Northern pay negotiations - deal agreed

[takno]

It seems like a case for inflation only pay rises until productivity improves (better loading, longer trains, more efficient ways of working).

The idea that wages should be the same as LSE TOCs where cost of living is higher, or there should be large pay rises without increases in productivity is somewhat fanciful.

We are talking about a lower-than-average rise against pay which is already significantly lower than LSE TOCs, locked in for four years regardless of any productivity improvements. In any case, the increased employee numbers on the railways aren't making anybody's jobs easier - they're wasting time on delay attribution, and over-engineering electrification. You shouldn't be trying to fund the costs of privatisation from the pay packets of one of the poorest-paying TOCs in the country.

 

[Dr Hoo]

We are talking about a lower-than-average rise against pay which is already significantly lower than LSE TOCs, locked in for four years regardless of any productivity improvements. In any case, the increased employee numbers on the railways aren't making anybody's jobs easier - they're wasting time on delay attribution, and over-engineering electrification. You shouldn't be trying to fund the costs of privatisation from the pay packets of one of the poorest-paying TOCs in the country.

Sorry if this seems to be going off thread but do you have any evidence of the increase in staff numbers at Northern being largely restricted to delay attribution (as opposed to things like crew for the additional trains that are going to be running and staff at the stations that are going to regain booking facilities). My impression was that delay attribution is a mature process, well over 20 years old now, since it was established under British Rail.

I also wasn't clear why Northern are apparently involved in over-engineering electrification.

 

[Bantamzen]

People on here seem very reluctant to explain why RPI + 0.1% isn't acceptable so we are no closer to finding out what would be acceptable.

Hasn't this already been established? I was under the impression that it is the length of the deal that concerns Northern staff? Given that there could be plenty of changes there, that seems a reasonable position.

 

[mandub]

Hasn't this already been established? I was under the impression that it is the length of the deal that concerns Northern staff? Given that there could be plenty of changes there, that seems a reasonable position.

Yep. I'd accept a 2yr deal on the current rates if Northern will come back with that offer. (Yr 1 - 2%, Yr 2 - rpi+ 0.1%).
It seems that they aren't willing to do this. I'm not sure why.

 

[Solent&Wessex]

Yep. I'd accept a 2yr deal on the current rates if Northern will come back with that offer. (Yr 1 - 2%, Yr 2 - rpi+ 0.1%).
It seems that they aren't willing to do this. I'm not sure why.

I had cause to peruse the official notice from Northern to it's staff 2 days ago. Sadly I wasn't in a position to take a copy or a photo, but the general gist of it was:
3 (minimum) or preferably 4 Year Deal or nothing.
They have significant challenges and don't want to be coming back every year to negotiate with the unions as this costs time and money.
Revenue Increases last year are well below what was expected and planned for so they need to sort their finances out now
The company faces revenue and budget challenges and agreeing a long term deal puts the company in a more secure position and allows them to plan better for the future.

 

[northernchris]

When pay deals come up, do the operators consider if their pay is significantly lower than the competitors that many traincrew could leave which in turn would increase their recruitment and training costs? Northern have historically struggled with retention and I suspect pay is a major factor

 

[the sniper]

When pay deals come up, do the operators consider if their pay is significantly lower than the competitors that many traincrew could leave which in turn would increase their recruitment and training costs? Northern have historically struggled with retention and I suspect pay is a major factor

This was the case with London Midland on the Drivers side, where it was recognised by the company that they had to somewhat close the gap between them and Cross Country to stop what was at one point a mass exodus every time Cross Country had an intake. This has been largely successful, with very few now deserting. In fact one or two who went from LM to CC have talked about coming back due to LM Drivers having better T&Cs.

 

[Moonshot]

This was the case with London Midland on the Drivers side, where it was recognised by the company that they had to somewhat close the gap between them and Cross Country to stop what was at one point a mass exodus every time Cross Country had an intake. This has been largely successful, with very few now deserting. In fact one or two who went from LM to CC have talked about coming back due to LM Drivers having better T&Cs.

Surely thats just market forces at work then?. So why not extend that to the passenger and have competition between operators in much the same way as airlines do? I realise that is somewhat difficult just now , but surely the industry should aspire to that ?

 

[northwichcat]

When pay deals come up, do the operators consider if their pay is significantly lower than the competitors that many traincrew could leave which in turn would increase their recruitment and training costs? Northern have historically struggled with retention and I suspect pay is a major factor

Operators also have to consider that if they are subsided DfT have some influence as to whether or not they can increase operating costs beyond what they've agreed. If Arriva allowed for salaries to increase 0.1% higher than RPI and most fares to increase by RPI then the books won't balance if salaries increase by 0.5% more than RPI unless other factors change - like DfT agreeing to increase the subsidy (not likely) or DfT agreeing to a higher proportion of DCO services (very likely.) They need to be careful what they wish for!

