Policy News Journal - 2014-15

dismissals were unfair.

High Court ruling may protect bankrupts’ pensions after freedoms take effect

16 January 2015

A man in bankruptcy has retained his personal pension after a High Court judge decided he should not be compelled to hand it over under an Income Payments Order.

ProfessionalAdviser has provided an interesting summary about this ruling.

The landmark ruling could mean bankrupts' pensions are protected after ‘freedom and choice' takes effect in April despite an earlier judgement opening up the full cash lump sum for insolvency claims. In Raithatha v Williamson in 2012 , a judge held that a bankrupt of pensionable age could be forced to draw their 25% tax-free lump sum and give it over to trustees in a bankruptcy. However, the judge in this latest case - Horton v Henry - ruled that even though a bankrupt aged 55 or over was entitled to access their pension, they were not obliged to draw it for the purposes of an IPO.

Ashfords associate Stephen Young said: "A lot of insolvency practitioners got excited when George Osborne gave his pension announcement in last year's Budget.

If Raithatha was good law, it would have followed that there seemed to be no reason why a trustee couldn't also apply to a court to compel a bankrupt to draw down their pension in one lump sum and therefore pay the whole pension into the bankruptcy. In effect, the proposed reforms meant we could have been heading back to the future to the days pre the Welfare Reform & Pensions Act 1999 when an individual's rights in a pension constituted an asset of the bankruptcy."

Appeals against Dismissal

27 January 2015

Where an employer decides that an appeal against dismissal should succeed, is communication of the decision necessary to revive the contract?

No, held the EAT in Salmon v Castlebeck Care , upon an appeal succeeding there are no further steps that are needed in order to revive the contract.

Daniel Barnett’s employment law bulletin summarises:

Mrs Salmon was dismissed for gross misconduct prior to a TUPE transfer. After the date of the transfer, the transferring HR Director decided that her dismissal was unsafe. She did not communicate that decision or make any direction as to reinstatement, but directed an employment consultancy to negotiate a settlement (although this never actually occurred). The EAT, allowing Mrs Salmon’s appeal, held that once an appeal against dismissal under a contractual appeal procedure has been upheld, the contract is automatically revived. There is no need for a separate reinstatement decision or communication of that decision. The situation was not analogous to that in which an employee is notified of a dismissal (in which case communication is necessary for the decision to be effective).

Mrs Salmon was therefore employed immediately before the transfer and entitled to pursue her claim against the transferee as per G4S Justice Services (UK) v Anstey .

CIPP Policy News Journal

08/04/2015, Page 133 of 521

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