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A fight for fair play on pensions

A fight for fair play on pensions

Strong support from members for union action gave our negotiators at BT the power to negotiate better pension rights than the company had originally offered. National secretary Philippa Childs reflects on how Prospect’s input has positively influenced the outcome.


Prospect has negotiated further improvements to the BT pensions changes for managers that union members – many albeit reluctantly – accepted in a ballot in January. The agreement voted on was secured by Prospect after months of talks. The process was triggered by BT’s plans to close its defined benefit BT Pension Scheme (BTPS) to managers for future accrual and move them into the BT Retirement Saving Scheme (BTRSS).

All people joining BT since 2001 have only had access to the company’s defined contribution scheme, renamed the BTRSS in 2009. By the end of 2017, 11,000 managers were contributing to the BTPS and 12,000 to the BTRSS.

During the very difficult negotiations we secured decent transitional arrangements for BTPS members having to transfer to the BTRSS for future service

We also won improved employer contributions for all members in the BTRSS

January’s ballot saw BTPS members voting by 53%, and BTRSS members by 85%, to accept the changes – an average of 60% in favour. The turn-out was 58%.

Members also voted by 74% to accept a pay offer awarding most people 1-2% from January, with longer-term guarantees for 2018-19.

While the margin in the pensions vote was much closer among those having to move out of the BTPS, the result gave us a mandate to reach a final agreement with BT.

In February we returned to the employer and won more protections. We thank all members who took part in our ballot and responded to BT’s consultation. Their strength of feeling helped us to make a positive difference in difficult circumstances.


BT acknowledged several concerns raised by managers – among them additional voluntary contributions, transition payments; retirement flexibilities; redundancy; differences between managers and team members; and the timescale. BT came back with improvements, including:

  • People in the old scheme will be moved into the BTRSS from 1 June 2018 rather than 1 April.
  • BT will allow managers moving from the BTPS to continue to make AVCs into their old scheme after it closes – until 31 September 2019 – thus covering two further financial years and bonus cycles.
  • On top of the agreed transition payments, BT will contribute an extra 11% of salary into the BTRSS for ex-BTPS managers willing to pay in 8% for five years (originally three years). This is subject to the BTRSS earnings cap (£154,200 for 2017-18).
  • From 31 May 2018, BT will introduce an option for managers aged 55 or over to start drawing their BTPS pension while continuing to work for BT for a further two years.
  • For at least a year from 1 June 2018, BTPS managers aged 55+ wanting to retire early will have the BTPS part of their pension actuarially reduced by less than normal, likely to be 3-3.5%.
  • BT has agreed a discretionary transition period for BTPS managers being considered for medical retirement at the point the scheme closes, so it happens under BTPS rules.
  • The company will formalise medical retirement benefits under the BTRSS to make them transparent, in consultation with Prospect.

Since then, BT has also agreed to raise its employer contribution to 10% for all employees contributing 5% or 6%, as well as those contributing 7%.

New redundancy limit

With the pensions changes, Prospect has negotiated revised redundancy proposals, from 1 April 2018, for all staff. The terms are a month’s pay for each year of service up to four years, then two weeks for each subsequent year of service, plus contractual notice, capped at two years’ pay.

BT has told us that it will only consider redundancy after exploring existing processes, eg redeployment, retraining, re-skilling, voluntary paid leavers, recruitment freezes, contractor and agency displacement.

The new procedure will give BTRSS members certainty for the first time.

In practice, the redundancy terms in the old BTPS were considered too expensive and outdated, meaning BT normally handled departures through private exit packages. So the new measures also provide clarity for those transferring from the BTPS.

Keeping up the pressure

This has been a difficult time for our members in the BTPS. But by engaging in difficult conversations with BT and listening to our members’ concerns we have achieved some valuable improvements. We have also achieved a better pension for those already in the BTRSS – important for anyone joining BT now and in future. And we will keep seeking more improvements wherever we can.

The message from our members at BT to workers in other companies is that pensions are just as much an industrial issue as pay and the hours you work, and worth fighting for.

If your pension is under threat we have shown that when members join together to oppose the changes and support union action, it gives us the power to fight back on your behalf.

As Stage Screen and Radio magazine went to press, BT and the CWU reached an agreement on future pensions arrangements for 20,000 team members, meaning the company will close the BTPS to all its members for future accrual – click here to read more.

  • This article was first published in the Spring edition of Stage Screen and Radio magazine, which members can read here.


Philippa Childs

Philippa Childs


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