In the case Prometric v Cunliffe, the claimant argued that he was entitled to membership of a DB pension plan, instead of his employer’s DC scheme, because of an alleged promise made to him a by a group director 16 years previously. 

Cunliffe was a senior human resources executive who joined a company called Sylvan Prometric in 1999.  When he was appointed, his letter clearly stated that he could join the DC pension scheme, which he ended up doing in 2000.  In 2001, the company was taken over and Cunliffe joined the new owner’s DB pension scheme.  According to Cunliffe, a conversation between him and the new company’s international human resources director occurred where he was told that his senior position entitled him to benefits offered to all the company’s directors and senior staff.  This included the DB pension scheme.

Approximately six years later, the company was sold yet again and Cunliffe had to move back to the original Prometric’s DC scheme.  Cunliffe’s argument was that the conversation he had with the international HR director back in 2000 was contractual and he was entitled to be part of a DB scheme.  Prometric accepted the conversation had taken place but was not at all willing to acknowledge there was any kind of contractual effect, since there was no documentation.  Cunliffe, who clearly was not playing around, began legal proceedings at this point.

The High Court refused the employers request for the court to strike out the claim on the basis it had no reasonable prospect of success.  It was clear that Cunliffe, at this point, had an arguable case where a conversation could have amounted to an official agreement.  What that agreement was would have to be figured out at the trial.

However, the Court of Appeal overturned the High Court’s decision and agreed with the employer and the claim was struck out.  The court felt that a conversation held between two HR executives would have been documented.  The claimant, as a matter of fact, had never requested or received documentation.  Furthermore, the court felt that the fact he was treated as a member of the DB scheme when Prometric was taken over wasn’t any kind of evidence that suggested a binding agreement but rather a discretionary arrangement.

This case stresses the importance of clear and written forms of documentation.  It also stresses the important of education on the employees behalf, who should always know what their options are and what choices they have.