringement of Article [141].”
The case concerned a German company which provided pensions for part-timers
provided they had worked full time for at least 15 years. A female employee brought
a claim on the basis that female workers were more likely than male colleagues to
take part-time work to care for family and children. The exclusion of access on to
pensions on criteria that indirectly affected more women than men was held to be
contrary to what is now the principle of equal pension treatment unless the employer
could show that their exclusion was based on objectively justified economic grounds.
In the Allonby (UK Court of Appeal 2001) case, it was noted that it would be wrong
to conclude that an employer can never justify indirectly discriminatory measures
unless such measures are shown to be necessary as the only possible measures. The
measures must be tested to establish whether the objectives are legitimate. If so, then
consideration of whether the means are appropriate and reasonably necessary for that
end takes place. It was also noted that: a “justification” for indirect discrimination
should be weighed against the discriminatory effect of the condition and the
reasonable needs of the party who applies the condition.
The Shillcock (UK High Ct 2002) case approved the Allonby approach and further
noted that: “The more serious and disparate the impact on men and women the more
cogent must be the objective justification.”
In Staffordshire v Black (UK Employment Appeal Tribunal 1995), a Council’s
policy of encouraging redundancy by means of a particular type of pension
enhancement was more beneficial to full timers than to part-timers. The benefits
applied to a higher proportion of men than women for the purposes of the applicable
test under the UK sex discrimination legislation of the time. The Tribunal held that
the Council’s desire not to allocate more resources to fund redundancy payments
might be described as “necessary” (i.e. a financial necessity) and therefore resulted
from a policy which was objectively justifiable despite the indirect discrimination
which the Tribunal concluded was inherent in the Council’s policy.
COMPLAINTS
Who can complain?
s.81E(1) 122. A person claiming not to be receiving or not to have received the
principle of equal pension treatment, or a person claiming to have been, or to
be, the subject of victimisation may seek redress by referring the matter to the
Director of the Equality Tribunal (“the Director”)
s.81E(4) 123. The complainant is the person who refers the matter, or, in the case of a
person with an intellectual or psychological disability, a parent, guardian or
person in loco parentis.
s.81E(3) 124. Where there is a failure to afford the principle of equal pension
treatment to persons on the gender ground, the aggrieved person may refer
their case to the Circuit Court instead of the Director.
s.81F(3) 125. Complainants may appoint any individual or body to represent them in
any proceedings. However, because of its overall duties and functions the
Pensions Authority is not in a position to represent complainants in any
proceedings.
s.81J, 126. The Pensions Authority may in certain cases refer certain matters
s.85EEA to the Director, and the proceedings shall operate as if the matter were
referred by an individual complainant.
127. The matters, in relation to Part VII, which the Pensions Authority may
refer to the Director are the following:
Where it appears that discrimination or victimisation has occurred in
relation to a particular person who has not referred the matter to the
Director;
Where it appears that there is a failure to comply with the principle of
equal pension treatment in respect of a person whom it is not reasonable
to expect to refer the matter to the Director themselves;
Where it appears that a person has procured or attempted to procure
another person to do anything amounting to discrimination or victimisation
or to breach the principle of equal pension treatment.
s.85(5) EEA 128. The Pensions Authority may in certain cases seek an injunction to
prevent certain persons or bodies from carrying our particular activity.
Time limits for claims
s.81E(5) 129. Claims in respect of a claim of victimisation or a breach of the principle
of equal pension treatment may be brought while the relevant employment
continues or within six months of termination.
s.81E(6) 130. In certain circumstances a complainant may, on application to the
Director or to the Circuit Court (as the case may be), have the six month post
employment period in which to bring a claim extended to twelve months
where there is reasonable cause to do so. Any decision by the Director to
extend the six month period to twelve months may be appealed by either
party to the Labour Court – such an appeal must be made within 42 days of
the date of the Director’s decision.
s.81E(7) 131. Where a complainant does not take a case within six months of the end
of their employment and the delay is due to a misrepresentation on the part of
the respondent, the six month period only starts from the date the
complainant became aware of the fact of the misrepresentation.
