The TUC has welcomed Thursday’s House of Lords decision on part time pensions as ‘good news’ for thousands of retired women who, because they once worked part-time, had been barred from paying into company pension schemes.

The Lords have decided that women part timers – who had been denied access to pension funds prior to 1994 – will now be able to claim backdated pension rights as far back as 1976. But on the cut-off point determining the time between a part-timer leaving employment and the point at which a claim for backdated pension rights must be made, the Lords decided to stick with UK law, which imposes a six-month time limit.

TUC General Secretary John Monks said: “This is good news for thousands of retired workers, mainly women, who will now be able to receive the pension they have been denied. Justice has been won for the women who until today faced a very bleak retirement. Now they can look forward to old age, safe in the knowledge that they will be more financially secure.

“But the TUC is very disappointed that the Lords failed to listen to the union case for extending the current cut-off for making pension claims from six months to six years. Many women, who logged pension claims against their employers more than six months after leaving work, will now get nothing. They will be devastated by today’s news.

“The unfair situation which prevented part-timers from paying into pensions funds has been partially righted at long last by today’s decision. But these women have had to wait a long time. We hope that employers will now move quickly and give the many retired women with valid claims the backdated contributions they are legally entitled to.”

Employers organisations meanwhile have said that the ruling threatens the future of thousands of small and medium sized businesses which will be put under immense strain if forced to fund pensions for a period of over 20 years.

Today’s decision was based on 22 test cases brought by six TUC-affiliated unions – public services union UNISON, banking union Unifi and teaching unions, ATL, NATFHE, NASUWT and the NUT. The TUC and the unions have been campaigning for the past six years for backdated pension rights for around 60,000 part-time, mainly female, workers.

The women who were awaiting today’s decision are mostly retired. They worked in both private and public sector organisations which, until seven years ago, did not allow part-time employees to pay into company pension schemes.

Following a 1994 European Court ruling, which found this treatment of part-time workers discriminatory on the basis that the majority of part-time workers are women, part-time workers in the UK have been allowed to sign up for company pensions in the same way as their full-time
colleagues have always done. However a long legal argument about how far back pension rights should be allowed ensued. Employers argued that only two years’ back pension contributions needed to be paid, while unions claimed that the back dating should take place to when European law first required equality in pensions – 1976.

There will be no immediate payout of backdated pension contributions after today. For each case to be valid, it will have to have been logged with an employment tribunal within six months of the individual leaving employment. It is likely that individual tribunals will now hear applications relating to groups of cases, so, for example ex-nurses’ claims will be dealt with in one batch, teachers in another.

The advice from the TUC to individual workers who have logged claims is to go back to their unions to find out what to do next. People who’ve logged cases but who were never in a union should go back to their solicitors for advice. New claims from part-time workers who are still in employment or who have left work within the last six months should be made immediately. But
anyone who is now retired and who believes that they failed to receive their true pensions entitlement, yet never logged their case, will probably be unable to take their case any further.

It will also be impossible to gauge the extent of the payout that public and private sector pensions funds will have to make until all the valid cases have been heard at tribunal.