Equal treatment - recent developments

Part-time Workers Regulations

The Part-time Workers (Prevention of Less Favourable Treatment) Regulations 2000 came into force on 1 July 2000. They provide that a part-time worker has the right not to be treated less favourably than a full-time worker who works under the same type of contract and who is engaged in the same or broadly similar work, unless the discrimination can be objectively justified.

Therefore employers must not discriminate between full-timers and part-timers over access to pension schemes unless different treatment is justified on objective grounds. There is no longer any need to establish that the exclusion of part-timers affects a disproportionate number of one sex.

To claim under the Regulations, part-timers will have to prove that they have been treated less favourably than a comparative full-timer (regardless of gender) engaged in the same or broadly similar work and have a broadly similar level of qualifications, skills and experience. A hypothetical comparator will not be acceptable.

Part-timers can request from their employer written reasons for exclusion from the pension scheme. The reasons must be supplied within 21 days of a request.

Fixed Term Workers

The Fixed Term Workers Directive 1999/70/EC will offer similar protection for fixed term contract workers. It provides that employees on fixed term contracts must not be treated less favourably than comparable employees with permanent contracts, unless the difference in treatment is objectively justifiable.

The UK has until 10 July 2001 to implement the Directive (although this may be extended by up to 12 months) and a consultation paper should be published shortly setting out the ways in which the UK could comply with the Directive's requirements. The Government will have the option of excluding employees who are undergoing vocational training or apprenticeships from the application of the equal treatment provisions.

The new legislation will almost certainly mean that requirements for employees to be "permanent" before they can join a pension scheme will be outlawed.

Schemes that wish to exclude temporary workers might be able to do so by incorporating long waiting periods (and backdated membership if appropriate). The Directive does allow such service qualifications, but the same qualifications would have to apply to permanent employees. We do not know yet whether UK legislation will allow this and there may also be indirect sex discrimination considerations.

Preston

The judgment of the House of Lords in the Preston case is still awaited at the time of going to press. It is anticipated that backdating of successful claims by part-timers is likely to extend to 8 April 1976 because the lawyers in the case did not argue for a shorter period.

The other critical issue which the ruling will deal with is whether the 6 month time limit for lodging a claim is compatible with Community law and, if not, what longer period should apply. Subscribers to our LawNow service will receive an analysis of the ruling by e-mail once the judgment is available.

To view the November 2000 issue of the Pensions update which includes this article, please use the link below. The document can be downloaded or viewed online as an Adobe PDF file.