The Civil Partnership (Opposite-sex Couples) Regulations 2019 permit two individuals of the opposite sex to enter into a civil partnership, which was previously only possible for same-sex partners. The Regulations were published on 11 November 2019 and will come into force on 2 December 2019. With a 28-day notice period, the first opposite-sex civil partnership ceremonies could take place on 31 December 2019. 

The Regulations have been made following a Supreme Court case in 2018 (Steinfeld v Secretary of State for International Development) which held that the Civil Partnership Act 2004 is incompatible with Article 14 of the European Convention on Human Rights to the extent that opposite-sex couples cannot enter into a civil partnership in the same way as a same-sex couple. The Civil Partnerships, Marriages and Deaths (Registration etc) Act 2019 was enacted to address this incompatibility and to enable the Regulations to be made.

How will pension schemes be affected?

Trustees of occupational pension schemes will need to ensure that opposite-sex civil partners are treated in the same way as opposite-sex married couples (this is the same equal treatment requirement as currently applies to same-sex civil partners). 

Scheme rules should already incorporate provisions for the equal treatment of same-sex civil partners. Depending on their drafting, it may be that no amendments are needed in order for those provisions to cover opposite-sex civil partners. However, changes will be necessary if the existing provisions refer to same-sex partnerships, which may well be the case in respect of the definition of "civil partner" and the death benefit provisions relating to civil partners. We recommend that trustees review their scheme rules (with legal advice if needed) to identify what changes will be needed.

Amending the scheme rules can be achieved in line with the scheme's amendment power as for any other rule amendment; if this is not possible for any reason, trustees may be able to use statutory amendment powers to amend their scheme by way of a trustee resolution. 

Trustees will also need to review member booklets and any other scheme literature, to identify whether any changes are needed to reflect the introduction of opposite-sex civil partnerships.

Where a buy-in contract has been entered into in relation to the scheme, it will be necessary to check the terms as they may also need amending to ensure that survivors' benefits can be paid to surviving opposite-sex civil partners. 

Given that the Regulations introduce a new form of civil partnership, it can be expected that the liabilities of defined benefit schemes will increase. However, at this stage it is not known how significant the take-up of opposite-sex civil partnerships will be nor the extent to which those who enter into the new civil partnerships would otherwise have got married; in practice, the increase in liabilities may be small. Co-habiting couples will continue to be outside the scope of survivors' benefits (except to the extent that a scheme's rules provides for a pension to be paid to a co-habitee on a member's death). 

The treatment of GMPs for opposite-sex civil partners is an unresolved issue which, at present, there does not appear to be any intention to change. Currently, same-sex civil partners receive the same GMP entitlement as widowers (that is, limited to the member's post-1988 accrual), whereas widows of male members have a GMP entitlement based on the member's accrual from 1978 onwards. GMPs for opposite-sex civil partners will be calculated on the same basis as for same-sex civil partners, meaning that a female surviving opposite-sex civil partner will be entitled to a lower GMP entitlement than if she had been married to her partner. For the time being, schemes should ensure that their rules and administrative practice comply with the requirement for surviving opposite-sex civil partners to be treated in the same way as widowers for GMP purposes.

Please get in touch with your usual contact in the pensions team if you would like to discuss any of the points raised in this update. 

This article is for general information only and reflects the position at the date of publication. It does not constitute legal advice.