In Air Products Plc v Cockram, the claimant was part of his employer’s defined benefit pension scheme which allowed access to pension at 50 years of age. The employer also had a defined contribution scheme which allowed access to pension from 55 years.
The employer’s Long Term Incentive Plan (LTIP) provided that any right to unvested LTIP awards would be forfeit unless employees remained in employment until 55. The claimant resigned at 50 and claimed the forfeiture of his unvested LTIP awards amounted to age discrimination. His employer accepted this but argued that its actions were objectively justified. It said that, amongst other arguments, its approach was a proportionate means of achieving consistency across its defined benefit and defined contribution pension schemes.
On the facts, the Employment Tribunal agreed with the employer and the Court of Appeal subsequently reinforced this finding. The claimant had access to a more generous pension than colleagues in the employer’s defined contribution scheme and had the right to draw his pension at an earlier age. Restricting access to unvested LTIP options was in the tribunal’s view a legitimate social policy aspect of intergenerational fairness.
This decision was heavily dependent on its facts, however it demonstrates that it is possible for an employer to be able to justify an age requirement in such schemes.