National Trust - Pay

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1 To: All Prospect Members in the National Trust Branch (H220) 13 February 2016 Dear Member National Trust - Pay The purpose of this circular is to:- Detail the main points of the Trust s formal pay proposal/offer to Prospect following the series of negotiation meetings between Prospect and the Trust s senior management Provide you with your Branch Executive Committee s recommendation Detail the arrangements for the electronic ballot of members Highlight the impact of the outcome from the ballot of members Please ensure you read the whole of this circular and consider how all elements of the offer impacts on you ahead of deciding on how you wish to cast your vote. Main points of the Trust s formal pay offer to Prospect Following the series of formal pay negotiation meetings between Prospect and the Trust s senior management, Prospect has received the Trust s formal 2017/18 pay offer. The formal offer is available via a link to this circular s covering or the Trust s Pay Review 2017 intranet site. All increases will be applicable from 1 April The main points of the final offer are:- An overall increase to the size of the pay pot of 4.0% (Circa 6.5m) The pay scale mid-points (to be known in future years as Target Points) to be no less than 98% of benchmark (market) pay rates as compared to Public and Not for Profit organisations. This results in the proposed midpoints being:- Newminster House, Baldwin Street, Bristol BS1 1LT T F E enquiries@prospect.org.uk W Latest revision of this document: This revision:

2 G3 61,176 G4 49,060 G5 40,189 G6 33,524 G7 28,499 G8 24,499 G9 20,583 G10 17,462 G11 14,989 To close the gap between the pay scale entry point and the midpoint for Grade 6 to Grade 10 staff to 9% (currently 12%). To close the gap between pay scale entry point and the midpoint for Grade 4 and Grade 5 staff to 10% (currently 12%). For the Grade 11 pay scale entry point to be set at the National Living Wage level ( 7.50/hr from 1 April 2017) apart from those on structured trainee programme or apprenticeship schemes where the National Minimum wage levels will apply. To increase the pay scale maximums for all grades to 20% above the pay scale midpoint (currently 14%) To pay in year pay progression payments of up to 0.5% to those staff who received a better than poor PDR score and who, after other increases have been applied, are still not at their pay grade s midpoint. This progression payment will assist staff in moving towards the midpoint but will not take them above their midpoint pay rate. To movement to the midpoint once five good or better PDR ratings have been achieved in the same grade is retained. To apply the following Performance Related Pay increases Exceptional 4.0% Very Good 3.0% Good 2.0% Generally Acceptable 0.75% Poor Nil 2

3 That the introduction of non-consolidated (one off payments) to those staff whose pay level is above their pay scale maximum be deferred for one year and will be applied from 1 April That staff who join the Trust on or after 1 October 2016 will either receive an increase of 0.5% or they will have their salary increased to the new pay grade minimum. They will not receive a progression increase. That staff who join the Trust on or after 1 January 2017 will receive no pay increase unless their salary falls below their pay grade minimum. That staff with a current warning for the reason of conduct under the Trust s performance management policy will be excluded from the pay review process and will only receive an increase should their pay drop below a statutory minimum. Allowances to mainly remain unchanged (to review the revised table of allowances see link to this s covering ) In addition to the monetary elements of the pay offer, the Trust has also confirmed that It wishes to work with Prospect to develop a robust policy and to identify roles that might attract a market supplement payment in addition to the normal pay scale. This is in recognition that due to external market pressures, certain roles, within any of the pay grades, may command a salary outside of the current pay structure. These roles are expected to be in highly technical or specialist type roles. Branch Executive Committee s (BEC) recommendation The BEC has considered the Trust s offer. While disappointed that the Trust has not committed to move to paying the true Living Wage (as determined by the Living Wage Foundation) as the entry pay point for Grade 11, the BEC believes that the offer is the best that can be achieved through negotiation and therefore recommends acceptance in the forthcoming ballot of members. Prospect will continue its campaign for the Trust to become a true Living Wage employer. Arrangements for the electronic ballot of members The electronic ballot will be sent to members preferred address as supplied by members and held on the Prospect membership database. 3

