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CWU REJECTS BT’s PAY OFFER - 2nd April 2014

The CWU met with BT last week to pursue the Union’s claim for an increase of 3% plus £500 which would be fully consolidated and pensionable and again reiterated our case. In response the company stated that there was no justification for this level of increase set against the measures and data which they had presented to our pay team.

BT have now written to the Union making an formal offer which they claim “is reflective of the data which has been shared including the current level of settlements and Team Member rates of pay compared to the external market.”

The offer which they have termed “fair” is as follows:
• A fully consolidated 2.0% base pay award for the Team Member population who are NewGRID grades and Loyalty Advisors agents;
• The Company is open to discussions on the construct of this award, for example a flat-rate percentage award or a fixed amount, or a combination of both these approaches;
• A 2.0% increase to those allowances automatically uplifted in line with the NewGRID agreement;
• In addition, we would want to discuss further a non-consolidated flat rate ‘sharing in success’ payment for all Team Members who are NewGRID grades and Loyalty Advisors agents.
With RPI inflation currently at 2.7% and forecast to stay around that figure throughout 2014, the CWU Pay Team have rejected the offer on the basis that it represents a real terms cut in pay for team members and does not reflect:
• The considerable contribution, commitment and flexibility made by CWU members in helping BT to succeed in a competitive market;
• BT’s solid financial performance including growth in profits, revenue and free cash flow.
This offer clearly signals to us how little BT senior management value CWU members and the roles they perform. This insulting offer has been rejected by the Union and we are prepared for tough negotiations ahead to ensure that a settlement is reached that reflects your real worth.

The CWU believes an inflation-plus rise is both affordable and justified given BT’s current performance and the contribution made towards this by CWU members.

We will be arranging further meetings with the company and CWU Branches and members will be kept informed of progress.
Please send us your views and questions to


The following proposals were endorsed by CWU Postal members. The agreement protects members pay, terms and conditions for as long as possible following the privatisation of the company.

Pay and Reward
The scope of the pay settlement covers all CWU represented grades within the Royal Mail Group (including Parcelforce and all other business functions). The details are as follows:-

- 3.0% base pay increase, backdated to 1 April 2013.
- £200 lump sum payment for each full time eligible employee (pro rata for part-timers) in post on 1 October 2013, in recognition of business progress. This will be paid before Christmas in addition to any Christmas bonus.
- Additional increase in the over 10 hours overtime rate++.
- Scheduled attendance payments during periods of annual leave will be extended++.

- 3% base pay increase. New incentive scheme to be developed and introduced by April 2014.

- 2.8% base pay increase. Subject to review, if inflation is below 2.3% or above 3.3%.

The increases over the three year period apply to the usual allowances and overtime payments etc. The cumulative year on year effect of these pay rises is worth 9.06%.

I. Inflation at the 1 April 2013 was 2.9%.
II. The £200 lump sum is in addition to existing Christmas bonuses, will be paid before Christmas and is not
dependant on the overall agreement being endorsed.
III. The additional 0.4% increase in the first year over the previous offer, will attract extra back pay of approximately £60 and will put approximately £90 ongoing into permanent pay.

Legal Protections
The legal protections cover job security and the employment model and business structure that the Royal Mail Group will operate under as a private entity. A summary of the main protections are as follows:-
- The employer will not outsource, sell or transfer any other part of its business.
- The employer will remain an end-to-end service provider and will not franchise out any part of its business or make any employee self-employed.
- The employer will not engage any new employees on inferior terms and conditions (no two tier workforce).
- The collectively agreed terms and conditions of employees will not be worsened in any respect, or changed
unless amended by agreement.
- The overriding objective will be for the employer to deliver all future change without recourse to compulsory redundancy.
- The employment model will remain predominately full-time and the agreed resourcing mix will be monitored on a quarterly basis.

How long will the Protections Last?
- The protections are made as an ongoing commitment subject to review and exceptional circumstances clauses. The first planned review is January 2019.
- The positioning of the legal protections is fair to both parties. It means they are not due to end at any given time, but neither are they an open ended commitment, something which no business will ever sign up to.


As part of the overall settlement of the National Dispute the Postal Executive has unanimously agreed a separate legally binding proposed agreement on pensions, a copy of which is attached.

