In Ireland there are eleven grounds on which discrimination is outlawed in pension schemes. The law mainly derives from EU Directives and case law but it also contains some special Irish rules.

Nine of the grounds of discrimination are defined in the Pensions Act 1990, and two further grounds are defined in the legislation dealing with the rights of part-time and temporary workers.

The remedies, procedures for bringing claims, defences to claims of discrimination and sanctions vary quite widely depending on the particular rights being breached.

A temporary (or fixed-term) worker, in overall terms, must receive a remuneration package that is at least as good as that of his/her permanent comparator. In devising the overall package of benefits the employer may pick and choose and may increase the rate of basic pay in order to eliminate pension benefits. There is no right to pension benefits if the fixed-term worker works less than 20% of the hours of the full time comparator. Part-time workers must be provided with the same benefits pro-rated to their full-time comparator. If the part time worker works less than 20% of the hours of the full-time comparator, pension benefits do not have to be provided. Where final salary benefits are integrated with a State pension the value of a scheme pension available, whilst theoretically accurate, may be disproportionately small and there are no legislative sanctions to address this, although new minimum preserved benefits may redress this issue in practice.

Claims for breaches of the rights of temporary and part-time workers will be heard by a Rights Commissioner who may require an employer to pay compensation of up to two years' remuneration.

The principle of equal pension treatment afforded by the Pensions Act 1990 outlaws discrimination on any of the nine grounds in respect of any rule of a pension scheme. This includes indirect discrimination unless it can be objectively justified.

The nine grounds defined in the Pensions Act 1990 are gender, family status, marital status, sexual orientation, age, religion, disability, race (including colour, nationality, ethnic or national origins) and traveller status.

The grounds are not as self evident as might appear. For example, the gender ground compares persons of the opposite sex provided that they have the same family or marital status. Thus, a woman is compared with a man provided they both do not have children (or both do) and a married woman with a married man (but not with an unmarried man).

Exclusions that derive from EU Directives apply.

• Different employer contributions are permitted on gender grounds if they are to remove or limit the amount or value of benefits provided under a defined contribution (DC) scheme or to ensure that there is adequate funding under a defined benefit (DB) scheme.
  
  
• The use of actuarial factors is justifiable to generate higher benefits;
  
  
• Special maternity treatment benefits may be given;
  
  
• Different treatment may occur as regards additional benefits available;
  
  
• Flexible retirement ages are permitted provided that the applicable conditions are the same for both sexes.

A variety of exceptions apply to the age ground. It is therefore difficult to see what practical benefit this ground will generate. Provided the gender ground is not breached it is permissible to fix the age, or qualifying service or both as a qualifying condition(s) for the following:

• entry to the scheme,
  
  
• entitlement to benefits (either individually or for groups),
  
  
• accrual of rights under a DB scheme or level of contributions to a DC scheme (either individually or for groups) provided this is appropriate and necessary by reference to a legitimate objective of the employer, including legitimate employment policy, labour market and vocational training objectives. Thus it is permissible to have a DB plan for an older workforce and a DC plan for a younger one.

In addition, the use of age related actuarial calculations is permitted.

The pipeline EU Directive on the Principle of Equal Opportunities and Equal Treatment of Men and Women in matters of Employment and Occupation is likely to overhaul this aspect of our pensions equality laws. It still remains to be seen how far ageism will be eliminated and if the use of homogenous actuarial data will be required when the ultimate version of this directive is implemented.

Positive discrimination in favour of married people is permitted in Ireland as regards, for example, death benefits. However, when providing such benefits the gender ground must be complied with. The legislation states that no breach of either the marital status ground or sexual orientation ground arises if more favourable benefits are provided to a deceased member's widow or widower, provided that no breach of the gender grounds arises. This makes it clear that same sex partners do not have similar rights to death benefits as may be provided for married partners.

Positive discrimination in favour of the disabled is also permitted. It is possible to provide lesser benefits on the grounds that the person with the disability is unable to have the same output as a person without that disability.

Disability is widely defined. There is an exception for those opting for early retirement on disability grounds: such rules are legal. However, a pension scheme is not permitted to apply less favourable treatment for someone with a disability who is able to have the same work output as their comparator (who does not have that disability). Consequently, scheme trustees or the employer are not permitted to pass on specific conditions imposed by an insurer on the basis of medical evidence or the claims history of a member if their condition is one captured by the wide definition of disability.

Where a pension scheme rule breaches one of the nine grounds it is rendered void. The remedies are quite complex and reflect in the case of gender issues all the complexities of the European Court's pronouncements, such as the requirement to level up, post 17th May 1990, inequality, until the offending rule is amended to equalize benefits. Failure to admit a member due to breach of the principle must be addressed and if the scheme is contributory, backdated admission is conditional on payment of back contributions.

The Pensions Act 1990 does not require a claimant to point to a comparator when bringing a claim for discrimination, although a claimant must point to a comparable situation. Broadly, the rules reflecting the burden of proof Directive apply, so that once a prima facie case has been established the burden shifts to the respondent to disprove the claim.

The Equality Tribunal has jurisdiction to hear claims under the nine grounds covered by the Pensions Act 1990, but gender based claims can also go to the Circuit Court (in order to comply with the Marshall case). Claims must be brought within six months of termination of the relevant employment. And, exceptionally, this may be extended by a further six months.

A wide range of remedies may be granted by the Equality Tribunal and include the power to order compliance with the levelling up principle and issuing compensation orders.

The Equality Tribunal, like a Rights Commissioner, does not have any power to award costs, so this can be a deterrent to bringing a claim, given the disparity of bargaining positions between a claimant and a respondent. Essentially, any legal costs incurred by a claimant must be discharged out of the award which is designed to be compensatory as regards the discriminatory act.

Going forward, future new grounds will probably derive from the pipeline EU Directive and it is likely that in the future there will be challenges on the grounds of sexual orientation and marital status.

This article appeared in the January 2006 issue of the "Irish Pensions Magazine", published by the Irish Association of Pension Funds (IAPF).

For further information please contact Fiona Thornton.