Belated pay offer for Capita O2 & Tesco Mobile members out to ballot

Telecoms & Financial Services, Capita

Wednesday 19th August 2020

Following months of uncertainty and many hours of difficult talks, the CWU has finally extracted an offer from Capita that the national negotiating team feels able to place before members.

A full eight months after the relevant January 1 pay date came and went – followed by months of stonewalling by company negotiators who repeatedly cancelled and deferred  meetings pending direction from Capita Group-level management – the company’s ‘final offer’ delivers  minimum increases of 2% over 15 months for the vast majority of those working on the O2 and Tesco Mobile contracts.

The overall deal for 2020 includes the earlier implementation of the Real Living Wage for Capita’s lower paid workers, which saw some receive increases of up to 5.33%.

Now subject to ratification by members in separate consultative ballots that will both begin tomorrow (Thursday August 20) the deal on the table emerged following determined CWU lobbying of both Capita CEO Jon Lewis and the managing director of Customer Management.

Despite the union being unsuccessful in its attempts to get the company to budge on a £28,000 upper pay cap, the offer is being recommended to members on the basis of a company promise to hold a special review for those affected later in the year.

“To be clear, there are nearly 100 members in the Capita O2 Partnership and a very small number in the Tesco Mobile Partnership who will receive nothing from these pay negotiations because their current salary is above the £28,000 threshold applied by Capita across the whole company from the outset,” stresses CWU assistant secretary Brendan O’Brien.

“The increase can take individuals currently paid below the cap up to that level but not above it – which the CWU believes is unfair on longer-serving employees on ex-Telefonica TUPE contracts – but, faced with complete company intransigence on the underlying principle of the cap at this point in time, the union has concentrated its efforts on minimising the number of people falling into this net.

“As a result of the union challenging the salary calculations being used – which were initially based on everyone being full-time and working to a 37.5 hour contract – the number of members impacted by the threshold has been reduced by nearly a half.”


Unusually complex negotiations

Already complicated by Capita’s welcome decision to honour previous commitments to pay a minimum of the Real Living Wage (RLW) across its UK operations from April 1, this year’s pay talks were made all the harder given the exceptional challenges stemming from the Covid-19 pandemic on a company that was already mid-way through a major restructuring exercise.

While the RLW move fulfilled longstanding CWU demands for just such a policy across the O2 and Tesco Mobile contracts, where the union is recognised for collective bargaining purposes, the badly needed uplifts for the lowest paid employees threw up a number of issues regarding squeezed differentials – or ‘pay compression’ as it is referred to by the company.

                        Brendan O’Brien

“Amongst the most difficult areas to work through have been the imposition of the £28K pay cap, pay compression associated with the deployment of the RLW, considerations of overall affordability, the change of the annual review date from January to April, the payment of bonuses and  pay progression and the need for  absolute clarity on back-payments,” explains Brendan O’Brien.

The CWU national officer for Capita continues: “The negotiations were complex but the deal is fairly straightforward and essentially the same for members in both the Tesco Mobile and O2 partnerships.

“Full details are set out in Capita Members’ Bulletins numbers 168/2020 (O2 contract) and 169/2020 (Tesco Mobile contract) – but basically it’s a 15 month deal that ensures that the vast majority of members in both TUPE and Capita Contracts get a minimum increase of 2%.

“Future review dates move from January 1 to April 1 – and there be back payments for Capita contracts-holders in recognition of the change of review date. Their pay was already made up to the RLW rate from April 1, with some additional payments now added to address what the company refers to as ‘pay compression’ in  salary tiers.

“Pay progression is also incorporated into the offer so no additional payments will be made this year.”

Urging members to accept the deal, which he stressed was the “best that could be achieved by negotiation alone,” Brendan concludes: “The CWU appreciates this has been a very long drawn out process, but we hope members appreciate that these talks have been held in the most unusual circumstances, and have involved a great number of facets.

“Although it’s bitterly disappointing that there’s nothing for those earning over the £28K pay cap now, the CWU will be holding Capita to its promise of a special review later in the year, and expects the full support of all members at that time.”


Ballot Timetable


The ballot of members will be conducted electronically and the timetable is as follows:


Ballot Opens:                        Thursday 20 August 2020


Ballot Closes:                        Noon Thursday 03 September 2020


  • Members should watch out for an email from ‘Popularis Ltd’ explaining how they cast their vote. If that email has not been received by Wednesday 26th August, members should contact their local branch rep without delay.