The proposed Agreement confirms the amended RMPP proposal and will ensure that the RMPP (Defined Benefit) Scheme has greater protection for the future; at the same time we have secured major improvements to the RMDCP (Defined Contribution) Scheme, which now has over 35,000 members. The key principles contained within the proposed Agreement are as follows:-

• A revised pension arrangement which represents a significant improvement to the proposal on which the company originally consulted members of the RMPP, which retains a final salary link for members who move within two CWU represented grade bandings.

• An ongoing legally binding commitment to keep the RMPP open with no increase in members’ contribution rates, or normal retirement age or any change to accrual rates. This commitment will be reviewed from time to time with the first review planned in 2018. Additionally, there are what’s known as force majeure clauses, which in exceptional circumstances give the company the chance to review earlier.

• Significant improvements to the rates at which the company contributes to the Defined Contribution Scheme, including the removal of the previous lowest rate, a higher automatic enrolment rate and a new and higher upper tier rate.

• New arrangements for the involvement of the Union in the overall governance of pensions policy within the company. This will provide the CWU with much greater influence over the company’s overall approach to pensions in the future. This is a significant development and can be viewed as an example of how the new governance arrangements in the main Agreement will be developed.

• New arrangements for the Union’s involvement in the election of two Member Nominated Trustees of the Defined Contribution Scheme.

The proposed legally binding Pensions Agreement will be subject to a separate membership ballot which will be conducted at the same time as the ballot on the main Agreement. There will also be a session at the National Briefing on the 17th December to explain the detail of the proposed Agreement.

Closing The Loopholes campaign

- To secure amendments to the UK Agency Regulations which close current loopholes that currently enable hirers and employment agencies to exploit agency workers.

- To raise the profile of agency issues amongst the CWU membership and to encourage our agency members to become active in the campaign.

- To raise awareness at a political level and to secure support in order that this issue is brought back on to the political agenda.

- To engage and work with the TUC and UNI to make this a wider trade union issue.

- To consider challenging the UK Agency Regulations within the European Commission.


Q. What is a 'PBA' Contract?
A. A 'PBA' Contract is a Pay Between Assignment contract which is a permanent contract of employment and pays the agency worker between assignments i.e. during the periods when they are not working and when there are no available suitable assignments for the agency worker.

Q. Why is a 'PBA' Contract different from other agency (Manpower) contracts?
A. The main difference is that after 12 weeks in a given job the agency worker on a PBA contract will not be entitled to the same pay as the permanent worker which is unlike other agency workers on zero hours contracts.

Q. Is this legal?
A. Yes, it is clearly permissible within the current Equal Treatment for Agency Workers Regulations.

Q. Does the agency worker have to be aware of these specific terms before working with the employment agency?
A. Yes, the Government guidelines clearly states that the employment agency (Manpower) should explain the terms of the contract to the agency worker so that they can make an informed decision as to whether they are willing to agree to forgo equal treatment on pay and enter into a permanent contract with them.

Q. Does the employment contract have to state this?
A. Yes, there is a requirement for the contract to contain a statement to the effect that entering into such a contract means that the agency worker does not have any entitlement to equal pay as set out in the regulations.

Q. What is the rate of pay between assignments?
A. The Agency Regulations state that the rate of pay between assignments must be at least 50% of an assignment, at least National Minimum Wage (NMW) and calculated using a reference period. The reference period on the Manpower contract is the 12 weeks immediately proceeding the period of pay between assignments.

Q. What other terms should the 'PBA' Contract state as far as the regulations are concerned?
A. The contract needs to state the following:-
1. minimum pay rates and their basis of calculation; 2. location of work; minimum and maximum expected hours; 3. Manpower 'PBA' Contracts state a minimum of 4 hours and maximum of 48 hours but basic hours of work are also laid out (usually 40 hours); 4. nature of work.

Q. Does the exemption only cover pay?

A. Yes. All agency workers, including those on 'PBA' Contracts are entitled to equal treatment in relation to, night work, rest periods, rest breaks and annual leave after 12 weeks in a given job.

Q. Can the contract be terminated whilst between assignments?
A. Pay Between Assignments must be at least 4 weeks pay before the contract can be terminated.

Q. Do I have to sign this contract and what happens if I refuse?
A. You can't be forced to sign a PBA contrac; however the agency won't employ you if you don't.

Q. I've already signed a PBA. Can I get out of it?
A. No. As a contract of employment it is binding between the two parties. You would have to resign to get out of it.

Q. Why are these PBA contracts allowed?
A. Because it is permissable as a loophole within the agency regulations which we are campaigning to close.