Burden of Proof
s.76(1)&(2) 132. Where in proceedings under Part VII it can be reasonably inferred from
SI 321/99 the facts established by or on behalf of the complainant that there has been a
breach of the principle of equal pension treatment, the onus then falls on the
respondent to prove otherwise. There are prescribed forms by which
questions may be posed by “X” (the complainant) of “Y” (the respondent) in
order to obtain material information and Y may, if Y so wishes, reply to any
such questions.
s.76(3) 133. Where proceedings arise on a reference from the Pensions Authority
(pursuant to section 85(1) of the Employment Equality Act) and facts are
established by the Pensions Authority from which it is reasonable to infer that
the activity under referral to the Director did in fact occur, then it is for the
respondent to prove that the contrary is the case.
s.98(1) EEA 134. If an employee is dismissed in circumstances amounting to victimisation
and in any proceedings it is proven that the employee was dismissed and in
good faith did one or more of the acts outlined in paragraph 44 then until the
contrary is proven, that proof shall, without more, be evidence that the sole or
main reason for the dismissal was the fact that the employee did one or more
of the said acts.
s.76(2) 135. If some other enactment or rule of law imposes a more favourable
burden of proof on a complainant then the more favourable burden will apply.
Procedure
s.81J 136. In general, the procedures set out in the Employment Equality Act, 1998
(the “EEA”) apply in relation to claims for redress made under Part VII.
s.77A EEA 137. The Director may dismiss a claim if he believes that it is frivolous or has
been made in bad faith, which decision may be appealed to the Labour Court
within 42 days of his decision.
Equality Mediation Officer
s.78 EEA 138. If it appears to the Director that the case could be resolved by
mediation, he must refer the matter to an equality mediation officer. However,
if one of the parties to the matter objects to the matter being dealt with by way
of mediation, it will proceed to being dealt with by the Director.
s.78(5) EEA 139. If the equality mediation officer resolves the matter he must prepare a
written record of the terms of the settlement, signed by both parties to the
mediation and send a signed copy to each party and the Director.
s.78(6) EEA 140. If it appears to the equality mediation officer that the matter cannot be
resolved by mediation, he will issue a notice to that effect to both parties.
Within 28 days of such issuance, the complainant must apply to the Director
to resume hearing the case.
Director of the Equality Tribunal
s.79 EEA 141. The Director is responsible for investigating the case and hearing all
evidence in those cases where he does not consider it appropriate to refer the
matter to an equality mediation officer.
s.79(2) EEA 142. Investigations are held in private.
s.79(3) EEA 143. If a question arises as to whether the situation of a complainant is a
comparator for the purposes of the Act then the Director may investigate this
as a preliminary issue.
s.79(1A) 144. Where a claimant makes claims on multiple discriminatory grounds
(including victimisation), the hearing will be heard as one case, but the
Director must make a decision on each of these claims.
s.94 EEA 145. The Director has wide powers in terms of gathering information and the
conduct of any investigation. This power extends to entering premises for the
purpose of obtaining information. The Director can require any person to
produce any records, books or documents which the Director believes might
contain material information.
s.95 EEA 146. The Director also has power to require people to attend before him for
the purpose of establishing if they have information within their power or
control which is relevant to the exercise of the Director’s functions under the
Act. Any person so requested to attend is obliged to so attend and shall if
requested by the Director sign a declaration of the truth of their answers to
any questions.
s.96 EEA 147. If it appears to the Director that any person has failed to comply with the
requirement to produce information, then the Director may apply to the Circuit
Court for an order requiring the specified person to comply with their
requirements. A specific exemption is made for the Circuit Court to set aside
any requirement to produce any record or information in respect of which the
specified person is entitled to claim legal professional privilege.
s.81 EEA 148. If in the course of investigation the Director or Circuit Court (as the case
may be) form the view that the respondent failed to supply information in
response to questions submitted in prescribed forms, or if the view is formed
that the answers given were false or misleading, the Director or Circuit Court,
(as the case may be) may draw such inferences as they deem appropriate.
s.79(6) EEA 149. Where a determination of the Director is in favour of a complainant, the
Director is obliged to make provision for redress.
