BT Pay 2013
Frequently Asked Questions
24 May 2013
The CWU has reached a negotiated settlement with BT on pay for 2013, which the union is recommending to members for acceptance in a consultative ballot.
The deal is for 2.8% on base pay plus a £200 pensionable unconsolidated payment (pro-rata for part time employees).
Ballot papers were posted to members’ home addresses on 17 May 2013, and the consultative ballot will run until 7th June.
Frequently Asked Questions
Answers to commonly asked questions in relation to the BT pay offer.
- Why is the pay review date 1st April when in the past it was 1st January?
The pay review date has always been 1st April and this has not changed. As part of the three year deal struck in 2010, the CWU negotiated the backdating of the pay award for each year 2010, 2011 and 2012 to 1st January. This had the effect of increasing the cash amount paid for each year by 0.75% of the award. The 2010 pay deal stipulated that the next Pay Review would be 1st April 2013. The CWU asked BT to backdate this year’s award to 1st January 2013 but the company declined the request in no uncertain terms.
- Why has the CWU settled for a deal that is below RPI inflation in consolidated terms?
The CWU has been extremely robust in talks with BT and we have explored every possible avenue to improve on the final offer and secure an above RPI consolidated rise. BT’s profits are up and their share price is performing well, but BT has argued that their revenues are declining and the BT Pension Scheme deficit is expected to increase at the next valuation meaning it will be more costly to fund. Against the backdrop of a weak economy, consistently high inflation and average pay settlements currently running at 2.5%, BT has made it absolutely clear they are unwilling to move any further in talks.
The CWU is in no doubt therefore that this is the best offer we can secure through negotiation.
The only other option available to us is to ballot for industrial action which would have seen the offer withdrawn and would not have guaranteed us success in the current climate.
The union has secured a deal that is in the upper quartile of current pay settlements according to pay consultants Xpert HR, and has been secured without recourse to industrial action.
RPI Inflation was 3.3% for the year to March 2013 and has fallen to 2.9% for the year to April 2013. At 2.8%, the consolidated element is below RPI inflation but taking into account the additional £200 unconsolidated payment, all grades will receive above 3.3% in cash terms.
- Why has the CWU accepted an unconsolidated cash lump sum which is a one off payment and does not improve the basic rate of pay?
BT was clear that 2.8% was as far as the company was prepared to move on the consolidated element of the deal. BT is also very keen to introduce a bonus scheme based on company (not individual) performance using transparent high level measures such as cash flow and customer service. If we had declined the £200 payment on behalf of members, then we would simply have denied members that cash sum. BT was clear it would not be added to the consolidated amount. We have agreed to talk to BT about how the company performance bonus scheme could work, but we have not committed to anything and we have secured BT’s assurances that this scheme will not replace the annual pay review.
- Why didn’t the CWU ballot for industrial action to seek a better offer?
If we had balloted for industrial action the offer would have been withdrawn and action would not necessarily have guaranteed us success in the current climate. Our members in BT face many challenges at present, not least on performance management. Feedback received from members and branches indicates that if the very serious step of industrial action is to be taken then all energies should be concentrated on the issue of performance management first and foremost.
- How will the deal affect my pension?
The consolidated element of the deal will flow through to your pension in the normal way. The pensionable cash lump sum is a one off payment that does not flow through to your basic salary, but a percentage of the £200 lump sum payment is payable into your pension fund and any matching contribution that the company makes to your pension payments will be applied.
Exactly how this will work will depend on which pension scheme you are in.
If you are in the BTPS section B or C the lump sum will automatically be pensionable for the CARE benefit you build up in 2013/14, and a percentage of the lump sum will be taken as a contribution towards this.
If you are in the BTRSS you will need to elect for a percentage of the lump sum to flow through to your pension. This will enable the rate to be the same as your current contribution rate. BTRSS members are being asked to elect to make the payment pensionable because it is necessary to make a specific instruction to change the contribution and the only way of dealing with this is through election.
BTPS section A members do not have CARE benefits and so will be asked to complete an online form to elect for the payment to be paid as an AVC. Section A members are being asked to elect to make the payment pensionable because it is necessary to make a specific instruction to make an AVC and the only way of doing this is through election.
For members who elect to make the payment pensionable, this must be done by 9th June in order for the contribution to be made in June.
- Is the £200 pro-rata for part time employees?
Yes, the £200 unconsolidated payment is pro-rata for part time employees.
- Is the £200 the first step on performance related pay at an individual level?
No. The £200 is based on company performance using transparent and public measures such as free cash flow and customer service. The CWU will not contemplate entering into any discussions on individual performance related pay. The CWU has agreed to discuss with BT the detail of any ongoing bonus scheme based on company performance. These discussions will be on a without prejudice basis and no commitment has been given by the union to any pre-determined outcome to the discussions. We have also secured assurances from BT that any bonus scheme will not replace the annual pay review.
- Will the award apply to Manpower workers in BT?
Assuming the BT pay deal is accepted by members, the expectation would be that the 2.8% rise (but not the unconsolidated £200 lump sum) will flow through to Manpower employees on the BT contract who are on a ‘zero-hour’ contract. This process will be subject to discussions between the CWU and Manpower.
Regrettably, however, the rise will not flow through to Manpower workers on ‘Pay Between Assignment’ (PBA) contracts. The CWU recognises the injustice of this situation and is running a campaign called ‘Closing the Loopholes’ which calls for stronger laws to bring about equal treatment on pay for all agency workers.
- Will I still receive the pay rise backdated to 1st April and the £200 lump sum if I leave BT before 1st June or if I am promoted or transferred out of NewGRID before 1st June?
Yes, the back payment and the £200 unconsolidated payment will be payable if you leave BT or if you are promoted or transferred out of NewGRID after 1st April and before 1st June.
- What will happen if members vote ‘No’ to the offer in the consultative ballot?
If less than 50% of votes are in favour of the offer, the CWU will go back to BT and request an improved offer. However, as BT have made it clear that this their final pay offer, the union may need to win a ballot for industrial action to achieve any improvement on the offer.