TUPE transfer counts as ‘resignation’ for pension claim purposes

Cabinet Office v Annette Ellis [2015] EWCA Civ 252.

The Court of Appeal has rejected a claim that a member of the Principal Civil Service Pension Scheme (PCSPS), whose employment was transferred to a private contractor, should have the right to retain a reduced pension age of 55 and favourable accrual basis that were available to active members of the PCSPS.

Facts

Ms Ellis was a prison officer and member of the PCSPS, whose employment was transferred to a private contractor following a TUPE transfer. At the time of the transfer, Ms Ellis was offered the option to join the private contractor’s comparable scheme or keeping a preserved pension with the PCSPS. She opted for the former.

Under the PCSPS rules, upon her transfer of employment, Ms Ellis was taken to have resigned from her post. The Pensions Ombudsman concluded that she was therefore not eligible to withdraw the unreserved pension when she reached 55, as offered to active members of the PCSPS. The Ombudsman found that the word ‘resignation’ had a broader meaning in this context, and included both voluntary and involuntary termination.

On appeal, the High Court found that the Ombudsman had misconstrued the PCSPS rules, and had given too wide a meaning to ‘resignation’.

The Decision

The Court of Appeal held that the relevant rules for resignation included both voluntary and involuntary methods of termination. It rejected Ms Ellis’s contention that this only covered methods of departure initiated by the employee and not those forced upon the employee out of their control.