Hogan Lovells

Grenville Holden Hampshire v the Board of the Pension Protection Fund

Topic -

Timeframe - Archived


Key dates

23 December 2014

 

Summary

The High Court rejected a claim by a scheme member whose early retirement pension was substantially reduced when his scheme entered a PPF assessment period.

Article 8 of the EU Insolvency Directive provides that member states are obliged to take the "necessary measures" to protect the interests of employees and former employees at the date of the employer's insolvency in respect of accrued rights under occupational pension schemes.  This was implemented in the UK through the establishment of the PPF and the Financial Assistance Scheme.  For members who have not yet attained normal pension age, PPF compensation is capped at 90% of the statutory compensation cap and adjusted to reflect the member's age.

A scheme member's early retirement pension was substantially reduced when his scheme entered a PPF assessment period. The member appealed against a determination of the PPF Ombudsman, arguing that in light of the ECJ decisions in Robins and Hogan Article 8 imposed a requirement on member states to ensure that that every member of an insolvent employer's pension scheme receive at least 50% of their pension benefits and that the Directive was directly effective.

Judgment

The High Court rejected the argument that Article 8 requires the UK to ensure that every individual employee of every scheme receives a minimum of 50% of their scheme benefits.  Consequently the claim that the Directive had direct effect failed.





Date Accessed: 25/09/2022