Types of Redress
s.81H(7) 150. Where an act constitutes victimisation under Part VII of the Act, the
Employment Equality Act, 1998 and/or the Equal Status Act, 2000, redress
may only be provided under one of those statutes.
s.81H(1) 151. The Director, if he finds there to be a breach of the principle of equal
pension treatment or finds that victimisation has occurred may make one or
more of the following orders:
1. an order requiring “levelling up” in accordance with sections 80 and 81
of the Act (see paragraph 112);
2. an order directing a person or persons to implement the principle of
equal pension treatment for the future (i.e. from the date on which the
rule of the scheme is amended to comply with an order under 1
above);
3. an order directing a person or persons to take a specific course of
action in accordance with the order;
4. an order of compensation for the effects of victimisation but limited to
victimisation occurring in the six years prior to the referral of the case
to the Director;
5. an order for re-instatement or re-engagement with or without an order
for compensation.
s.81H(4) 152. The maximum amount the Director can award by way of compensation
under 4 and 5 above where the complainant was in receipt of remuneration at
the date of the reference of the case or, if earlier, the date of dismissal, is
104 times their weekly remuneration or, if greater, 104 times the weekly
remuneration the person would have received but for the victimisation.
153. In all other cases the limit is €12,700.
s.81H(9) 154. For the purposes of determining compensation “Remuneration” is
defined as including occupational benefits and any consideration whether in
cash or in kind which the employee receives, directly or indirectly, from the
employer in respect of the employment.
s.81H(5) 155. Where the Director makes an award of compensation having found a
breach of the principle of equal pension treatment on the gender ground, in
addition to an award of compensation he can also order the payment of
interest.
Collective Agreements
s.86(1) EEA 156. Claims that a provision of a collective agreement is null and void may be
referred to the Director by a person who is affected by the collective
agreement or by the Pensions Authority.
s.86(3) EEA 157. If the Director considers that the possible nullity of a provision in a
collective agreement referred to him is an issue which could be solved by
mediation, he must refer the issue to an equality mediation officer. If one of
the parties objects to this course of action the matter is dealt with by the
Director.
s.87(1) EEA 158. The Director or equality mediation officer (as the case may be) may if
they think it appropriate provide guidance to the parties to the agreement on
how alternative or amended provisions might be included in the agreement.
s.87(2) EEA 159. A decision of the Director relating to a collective agreement may be
s.87(3) EEA appealed to the Labour Court by the claimant or respondent within 42 days of
the decision. Such an appeal will be held in private unless one of the parties
requests it be held in public, in which case only the non-confidential aspects
of the hearing shall be held in public.
s.87(4) EEA 160. The Labour Court is obliged to identify which of the provisions are null
and void and provide guidance to the parties as to how alternative provisions
might be devised which are lawful to include in the agreement.
Decisions and Appeals
s.88 EEA 161. All decisions of the Director and Labour Court must be in writing. The
s.89 EEA decision may contain written reasons for the decision if the Labour Court or
the Director think fit, or if requested to do so by one of the parties. A copy of
every decision of the Director shall be given to each of the parties as well as
to the Labour Court. Similarly, a copy of every decision of the Labour Court
shall be given to each of the parties and be published and made available for
inspection at the Labour Court office.
s.83 EEA 162. Every decision of the Director may be appealed, within 42 days of the
decision, to the Labour Court by the claimant or the respondent. Any such
appeal hearing will be held in private unless one of the parties requests it to
be held in public, whereupon such part of the proceedings which are not
confidential may be held in public.
s.84 EEA 163. The Labour Court may refer any issue on appeal back to the Director for
further investigation. The Director must give a written report to the Labour
Court on that matter.
164. During any such investigation, the Labour Court may suspend or
adjourn all or part of the appeal pending the Director’s report, and it is obliged
to take account of the Director’s report in reaching its determination.
s.83 EEA 165. The Labour Court may provide any of the same forms of redress as the
Director.
s.90 EEA 166. Where a determination is made by the Labour Court on an appeal under
Part VII the parties may appeal to the High Court on a point of law, and it may
adjourn proceedings pending the outcome of such determination.
s.102 EEA 167. Where a case is referred to the Director under sections 77, 85 or 86 of
the EEA, and is not pursued within a year, the Director may strike out that
case. If an appeal is brought to the Labour Court and the complainant or the
appellant has not pursued the matter after a year, the Labour Court may
strike out the reference or the appeal.
168. The complainant and the respondent must be notified of any such
striking out.
