The Court of Appeal has backed a High Court interpretation that a group of Vodafone pension scheme members have a contractual entitlement under the scheme rules to pension increases linked to pay movements rather than increases being entirely at Vodafone’s discretion.
The dispute concerns Scheme C of the Vodafone Ireland Pension Plan. Its members are former Department of Posts and Telegraphs staff whose employment passed through Telecom Éireann and eircom before they moved to Vodafone following its acquisition of Eircell in 2001.
There were 169 Scheme C members when the proceedings began: 127 pensioners, 30 deferred members and 12 active members.
The central provision was Rule 10 of a 2005 pension deed. It said Scheme C pensions “will increase” in no less favourable a manner than if members had remained in the eircom scheme and “will increase in line with the percentage increase in the relevant grade”.
Vodafone argued that increases remained discretionary, pointing to earlier scheme wording and the background to the 2005 deed. The High Court had rejected that interpretation in 2024 and held that Rule 10 created a guaranteed pay-parity entitlement.
Mr Justice Allen agreed with the High Court’s approach. He said the words “will increase” could not credibly be read as leaving increases wholly discretionary. Vodafone’s interpretation would require inserting words such as “if such increases are granted” which were not in the rule.
The court also considered the members’ employment history important. Their pension terms had repeatedly been protected on a “no less favourable” basis as staff moved from the civil service through Telecom Éireann and eircom to Vodafone. A €36.7 million transfer into the Vodafone scheme had also been calculated on assumptions that included pay-parity increases.
The court rejected Vodafone’s argument that the 2005 deed was merely a consolidation of earlier rules. It found that the deed contained substantive changes and that its language had to be given effect.
The supplied judgment extract ends before the court’s formal concluding orders, but the reasoning provided rejects Vodafone’s principal grounds challenging the High Court’s interpretation of Rule 10.