Mass grievances lodged by Capita VMO2 and Tesco Mobile contract members as disputed 2023 pay deal goes to ACAS


An increasingly bitter row with  Capita over glaring irregularities in the application of the 2023 pay deal for VMO2 and Tesco Mobile contract members is now being escalated to ACAS in a last ditch attempt to prevent the disagreement spiralling into a full-blown dispute.

This week’s (Wednesday’s) agreement between company and union negotiators to refer the issue to the independent arbitration and conciliation service comes in the wake of a remarkable outpouring of employee anger that has so far seen at least 50 individual and collective grievances lodged by members – plus an as yet unknown number of small claims court claims.

The involvement of ACAS – which Capita could theoretically have vetoed – follows the company’s steadfast refusal to date to reconsider the way in which two key strands of the 2023 pay deal were applied in practice, and the CWU’s equally vehement insistence that fundamental issues of trust are at stake on both issues that simply cannot be overlooked:

  • One involves a carbon copy re-run of the miscalculation of the 2022 pay deal for longer-serving (TUPE population) staff on 36-hour contracts which was finally corrected in March last year. At that stage the company conceded that calculating the pay increase using a formula based on now standard 37.5-hour Capita FTE contract wrongly disadvantaged those on shorter hours. Crucially, in a detailed joint statement with the union that was shared with the workforce at that time, Capita pledged that it would make changes to its systems “to prevent this happening again”.
  • The second issue involves the company’s failure to inform the union or members that the belated 2023 pay deal was inclusive of, rather than additional to, last year’s Real Living Wage (RLW) uplift that had been automatically applied to 249 of the lowest paid workers on the VMO2 and Tesco Mobile contracts’ in April last year. As such, when individuals came to open their November pay packets, they were horrified to discover that, with the RLW  increase deducted, their actual rises bore scant relation to the deal they had overwhelmingly accepted in good faith just a month earlier.

That issue was immediately flagged up to management by the CWU, but following a company response just before Christmas – where the company failed to satisfactorily explain  its position of not applying what had been agreed  – national officer Tracey Fussey was unequivocal as to where the blame lay in a blistering response to Capita’s chief operating officer last month.

We put the wording of the agreement to our members – the words were provided by yourselves,” Tracey pointed out.

Our members participated in a ballot and voted on the agreed deal put before them.  It appears that you have inexplicably reneged on the deal. Furthermore, you directly communicated the same deal to all employees. 

It is incumbent on you to pay what the agreement states and honour the agreement. Our members are furious and keen to seek redress through external means if this matter is not resolved.”

The CWU hopes a resolution will indeed emerge as a result of the involvement of ACAS that is now underway – but, in the meantime, is advising aggrieved members to continue submitting  individual grievances with the help of their local CWU rep. (See Capita Members’ Bulletin No. 18/2024) 

  • The disagreement on the implementation of the 2023 pay award in Capita’s VMO2 and Tesco Mobile partnerships is taking place against the backdrop of the company’s wider announcement that it is withdrawing from its accreditation as a Real Living Wage employer – and that in future it will benchmark pay levels for its lowest paid staff at only fractionally above the statutory minimum wage.

At a stroke that move represents an abandonment of the commitment made by made by former CEO Jon Lewis in 2019 to pay a minimum of the amount calculated by the Living Wage Foundation as being required to cover the basic cost of living from April 2020.

At present the RLW is £10.90 per hour outside London – but that is due to rise to £12 per hour on April 1. As things stand, however, that April increase will not now apply to Capita’s lowest paid employees, with them instead receiving a new ‘Capita minimum wage’ of £11.56 per hour  which is just 12p per hour above the Government’s confusingly rebranded ‘National Living Wage’.

Earlier this month CWU Capita members from across the union’s Postal and Telecoms & Financial Services constituencies took part in a demonstration against the move outside Capita’s TV Licensing site at  Darwen in Lancashire – coinciding with a  visit by newly appointed CEO Adolfo Hernandez.

Following Mr Hernandez’s failure to respond to a request from the CWU on February 12 for an urgent meeting about the announcement, this week the union has sent a further letter seeking talks and a reconsideration of “this appalling decision” – warning that, in the meantime, the CWU will be “campaigning against Capita’s decision both politically and in the wider media.”