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Capita staff start strike action over pensions

Capita staff start strike action over pensions

30 October 2017

Staff at Capita have started their industrial action in their pensions dispute with the outsourcing company.  Following the breakdown of talks at Acas, staff are taking part in nine days of industrial action.

The dispute centres on Capita’s attempts to close the current defined benefit scheme and transfer staff to a defined contribution scheme. Unite members are taking nine continuous days of strike action which started on Saturday 28 October 2017 and ending on Sunday 5 November. Unite conducted an industrial action ballot following the proposal to close the current defined benefit scheme. In June Capita informed its employees of significant changes to the pension arrangements. Staff in the scheme will suffer a massive cut in their retirement income as a result of the proposals.

Staff at Capita voted overwhelmingly in favour of strike action in a ballot, calling on their employer to give them a decent pension. In the industrial action ballot 95 per cent of members voted for strike action, on a turnout of 72 per cent. 

Dominic Hook, Unite national officer, said: “Capita management only have themselves to blame for the fact that staff at Capita have been forced to take industrial action. The employer’s disgraceful plans to slash the deferred pay that staff will get in retirement has made employees angry in workplaces across the country.

“Unite has repeatedly tried to settle this dispute and made numerous alternative pension proposals to the company, all of which the employer has failed to consider. Unite suspended planned strikes in good faith in order to reach a settlement with Capita. Unfortunately the company has failed to make a reasonable offer to address the concerns of their workforce.

“Capita’s pension proposals will have far reaching consequences for the retirement of many Unite members. Some staff will lose a shocking 70 per cent of their retirement income.

“There is no justification for highly profitable Capita to treat its workforce in this manner.  The extremely high vote in favour of strike action shows how strongly members feel about this. 

“Capita must urgently rethink these pension proposals for the sake of their loyal staff and in order to prevent further delays to their contracts and increased reputational damage to the organisation.

The union is calling on the companies which outsource contracts to Capita to intervene to settle this betrayal of staff facing the loss of a significant proportion of their retirement income. 

If Capita implements this proposal, then Unite has a real concern that it will open the door to further attacks on the other company pension arrangements. The Capita sites where Unite members are impacted are: Birmingham (two locations); Reading; Bristol; Manchester; Stirling; and Belfast. 

Unite members who are affected are employed by Capita Life & Pensions Regulated Services Ltd, there are also some employed in Capita IT Services Ltd.  The following Capita contracts will be affected: Prudential; Royal London CIS; Phoenix / Royal London (Birmingham); Aviva; Specialist Services (all sites); IT Programmes /projects (all sites)

There are also some staff employed in Capita IT Services Ltd and Capita Employee Benefits.

ENDS

For further information contact Saba Edwards on: 07768 693 953.

Notes to editors:

Case study 1: 60 year old aims to retire at 65 (normal retirement date). Their salary is £25k and they currently pay 3% into the scheme. If they remain in the current scheme, their pension earned in those final 5 years is around £2k per year. If they are moved to the new scheme, and continue to pay 3%, then their pension earned in those final 5 years is projected to be around £350 per year. This is a loss of around £1,650 per year. If they are in retirement for 20 years, a total loss of about £33k.

Case study 2: 35 year old the employee is currently paying 7% into the scheme. The projected pension from this, were they to remain a member until retirement, would be around £22k pa. On being moved to the new proposed scheme, and paying 6% until retirement, their projected income is around £7k. Along with a deferred pension of around £4k, their total pension is now around £11k – roughly halved. If this colleague is in retirement for 20 years, they will lose a total of almost £220K.

  • Unite is Britain and Ireland’s largest trade union with over 1.4 million members working across all sectors of the economy. The general secretary is Len McCluskey.