Legislation update – Falling foul of equality rules?

The final details on how the Employment Equality (Age) Regulations will affect pension schemes could leave some employers in breach of the law. Jane Beverley, senior technical consultant at Punter Southall, explained: "The original draft made out that occupational pension schemes would be exempt, so we gave our employers a reassuring message."

However, the final copy of the regulations, which come into force in October, includes much more specific rules around pension schemes. This means that companies which previously believed their scheme would not breach the new rules may now need to carry out a further review to ensure they are covered. "In the final regulations, which came out in May, there is a long list of exemptions, so every company will have to go through their scheme rules to ensure they are covered," said Beverley. Employers should be particularly wary of offering age-related member contributions.

Under the rules, they must be able to prove that differing bands of contribution are in place to provide equal benefits for members on retirement. "The final rules state that employers offering varying contributions on the basis of age are exempt, but only when the intention is to equalise benefits [for staff]," said Beverley.