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Rolls Royce Update 18/12/20

CNC Newsletter #3  - Fighting for UK Pensions (Again) 

Date: 18/12/2020 

1 Defined Benefit (DB) Transition

From 31st December 2020 your DB Pension Scheme will be closed to future accrual.  Any funds you have accrued will be secured and will continue to receive statutory increases.

From the 1st January 2021 former active members of the DB Pension Scheme will automatically be enrolled into the Rolls Royce Retirement Saving Trust (The Defined Contribution ‘Money Purchase’ Scheme), with a member contribution of 6% and an Employer contribution of 12%.

2 CNC NDA (Non-Disclosure Agreement)

Although accrual in the DB Pension scheme will stop on the 31st December 2020 and your accrual in the DC Scheme will begin on 1st January 2021, negotiations for the basis of the transition will continue until a conclusion is reached.

The negotiations between the Company, CNC, and the Trustees have now reached a point where confidential information relating to the valuation of the DB Pension Scheme and the Covenant of the Employer (the Company’s ability to financially support the Scheme) is being discussed. Therefore, at the request of the Company and the Independent Chair of the Trustee Board, it has been agreed that a small CNC subgroup (covered by an NDA) will continue these discussions into the New Year.

3 Pensions Memorandum of Understanding (MoU)

The Pension MoU is intended to cover both future benefit improvements to the DC Pension Scheme and transitional arrangements for the DB Pension Scheme.  This document will not be finalised until the New Year.

• DC Scheme Improvements

Setting the terms of reference for any benefit improvement of Total Reward arrangements that include the DC Pension Scheme to ensure and promote good quality long term retirement savings for members.

• DB Scheme

The Pensions MOU will include the following benefit changes already agreed with the RRUKPF Trustee:

✓ The eligibility to partial transfer value payments for all members, regardless of whether a share of fund or cash equivalent transfer value is payable, subject to prevailing requirements of the FCA being met in relation to transfer certificates etc

✓ The ongoing eligibility to a bridging pension for all retiring members

✓ The treatment of any employee subject to a TUPE transfer on a parity basis with employed-deferred members up to 31 December 2023 for the purposes of with consent early retirement factors and transfer value basis

✓ Death in Service, Ill health lump sum benefit and pension (Medical Early Retirement) applicable to active members of the RRUKPF on 31st December 2020 continues to apply until 31st December 2023.

• DB Transitional arrangements (Yet to be finalised)

The MoU will also include the following transitional arrangements for all former active DB members who are in employment with the Company on the 31st December 2020.

o Potential enhancements to pension benefits of members as at 31 December 2020

o The basis of any share of fund transfer value (SOFTV) available beyond 31 December 2021

o Provision of with consent early retirement factors beyond 31 December 2023

o Better protection on revaluation for all deferred employees.

The role of the CNC Sub Group covered by the NDA is to finalise the above points with the Company.  These negotiations are not conventional - we are in negotiations with the Company, whilst in parallel the Company are also in negotiations with the Trustees.  There is no formal relationship between the CNC and the Trustee.

It is important to note that the Trustees are the ultimate decision makers, whose primary aim is to protect the fund and secure those benefits accrued up to the 31st December 2020.

The MoU will not be finalised until early 2021 and recognising our members apprehension, the CNC have requested a ‘letter of intent’ from the Company, see attached (Appendix 1), committing to reach an agreement on any MoU in the New Year.

4 SOFTV

Current situation determined by the Company for all DB leavers in 2021, who are of an eligible age (depending on their scheme rules) and entitled to a SOFTV: 

Normal Leavers

• The Company have stated SOFTV will stop on 31st December 2021

• Those leaving the Company aged 55 and above (or ex-members of RRPF who are 50* and above) and not receiving Voluntary Severance or Compulsory Redundancy must give the Company at least 3 months’ notice (to be received no later than 30th September 2021) to qualify for SOFTV

*Can Take SOFTV at 50 if your scheme rules allow provided you are able to get a bulk transfer (Buddy System) with WPS, however, this is a very complex area of legislation in which certain criteria must be met and must be done in conjunction with a financial advisor.

• SOFTV quotes will be guaranteed within 3 months of members leaving date and valid until 3 months after their leaving date.

Voluntary Severance (VS) or Compulsory Redundant (CR) Leavers

• The Company have stated SOFTV will stop on 31st December 2021 with those leaving on VS or CR with an extended guarantee of SOFTV with final payment by 31st March 2022

• Members leaving on VS or CR during 2021 and wanting to extend their decision-making period must formally request a SOFTV payment by 31st December 2021

• VS or CR leavers who are delaying their decision will have a 12-month decision window, however from the 1st January 2021 onwards the last date to inform the Pension Dept to qualify for a SOFTV will be 31st December 2021

• VS or CR members who pass their 55th birthday (or ex members of RRPF 50th birthday) during the decision window can receive SOFTV provided they have reached that birthday by 31st December 2021.

5 Pensions Administration

We have been assured that there will be an improvement in the support from the Pension Department now the Company have provided them with the correct tools (including mobile phones and call centre software in order to support scheme members). 

This is something that should have been addressed several months ago to alleviate the pressure felt by the Pension Department staff and scheme members.

6 Pensions Website

The Pensions Website now only provides estimates to 31st December 2020, we have registered our concerns about the modification on behalf of those members considering leaving Rolls-Royce on VS.  

We have been informed that a further upgrade will take place in January that will reflect the closed status of the scheme and provide more appropriate estimates.

7 Money & Pension Service Helpline (MaPs)

An additional financial service has also been provided for those considering leaving Rolls-Royce and taking their pension. MaPs provide guidance on redundancy, budgeting and other financial matters not just pensions.

MaPs was created in 2019 by the UK Government and is funded by the Department of Work and Pensions.  It brings together the Money Advice Service, Pension Wise and The Pension Advisory Service into one place, although they are still to change some of their branding.  It’s completely free and impartial.

You can call them on 0345 602 7021

Stay strong and remember the only source of fact and truth is via these newsletters.

  


 

Date: 03/12/2020 

Newsletter #11

Fighting for UK Jobs, Sites, Terms & Conditions, Pensions, Fair Treatment, Truth, Transparency, Ethical Behaviour, Morals… etc (Again)

It is important you take time to read this lengthy newsletter.  The time for all of us to fight for what is right is fast approaching. Our Company has lost it moral compass.

Barnoldswick Update

The Barnoldswick dispute is now becoming a national issue due to the disgraceful actions of the Company.  Collectively, across Civil Aerospace and beyond, we cannot let them get away with it. It could be you next. Information about the response from Unite the Union can be found at Appendix 1.

The Company have played games with the information they provided to the Barnoldswick TU representatives, which leads us to conclude they do not want to resolve the dispute.

These games are also attempted at a national level - even when some of the discussions are covered by a non-disclosure agreement (NDA) they cannot be truthful.

On several occasions the NDA group of representatives have demanded the Company provide the details behind their so-called business plans - a reasonable request so the local Barnoldswick TU can question the Company and table an alternative. Sadly, all the information has not been provided to date.

We have now found out why they have been doing this.  Today they announced that the SCAM (Structures) work currently being undertaken at Barnoldswick will be exported to ITP in Spain.

Barnoldswick have already suffered a reduction of 235. As a result of the latest announcement Barnoldswick face an additional crippling reduction in excess of 350 (177 for the transfer of Fans, 145 for the offshoring of SCAM work and 28 aligned to central functions) plus an as yet unknown number due to a load reduction.

This disgraceful ‘death by a thousand cuts’ approach has seen the workforce at Barnoldswick reduce from over 700 to approximately 100 as a result of the Company proposals.

On 24th November the Company issued a memo to the Barnoldswick workforce stating that they were closing the site for safety reasons and that employees not taking strike action would receive ‘Company Furlough’ at 80% of pay.  This is at the same time as offshoring parts that have a dual source abroad (Japan, Spain and Singapore), as well as making further plans for new offload work for those parts that are currently single source in Barnoldswick.

On the 27th November the Company sent out another memo to the Barnoldswick workforce stating “the Company has decided to pay the first two weeks of furlough at 100%” then go on to follow with a ‘Company Furlough’ payment of 80%. Once this ‘Company Furlough’ was reported to the National TU Group we made it clear to Andrew Page (Head of Employment Relations and Standardisation) that this arrangement does not exist and is potentially illegal without the agreement of us and the Barnoldswick TU representatives (which has not been provided).

The Company were informed they have two options - full pay, or no pay and take the consequences that will follow.

