Employment Cases Update

This Third Addendum updates, but does not replace, the Presidential Guidance dated 10 August 2017 which introduced the fourth edition of the guidance for Employment Tribunals and parties on calculating compensation for pension loss (the document titled "Employment Tribunals: Principles for Compensating Pension Loss" - referred to as "the Principles").

The working group has now produced the third revision of that fourth edition of the Principles. The revised document is available here. A shorter Basic Guide to Compensation for Pension Loss can be found here.

Tribunals and users should now refer to the third revision rather than to earlier versions of the fourth edition.

The main changes in this revision of the Principles are as follows:

• The relevant passages of the text, the tables in Appendix 2 and the worked examples in Appendix 3 are now based on the Eighth Edition of the Ogden Tables published in 2020.
• References to rates of tax and of state pension have also been updated to current figures in the text and in Appendix 3.
• The approach to grossing up in Appendix 3 reflects the possible impact of the High Income Child Benefit Tax Charge if the Tribunal award means this applies to the claimant.
• The text acknowledges the potential impact of furlough arrangements under the Coronavirus Job Retention Scheme.
• The text takes account of the Government announcement of 4 February 2021 that for public sector workers in defined benefit schemes before 31 March 2012 the compulsory transition to career average revalued earnings schemes will be delayed until April 2022.

In addition, recognising the complexity and length of the Principles, the working group has produced an accompanying Basic Guide which aims to provide a simple overview of the recommended approach to pension loss.

These revisions to the Principles in part reflect contributions from beyond the working group, and those who have contributed are acknowledged in Appendix 5.