Areas unlikely to change
Once the UK leaves the EU, the UK Government will not be under an obligation to retain any legislation derived from EU law. However, any UK primary legislation which has implemented EU law will not automatically fall away. For example, the provisions of the Pensions Act 2004 relating to scheme-specific funding and the Equality Act 2010 relating to discrimination will remain in force, unless and until the Government decides to repeal or re-write them. It is likely that it will take the Government years to work through all EU-derived primary legislation to decide which parts to retain and which to repeal.
Practically, it seems unlikely that the UK Government will decide to repeal the relevant provisions of the Equality Act 2010. In addition, the scheme-funding regime under the Pensions Act 2004 is well-established and is generally accepted to be more effective than the previous minimum funding requirement regime at reflecting the actual funding position of defined benefit schemes.
In addition, if the UK negotiates, for example, to join the EEA, it will have to continue to comply with certain EU standards and requirements. These are likely to include much of EU-derived employment law and possibly other areas, such as data protection and the cross-border pension scheme requirements.
Areas of change
Once the UK leaves the EU, the European Court of Justice will no longer have jurisdiction over the UK courts, and UK legislation will no longer need to be interpreted in the context of EU law. In addition, even if in the short-term the UK Government decides to retain much of EU-derived legislation, over the long-term, there will be greater flexibility for UK legislation and case law to diverge from EU law.
Future changes which are being proposed by the EU which would affect UK pension schemes may fall away. For example, it is possible that UK pension schemes may not be required to equalise guaranteed minimum pensions (the Government’s view being that it is EU law which drives the requirement to equalise), and the new disclosure, governance and risk assessment obligations which are being proposed by the IORP II Directive, which is expected to be finalised later this year, may not apply to UK schemes.