4 The ballot will open at MID-DAY MONDAY 13 FEBRUARY The ballot will run until MID-DAY MONDAY 6 March The result of the ballot will be communicated to members and the Trust as soon as is practicable thereafter. Please remind your work colleagues who are not Prospect members that they don t have a say, and a vote, on their pay unless they join Prospect. We encourage non-members to join via the Prospect website ( Arrangements have been put in place such that anyone who joins Prospect before Wednesday 1 March will be able to take part in the ballot. The outcome of the members vote Acceptance Should members vote to accept the offer then it will be implemented from 1 April 2017 and increases will be made in the April pay run. Rejection Should members reject the offer, Prospect will seek to reopen negotiations with the Trust in an attempt to improve the offer currently on the table. Should a revised offer from the Trust be received it would be the subject of a further ballot of members. If, following the above process (or a number of repetitions of it) the Trust s ultimate final offer is not acceptable to members, the BEC will need to seek from members their will, through a consultative ballot, on taking some form of Industrial Action to press for a settlement from the Trust which meets members aspirations / expectations. It is important however, to highlight that the Trust will be at liberty to impose any offer it wishes, and not necessarily the one currently on the table, should a rejection vote be returned. Please use your vote. Kind Regards Kevin Warden Negotiations Officer 4

5 Direct line: +44 (0) February 2017 Mr P Stewart The National Trust Mount Stewart Portaferry Road Newtownards Co Down BT22 2AD Dear Paul 2017/18 Pay Negotiations Following the series of negotiation meetings with Prospect, I am delighted to detail the following pay award proposal to Prospect members. We have offered an overall annual pay award of 4%. We feel this is an extremely positive offer when considering pay offers in the wider market place and current internal financial pressures. We are committed to our approach to reward and believe this pay award will enable us to continue to focus on improving low pay, rewarding individual performance and helping our staff progress through the pay scales. This year we propose to invest a higher proportion of the pay award to improve our pay ranges. In the summer, we commissioned an independent review of our reward framework to check it is suitable for the future needs of the Trust, in light of changing external pressures. The review recommended further investment in our pay ranges to ensure our pay levels remain fair and competitive; and allow us to recruit and retain great staff to deliver our organisational strategy. Due to the affordability, we propose to phase the changes to our pay ranges over a two year period. We believe this investment, along with an above RPI performance award, reflect our joint pay ambitions and will help us deliver our strategic aims. We propose that: 2.3% of the pay award (circa 3.7 million) will be invested to reward individual staff performance through their PDR ratings; 1.7% of the pay award (circa 2.8 million) will be invested to improve our pay ranges and progress staff through them; National Trust President: HRH The Prince of Wales Heelis Chairman: Tim Parker Kemble Drive, Swindon Deputy Chairman: Sir Laurie Magnus Wiltshire SN2 2NA Director-General: Dame Helen Ghosh DCB Tel: +44 (0) Fax: +44 (0) Registered office: Latest revision of this document: Heelis, Kemble Drive, Swindon, Wiltshire SN2 2NA This revision: Registered charity number

6 This investment will ensure regular staff will receive an average pay award of circa 3.7%. It will also mean that 95% of regular staff will receive a pay award higher than the average cost of living increase, as measured by Retail Price Index. A 4% pay award is considerably above current external market pay award predictions. The current median pay settlement for the total economy, which includes the private sector, is 2%. The proposed award is higher than the median pay settlement for the Not for Profit sector (which is 2.3%) and the Public sector (which is 1%). The award is also higher than the average RPI for the last 12 months (which is 1.6%). This investment is alongside an increase in our headcount, to ease staff capacity and help deliver our organisational strategy. In 2016/17 our headcount grew by 384 full time equivalent staff at a cost of circa 10 million. From our budget plans, in 2017/18 we expect our headcount to further grow by 241 additional full time equivalent staff, at a cost of circa 6.4 million. Additional staff will mean an increased wage bill and extra pressure on our pension scheme contributions. In addition, the Trust will have to pay the new Apprenticeship Levy of circa 900,000 per annum, from April 2017, as well as the agreed increase to the agreed Defined Benefit Pension deficit repayment plan. As a result, our overall additional investment in staff costs will increase by circa 9.4% in 2017/18. A summary of the National Trust/Prospect Pay Negotiation outcomes As we discussed, we propose to distribute the 2017/18 pay award in the following way: We will continue to invest more in low pay, retaining the National Living Wage as the minimum of our grade 11 pay band. We will award the National Living Wage rate to all staff and not just those over the age of 25 years which is the statutory minimum. The new National Living Wage rate of 7.50 an hour (a 4.2% increase on the current rate of 7.20) will be applied to all staff (both regular and hourly) from 1 April Regular staff currently below this new pay band minimum will be awarded a pay increase to the minimum, before any further performance or progression increase is applied. We will continue to reward staff through performance related increases based on their PDR ratings. We will continue to invest in our pay ranges and award pay progression payments: - Investing to improve the midpoints of grades 3 to 10 to retain market competitiveness. We are committed to continuing to address any differences in our midpoints when comparing them to market benchmarks and move the majority of pay band minimums closer to the midpoint of the pay band. By increasing the midpoints, we will also increase the pay band minimum and the pay band maximum by the same percentage uplift. Staff currently below the new pay band minimums will be awarded a pay increase to the minimum, before any further performance or progression increase is applied. Cont/d 2

