1 / 12

Research

Analysis of financial and economic information to support the 2004/05 pay claim at BT. Research. Bill Taylor – CWU ILO Turin August 11/12 2005. Research. Areas to cover. When deciding on the pay claim at BT we looked at: Pay comparisons The economy Company performance and strategy

drake
Download Presentation

Research

An Image/Link below is provided (as is) to download presentation Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author. Content is provided to you AS IS for your information and personal use only. Download presentation by click this link. While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server. During download, if you can't get a presentation, the file might be deleted by the publisher.

E N D

Presentation Transcript

  1. Analysis of financial and economic information to support the 2004/05 pay claim at BT Research Bill Taylor – CWU ILO Turin August 11/12 2005

  2. Research Areas to cover When deciding on the pay claim at BT we looked at: • Pay comparisons • The economy • Company performance and strategy • Regulation and market pressures • Staffing and productivity • Quality of Service and Employee attitudes

  3. Research Pay • History of BT pay settlements For most years since 1984, pay has risen by more than the rate of inflation • Allowances Last year some allowances were not uprated • Pay for CWU grades compared with executives 1997-2000 CWU grades pay rose 24% whilst CEO pay rose 162% • Pay comparisons outside BT BT pay tends to be in the upper quartile of pay for comparable jobs

  4. Research The Economy • The economic outlook Treasury expected GDP to grow 3% - 3.5% in 2005 • Employment One of highest levels recorded (4.7% unemployed) • Current and forecast inflation 3.4% in Nov 04, expected to be 3.5% in March 05

  5. Research The Economy • Recent pay settlements Whole economy median 3.0%, upper quartile 3.2%, lower quartile 2.5% Private sector median 3.0%, upper quartile 3.4%, lower quartile 2.5% Individual settlements: Manx Telecom 5.5%, HVD Engineering 4.5% • Movements in earnings Currently 4.1%, expected to rise 4.4% in 2005 (includes overtime, bonuses and incentive payments)

  6. Research Company Performance • BT’s financial performance Turnover flat, pre-tax profit up 4%, net debt down 6%, share dividend up 22%, new wave turnover up 34%, offset 6% decline in traditional turnover • BT annual general meeting Chairman tells of strong financial performance at BT Intention to remain a good employer with good working practices Commitment to invest in UK based call centres • BT’s financial prospects Depends upon: market growth, competition, new wave strategy, regulation, debt management

  7. Research Regulation and Market Pressures • Regulation Encouraging more competition Equal access to BT’s network Deregulating in some areas Regulatory certainty enables investment in 21CN • UK Market Growth Growth in Information Communications Technology (ICT), mobile, broadband Broadband growth rate 17% (50,000 a week) • BT Market Share Decreasing in fixed and broadband as competition increases Starting out in mobile Strong in ICT

  8. Research Company Strategy • Defend traditional • Grow new wave • Reduce customer dissatisfaction • 21st Century Network Huge investment required Will make demands of staff Will help cut costs Will help deliver new compelling services eg Broadband TV • International Operations Strategic acquisitions focus on ICT strategy (Albacom, Infonet)

  9. Research • Staffing Levels Reducing in a drive to cut costs – down from 215,366 in 1991 to 99,900 in 2004 • Staff costs as a proportion of Operating costs Down from 45% in 1991 to 20% in 2002 Up again to 28% in 2004 due to further decrease in operating costs • Productivity Measures • Compare productivity historically within BT – like for like comparison • Turnover per employee decreased slightly, but still strong at £189,329m • Pre-tax profit per employee decreased significantly, but still strong at £19,499 Staffing and Productivity

  10. Research The Company • Quality of Service Overall customer satisfaction levels improved during the year • CARE Survey (survey of employees’ attitude) Only 36% of respondents agreed that ‘overall I am paid fairly compared with people in other companies doing similar jobs’

  11. Research • Current and forecast inflation – 3.4% and 3.5% • Current and forecast pay settlements - median 3.0%, UQ 3.2% • Company Performance – pre-tax profit up 4%, new wave turnover up 34%, net debt reduced. • Need to motivate to deliver business transformation • Contribution to change and new wave growth • Achieving improvement in customer satisfaction • Submit pay claim for 6% in all pay rates and allowances Conclusion

  12. Research • Questions and discussion

More Related