LOSS OF EARNINGS:THE BADLY INJURED CHILD AND PENSION LOSS

This blog has looked before at the approach that judges take when assessing loss of earnings in cases of badly injured young children.  This issue was considered in the judgment of Mrs Justice Cox in Manna -v- Central Manchester University Hospitals NHS Foundation Trust [2015] EWHC 2279 (QB).  There is an interesting, and important, issue relating to a claim for pension loss.

THE CASE

The claimant was aged 18 years. He had suffered brain injury at birth.

KEY POINTS

  • A badly injured child was entitled to damages for pension loss.
  • The loss was calculated by reference to the financial contributions that his employers would make towards a future pension.

THE JUDGMENT ON FUTURE LOSS OF EARNINGS

(d) Loss of Future Earnings and Pension
  1. The Claimant’s future earnings are claimed at the level of median gross annual earnings, giving a figure of £21,451.00 net per annum, and there is no dispute as to the multiplicand. Applying the multiplier of 22.81 (see above) the award for future loss of earnings is therefore £489,297.31.
  2. The Defendant makes no allowance in respect of loss of pension. The basis for this, as set out in the Counter Schedule (Mr Seabrook made no submissions upon it), is that the Claimant “has not made any allowance in his loss of earnings claim for employee contributions that would have been deducted from his salary“. This, it is said, would “broadly cancel out any benefit from employer contributions.”
  3. This, however, is to misunderstand the claim being made, as Mr Sweeting submits. The Claimant is not claiming the pension that his own contributions would have provided, in which case it is accepted that a deduction would have to be made. He submits, rather, that the Claimant is entitled to his full loss of earnings, including the contributions he would have made to a pension, since he is entitled to make those contributions in order for him now to be able to purchase a pension. This claim is therefore confined to the additional contributions that his employer would have made.
  4. I accept that submission and award the sum claimed under this head. These are contributions that employers will have to make under the terms of recent pension legislation, requiring them to designate workplace pension schemes and automatically enrol all employees aged between 22 and state pension age with earnings at the income tax threshold.
  5. The relevant calculation is set out at paragraph 11.4 of the closing submissions, applying the multiplier of 22.81 to the figure of £700, making the award one of £15,967.00.

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