7 - Investing to increase the pay band minimums, reducing the gap between the minimum and the midpoint of the pay band. This will reduce the time it takes for staff to reach the midpoint of the salary bands from five years to three years. Again, staff currently below the new pay band minimums will also receive a pay increase before any further performance or progression is applied. - Retaining the additional in-year progression increase, over and above the performance related element, for those paid below pay band midpoints and achieving at least Generally Acceptable performance. The value of the progression award this year will be (up to) an additional 0.5%. - Continuing to increase staff salaries to the midpoints of pay bands, for staff that have 5 full PDR years service at the same grade, as at 1 April 2017, with at least a Good PDR performance. In last year s pay negotiations we agreed the principle of capping salary growth for staff paid above the pay band maximums, to address pay parity and equal pay risks. Instead we agreed to award a non-consolidated payment to staff currently paid at or above the maximum of the pay band rather than further increasing their base salary. We propose to implement this new policy for existing staff from April We also propose to: - Extend our pay band maximums for grades 3 to 11 to +20% of the midpoint, increasing it from the current +14% of the midpoint of the pay band. - Identify roles that might attract a market supplement. We recognise that in exceptional circumstances the pay band may not be sufficient to attract, recruit or retain staff in a small number of unique, highly technical or critical roles; where a market supplement paid above the pay band maximum may be justified. Over the next year, working closely with you, we will identify the roles which require a market supplement and create a robust, defendable policy and process to manage these exceptions. All allowances have been reviewed; there will be no change to the majority following positive benchmarking to the external market. The number of grades will remain the same. The midpoints for grades 3 to 10 will be increased in response to market benchmark data and we will endeavour to achieve and maintain pay band midpoints at 100% of the market benchmark data. The minima for grades 4 and 5 will be further increased from 12% to 10% below the pay band midpoints and grades 6 to 10 will be increased from 12% to 9% below the pay band midpoints. There will be no change to the minimum of grade 3 this year. Pay Cont/d 3 National Trust/Prospect Pay Negotiation Detail 1. Pay budget The Trust will provide an annual increase to the pay budget of 4% from 1 April This will cover both statutory and discretionary pay award increases. 2. Pay ranges

8 band maximums will be increased from +14% to +20% above pay band midpoints for all grades 3 to 11. Grade 11 will have the new National Living Wage rate as its default minimum. Midpoints will now be known as Target points. 3. Pay Advancement Pay advancement within each grade will be determined by two criteria: performance and position in grade. Staff paid below pay band target points will retain the opportunity to receive a further progression increase based on criteria as detailed in section Performance Related Pay Performance related pay will continue to be determined by Performance and Development Review (PDR) ratings. The fixed percentage increases for each PDR rating will be: PDR Rating April 2017 Increase April 2016 Increase for comparison Exceptional 4.0% 4.5% Very Good 3.0% 3.5% Good 2.0% 2.5% Generally Acceptable 0.75% 1.0% Poor 0% 0.0% If an individual receives a Poor PDR rating it is expected that they will have an agreed improvement plan with their manager. When the manager has judged the improvement plan to be successfully completed (six months or earlier) individuals salaries will be increased by 0.75% or higher if this is to increase them to the new pay band minimum. The increase will not be backdated. Please refer to section 7 (iii) for clarification on individuals currently on a formal disciplinary warning in accordance with the Trust s Performance Management Policy. 5. Progressing through the pay scales i) Position within the pay band If individuals (except those rated Poor) are still below the target point after receiving their performance related pay increase, they will receive up to a further 0.5% increase. This will assist them in moving more quickly towards the pay band target point but not beyond it. Those with a Poor rating will not be entitled to any element of the additional 0.5% increase even when the manager has judged the improvement plan to have been successfully completed. Cont/d ii) Progressing those with 5 years service in grade Staff with 5 full PDR years service at the same grade, as at 1 April 2017, with at least Good PDR performance, will be moved to the target point of their grade. Following the same approach as previous years, to be eligible staff 4

