Retrospective treatment

European law makes clear that, unless there are exceptional circumstances, it cannot be applied retrospectively. In O’Brien v Ministry of Justice; Walker v Innospec and ors, the Court of Appeal has confirmed that if employees are treated in a way that was lawful at the time, the treatment cannot become unlawful retrospectively.

Basic facts

This case concerns two appeals which were originally heard separately but which were subsequently conjoined in the Court of Appeal.

The first concerned Mr O’Brien, a part time judge who held office from 1978 to 2005. He became entitled to a pension with the introduction of the Part Time Workers Directive which was transposed into domestic law in April 2000. Mr O’Brien argued that his pension should be backdated to take account of all his sitting days. In other words, from 1978 onwards.

Mr Walker, who had worked for Innospec Ltd from 1980 until his retirement in 2003, entered into a civil partnership with his long term partner in January 2006 under the Civil Partnership Act 2004 which came into effect in December 2005. The two men subsequently married. Under rule 8.1 of Innospec’s pension scheme, a member’s surviving spouse is entitled to a pension for life. Mr Walker argued that the fund should pay out a surviving spouse's pension to his husband in the event that he outlived him (see LELR 365 for more details).

Tribunal and EAT decisions

The tribunals in both cases found in favour of the claimants but the EAT dismissed both appeals. .

Decision by Court of Appeal

Relying on the case of Ten Oever v Stichting Bedrijfspensioenfonds Voor Het Glazenwassers-en Schoonmaakbedrijf, the Court of Appeal agreed with the Advocate General who held that "…the extent of [pension] rights falls to be determined on the basis of the Community rule which applied at the time of the period of service on the basis of which those rights were acquired.” As Mr O’Brien had not acquired any pension rights before 7 April 2000 as a part-time worker when the Part Time Workers directive was transposed into domestic law, he could not do so retroactively.

The Court of Appeal then considered Mr Walker’s case. As he retired before the Equal Treatment Framework Directive 2000 came into force in the UK, he faced an obstacle to his claim under schedule 9, paragraph 18 of the Equality Act 2010. This states that, in relation to sexual orientation, it is not unlawful for employers to restrict access to a “benefit, facility or service” which accrued before December 2005 (when the Civil Partnership Act came into force), or which was payable in respect of periods of service prior to that date.

The Court noted that Mr Walker's entitlement to benefit was part of his pay that was earned incrementally during his period of service when it was lawful for employers to discriminate on the ground of sexual orientation. As the treatment was lawful under domestic law when it occurred, the Court held that it could not become unlawful retrospectively. Likewise, his entitlement had to be judged by reference to the EU law in force at the time of his service.

Finally, the Court held that paragraph 18 of Schedule 9 of the 2010 Act was compatible with the Framework Directive. But even if it was incompatible, the Court could not “trespass into the field of law-making which is the task of Parliament and not the court”. It was clear that paragraph 18 was expressly designed to preclude claims such as Mr Walker's from being made.