back to article BT must 'prioritize' between 'shareholders and workers' says union boss

BT's largest union is rejecting the offer of a flat rate pay rise and threatening to start laying the groundwork for national "statutory industrial ballot action" to ratchet up the pressure on the telecoms biz. According to a blog post to members by Andy Kerr, deputy general secretary Telecoms & Financial Services at the …

  1. Anonymous Coward
    Anonymous Coward

    NG staff are voting on a below inflation offer. For experienced staff especially its more below than others; so another real terms cut.

    For those that know the company, it’s income is largely based on RAV indexed with inflation, so a 1pc rise in RPI actually earns the company more than it costs it. (This is clearly stated on NGs investor relations website).

    The unions recommended accepting the offer. Very Straw polls of a few prospective voters indicate roughly 50/50 acceptance. We’ll know the result in a couple weeks.

  2. Anonymous Coward
    Anonymous Coward

    How is someone from a call centre working from home putting his life on the line during the pandemic?

    1. Anonymous Coward
      Anonymous Coward

      Did you actually read the article?

  3. Anonymous Coward
    Anonymous Coward

    The CPI measure is biased towards the upper income ranges - for most people RPI is a more accurate reflection of the inflation they experience ( if you want to counter arguments about the "formula effect" on RPI, reduce its value by a twentieth ).

  4. Arthur the cat Silver badge

    No choice

    BT have a choice to prioritize between its "shareholders or workers"

    Nope. Legally BT management is required to act for the best interests of the shareholders and nobody else, and has no choice in the matter.

    Now, it's a perfectly reasonable argument that shareholders' best interests are best served by keeping a happy work force that doesn't bugger up the business by striking, especially if the business is making good profits, but shareholder capitalism needs the management to answer to the business owners, not "stakeholders". If the unions don't like that, we're a mixed economy, so they're always at liberty to set up a union led workers' cooperative competitor to BT.

    [And of course I'm not even touching on the Principal/Agent conflict inherent in a system with hands off shareholders and an executive management board.]

    1. Tom 7 Silver badge

      Re: No choice

      Now, it's a perfectly reasonable argument that shareholders' best interests are best served by management keeping a happy work force that doesn't bugger up the business by striking.

    2. Martin M

      Re: No choice

      Legally that’s not correct. The second of the 7 duties of a director, as described by Companies House and enshrined in the Companies Act 2006 s172, is indeed to promote the success of the company for the benefit of shareholders. However under this duty they are also required to consider the consequences of decisions for various stakeholders, explicitly including employees. In their words:

      “Board decisions can only be justified by the best interests of the company, not on the basis of what works best for anyone else, such as particular executives, shareholders or other business entities. But directors should be broad minded in the way that they evaluate those interests – paying regard to other stakeholders rather than adopting a narrow financial perspective.”

      1. Arthur the cat Silver badge

        Re: No choice

        But directors should be broad minded

        I think what RFC 2119 says about "MUST" and "SHOULD" is appropriate here.

        As I said, keeping your work force happy is probably the best thing for the shareholders in most cases - for my start up it was vital because for software companies the workers are the company, there are very few physical assets. My point was that the union was demanding boards ought to prioritise workers above shareholders which they can't do.

        1. Martin M

          Re: No choice

          If you had bothered to look up the legislation referenced, which is the thing actually phrased like an RFC, unlike Companies House guidance:

          —-

          (1)A director of a company must act in the way he considers, in good faith, would be most likely to promote the success of the company for the benefit of its members as a whole, and in doing so have regard (amongst other matters) to—

          (a)the likely consequences of any decision in the long term,

          (b)the interests of the company's employees,

          —-

          MUST … have regard (amongst other matters) to … the interests of the company employees.

          You can argue about the weight that might in practice be placed on those interests amongst competing concerns, but they are required by law to be considered. As I said.

          You may have meant to say “My point was that the union was demanding boards ought to prioritise workers above shareholders which they can't do.“ but what you actually said was “Legally BT management is required to act for the best interests of the shareholders and nobody else”. Those are two different statements. The first is correct. The latter is clearly not.

