Prudential wins in court case over pension dispute
PRUDENTIAL won a court dispute with members of its staff pension plan yesterday over cuts to payments into the scheme.
Members had argued that the insurance group did not have the right to introduce a cap of 2.5 per cent on the annual increase in discretionary payments into their pensions in 2005, after decades of basing the rise on retail price inflation. Members felt they had been given a reasonable expectation that the rule would not be changed, but the court ruled that Prudential had not breached its duty of good faith to its staff.
Katherine Dandy, a partner at Sackers, which represented members, said the decision was “very disappointing for the members who had come to expect a particular level of benefit”.
A Prudential spokesman said it “introduced the new policy, in good faith, as part of a package of measures designed to secure the financial future of its pension scheme”.