Court adviser says UK not breaking EU pension law

LUXEMBOURG, July 13 (Reuters) Britain has flaws in its protections for workers who lose their pensions when firms go bust but they are not big enough to mean the country is breaking EU law, an adviser to the European Union's top court said.

The advocate general considering the case brought by British trade unions said today the breach was not sufficiently serious to trigger Britain's liability under EU law.

The opinions of advocates general are not binding but are followed by the full court in most of its rulings.

Britain's biggest private sector trade union Amicus brought the case before the European Court of Justice last year.

The union has championed the case of former employees of Allied Steel and Wire, a British company, who lost their jobs and pensions when the company went into receivership in 2002.

An EU insolvency directive from the 1980s requires member states to take measures to protect employees' pensions.

Unions say the government of then British prime minister Margaret Thatcher was the only one in the bloc that failed to meet the obligation.

They also say British reforms, such as the creation of the Pension Protection Fund (PPF) in 2005 to help workers whose companies go bust, are inadequate.

But the British government says it has done all it is required to under EU law.

''The government believes it has met its obligations under Article 8 of the European Insolvency Directive, as successive governments have done since the directive was implemented,'' said a spokesman for the Department of Works and Pensions.

Besides creation of the PPF, the government last year set up a powerful regulator to police the corporate pension industry.

REUTERS SHB ND1514