The National TU Group stated we would hope to find a solution to the dispute with the Company within these two weeks.

The Barnoldswick TU representatives will also use this time to table their alternative proposals (despite having to contend with more bad news announced in the latest communications).  Note that it took the Company months to put their plan together using a fleet of extortionately priced consultants.

If no solution is found in that time and the Company decide to pay anything other than full pay without agreement, the TU will instigate legal proceedings on an unlawful deduction of pay.

If the alternative Barnoldswick TU business case to retain all fan blade and SCAM work is rejected by the Company, and the Company also reject the National TU Group proposal of alternative work, our internal processes are concluded and a national Failure to Agree (FTA) will be registered.  A meeting will then be held with the Company and external officers of the TU’s.  Failure to reach a solution at this stage will lead to a national trade dispute.

Ansty & Inchinnan

Representatives from the National TU Group are in discussions with the Company on their proposals for these sites and have updated the relevant site TU reps accordingly.  Unfortunately, the Company do not want us to discuss or communicate these proposals, or the threats if they’re rejected, as they are embargoed under the NDA.

One thing we can say at this point is that the National TU Group and the Site TU reps have not agreed to support these proposals as there are several unresolved issues over guarantees and protections.

Once final proposals are communicated, members at both sites must have the final say on the outcome of any such proposals via a ballot, as they are best placed to make intelligent decisions on their futures.  More importantly, they will also know what guarantees and protections were rejected by the Company.

Hucknall

Representatives from the National TU Group are in discussions with the Company on their decisions regarding Hucknall and have updated the site TU reps accordingly. Unfortunately, the Company do not want us to discuss or communicate details as they are embargoed under the NDA.

As you may know, a TUPE transfer provides no protection of future terms and conditions. All it does is collate your current T&Cs, contractual and collective agreements that are in place at the date of the transfer. It will not provide any protection if ITP subsequently want to make changes - it will be up to the local TU representatives to fight accordingly at that time.

You should also be aware that TUPE has extremely limited protections concerning pensions.  ITP have no obligation to mirror the current Rolls-Royce arrangements. The only thing they are legally obliged to provide is access to a pension (even if this is just the statutory minimum NEST scheme).

One thing we can say at this point is that the National TU Group and the Site TU reps have not agreed to support this decision as there are several unresolved issues over guarantees and protections. These are:

What guarantees of security of supply is RR setting with ITP? • What guarantees of security of employment on the Hucknall site is being set with ITP? • What productivity/efficiency measures are being set by RR with the transfer to ITP? • What pension protections and provision will be provided by RR/ITP? • What guarantees and protections are being provided for individual DB pension scheme members by RR?

Members at Hucknall must have the final say via a ballot, as they are best placed to make intelligent decisions on their futures.  More importantly, they will also know what guarantees and protections were rejected by the Company.

EOS Derby & Heathrow

As the Services leadership team communicated on 5th November (without talking to those affected in the first instance) ~150 direct reductions have been identified.  This is approximately 30% of the direct workforce. As part of the announcements the Company also intend to close the Heathrow facility.

To date, the only point which has been agreed between the Services Leadership Team and Senior TU representatives is to maximise use of the government furlough scheme to the end of March 2021, to ensure adequate time is provided for detailed consultations and mitigation discussions into the new year.

For your information, and so you are aware of the strong feelings, the relevant EOS TU newsletter is attached at Appendix 2.

5th November Announcements

Hopefully you will have noticed the Company extended the Voluntary Severance (VS) application window for Staff and Works to the 17th December.  Note that yet again this was not done out of kindness by the Company (despite what their communications imply).  We had to demand it.

As a reminder, a HR1 is a formal notice from the Company to the government of potential future reductions in the workforce.  A Section 188 (S188) notice formally triggers the start of the statutory 45-day minimum consultation period before any redundancies can take place.

The Company issued the relevant Staff TU representatives with S188’s on the 5th November without any prior discussion.  However, impact briefs began prematurely without our knowledge.

Whilst the S188 is a statutory legal document the Company still can’t get it ‘right first time’.  The Company has since reissued the S188’s but it’s anyone’s guess if they are correct.

The current reduction totals on the S188’s are 94.5 in Civil Aerospace Staff and 12 in the Innovation Hub.

For Works colleagues we have now received some clarification of the locations of the ~420 direct reductions but cannot communicate further due to the obligations of the NDA.  This will be communicated as soon possible.

We can confirm that the Company have eventually agreed to our request to postpone the issuing of any S188 notices for Works colleagues until the end of January 2021. There are a number of issues regarding the release of VS applicants, even where a HR1 and/or S188 has been served.

Apprentices

Some apprentices were scheduled for finishing their apprenticeship in 2020, but have no permanent role available, where possible have been placed in temporary positions until March 2021 due to number of VS leavers earlier this year.  Unfortunately for the rest of the 2020 completers they will be receiving termination letters from as early as the 7th December.

It is therefore important that VS applications are processed as quickly as possible to at least provide some temporary positions (if not permanent positions).   A point which has been registered with the Company by your Trade Union.

Furlough Phase 4

We have agreed that payment at 80% will be extended until 31st January 2021.  We will then meet with the Company early in the new year to understand further governmental furlough guidelines for extension until the end of March 2021.

Pay & Benefits

As previously reported, we have yet to agree collective agreements on COVID temporary changes and Package Principle MoU documents. After reaching agreement with the Company we will be double checking everything with the Union’s legal team.

You may have seen the recent communication from Simon Burr and Simon Carlisle, in which they stated, “Discussions have commenced on the Reward Principles and proposals announced on 5th November”.

Unfortunately, this is another example of fake news by the Company as no such discussions are taking place with TU representatives.

To make it clear to members and the Company (we know they love reading these newsletters) – no discussions on pay and benefits will take place until all appropriate collective agreements are agreed and signed.

Be assured, everyone who is affected will have a vote on the outcome of those discussions.

Pensions

There are also problems obtaining pension figures for colleagues exploring VS – a fundamental part of the decision to apply to leave.

The Pensions CNC hope to issue an update on the current situation next week.

H&S

We are continuing to have several health and safety issues, not least of which is having to go back over fundamental points we thought we had agreed previously.

We have asked for more details around the use of the Track and Trace app being used in the workplace and we still have outstanding issues around self-isolation and payment of shift pay guidance.

It is interesting to note that managers are also becoming increasingly concerned about these issues.

All these outstanding issues remain on our agenda and are becoming problematic to resolve.

Finally, remember that the only source of truth is through these newsletters and we thank you for your continued support.

All previous newsletters can be found at the following link:

https://www.gmb.org.uk/network/manufacturing-section/rolls-royce-noticeboard

Appendix 1 – Unite the Union Barnoldswick Press release.

Unite Press Release

Immediate Release: Wednesday 25 November 2020   Rolls-Royce Barnoldswick Christmas lockout and offshoring decision an act of industrial selfmutilation   Rolls Royce’s announcement that it will close its factory in Barnoldswick from this Friday (27 November) until after Christmas, while offshoring work around the globe, has been described as an act of ‘industrial self-mutilation’ by Unite the union, which represents workers at the plant.   Unite members have been undertaking targeted strike action since 6 November, which was due to end on 24 December, in a campaign to secure the future of the historic factory, the cradle of the jet engine. The campaign has become known as the ‘Battle for Barnoldswick’.   In a briefing staff were told that “on the basis of health and safety” the site would close for an extended Christmas shutdown and workers would not return until after Christmas.   They were also informed that work currently undertaken at Barnoldswick will be immediately transferred to Japan, Singapore and Spain.   Rolls-Royce has further announced that workers who are not part of the current targeted industrial action will be furloughed from Monday 30 November until Friday 18 December and will receive 80 per cent of their pay during this time.   The ‘Rolls-Royce furlough’ is not part of the government’s Job Retention Scheme, nor is it something that has been agreed with Unite. As a consequence, Unite is seeking urgent clarification and is considering a legal challenge to ensure the workers who were not on strike receive 100 per cent of their wages.   Unite regional officer Ross Quinn said: “We have consistently called on Rolls Royce to work with us to find the resolution that the members who have given their working lives to Rolls Royce deserve.   “However, the company has shown absolutely no appetite to resolve the dispute. The decision to lock workers out of Barnoldswick before Christmas and to immediately offshore work at the factory demonstrates that Rolls-Royce has no intention of negotiating or consulting its loyal workers on its plans.   “Workers at Barnoldswick, who take huge pride in their work, began targeted industrial action as a last resort in order to ensure the future of the historic factory.   “By its actions today it appears that Rolls-Royce is simply not prepared to enter into negotiations and to preserve this historic site. Instead it has undertaken this course of action which damages workers, the local community and the historic Rolls-Royce brand.

