Pensions ruling deals blow to women workers

MILLIONS of women in Britain hoping to protect their right to retire at 60 instead of 65 without loss of pension entitlements have been dealt a blow by a European judge.

The Advocate General of the European Court said this week that an employer is allowed to raise its female employees' retirement age to 65 under certain circumstances.

His opinion is not legally binding on the court, although it usually confirms his views.

However, its implementation is likely to cause headaches for many employers, who will need to recalculate the pension entitlements for both their male and female staff.

The case was taken to the European Court by a group of women employed by Avdel, a maker of industrial fasteners.

It follows a separate case in 1990, called the Barber judgment, in which the court ruled that pensions were part of pay. Therefore men and women in company schemes should receive equal benefits.

Avdel, based at Welwyn Garden City, Herts, told its female staff in July 1991 that to comply with the Barber judgment their retirement ages would be raised to 65. If they wanted to retire at their original age of 60 their pension entitlement would be cut by up to 20 per cent.

Andrew Scrimshaw, a pensions specialist at Sedgwick Noble Lowndes, the employee benefits consultancy, said: 'The opinion appears to say that prior to May 1990 it is possible to alter retirement ages because equalisation did not apply.

'Once equalisation takes place, employers can raise the pension ages of both men and women back to 65 because both are getting the same treatment.'

It was still open to women to argue that their contracts were being breached if companies try to raise their pension ages - but the breach would only relate to service before the Barber judgment.