Salary costs over the last three years 

Main points & key dates 

In May 2000, the bulk of ScottishPower/Manweb IT staff were TUPE transferred into a joint venture company called Calanais owned 50:50 by ScottishPower and SAIC (a US outsourcing company with 41,000 employees, largely based in the US but with a small operation of 500 in the UK).  Whilst the TUPE transfer protected the collective bargaining rights of those transferred, all new starters after May 2000 were taken on to personal contracts.

In January 2003 SAIC bought out the remaining 50% of Calanais and all staff TUPE transferred into SAIC UK. 

Since the transfer the base pay offers to collective staff in 2003 and 2004 were below inflation and, due to claims that the Company has been in financial difficulties, staff reluctantly accepted these offers. 

This year’s pay negotiations started on 16 March 2005 following formal submission of the annual pay claim to SAIC in February.  The claim was drawn up by the SAIC Joint Trade Union Committee following member consultation during December and January. 

Pay negotiations took place over three separate days, 16 March, 30 March and 24 May against a backdrop of improvements in SAIC’s financial outlook (profits in the UK having doubled from £4 million to £9 million) and inflation having increased from 2.6% (April 2004) to 3.2% (April 2005).  Unfortunately the pay offer this year was based on the same “pot” of 3% as last year.  This pot includes all elements of the pay rise including both the base rise and all elements of performance/increment. 

During negotiations the TU Side argued its case for an inflation-proof pay rise – offering to consider a multi-year deal if this could ensure inflation-proofing.  The Company rejected these offers and yet failed to substantiate their arguments that their offer was comparable with others in the market.  The Company rejected all other elements in the claim save for acknowledgement that the existing Merit Pay Scheme needs review / replacement. 

Finally the Company made two offers, one of 2.5% base plus 0.5% performance related payments and one of 2.5% base plus a non-consolidated 0.5% lump sum, plus 0.25% performance related payments.  This was put to members without recommendation either way in a consultative ballot asking whether they accepted the 3% pot in principle or if not would they be willing to indicate their support for industrial action in an industrial action ballot.  

On a 56% turnout, 57% rejected the pot and indicated they would support an industrial action ballot. 

The TU Side returned to the management, reported the situation and requested they consider returning with an improvement to their offer.  The management considered this and rejected any further improvement suggesting the TU Side should decide what they intended to do.   

The TU Side consider that the mood amongst members is one of considerable anger and that on the basis of a campaign for a YES vote there would be a considerably larger vote in favour of industrial action in a properly convened ballot than there was in the consultative ballot where the TU’s had adopted a deliberately neutral stance.