“We remain committed to finding a resolution and call on the company to meet with Unite immediately before they do irreparable damage to this workforce and community.”   In August Rolls-Royce announced that it intended to offshore the work on its Trent jet engine blades from Barnoldswick to a site in Singapore, with the loss of 350 jobs. Unite has warned this would make the factory, which Rolls-Royce has operated for over 70 years, potentially unviable.   The loss of jobs or the potential closure of the site would have a devastating effect on the town and the community of Barnoldswick where Rolls-Royce remains the principal employer.   Since the announcement, Unite has been campaigning to have the decision to offshore the jet engine blade work reversed or alternatively secure a commitment that similar work would be transferred to the site.   Rolls-Royce’s actions are especially controversial as it is currently in the process of securing around a billion pounds support from the government, as part of a £5 billion refinancing scheme, to contend with the global slowdown in the aerospace sector due to the Covid-19 pandemic.    Unite national officer for aerospace Rhys McCarthy said: “Rolls-Royce actions are totally unacceptable. At a time when they should be entering into negotiations, they have instead locked workers out and moved work abroad.   “It is vitally important that the government and MPs make it entirely clear to Rolls-Royce that its actions are deplorable and should be reversed immediately.   “Since Rolls-Royce first announced its intentions, Unite has been crystal clear that it was fully prepared to negotiate to secure the future of Barnoldswick and this still remains the case.”   ENDS.

Appendix 2

EOS Trade Union Newsletter

Date: 24/11/2020 

It is only right and proper to issue an EOS-specific newsletter following a year of complete deceitfulness from the Services Leadership team towards us, both in Derby & Heathrow.

Back in April we had a total headcount reduction of 49 from EOS Heathrow (50%) and 35 from EOS Derby.  Announcements for reductions in other MRO bases including Inchinnan, Ansty, Bristol, Germany and Canada were also made at the same time.  We had our suspicions concerning the future of EOS London Heathrow but unsurprisingly no commitment was provided by the Services leadership team at the time!

With a combined total of over 4700 years’ service, 167 employees in EOS Derby came forward for Voluntary Severance (VS) and left the Company by September 30th 2020. This meant we could mitigate reductions in other areas of the businesses – over 100 jobs in total.

We raised concerns that all leavers were being replaced and stated that ethically we should not be giving the false hope of people making the decision to move with a second phase of reductions before the year end, but regrettable that is the situation we find ourselves in.

Taking into account the closure of MRO Inchinnan (446 direct jobs) and now 150 directs within EOS (29% of our direct workforce), this is not just a drop in load but a blatantly opportunistic and strategic attack on cutting UK MRO jobs and offshoring work to Joint Ventures and third party maintenance providers.

For those who witnessed the shambolic way the Services WebEx singled out EOS Derby and EOS Heathrow on 5th November, you will understand and probably share our utter disgust at the way the announcement was delivered.

Many of you heard the announcement second-hand from colleagues or by seeing the ‘Killer’ slide on your mobile phone, we’re sure you all felt better about the situation with the usual Company cliché of “we care about your wellbeing and mental health”.  We know they really don’t care.

EOS have always played a big part of the MRO network, especially when it comes to the health of the Trent 1000 engine fleet during recent times, by developing methods and training 3rd party providers to get the AOG levels of the Boeing 787 Dreamliner down to zero – something the workforce answered admirably with hard work and dedication to the cause.

When the National TU Group forced the Company to shut down sites in March to make workplaces safe, EOS took the time to redesign the shop layout and have since implemented over 600 improvements – to allow us to continue working safely and thus continue to drive down the Boeing 787 AOG’s.

Our suspicions were raised again when a review revealed RR Canada was not going to be impacted as first thought and are now not facing closure.  We never believed Canada was ever going to be impacted as originally announced, and now we know!

Their actions prove the deception that’s been played out.  We do not need to tell you how the whole of our workforce must now feel after the announcement on 5th November of a FURTHER 150 job cuts in EOS and the proposal to close the London Heathrow facility.  This now leaves us with a workforce they wanted in June, not knowing what their future entails.

We will of course be raising the above and much more in the coming weeks, including maximising the government furlough scheme into 2021 and will endeavour to maximise mitigation of job reductions.

What we have recently been provided with is the EOS 2021 SORB data;

Facility Derby LHR Engine shop visits 100 35

Lastly for now, we would like to thank the membership for your complete professionalism and continued support in this most difficult of years.

Take care of yourself and each other - your TU cares about you even if the Services Leadership team does not.

 


 

Date: 18/11/2020

Update

Our previous newsletter (9th November) communicated that the CNC had registered a Failure to Agree (FTA) with the Company.

Even in normal times pensions are complicated, with any outcomes requiring agreement between the Company, the CNC and most importantly the Trustees. This is something we have done successfully for many years.

Unfortunately, we are not in normal times.  It has been frustrating and damaging in equal measure that all year we have had to deal with a Company which in many instances has lost its moral compass on how it should treat its employees.

It stated that the Company does not accept we have any legal right to register an FTA, ballot our members or even negotiate on pensions, even though there is over 20 years of precedent.

The Company agreed to a vague future review of the Defined Contribution (DC) scheme structure. However, in parallel they disgracefully changed the Defined Benefit (DB) proposals they had already tabled to the CNC and Trustees.

The Chair of the CNC subcommittee contacted Joel Griffin (Head of Reward) and made it clear we cannot accept this attitude or the response to our FTA.  The outcome was that the Company issued a revised response to our FTA (not written by a lawyer).

An FTA meeting took place, the outcome of which is an interim position for the DB scheme to provide much needed certainty for people considering Voluntary Severance (VS) and/or early retirement due to the DB scheme closure on 31st December 2020.

The main terms are:

  • All DB members will be automatically enrolled into the DC pension on 1st January 2021 at the highest available level of employer pension contribution (12%) with employee contributions remaining at 6%.
  • Current ‘with consent’ Early Retirement Factors will continue to apply until at least 31st December 2023 (including any TUPE transferees).
  • The current basis of calculating Share of Fund Transfer Values (SoFTV) continues until 31st December 2021 (including any TUPE transferees).

In addition, the results of the 2020 funding valuation are not yet known to the Trustee, Company or CNC.  Once the details are known (expected over the next few months), we shall re-enter discussions with the Company to negotiate an MoU that will include:

DC

A Review of the DC scheme arrangements (Whilst the Company had agreed to provide a review of the DC pension, we have made it clear that we need to have further discussions, specifically to clarify the ‘terms of reference’ of any review).

DB

  • Basis of potential terms of pension benefits for members as at 31st December 2020.
  • Basis of any SoFTV available beyond 31st December 2021.
  • Provision of ‘with consent’ Early Retirement Factors beyond 31st December 2023.

No final decisions on any of these aspects are expected to be taken before January 2021.

Conclusion

The CNC and Company have reached an uneasy truce.  But it is paper thin.

We believe the next time we fundamentally disagree with the Company; their lawyers will write more threatening letters stating we do not have the right to negotiate pensions or ballot our membership.

As a result, we must all be prepared to take the Company on.

Stay strong and remember the only source of fact and truth is via these newsletters.

Thank you for your continued support.

Pensions CNC Subcommittee

 


 

Date: 09/11/2020

Background

Over the last 20 years, the Pensions Central Negotiating Committee (CNC) and Trade Union structures have battled to protect and improve the various pension schemes in Rolls-Royce.

We are now in a crucial situation where the Defined Benefit (DB) Scheme is closing and, from the 1s January 2021, everyone will be a member of the Defined Contribution (DC) Scheme.

It is therefore vitally important that everyone understands the current situation in the DC and DB pension schemes (irrespective of which one you are currently a member of) regarding the negotiations the CNC are having, the decisions which are being taken and the behaviour of the Company.

As we have reported recently, the CNC recognise the current financial climate and have been prepared to make difficult decisions – including not contesting the initiation of the force majeure clause to enact closure of the DB scheme.

The CNC have also been realistic in their objectives of improving both the terms of the DC Scheme going forward and the fair transition of the DB Scheme closure.

