‘Profiteering’ Capita faces strikes as workers overwhelmingly
reject attack on pensions promises
11th May 2010
Unite members at Capita Life and Pensions division have
overwhelmingly rejected the company's plans to change their own
pensions from July this year.
Workers balloted across eight of the division's UK sites
rejected proposals, which would have allowed Capita to backtrack on
promises to protect the final salary scheme and instead introduce
an inferior career average scheme. At one site the proposals were
dismissed by 98 per cent of the membership, with other workplaces
also returning heavy votes against acceptance.
Under the Capita proposals, ex-Prudential and Pearl group
contract workers would swap their existing non-contributory final
salary scheme for a career average scheme into which they must pay
up to seven per cent of their earnings. This, says Unite, amounts
to Capita breaking a long-standing commitment to the workforce and
breaching their commercial agreement with them in order to
"plunder" the employees' pension to boost short-term profits.
The employees' rejection brings closer a full industrial action
ballot. This could mean strike action at the UK's biggest business
processing outsource company which has IT and back office contracts
across the public and private sector, including the financial
services industry. Staff servicing Capita's client AXA Insurance
are also about to be balloted on the pensions proposals.
Rob MacGregor, Unite national officer for the finance sector,
said: "Unite has been in talks with Capita since it announced its
plans in autumn 2009. We have been making it very clear about the
strength of feeling on the subject.
"Despite gaining some concessions during the talks it hasn’t
been enough to assuage our members' anger. Today, they have given a
clear message to Capita that it needs to honour the commitment it
made to the staff on pensions when they transferred into
Capita.
"Under the Capita proposals our members could lose many tens of
thousands of pounds in retirement income and are also being
expected to pay for the privilege which is why they have
overwhelmingly rejected the proposed inferior career average
scheme.
"There is absolutely no justification for the move as Capita is
in a very sound financial position having again increased its
profits and dividends to shareholders this year. The current
pension scheme is in good health and the trustees are not currently
asking for any additional funding from the company.
"This is a clear attempt at profiteering at the expense of our
members' pension arrangements as Capita seek to hit the ever more
ambitious profit targets it has promised the City.
"Unite urges Capita to have a serious rethink and is also urging
Capita's clients to intervene and uphold their commitment to
corporate social responsibility to their previous workforce. Loyal
and hardworking staff who have given many years service must not
have their retirement plundered by Capita."
Unite says Capita must re-open discussions in order to avert
industrial action this summer. A strike would both damage Capita's
reputation and severely disrupt the service provided to clients and
their customers, which include the Prudential, Co-op Financial
Services and the Pearl group.
Unite believes the situation at Capita also exposes a weakness
in the law which protects transferring pensions of outsourced staff
in the public sector but not of those working the private sector.
In the case of Axa staff, Capita announced it would renege on its
commitment to match their pension arrangements a matter of months
after 1,200 Axa staff transferred to the company in June 2009.
The sites balloted by Unite were Reading, Birmingham,
Manchester, Belfast, two sites in Glasgow, Craigforth (Edinburgh)
plus the current ballot in Bristol, which is an Axa insurance
site.
ENDS
For further information please contact Daryl Williams on 07764
655 755 or Ashraf Choudhury in the Unite press office on 020 7420
8914 or 07980 224761.
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