  5. hoola Silver badge

    Simplistic View

    I appreciate that this is a simplistic view:

    Everyone would like an inflation busting pay rise and yes there are many arguments that pay settlements over the last few years have been marginal. The trouble is is that we end up in an even more vicious spiral of inflation. I know that energy costs in particular are a very big concern for many and there is a new block of people pushed into energy poverty however is a round of inflation-busting pay settlements the answer?

    I don't know and don't pretend that there is an easy answer but from the comments I have from people I know ranting about fuel costs the common theme is:

    My monthly payments have doubled

    My supplier went bust and the new one is "ripping me off" because it is twice the cost.

    The Government should do something (what the "something" should be is never forthcoming).

    The heating is still on 25 degrees all day and they are in T shirts

    Lights are on all over the place including a raft of decorative stuff illuminating half the street.

    The house is stuffed full of the latest gadgets.

    They are still going on the half term holiday, again at Easter and then for the two week "Main" holiday in the summer.

    This is only a snapshot and there are many that are in genuine hardship but those making the most noise appear to be the ones with the most disposable income and their outrage is that they are being impacted not that the the less well off are having a hard time making ends meet.

    1. LybsterRoy Bronze badge

      Re: Simplistic View

      I was just wondering if the (any) union officials had ever thought about the relationship between rising wages and rising inflation.

      1. Binraider Silver badge

        Re: Simplistic View

        Costs were well on the way up long before inflation was.

        And staff wages haven't gone up anywhere near an equivalent rate unless your a scum sucking bottom feeder.

        Being a CEO used to be a respectable profession. Today, the disparity is just plain disgusting.

        So yes, please join unions and tell them where to go. The next month or so will show just how crippling energy inflation is (stoked by capital markets able to push prices up like an eBay PS5 scammer, just on a much larger scale).

      2. localzuk Silver badge

        Re: Simplistic View

        Current inflation is supply lead - there are constraints on a great many things, meaning higher prices as people fight for those supplies.

        What you're talking about is demand lead inflation - where people are paid more and more, forcing prices up. That isn't currently happening anywhere near as much.

        Its why the Bank of England putting interest rates up was a bad move, as it won't do what they want.

        The fix to the issue is increased supply - more gas, more electricity, more grain imports etc...

    2. Anonymous Coward
      Anonymous Coward

      Re: Simplistic View

      Inflation matching would be fine, thank you; plus a route for newer staff to progress up their respective pay scales.

      If I didn't mind working in Saudi Arabia I get an offer a week for pay+25pc,tax free +30pc bonus on a 1-3 year contract.

      The money is 'valuable', the location and impermanence of it sucks.

      I didn't say the money was good because of the taint it carries from the source.

      But even locally, I see loads of staff going off to Orsted and other such operations on better terms than UK firms. It's not hard to see why we have a retention problem. Bigger, is the intransigence of the co. To not do anything about it.

    3. localzuk Silver badge

      Re: Simplistic View

      I'd suggest you keep wild sweeping accusations to yourself tbh.

    4. Anonymous Coward
      Anonymous Coward

      Re: Simplistic View

      Old suppliers went bust because they could no longer balance their takings with their outgoings - as they are wholly at the mercy of wholesale markets.

      Suppliers of last resort (e.g. Centrica, etc.) have to both cover the cost of the "old" bankruptcy, plus ongoing running.

      Wait till the DD goes out next month. I'm anticipating many more bounced transactions than normal, defaults wil be up, disconnections will be up. As one of the "better" off, I'll make noise to challenge the government and Ofgem on it's terrible policies and lack of central planning; where they prefer to turn the problems over to a free market - one where someone who has $20bn lying around can dump it all into buying up supply and reselling for $21bn. The only defence against this is who has that kinda cash, and do they want to compete with each other (hint - we've just slapped a ton of sanctions on a lot of those types).

      I'm not demanding a return to the bad, dark side of nationalisation and energy rationing (if you don't remember, read up on the Winter of Discontent). Limited working days per week, etc. Thatcher leapt on that and used it as an excuse to privatise the whole lot - dispensing with any and all central planning. And in doing so, also contributed to the current problems... You see, the old CEGB plan was to build a bunch of Nukes to the design of Sizewell B; plus wind, and bits of gas/coal as backup.