After initial consultation meetings the CNC agreed to remove some proposals from our list (National TU Newsletter 8). The reason for this was that after the Company supplied the financial cost of our proposals the CNC decided there were more important and realistically achievable items to focus on. In fact, the Company thanked us for being pragmatic.

DC Scheme

Pensions experts will tell you that we need to aim for between 20 – 25% total contributions of income in order to receive reasonable pensions outcomes.

In 2018, as part of the Total Reward package, we negotiated some changes to the DC Scheme. The CNC’s objective was always to use the probable future closure of the DB Scheme to improve the DC Scheme.

We must therefore revisit our promise to address the outstanding issue of contributions for members who are over 40 years old. This will benefit members of all ages and must therefore be included in any settlement going forward.

Recognising the current financial position of the Company we proposed a transition arrangement to address this situation (National TU Newsletter 8). As we have communicated previously, we are prepared to negotiate a reasonable transition for any DC Scheme improvements so the Company can realise greater cost savings in the current financial climate.

DB Scheme

From the moment the Company communicated their intentions, the CNC could have legitimately fought against the closure of the DB Scheme. However, because of the financial position of the Company the CNC decided the best course of action was to work with the Company with the objective that DB members get a ‘fair transition deal’.

You may recall that in 2018 you agreed (as part of the Total Reward package) the Company could take a £145m contribution holiday to assist their financial situation at that time, which they have conveniently forgotten about. To date this money has not been repaid.

The CNC DB Scheme transition proposals are to ensure equality in application across all scheme members - for example a 5% uplift and existing ‘with consent factors’ going forward. This would also be consistent with existing arrangements agreed with managers on 1st March 2020 (surprisingly no force majeure was applied). We’re not asking for removal just equality.

Negotiations

As a reminder, the Company and CNC have already agreed to the following for the DB Scheme closure transition:

• • Pre 1997 pension contingency increases guaranteed up to 31st March 2024, subject to Trustee agreement

• • Bridging Pension Option maintained, subject to Trustee agreement

• • Partial Transfer Option, subject to Trustee agreement

• • Unreduced Benefit Underpin for Death in Service/Medical Early Retirement (MER) until 31st December 2023, subject to Trustee agreement.

The CNC have informed the Company that our remaining priorities are:

For the DC Scheme

• • An improved contribution structure of the DC Scheme for all existing and future members.

The only response from the Company on the DC Scheme is attached at Appendix 1. Click HERE to view 

For the DB Scheme

• • A 5% uplift on DB pensions accrued up to 31st December 2020, for Works & Staff employees. The CNC is simply asking for parity with what managers received in March 2020

• • ‘With Consent’ early retirement factors maintained in the DB Scheme, post-closure. Again, the CNC is simply asking for parity with what managers received in March 2020

• • Share of Fund Transfer Values [SOFTVs] in the DB Scheme maintained from age 50 or 55 as per current scheme rules post-closure.

The Company have not satisfied our proposals, instead they have made their own proposals to the Trustees which fall well short of our expectations.

Failure to Agree

On Friday 6th November, the CNC registered a formal Failure to Agree (FTA) with the Company.

A copy of this is attached at Appendix 2. Click HERE to view 

We will provide further updates when the FTA has been heard.

And Finally

You will have seen (or experienced at first hand) how the Company has handled the COVID crisis regarding furlough, redundancies and site closures. They are now using the pandemic as an opportunity to attack everyone’s pension.

We know they will do the same to employment terms and conditions for those of us that remain in a job, if we allow them to.

We must all be prepared to fight every single unfair attack.

Stay strong and remember the only source of fact and truth is via these newsletters. and we thank you for your continued support.

 


 

Date: 14/10/2020

1. Update

The National TU Group was informed there have been several ethics complaints raised as a result of our newsletters.  It is never our intention to cause offense - and if we have, we apologise - but we will not apologise for stating facts and our honest assessment of any given situation.

Throughout this crisis we have highlighted several occasions where we believe the Company has acted unethically, opportunistically and made incorrect or poor decisions.  We see it as a fundamental part of our role to continue to highlight this hypocrisy wherever necessary.

You may have seen various press reports talking about the Company exploring ways of raising further finance to underpin the company’s equity position and see us through these difficult times – such as share rights issues, government bonds, disposals (selling parts of the business), etc. The National TU Group have had no part in these discussions or announcements, however we will continue to monitor the situation and support where appropriate.

2. Pensions

The Pensions Central Negotiating Committee ((CNC) - the TU body responsible for pension consultations and negotiations) have issued a joint communication with the Company on the 5th October 2020.  

The communication strongly recommends the use of a company called Workplace Solutions Advisory (WPSA).  The National TU Group fully support the Pensions CNC and the use of WPSA.  Please see Appendix 1 on the WPSA fee structure.   The statutory 60 days individual consultation process, which was unilaterally initiated by the Company, has now closed.  However, consultation discussions are still ongoing with the Pensions CNC and further meetings have been arranged.

The Company have already agreed to the following proposals (subject to Trustee agreement):

  • Pre 97 contingency pension increases guaranteed up to March 31st 2024  • Bridging Pension Option maintained
  • Partial Transfer Option  • Unreduced Benefit underpin for Death in Service/Medical Early Retirement (MER) until 31st December 2023
  • The Trustee and Company have agreed to guarantee that a Share of Fund Transfer Value (SoFTV) - calculated as at 31 December 2020 - will be available for eligible members who leave employment on or before 31 March 2021

Some progress has also been made on: 

  • Members leaving on voluntary severance (VS) or compulsory redundancy (CR) in 2020 are included in future enhancements.  The Company will discuss with the Trustee any members leaving on VS or CR in 2021.

To date no progress has been made on: 

  • Improving the terms of the Rolls-Royce Retirement Savings Trust, Defined Contribution (DC) arrangements. 

The Pensions CNC have told the Company that in future discussions the priorities are:

  • An improved structure of the Defined Contribution (DC) Scheme for all employees and minimising the effect on the expected retirement savings for members in the Rolls-Royce UK Pension Fund, Defined Benefit (DB) pension scheme.  That is why it is vital to have the correct structure for the future DC scheme.
  • A 5% uplift on DB pension built up to December 31st 2020 (Works & Staff employees only). The Pensions CNC is asking for parity with what our management DB members received in January 2020.  
  • Early retirement factors protected – Employed members post 31st December 2020 to be classed as “Active Deferred” and apply appropriate “with consent retirement factors” on retiring from active service post closure. The Pensions CNC is again simply asking for parity. 
  • Share of Fund Transfer Values [SOFTVs] maintained from age 50 or 55 as per rules of legacy schemes and transferable to alternative DC arrangement whilst remaining an “Active Deferred”.  

The Pensions CNC completely agrees with the Director for Total Reward that there should not be a two-tier system.   

3. Strategic Review 

Several meetings have taken place. The first three discussed the communications already announced with the half year results, which are now under local consultation.  As a reminder:

  • Proposed closure of the plant at Crosspointe (USA).  Work would come back to the UK - Rotatives (Discs) to transfer to Washington (UK) and Turbines (Blades) to transfer to Derby.
  • Proposed closure of the plant at Annesley.  Work would transfer to Discs and Drums in Derby and Oberursel (Germany)
  • Proposal to cease large engine build in SATU (Singapore) with the work transferred to Derby
  • Proposed consolidation of Wide Core Fan blades with the transfer of Trent XWB blades moving from Barnoldswick to Seletar (Singapore). 

Please note the National TU Group (Civil) sub-committee have been made to sign a Non-Disclosure Agreement (NDA) regarding the discussion of proposals beyond those already announced and we are therefore unable to communicate any further on these issues at this time.

We would specifically like to highlight the current situation at Barnoldswick.  Following the company’s latest betrayal of the workforce (after 5 years of constant downsizing with over 50% of the workforce gone, many broken promises, failure to bring in replacement work for that offloaded and even changing terms and conditions) the membership feel they are left with no other course of action other than to ballot for industrial action in order to try to protect jobs.  The company’s continued reductions of the manual workforce only serves to place more financial pressure on what is left and makes the site less competitive with every decision they take.

The National TU Group are fully supportive of the Barnoldswick workforce in their struggle and support their request for financial assistance from the Rolls Royce dispute fund, in the event it becomes necessary. See Appendix 2 for more details on the Barnoldswick campaign.

4. End of Furlough Phase 3 

There are ongoing issues with salary in relation to furlough payments.  The National TU Group have requested a meeting with the Company to try to address these concerns.