9 must have achieved at least a Good rating during the 2016 PDR process; and they must have been at the same grade for at least 5 years achieving at least a Good, C or Effective/Effective rating in five of those years. Eligible years do not have to be consecutive. The PDR year is 1 January to 31 December. 6. National Minimum Wage and National Living Wage In April 2016 we committed to paying the new over 25 years National Living Wage (NLW), as the default minimum for all our staff despite the statutory requirement to only pay it to staff over the age of 25 years. Staff on structured trainee or apprenticeship schemes may still be paid the National Minimum Wage (NMW) junior pay ranges dependent on their age; pay levels will be agreed individually for each training scheme. Each year, the NLW rate is adjusted on the 1 April and the NMW is adjusted on the 1 October, both following government guidelines. 7. Pay Policies In addition to the above, the following policies will apply in determining 1 April 2017 salary increases. i) Staff joining the Trust on or after 1 October 2016 (i.e. within the last 3 months of the PDR year) will be paid a default increase of 0.5% or have their salary increased to the new pay band minimum whichever is greater; they will not receive a progression increase. ii) iii) Staff joining on or after the 1 January 2017 (i.e. after the end of the PDR year) will not have a pay increase unless their salary falls below the new pay band minimum for their grade, whereupon it will be increased to the new salary minimum from 1 April Staff with a current warning for the reason of conduct under the Trust s Performance Management Policy will continue to be excluded from the pay review process in 2017/18 i.e. they will not receive a pay award unless they fall below a statutory minimum. 8. Allowances A review of allowances has been undertaken with Prospect. There will be no change to the majority due to benchmarking favourably to the external market. Specifically there will be no change to either the inner and outer London Weighting allowances which remain at or above market benchmarks. 9. Performance Related Pay We are committed to the philosophy of performance related pay and believe that it drives both individual and organisational performance through structure and discipline. It enables us to measure what we deliver and how we deliver it through objective setting and reviewing behaviours. Cont/d 5

10 Our staff have also told us that they support performance related pay but want our focus to be on improving the consistency of the application of PDR process. We acknowledge that Prospect continues to challenge the effectiveness of performance related pay. We will continue to work with Prospect to improve the consistency of our performance management processes and will continue to monitor staff feedback through staff survey results. 10. Living Wage Foundation voluntary rates of pay We acknowledge that the Living Wage Foundation guidance on pay is at the core of Prospect s pay ambitions. Our commitment to the National Living Wage and to increasing our pay band minimums and maximums is a considerable investment, one which we believe is vital to our reward strategy. We will continue to invest a significant proportion of our pay award in our lowest paid staff; increasing our minimum pay rates and in doing so we continue to move our minimum pay level closer to the Living Wage Foundation s Living Wage rate. However, we are still unable to commit to the Living Wage Foundation s Living Wage rate as our minimum pay level, due to the considerable additional investment required. We will continue to monitor this decision on an annual basis. This letter summarises the basis of our offer to Prospect. Thank you for your constructive challenge during the pay negotiation meetings. I hope your members will respond positively to our pay offer. Yours sincerely Tina Lewis Director of People & Legal Services Copies to: Louise Heppinstall, Jane Smyth, Leigh Freeman, Lorraine Vinten, Mark Bray and Kevin Warden Cont/d 6

11 Allowances Recommendations for Pay Negotiations January 2017 (effective 1 April 2017 until 31 March 2018) Allowance type Heating and Light contribution (from staff to the Trust) Current level Change effective 1 April 2015 (% and/or ) 720 Increased by 12 month average of CPI 1.3% Change effective 1 April 2016 (% and/or ) Increase by 12 month average CPI at 0.06%. (as CPI so low in effect no increase) Proposed level 2017 WFH 525 No change No change No change Comments Increase to 725 Linked to YTD CPI figure - 12 month CPI is at 0.56%. Energy data reviewed. Inner London Weighting 4465 No change No change No change Benchmark data suggests level still relevant Outer London Weighting 2690 Increased by +24% to benchmark data No change No change Benchmark data suggests level still relevant Dog allowance 470 Increased by 12 month average RPI Increased by 12 month average RPI Increase to 478 Linked to YTD RPI figure - 12 month average RPI at +1.6%. On call allowance 15 No change No change No change On call payment 55 Increased by 5 (10%) Latest revision of this document: This revision: No change No change

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