CWU recommends Agreement on BT Pensions and PayTelecoms & Financial Services, BT March 19 2018
Preparations are underway for a consultative ballot of all members in BT on a proposed deal covering both pensions and pay following a breakthrough in exceptionally tough discussion with the company.
The agreement – which will now be put to members with a strong Executive recommendation for acceptance – comes in the wake of more than 10 months of discussions and the overwhelming rejection of BT’s previous proposals in a company-wide consultation.
Solid support for the CWU’s Tell BT No campaign proved decisive in talks with the company that resumed in January following detailed analysis by BT of employee responses to the consultation.
The resulting recommended deal significantly increases BT’s contribution levels to the BT Retirement Saving Scheme (Defined Contribution) and crucially, retains a substantial defined benefit element in future pension provision for those who are currently members of the BT Pension Scheme (Defined Benefit).
“In our campaign we said that BT could afford more and our members deserve more; BT will be paying more and we have got a better deal” commented Deputy General Secretary Andy Kerr.
Detailed information about the agreement will be cascaded to members of both the BTPS and BTRSS – but the main features of the legally binding proposed agreement are:
- BT will establish a new hybrid pension that will include both defined benefit (DB) and defined contribution (DC) elements and will share future risk with BT. This will be available to members of the current defined benefit BT Pension Scheme, which will close for future service in June.
- The hybrid pension is due to be set up later this year following further discussions between BT and the CWU. In the meantime current BTPS (DB scheme) members will be opted into the improved BTRSS (DC scheme)
- BT will increase company contributions to the defined contribution BT Retirement Saving Scheme including a standard 10% BT contribution, and an increased minimum BT pension contribution of £2,000 (pro-rated for part time staff).
- A pay rise of 3% in April 2018 and 3% in April 2019.
- Those on Workforce 2020 contracts will receive an additional consolidated £150 p.a (pro-rated for part timers)
- BTPS members and joining either the BTRSS or the new Hybrid will be entitled to transitional payments for up to 10 years.
- A new redundancy agreement covering all team members will apply.
Deputy General Secretary Andy Kerr explains:
“Talks have been taking place against the difficult backdrop of a spiralling BTPS deficit that was last measured at nearly £13 billion and likelihood that future service costs will double.”
“For members of the BTPS the proposed settlement secures an important element of DB pension benefits under an innovative new Hybrid pension arrangement. This is a significant achievement – set against a backdrop of the company’s preferred option to do away with DB pensions altogether.
“Under the recommended agreement, 70 per cent of our BTRSS members will be getting a 25 per cent increase in company contributions – as well as key allowances counting towards pension for the first time. This is a major improvement.
“Overall BT pension costs will increase as a result of this proposed deal – something we would not have been able to achieve without the wholehearted support of our members throughout our Tell BT No campaign.
“The proposed agreement significantly improves on BT’s original proposals, secures a continued defined benefit pension option for BTPS members and significantly enhances the defined contribution pension which the CWU has long argued was inadequate – especially at lower contribution levels.”
Andy concludes: ““Taken together with a pay increase in excess of 6% over two years, the Executive firmly believes that the company’s full and final offer is the very best that could be secured by negotiation for both , BTRSS and BTPS members
“Accordingly we will be strongly recommending members to accept the package in the forthcoming ballot – details of which will be announced shortly.”
The Union will be arranging a series of briefings around the UK to discuss the proposed deal. Members should contact their local Branch for further details.
Member enquiries should be addressed to your local CWU Branch or to; email@example.com