Last month the government announced its latest plan to try to protect jobs from the end of October when the current furlough scheme comes to an end.  Although the government reiterated that furlough was ending, it also announced the Job Support Scheme (JSS) to support viable UK employers who face lower demand due to COVID19 and retain their employees.

We have this week met with the Company to explore how we best utilise any support that is available to try to protect jobs.  It is important to note that the rules surrounding the JSS are not the same as furlough and at present are not entirely clear. 

This discussion will also include:

  • Understand future load demand • Shorter working week/reduced hours working • Working from Home • Flexible working • Holidays/shutdowns • Rotation • Additional Hours

These discussions may result in having to take further difficult decisions on a temporary basis to support the current financial status of the Company and protect long term employment.  There may be a suite of options that may apply differently across the business.

If we can reach agreement on any of these issues, then we will provide further updates in due course all of which will be covered by the temporary collective agreement which we informed you of in the previous newsletter. Please note any changes that are to be applied beyond March 2021 will require agreement via a ballot of affected members.

5. Health & Safety 

As track, trace and testing becomes more widespread we are seeing an increasing number of employees with positive test results.  

The Company have issued updated guidance for managers on how to deal with positive cases within the workplace.   We will review this new guidance and will provide feedback to the Company on its contents.

Irrespective of this guidance one important aspect that has been not been addressed (which the National TU Group raised a number of weeks ago) is the financial inequality of how employees are treated for those unable to work from home whilst self-isolating, the majority of which are shift workers who under Covid-19 self-isolating rules who lose their shift premium.

We do not want any financial impact to be a barrier to people self-isolating thus placing other employees at increased risk and the possibility of workplace shutdowns.    

Following the last newsletter, we continue to remain concerned and remind everyone that it is imperative we maintain adherence to social distancing and compliance to all safety measures put in place. 

Finally, remember that the only source of truth is through these newsletters and we thank you for your continued support.

All previous newsletters can be found at the following link:

https://www.gmb.org.uk/network/manufacturing-section/rolls-royce-noticeboard

Appendix 1

Approved Independent Financial Advisor Charges

The cost of the advice that’s been negotiated with WPSA is currently £500 plus VAT for providing a written personal advice report, plus an additional £125 plus VAT to implement a transfer out of the Fund and establish your benefits in an arrangement to suit your personal circumstances (e.g. annuity or a drawdown arrangement).

However, WPS may charge additional fees over and above the negotiated cost as detailed above where your circumstances are more complex, for example where you have a complex tax situation; have lifetime allowance issues or have specific drawdown requirements.  Any such request is individually priced and WPSA will clarify the fee before undertaking any such work.  All fees are charged on a fixed fee basis rather than commission to ensure transparency.

There are certain more complex member circumstances which are more common to our Fund members and these are summarised below with a price range to give clarity on cost.

  • Advice for a Defined Benefit (DB) Pension scheme (non-RR) – ranges from £3,000 - £5,000 depending on complexity
  • Advice for a Defined Contribution (DC) Pension scheme (RR service related) - £300 plus £125 if member transacts unless being reviewed and transferred as part of the review of the RR DB Scheme where there is no additional fee
  • Advice for DC Pension Scheme (not RR service related) - £750 - £1,000 per DC plan but discounted, if 3 or more reviewed at the same time

If preferred, you can of course use your own adviser but please note that where an adviser charges a percentage of the overall transfer value this can amount to substantially increased fees when compared to WPS fees quoted above. 

If you are using your own advisers, we would suggest you review the proposed charges and fee structure of any financial advisers especially in the wake of the changes introduced at the beginning of October banning contingency fees.

Appendix 2 

Battle for Barnoldswick

Link to on-line petition to both Rolls-Royce and the UK Government to save the Barnoldswick site: https://www.megaphone.org.uk/petitions/save-our-site-battle-for-barnoldswick-rolls-royce  

Link to a powerful video about the history and importance of the Barnoldswick site which has been put together by past and present Rolls-Royce workers and the local community: https://youtu.be/Q5FHsCED6l8

 


 

Date: 07/09/2020

1 Update

Yet again we have a lot of information to communicate, so apologies for the length of this newsletter. To access the appendix document referenced in this update please click here

Firstly, the Company have registered concerns as to the content and tone of our newsletters. We make no apology for them - they are factual. It seems we have some rather sensitive leaders who like to dictate but can’t take criticism, even if it is the truth.

The half year results have shown what dire straits we are in. We have always acknowledged how serious the situation is and why we have had to take some difficult decisions - there be many more to be taken over the coming months, possibly years.

The results show the Company have saved £350m. This should have been significantly more. We previously reported our dismay at paying the 2019 bonus which would have resulted in another £100m saving and their reluctance to maximise furlough across all categories of employees, which would have resulted in tens of millions more savings.

Sebastian Resch - Operations Director, Civil Aerospace and the main architect of the Company’s plans - made the comment that we need to ‘cut our cost structure by £1.3bn’. What will be interesting to see is how much ‘consolidation’ will take place concerning to the 87 Executive positions, many of whom who sit at home dictating their mandate at a cost of £42m per year.

Whilst we are on the subject of Company finances we note the announcement of our departing Chief Financial Officer, Mr Daintith, who has clearly decided it is time to jump ship (or perhaps more appropriately don the parachute to land in greener pastures) with the prospect of another golden hello, despite only being with our Company for just over three years. It says it all doesn’t it.

2 Furlough & Working from Home

We have registered our concerns that there has also been a serious lack of attention given to the mental health of those on long term furlough (who have the added financial pressure) and/or those working from home who may not have the appropriate facilities or environment.

We have requested on numerous occasions that the internal information around mental health and the Employee Assistance Program (EAP) on Engine Room is made available on the external Rolls-Royce website. We are still awaiting confirmation that this has taken place, despite receiving assurances it would happen.

Another outstanding issue to be agreed is a monitor-and-review process on the fair and equitable application of rotation, not only for those on furlough but those working from home as well. We remain suspicious as to what plans the Company have for those roles that have proven can be effectively worked from home.

It seems there have been several discussions between managers and employees taking place at some sites concerning employee holidays and shutdowns. At a national level the only feedback given to date is they are ‘in discussions’ and they have still not reached any conclusions.

We have yet to enter discussions on reduced hours working/shorter working week beyond furlough Phase 3, which we believe is both inevitable and necessary, and will be needed in a number of areas for some considerable time to protect jobs and the future of the Company.

The Company communications from 14th August 2020 created the illusion they were willing to discuss a shorter working week at Barnoldswick. However, with last week’s announcement that they are planning to transfer most of the Barnoldswick Fan blade work to Singapore, it is clear that the discussions we had in August, were nothing more than a sham as they obviously knew they were planning further cuts.

3 Headcount Reductions

Sadly, in Phase 1 we have finished up with approximately 100 + compulsory redundancies. This is a moving picture with national pooling still taking place, with the main areas being Inchinnan and Barnoldswick.

However, let’s be honest, at Inchinnan MRO it was in fact 525 compulsories and please be aware that the Barnoldswick figure does not include any numbers as a result of the announcement on 26th August. Despite telling the site they were moving the work, they failed to inform the workforce the amount of jobs that are too be exported as a result.

We have been clear that the Company should always maximise voluntary severance in the first instance, so it is very disappointing that the Company-controlled VS Decline number currently stands at 65. 113 applications are pending, 92 of which are in Turbines. We have asked the Company for these declines to be monitored and reviewed on an on-going basis and we are awaiting further discussions on how we deal with Phase 2 VS applications and expression of interests.

We were recently informed that some engineering areas are once again trying to ramp up the use of managed services to fill the gaps left by the headcount reductions, knowing full well there are several hundred more reductions to come in Phase 2. It is totally unacceptable to outsource and export this work whilst the threat of compulsory redundancies is on the table. We have yet to finalise the control measures and review process related to Managed Services

4 Collective Agreements/MOUs

We are sure you are all aware we have been working as a temporary appointed National TU Group for a number of months now. It was agreed nationally it would be the responsibility of the Group to negotiate and formulate where required changes to some of our agreements whether they be temporary or permanent.

We have several agreements to formalise and sign; • Temporary COVID Redundancy Agreement (December 31st 2021) • Temporary Collective Agreement (covers temporary T&Cs changes implemented in relation to furlough phases, shift changes and pay deferment) • National Trade Union Constitution (required no later than end of September 2020) • Managed Services MOU • Package Principles Agreement (covers, Pay freeze 2021, Productivity/Efficiency, Core Workforce, New Starter Rates, etc) • National Redundancy Agreement (2022 onwards) • Pension Agreement (CNC).