Circuit Court
s.81E(3) 169. A person claiming not to have been afforded the principle of equal
pension treatment on grounds of gender may choose to refer their case to the
Circuit Court instead of the Director.
s.81H(3) 170. Where the Circuit Court has conduct of proceedings it has the same
powers as the Director and any redress awarded under Part VII of the Act is
not subject to the jurisdictional limit of the Circuit Court.
s.80(4) EEA 171. The Circuit Court may request the Director to nominate an equality
s.80(5) EEA officer to prepare and report on any question specified by the Circuit Court,
which report must be furnished to the complainant, the respondent and any
other person to whom it relates. The report shall be received as evidence in
the proceedings, and the equality officer may be called as a witness by the
complainant or respondent to the proceedings
Enforcement by Circuit Court
s.91(1) EEA 172. In the event of failure to comply with the final determination of the
Labour Court or a final decision of the Director, then on application to the
Circuit Court the employer or other person who is bound by the terms of the
decision, may be made the subject of a Circuit Court order directing them to
so comply.
s.91(2) EEA 173. Similarly, the Circuit Court may direct that the terms of a settlement
arrived at through mediation be implemented in accordance with its terms,
however in such a situation the court cannot direct any person to pay any
sum or do anything which had the matter been dealt with otherwise than by
mediation, could not have been provided for by way of redress by the
Director.
s.91(3) EEA 174. Circuit Court enforcement in respect of the failures described in
paragraphs 172 and 173 cannot be applied for until the time period for
bringing an appeal has expired or in the case of a mediated settlement until
42 days have passed from the date of the written record of the settlement.
s.92 EEA 175. Where the Circuit Court issues an enforcement order it also has power
to direct that where compensation was part of the order that court interest on
such compensation be payable.
s.92(3) EEA 176. Where a determination or decision requires the employer to reinstate or
re-engage an employee the Circuit Court has power to award compensation
of such amount as it considers reasonable in respect of the failure of the
employer to comply with the determination or the decision.
s.93 EEA 177. When making an enforcement order under section 91 which relates to
reinstatement or re-engagement of an employee the Court may, if it thinks in
all the circumstances it is appropriate to do so, direct that a compensation
order be made in lieu of the original order. In such event the amount of
compensation cannot exceed 104 times the amount of the employee’s weekly
remuneration and occupational benefits at the rate which the employee was
receiving at the date of the reference of the case or what he would have been
receiving at that date but for the discrimination in question.
Defence Forces
s.81F(1) 178. In connection with claims relating to employment in the Defence
s.104(2) EEA Forces and where they are made by a member of the Defence Forces such
claims must first be made in accordance with section 104 of the Employment
Equality Act 1998. If requested by an authorised officer within the meaning of
the Defence Act, 1954 the Director shall investigate, and make a
recommendation in respect of, any matter which has been complained of in
accordance with section 114 of the Defence Act, 1954 and which would save
for section104 of the Employment Equality Act be a matter which the Director
could investigate under Part VII or which could be the subject of Circuit Court
proceedings under section 81E(3) of the Pensions Act.
s.81F(2) 179. A member of the Defence Forces can still make a claim under Part VII
if:
(a) 12 months have elapsed since the matter was referred under section 104
of the Employment Equality Act and the section 104 procedures have not
been requested or completed; or,
(b) the complainant is not satisfied with the recommendation given under
section 104.
MISCELLANEOUS
Disputes as to whether scheme is Defined Benefit or Defined
Contribution
s.81G 180. Where there is a dispute as to whether a scheme is defined benefit or
defined contribution it shall be determined by the Pensions Authority,
following an application made to it by one of the following persons:
the trustees of the scheme;
any employer of the persons to whom the scheme applies;
a member or prospective member of the scheme; or
other persons prescribed in regulations by the Minister who, in the opinion
of the Minister ought to be entitled to make such an application.
An appeal to the High Court exists in relation to points of law by a person who
brought or was entitled to bring an application.
Report of Pensions Authority to the Director
s.81I 181. The Director may request the Pensions Authority to prepare a report
and answer questions in relation to occupational pension schemes, on which
he may rely in making his decision. The Pensions Authority must give a copy
of any such report to the complainant, respondent and any other person to
whom it relates.