BT staff closer to door as pay deal rejected

Steve Dinneen
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BT staff may strike for the first time in over 20 years after a pay deal was rejected yesterday by the Communication Workers Union (CWU).

The telecoms giant is locked in a bitter feud over pay with their staff. City A.M. has learned BT tabled a two year pay offer including a three per cent rise in 2011, in addition to the two per cent already offered for this year, and a bonus of £250 related to performance. The group is also understood to have agreed that no compulsory redundancies will be made before the end of 2011.

But the CWU said the offer was “unacceptable” as it does not include an immediate pay hike. Last year the union agreed to a pay freeze but is determined to secure a real-term rise for staff this time around.

The union pointed to the firm’s swing back to profit in the fourth fiscal quarter after a loss the year before. Now it will ballot its staff again to decide whether to down tools.

A BT spokesman said: “Our door has always been open to the CWU. We are disappointed by their initial response.

“We were prepared to go the extra mile to try and settle this.”

The UK’s leading fixed-line and broadband provider is desperate to avoid its first strike since it was privatised in 1984.

It is understood to be bristling that the CWU is pushing for an immediate five per cent hike after settling for just two per cent for workers it represents at Virgin Media.

Troubled BT finally began arresting its declining revenues last month. It slowed its drop in revenue to just two per cent and the company now predicts a return to growth in 2012-13.

It is also operating under the cloud of a huge pension deficit, which stands at £5.7bn. The firm is awaiting results of a review by the pension regulator into its proposed 17-year plan to fund the deficit.

BT plans to cut another £900m in costs this year, after £1.75bn worth of cuts last year.