We have addressed the following issues from our last newsletter; • The Ross Ceramics issue with voluntary and compulsory terms has been resolved • All VS and Compulsory leavers will receive their contractual weeks in lieu of notice paid • Rundown payments at Inchinnan as previously agreed • Ensured Company clarified its Share of Fund (SOFTVS) availability for those leaving in 2020 and taking their options next year • We requested and now have a pay slip descriptor for all the deductions/paybacks being applied so people can at least understand what they are even though they may not be correctly applied.

5 Strategic Review – Phase 2

We have always recognised situation the Company are in and have always been willing to ‘work together’ to find solutions going forward. But as you know yourselves, this has not always been possible.

From arguing to force a shutdown of facilities to make them safe while the leaders priority was communicating the virtues of working from home, to unilaterally giving notice of binning our agreements - and we have many more examples.

Every day for the last six months has been a dog fight with management and continues to be so, who believe they can do whatever they like, whilst disregarding the views of your representatives.

On the 26th August the Company afforded us ‘one whole hour’ with Sebastian Resch who presented extremely limited information on their plans (we do not believe these are just proposals). They deliberately evaded answering direct questions that were posed to them. Thirty minutes later they briefed the affected sites, however the briefing at Barnoldswick presented different information to that given to the national team! The following day the Company communicated its half year results and footprint consolidation plans to the city.

They presented only a few specific elements; • Closure of the Crosspointe facility in the US and consolidation of the discs and HP turbine blades into Washington and Derby (announced prior to the meeting) • Transition and consolidation of widebody engine assembly & test to Derby from SATU (Singapore) • Outsourcing and consolidating Fan blades from Barnoldswick to Singapore • Closure of Annesley Site and consolidation to Derby & Oberursel.

At no time did they provide the business case for these decisions nor any indication of the number employees impacted by these announcements creating further uncertainty and anxiety at these affected sites.

Sebastian Resch then went on to state the Company’s plans will be ongoing for the next 3 to 5 years’ under the following three pillars; • Consolidation of Footprint • Make/Buy (Outsourcing to Supply Chain) • Joint Ventures with 3rd parties (TUPE & Outsourcing).

At the meeting we stated that footprint consolidation proposals surely need to be consulted as a whole package. Be under no illusions their intention is to inflict death by a thousand cuts and we believe the Company have formulated their plans but are unwilling to share any of those details.

This might be RR’s interpretation of consultation and it was made very clear to us again that the Company have no intention to meaningfully consult. The reasons they gave for this is their lack of trust, their dislike of our factual responses and the direct tone of our newsletters.

To be clear, if these consultancy driven plans are implemented every civil site left in the UK will be affected, including those perceived as benefiting from these announcements. Sites will be assessed against a Company Productivity/Efficiency matrix. Some of you may remember the disastrous ‘blueprint’ (terms & Conditions) initiative a few years ago. Yes, it does still exist. We have not seen the modern version yet but it’s there waiting to be slapped on the table, with no doubt the threat of “it’s this or your work goes”!

We understand the current load issues and its relation to employee numbers, but we are now in a situation that the executive are executing their long term strategic plans. History and experience tells us that on numerous occasions they have got it badly wrong to the financial detriment to the Company and UK jobs.

We cannot just accept their plans and continue to be dictated to. We cannot just accept death by a thousand cuts, never knowing who is next and slicing people’s legs from under them, along with the simultaneous attack on people’s pensions (including the removal of Share of Fund).

It’s worth pointing out the ethical concerns relating to ‘double standards’ by the Company. The National TU Group maintain we had reached agreement to pay Share of Fund for those leaving on VR and CR as part of the Covid redundancy agreement (applicable to the end of 2021). However, the Company pension announcements have stated that they are not prepared to guarantee SoFTVs for anyone leaving in 2021/22. This is unacceptable and includes factories where closure or further reductions have been announced before the end of 2021 but won’t close or reduce until after 2021.

We informed the Company the two points above would form the terms of reference to a Failure to Agree (FTA). The Company proposed meetings to discuss, to try to avoid a further deterioration in relationships.

Yesterday we had a follow up meeting with Sebastian Resch to address our concerns regarding the lack of meaningful consultation. We had open discussions concerning the lack of trust and participation, but it was clear we have one common goal to ensure we have a Company in the future. With this foremost in our minds, we have agreed in good faith to pursue a more collaborative way forward to engage in the strategic review.

Clearly, we will not be able to communicate some of the information directly and may be subject to a non-disclosure agreement, but we do recognise we need to work at pace to turn ‘what ifs’ into firm and meaningful proposals. Be under no illusion - as we have said manty times - we will have difficult decisions to make to ensure we do have a company.

We will also shortly be reviewing the Consultation Workstream Framework to take account of the consequences of Phase 2 and all its connotations including package principles.

Yesterday after discussions with Joel Griffin (Head of Reward) to address our concerns regarding the removal of SoFTVs aligned to the redundancy agreement, he provided the following statement we can share with you;

“Over the coming weeks it is our intention to seek agreement from the Trustee to enable us to meet the commitments already made in respect of SoFTVs for employees impacted by VS and compulsory redundancy in 2020 and 2021. NB, The proposals made in respect of the closure to future accrual are all under consultation are all subject to ongoing discussion until such time as a final decision is made by the Company and agreement is reached with the Trustee on a Rule amendment.

You will appreciate that the terms of the SoFTV requires the agreement of the Company and the Trustee and there is a lot of focus on this aspect of the RRUKPF at the moment. The Trustee is scheduled to meeting on 16 and 17 September, including a dedicated session focussing on member retirement options. This would be an opportune time for us to raise the question as to whether or not the Trustee would support the delivery of SoFTVs during 2021 for members impacted by redundancy. I understand that the Trustee is considering the topic of retirement and transfer terms more broadly given the high number of members transferring out.” We will wait for the outcome of the discussions between the Company and the Trustees at the meeting on the 17th September.

6 Pensions

As we have consistently stated, we acknowledge the exceptional circumstances the Company is in. Therefore, to ensure and secure a Company for future generations irrespective of which pension arrangements members have, difficult decisions need to be considered.

We understand Defined Benefit (DB) members’ concerns with the intimidating communications and the dismissive responses put out by the Company as to what they are going to do and it is now time for us to respond.

We now have a consultation meeting between the Pensions CNC and the Company taking place on the 7th September 2020.

The Pensions CNC has a proven track record in its responsibility to members’ pensions and has always been pragmatic in dealing with problems, stretching back over the last two decades. Seventeen years ago there was a pension deficit of £1bn and we agreed to a reduction in benefits and increased individual contributions to maintain the DB schemes going forward. That scheme is now in surplus.

The TU, through the Pensions CNC battled to secure, protect and improve our pension schemes to the point in 2018 where we agreed to loan the Company £145m from the surplus to help with the Company finances. We could have easily said no but recognised the need to help the Company at that time.

We will help the Company - our Company – again. We will put our differences to one side to do the right thing and make another big decision in the acceptance of the ‘force majeure’ clause and agree to the closure of the DB scheme.

We recognise that the Pensions CNC are not the only stakeholders in this process. There are several important aspects that fall under the remit of the Trustees, for example the ongoing management of the scheme and the schedule of contributions (including any repayment that may become due from the £145m pensions holiday that was afforded to the Company in goodwill).

The Pensions CNC will table a number of DB considerations and a new Defined Contribution (DC) option to provide adequate reparation for DB members and improvement to the DC scheme. The Pensions CNC have not forgotten about those that are in the DC scheme who were given an assurance in 2018 that we would revisit the 15% (see Appendix 1).

It is also noteworthy that Joel Griffin (Director of Reward) has openly stated “We’re not comfortable continuing with a two-tier pension arrangement”. We completely agree - lets have just one. Let’s have some ethical values of purpose - one scheme from board member to worker. Let’s see what behaviours the Company executives bring to the table on this one!

We have said in several newsletters it’s how we deal with the situation that really matters and pensions will be no exception.

7 Health & Safety

Following our last newsletter where we spoke about site Covid audits, concerns have been raised to us about the Health and Safety provisions for those working from home for a prolonged period of time. We will register this with the Company, including risk assessments, provision of suitable equipment and the mental wellbeing of our members.

We remain concerned that as lockdown restrictions are eased, concentration can lapse along with adherence to social distancing. Compliance to all safety measures put in place must be observed.

We end all our newsletters with the same two sentences.

We thank you for you continued support.