      What we have now is no new nuke for 2 decades (Heysham being the last "new" one); 3 decades of coal winding up; and an awful lot of gas burners that, unsurprisingly are expensive to run and at the whim of the markets.

      So yes, a modicum of central planning regarding generation split (e.g. France, and it's large, though admittedly old nuclear fleet that needs replacement) would have gone an awfully long way. And now it's too fucking late. Again, wading from crisis to crisis instead of doing it's job to forward plan effectively.

      Being employed in this line of work does somewhat give insight into lunacy that haunts the UK civil service. All so frustrating that there are solutions if anyone would think beyond the end of their nose.

      See also, China, playing a very-long game; and it has gotten quite good at it.

  6. Anonymous Coward
    Anonymous Coward

    My bill went up...

    So the staff can have a CPI + 3.9% increase, no?

    1. X5-332960073452
      Megaphone

      Re: My bill went up...

      BT use the Jan CPI figure, 4.9% Jan 2022 plus the 3.9% = 8.8%, that should be the offer

      1. Anonymous Coward
        Anonymous Coward

        Re: My bill went up...

        From my perspective as a BT management-grade techy-person, (all of whom have had a pay-freeze for the previous two years), I think you speak wise words.

  7. VoiceOfTruth

    As much as I feel for the workers (possibly) represented by the union...

    The board is responsible to the shareholders, not to the union. If the union doesn't like this position it should start its own company.

    1. Binraider Silver badge

      Re: As much as I feel for the workers (possibly) represented by the union...

      I think you will find a responsible board would consider its greatest asset - its staff as well as shareholders.

      To do otherwise is simply to invite failure over the long term in chasing short term profits. See also, the long list of failed biz with leadership focussed on their own pay to detriment of wider org.

      A company exists to do more than create money alone (though obviously it is a criteria for continued operation that it does so).

  8. Anonymous Coward
    Anonymous Coward

    suitably pathetic english answers here

    expected answers here. Standard "blah blah blah shareholders" & "blah blah blah"

    BT Shareholders have had MASSIVE subsidies from the government with various broadband and fibre roll outs. The whole point of shareholders is that you take a risk, not that you just continually get handed money by the Government. BT is an monopoly with it's OpenReach division. See how well those shareholders do if the government grows some balls and not only Removes OpenReach (whose orignal piping was all tax payer funded) but splits it up as it should be.

    I've worked with BT Engineers who do 16 hour + days to get our networks up and running. These guys don't get over time but that pathetic "time in leiu", which is something in my view that should be made illegal. They can't take vacations because they are so busy so end up losing WEEKS of pay.

    All the while BT is off making billions in profit.

    The excuses for it's behaviour by people that I'm assuming aren't hedge fund managers just shows how broken the English really are. "oh yeah, we'll take a pay cut so that the shareholders can get more money". "yeah I'll turn my heating off or cancel a holiday so the CEO can get another multi million bonus"

    1. Anonymous Coward
      Anonymous Coward

      Re: suitably pathetic english answers here

      But, hey you can turn off your heating longer if you work 16 hour days!

      Fuck BT and other subsidy leaches.

    2. Cliffwilliams44 Bronze badge

      Re: suitably pathetic english answers here

      "time in leiu"? Is that really legal over there? This is not even actually "legal" here in the US for salaried employees. My company does this for salaried employees we just can't put it into any official policy or we get in trouble with the Labor Dept.

  9. Cliffwilliams44 Bronze badge

    Unions do only 1 thing, restrict your ability to make money!

    "We are proposing a consolidated pay increase of £1,200 for all Team Member and frontline colleagues across BT Group."

    So, everyone gets the same raise. That includes the slackers that everyone who works hard covers for! "Shut up and accept what we negotiated FOR YOU! Also, don't complain about Joe over there who doesn't produce a tenth of what you do. His dues are just as valuable 'to us' as yours are!" That's the true Union message!

    You lose the right to go to your employer and negotiate your own rate!

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