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'Bitter disappointment' greets VT’s desire for pay freeze

16 March 2010

BECTU issued the following press release today (Tuesday) in response to VT Group's plans to freeze pay in 2010/11.

BECTU, the media and entertainment union, has reacted with "bitter disappointment" to the announcement that VT Group wants to implement a pay freeze for the company's staff in 2010/11.

We cannot see any justification for a pay freeze in the year ahead; our pay claim was considered and there is no doubt that we will be looking for a better response to it than we have had so far

The news, which came yesterday, flies in the face of the company's ability to make an award and ignores the reality of inflation running at 3.7 per cent. Experts predict that inflation is only set to rise.

BECTU and general union, the GMB, are two of several unions recognised by VT; union representatives will come together on 23 March to consider their detailed response to the proposed pay freeze.

The joint unions' pay claim - for an RPI increase plus £500 coupled with an increase in allowances of RPI plus 3 per cent - is set in the context of factors which belie the company's arguments:

- the VT Board plans to distribute £230m to shareholders;

- the company has contracts worth £4.4bn, with bids for work which could almost double the value of contracts to £8bn;

- net annual savings of £7m per year following a reorganisation programme which placed additional demands on staff.

Revealing to staff the company's plans for pay for the 12 months from 1 April and citing "the ongoing challenging and uncertain economic environment in the UK and worldwide" Paul Lester, chief executive, wrote:

"I can assure you that the decision to freeze pay for 2010 has not been an easy one to take. It has not been taken lightly and I do believe it is the right decision for our business."

The company has offered a single additional day's holiday in 2010/11 for its UK-based staff to mark the company's 150th anniversary.

Gerry Carr, BECTU national official, said:

"We are certain that the company's decision to announce a pay freeze for 2010/11 will be met with bitter disappointment by staff.

"The company's performance has been strong and its prospects are good; in addition staff have helped to deliver £7m net annual savings following a recent reorganisation.

"We cannot see any justification for a pay freeze in the year ahead; our pay claim was considered and there is no doubt that we will be looking for a better response to it than we have had so far."

The recognised unions will report back to the company following the representatives’ meeting on 23 March.

ENDS

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