Remember, the only source of truth is through these newsletters.

Stay strong and remember the only source of fact and truth is via these newsletters.

Thank you for your continued support.

 


 

Date: 10/08/2020

Rolls Royce Update August 2020

1 Update

Yet again we have a lot of information to communicate, so apologies for the length of this newsletter. To access the appendices documents referenced in this update please click here

Rolls-Royce has confirmed it intends to repay the Scottish government, after using public money for development of the MRO workforce at Inchinnan, equating to nearly £1.6 million pounds, having now decided to close that part of the facility in favour of MRO bases around the world. The question remains how much and how long it will take RR to do the right thing and pay back the UK government?

Whilst still on the subject of money, we are keen to understand Mr Holt’s perspective on 1500 of our furloughed colleagues who were paid incorrectly – many of whom also left the Company.

We immediately raised the issue with the Company, and they are attempting to rectify the errors as well as communicating with the affected individuals. This once again demonstrates that the Company does not have the infrastructure to deliver on its self-imposed timescales, we have told them time and again that they are unreasonable and likely to fail, only to be told repeatedly by the Company that they can deliver.

2. Peoples Champion

As part of recent Company communications, we had the first public showing of the Company’s ‘People Champions’ - appointed by the board, from the board. Notwithstanding our bewilderment about what they actually do, where have they been for last five months?

For your information, Irene Dorner has been a non-executive director of Rolls-Royce since July 2015. In 2017 she was given the additional responsibility of presenting ‘the voice of the worker’ in the boardroom and receives an additional £15,000 for this role.

She is a qualified barrister and has spent most of her career with HSBC, finishing as CEO and President of HSBC in the United States before she retired in 2014. She holds a number of board positions at other companies including most interestingly the chair of ‘Control Risks’.

Control Risks are a secretive private UK company providing “Political and Security Risk Investigation Services”. They were hired by Crossrail in 2013 to challenge Unite’s campaign to reinstate a Senior Steward who was targeted by Crossrail for Trade Union activities and defending the health and safety rights of union members.

In summary, Rolls-Royce is employing someone who is the chairperson of a business known to be involved in anti-Union activities, in the position of a ‘Peoples Champion’.

3. Furlough Phase 3

The terms of Phase 3 and associated Q&A’s are identified in Appendix 1, but we draw your attention to the following points relevant to Civil Employees:

• Shift Changes – a standard 4 weeks’ notice/protection period

• The option of ‘wind down’ is suspended until 2022

We previously reported the utilisation of furlough has been extremely poor, not only in failing to maximise the support to prevent job losses (the whole purpose of the scheme) but also doesn’t demonstrate a fair and equal impact across management, staff and works.

In some cases, there has also been a serious lack of rotation, which has had a huge impact on some colleagues in terms of mental health and financial hardship. We are still waiting for the Company to agree a monitor-and-review process on a fair and equitable application of furlough, which has been a principle for the TU from the start, but alas missing from Company communications.

The Company seem to be more concerned about working from home following the latest announcement to some within Civil from Sarah Armstrong. We have fundamental concerns about this as it was not discussed with the national TU. We will seek to engage with the company and provide more details in our next newsletter.

4. Headcount Reductions

The Company are now in the ridiculous situation where they could be placing around 300 people at high risk of compulsory redundancy, whilst we still have around 150 volunteers who wish to leave the business who have either been rejected or are still waiting to receive an offer of acceptance or rejection. Again, this is as a result of the Company working to its own self-imposed and unachievable timescales.

Once again we need to inform you of the HR1/S.188 debacle. Despite it being a legal requirement, some site representatives never actually received the information for their site. Even more ludicrous is the fact that some people named on the legal documentation had actually left the business the day before it was issued. Right first time?

Following intensive negotiations we believed we had reached agreement in principle on the framework of a complete deal also referred to previously as the ‘package’ but once again after the negotiations had been concluded, we find the company’s underhanded tactics at work again, despite reaching specific agreement on the monetary value of run down payments we find at Inchinnan our MRO colleagues have not only been kicked in the teeth.

But now the company are putting the boot in when they are down and trying to reduce the agreed value of what has been agreed, this is totally unacceptable.

We have also learnt this week that the company are delaying VS application leaving dates for some to allow for training, but what was never discussed or agreed is that they would reduce the individuals paid notice periods. After raising this issue with the Company their failure to rectify the situation further erodes the relationship.

We now find ourselves back in the position of having to potentially raise another National FTA to try to resolve multiple issues.

Notwithstanding the contents of the last FTA, in which the COVID Redundancy Agreement and Terms for Ross Ceramics were taken offline with an agreed way forward, we are still waiting for this solution to be implemented. We are making it clear to the Company that until the Ross Ceramics issue is resolved, there will be no further talks on the Company Package.

5. Strategic Meeting

Many of you have been asking about the impact on the future of individual sites. Despite several promises and false starts, once again we are having to report that there is no progress from the Company on this extremely important issue and we have still not been given any further details on this subject. However, it seems there have been several discussions between managers and employees taking place at some sites concerning employee holidays and shutdowns.

We registered this point with the Company at a national level over two weeks ago, asking what the Company proposals are. The only feedback given to date is they are ‘in discussions’ and they have still not reached any conclusions. As usual those discussions are amongst themselves.

We have reiterated to the Company that until they come clean on their strategic footprint review, we will not be entering into any discussion’s regarding the closure of the DB pension fund and therefore we will be conducting our own review of our position on ‘the package’.

The Company are matching employees based on previously agreed skill sets (38 in works population and the jobs within the 7 primary capabilities in engineering) asking them to transfer to other sites (in some cases hundreds of miles) only for them to find they have moved from the frying pan into the fire. This is ludicrous and does not fit with the Company narrative of treating us all with dignity and respect. Equally outrageous is for the Company to be sacking some apprentices whilst pontificating the virtues of being a good employer.

6. Pensions

We received a number of complaints from people leaving the company about the withholding of parts of their VS payments (anything over £30k), until after they had received independent financial advice. This was to allow them time to consider the Bridging Pension Option (BPO), which for legal reasons can only be done before any payments are made. Unfortunately, this default position was not made clear prior to anyone leaving the company.

A large number of people stated they were not interested in the BPO, therefore, following discussions with the company a process has been launched whereby individuals can log on to the pension website, read all the information and then if they are still of the opinion the BPO is not for them, they can complete and sign a waiver form, which will then release the additional VS payments via the next payroll. It will also be possible to divert the excess VS into an AVC by completing the form on the website. For further information see Appendices 2.

Last Friday many of you would have seen the Company communications on the DB scheme. All affected employees will receive a letter concerning individual 60-day consultation. But this is not really consultation - the Company have already made their mind up and they see it as just a legal tick-box process they must go through.

Meaningful Consultation is supposed to be two way. The TU body that represents everyone for pensions issues (the Central Negotiating Committee – CNC) has yet to meet with the Company for the reasons explained in the Appendices 3 and 4.

As explained earlier, they have reneged on the agreed principle that we would have a strategic restructuring (Phase two) meeting; it was removed from our diaries and to date has not been rescheduled. They are now ignoring us.

As many of you are aware, we have battled to protect and improve our pension schemes over the last 20 years or so and we recognise the current situation we now find ourselves in. Some changes are inevitable, but as with most things it’s how we deal with it that is important.

We will not just allow the Company to rip it away from us with nothing in return, especially when they intend to simply pocket the £145m loan agreed in 2018 to assist the Company finances at that time – conveniently claiming that we are now in a ‘force majeure’.

Interestingly no force majeure was enacted within Services with 3rd party providers to support Inchinnan maintaining its MRO capability going forward or other Services work to support other sites. Yet again another example of double standards.

It is also noteworthy that Joel Griffin (Director of Reward) has openly stated “We’re not comfortable continuing with a two-tier pension arrangement” - yet the same person appears totally comfortable in trying to impose two-tier pay rates from 2022 for future employees.

We have yet to enter into discussions on the company proposals or indeed present any counteroffer which could include protections going forward and an improved DC scheme for all.

7 Apprentices

Most of our apprentices have been furloughed from the beginning and received 100% of their monthly pay due to the underpin guarantee negotiated by the TU.

We have had approximately 60 apprentices who have come off furlough for various reasons, we now need to address all apprentices to assist in getting them back into work to complete their training. Please do everything to assist with this if you can.

