The Lloyds Trade Union has instructed former Thompsons Solicitors head of pensions Ivan Walker to bring a case before the Employment Tribunal (ET) on behalf of three women that will seek to ‘close the gap’ between pension payment increases for male and female employees at Lloyds Banking Group. The claim targets a system known as guaranteed minimum pensions (GMP), whereby companies like Lloyds provide an equivalent pension to employees wanting to top up their retirement savings. The GMP is considered generally less accessible to female employees than their male colleagues due to the five-year gap in the eligibility age for pensions between men and women and the different rates at which male and female employees accrue benefits.
Skewed against women
Announcing the new legal action, LTU general secretary Mark Brown described guaranteed minimum pensions as ‘one of the last bastions of pension discrimination’ in the United Kingdom. According to the LTU action, approximately 5 million female employees – including up to 148,000 working within Lloyds Banking Group – have ‘either got or are going to get smaller pension increases than men’ as companies and regulators have failed to address the skewed system. The legal challenge, which has been initially brought forward on behalf of three female employees only, may eventually be expanded into a class action on behalf of at least 28,000 female Lloyds employees currently on applicable pension schemes. The LTU estimates that closing the gap in the across UK could accumulatively cost major British companies in the vicinity of £20bn.
Sources: The Lawyer; The Guardian
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