A national priority plan is being put together:

• Getting 2020 final year apprentices back into work

• With the reopening of colleges, plans are ongoing for 1st years into college/LDC apprentices coming back from furlough by October

• Develop plans for the rest of the apprentices across the entire business

• Review the timing of a greatly reduced 2020 intake for Bristol & Derby

New apprentice candidates who were due to start their apprenticeship in 2020 and had their 2020 offer retracted, will be asked if they wish to be kept on file for future communication and the potential of an offer for September 2021.

We are also confident we will be able to address securing training slots for the Inchinnan MRO apprentices, either internally or externally, including providing a relocation payment of £5,000 as displaced employees.

Although the Inchinnan MRO 1st year apprentices have been placed into the Compressors business to finish their training program after pressure was applied by the TU, unfortunately the 2nd year apprentices never got offered the same opportunity. The Company organised external employers or other RR sites to take over the rest of the training for these young people.

You are reminded that Harry Holt had committed to the negotiating team that all apprentices would finish their apprenticeship programs with RR - as did Warren East to the Inchinnan MP.

In addition. the TU also negotiated that the apprentices will receive 8 weeks’ notice pay and access to the virtual resource centre on the completion of their apprenticeship and the option of training extensions, where a temporary role exists – however, this may not lead to a substantive position.

We have also been asked a number questions about apprentice staged payments - please see Appendix 5 for further information on this subject.

8. Health & Safety

Recently the company has carried out 6 COVID site audits, these have been done by the independent HSE team within GBS in order to check compliance to the new COVID measures introduced across the sites in order to reduce the risk to our employees. The findings of these initial audits appear to show a good level of adherence to the new measures put in place, with one or two areas of best practice observed that can be rolled out as improvements on other sites/ business.

We have now requested that these audits be extended to all sites and continued for the foreseeable future, whilst the pandemic remains ongoing, like the company we remain concerned as lockdown restrictions are eased people’s concentration may lapse along with adherence to social distancing.

The latest figures from the government should serve as a reminder that the virus has not gone away and continued adherence to all safety measures put in place need to be observed, we have also started the conversation with the company about preparation for a second wave should it occur.

Thank you for you continued support.

 


 

Date: 20/07/2020

Rolls Royce Joint Union Bulletin 20 July 2020

1. Update

Unlike the Company, the TU negotiation team do not have dedicated resources to assist us in our communications. We have to juggle writing our newsletters whilst facing off across several fronts with the company, alongside our usual tasks.  This often takes place late into the evening or over the weekend. We are not saying this to gain your sympathy but trying to demonstrate our unquestionable commitment.

It’s therefore disappointing that throughout this issue our Company’s senior ‘leaders’ haven’t bothered to participate in discussions. We can only presume they are using the time to brainstorm their blue-sky thinking communications. 

What a shame most of them don’t bear any resemblance to workplace reality

Several Company communications have been issued over the last few weeks and finally, the Company accounts for 2019 have been published.

We previously reported the company could have saved around £100m by not paying the 2019 bonuses, but it’s clear they would rather attack your money this includes the bonuses paid to Warren East and Steven Daintith who received an eye-watering £1.79m in shares between them.

Harry Holt’s communication on the 8th July described how the Company is living up to its ‘Care Promise’. Many of you, including the national TU team, know a very different reality.  He is either completely unaware of the truth or has been misled by his team.

But fear not!  They have told you:

  • We will weather this storm together and you will always be part of the Rolls-Royce family
  • The dignity and respect with which we treat everyone, especially those leaving our company, will define the company we want to be in the future.

So that’s alright then.

In turn, we make this promise - we will never forget how they have treated the workforce during this pandemic.

2. Headcount Reductions

On the 14th July, over 1,800 colleagues started to voluntarily leave the Company.  In many cases, none of us have had the time to bid farewell to our friends and colleagues. We thank them for their loyalty and service, reducing the need for compulsory redundancies and wish them all well for the future.

The Company’s original timescales were both unrealistic and unnecessary. We successfully challenged them and obtained an extension, which proved extremely worthwhile - during this extension, the Company received a further 290 VS applications!

Getting to this point has not been easy. The company originally served notice on our current redundancy terms and threatened they would impose paying the legal, statutory minimum payments with the legal, statutory minimum notice periods – giving them freedom to control who got the sack.  Without asking for volunteers first.

They now laughingly claim they are “providing above industry and in country standards for our severance terms, ensuring that if you leave, you do so with a good package to minimise the financial impact” out of the goodness of their hearts.

We will let you judge how this came about (hint – it wasn’t the Company).

Irrespective of the progress made in identifying volunteers, the very next day (15th July) the company literally couldn’t wait to issue the S188 redundancy notices as outlined in the communication from Simon Burr and Simon Carlisle to Civil Aero employees.

This communication stated that a compulsory reduction of 1,446 would be a “worst case scenario”.  As they have yet to complete the VS program (some applications are still awaiting a decision), along with not fully exploring all mitigation options across the business, they have obviously guessed what the final compulsory figures will be.

You now have the ridiculous situation where management are assessing employees against compulsory redundancy criteria, whilst some colleagues haven’t even been told if they can leave on VS.

See Appendix 1 for the compulsory redundancy numbers and timescales.

We have reminded the Company that they have an obligation to continue to promote and pursue VS during the compulsory programme. Will they take any notice?

It’s a pity the Company does not adhere to the values and behaviours it constantly preaches. In their minds, this has always been about ‘pace’ and hitting the half-year results. Which, coincidentally, they are delaying until the end of August to take account of all the Phase 1 Redundancies, forecasted savings of Phase 2 and associated cost savings of the ‘The Package’.

We believe that is to create the illusion of a board in control.

3. Strategy Meeting

We agreed that we would enter into discussions on the Company’s Strategic Review of the Rolls-Royce UK Pension Fund (RRUKPF) provided that in return they initiate ‘meaningful’ consultation of Phase 2 restructuring proposals. The definition of meaningful is not just to present information about a decision that has already made. If the company have made their decisions, then we are on a collision course.

A meeting was held on 22nd June, but the content that they presented was poor and patronising.  We didn’t learn anything new.  A further meeting had been arranged for Friday 17th July but was unexpectedly cancelled.

Therefore, as promised, until this is rearranged, we will not enter discussions on pensions.

4. Company Package

As outlined in our last newsletter, the Company wanted to discuss a package of changes alongside redundancy terms, some of which will apply to all areas of the business whilst others will not.

You would be entirely correct in thinking this is an opportunistic attack by the Company.

We have agreed the topics of the package in principle, but a lot of detailed negotiation will still need to be undertaken and further details will be provided when available.

Any package that includes a permanent change to terms and conditions will require a ballot of affected Union members by March 2021.

As with the redundancy terms the outcomes listed in the appendices is a very long way from the original position of our ‘caring’ Company.

We have made several difficult decisions to help ensure we all have a Company going forward.

Please refer to the following attached appendices:

  1. Temporary Voluntary Severance & Compulsory Terms during COVID & Restructuring Redundancy Programme
  2. Furlough Phase 3 & Related Topics
  3. Restructuring Framework Principles  
  4. Redundancy Agreement from 2020

Failure to Agree (FTA) Update

The FTA was delayed several times – some by the Company in order to delay proceedings, others by mutual agreement.  As all terms of the original FTA have now been resolved, the FTA was withdrawn on 14th July.

You may remember that during the original FTA meeting the Company stated they do not trust us.

So, imagine our anger just two days after the FTA was withdrawn when we discover the Company has blatantly and arrogantly attacked TU representatives and their constitutional rights in Inchinnan Compressors.  We addressed this immediately and informed the company that this would put ‘the package’ at risk.

Despite what they might like to portray, we are not ‘working together’ and refuse to have joint communications. The relationship between the TU and the Company is extremely fragile and could shatter at any time.  And there is still a long way to go…

6. Apprentices

We will provide a more comprehensive report on apprentices for our next newsletter, as a current review is still ongoing of getting apprentices and their assessors back into the workplace.  We will also need to address shift pattern arrangements and future intakes.

7. Health & Safety

Although discussions with the Company are clearly important, everyone is reminded that the threat of COVID-19 has not gone away.  Everyone must continue to work safely and remain vigilant.  Please also look after your own wellbeing as much as possible.

If there are any unsafe practices taking place, or you are unsure, please contact your local workplace representative. 

Stay strong and remember the only source of fact and truth is via these newsletters.

CLICK ON THE LINK TO VIEW APPENDIX 1-5 

https://www.gmb.org.uk/file/rolls-royce-joint-union-update-200720-1docx

 

 
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