I would have thought long serving guards would be best off staying where they are at the moment as they could lose thousands of pounds if their new TOC moves towards DOO/DCO and makes them redundant over what they would get if their existing TOC makes them redundant.

 

[Solent&Wessex]

Operators also have to consider that if they are subsided DfT have some influence as to whether or not they can increase operating costs beyond what they've agreed. If Arriva allowed for salaries to increase 0.1% higher than RPI and most fares to increase by RPI then the books won't balance if salaries increase by 0.5% more than RPI unless other factors change - like DfT agreeing to increase the subsidy (not likely) or DfT agreeing to a higher proportion of DCO services (very likely.) They need to be careful what they wish for!

I would have thought long serving guards would be best off staying where they are at the moment as they could lose thousands of pounds if their new TOC moves towards DOO/DCO and makes them redundant over what they would get if their existing TOC makes them redundant.

Again, despite what the RMT's external press release wibble says, I don't think the % increase involved is the issue.

All Unions - Aslef, RMT and TSSA - don't want to agree to a 4 year deal at this stage.

 

[northwichcat]

Again, despite what the RMT's external press release wibble says, I don't think the % increase involved is the issue.

All Unions - Aslef, RMT and TSSA - don't want to agree to a 4 year deal at this stage.

The point still stands. If RPI+0.1% has been included in the long term financial plan for the franchise than a bigger increase in a future year could still require a cost saving elsewhere.

 

[takno]

The point still stands. If RPI+0.1% has been included in the long term financial plan for the franchise than a bigger increase in a future year could still require a cost saving elsewhere.

Or an extremely small increase in ticket sales, or a small decrease in profit for the company.

The company bid for the franchise with full revenue risk at a set subsidy assuming they would have sales of x and costs of y. They may well have won the franchise by cynically assuming they could keep costs low by underpaying. If they are successfully called on that, their low profits (or losses) will reflect the fact that they made the wrong call.

 

[northwichcat]

Or an extremely small increase in ticket sales, or a small decrease in profit for the company.

This time it's been presumed passenger numbers will rise, unlike last time when it was presumed passenger numbers would stay constant. Profits will also be much lower unless passenger numbers rise faster than expected or the average journey length goes up but either of those scenarios could create the problem of more carriages being required.

The company bid for the franchise with full revenue risk at a set subsidy assuming they would have sales of x and costs of y. They may well have won the franchise by cynically assuming they could keep costs low by underpaying. If they are successfully called on that, their low profits (or losses) will reflect the fact that they made the wrong call.

How is offering above inflation increases to employees who have seen well above average pay increases in recent years (meaning they aren't catching up other industries) underpaying? What ever they are offered the union would be capable of finding some excuse as to why they think it's too low - whether it's making comparisons to Intercity TOCs or to how much rail workers in Switzerland earn compared to UK rail workers.

Just looking at the profit and lost accounts for the final year of old Northern the total staffing costs (including pension and employer NI) was equal to 94% of the amount they got from ticket revenue, without the subsidy they wouldn't have been able to lease the rolling stock on top of employing the staff never mind actually running the trains. It's no wonder DfT wanted the franchise bidders to offer a lot more for less.

 

[Bantamzen]

The point still stands. If RPI+0.1% has been included in the long term financial plan for the franchise than a bigger increase in a future year could still require a cost saving elsewhere.

Given that Northern are likely to be looking at some form of DOO in the not too distant future, staff are well within their rights not to want to set pay and T&Cs for too long into the future. Remember pay deals are not just about the headline increase. Ask yourself, if you strongly suspected that your T&Cs in your job were to change in the next 4-5 years, would you sign a contract without knowing the finer details? That Arriva are currently sticking to a 3 or 4 year deal minimum is enough to tell me they are worried that staff may not like what is coming. However they could shift down to a two year deal, potentially avoid any conflict with the staff and still offer the same pay deal, but with T&Cs discussed when more is known.

 

[northwichcat]

Given that Northern are likely to be looking at some form of DOO in the not too distant future, staff are well within their rights not to want to set pay and T&Cs for too long into the future. Remember pay deals are not just about the headline increase. Ask yourself, if you strongly suspected that your T&Cs in your job were to change in the next 4-5 years, would you sign a contract without knowing the finer details? That Arriva are currently sticking to a 3 or 4 year deal minimum is enough to tell me they are worried that staff may not like what is coming. However they could shift down to a two year deal, potentially avoid any conflict with the staff and still offer the same pay deal, but with T&Cs discussed when more is known.

I would have thought if Arriva want to change the terms to suit their requirements they would offer that change of terms alongside something the union wants which could be a pay rise or could be an improvement to other conditions.

 

[40129]

What would happen if the TOC said no DOO/DCO in return for no pay increase above RPI+0.1% with both being for the life of the franchise?

 

[Bantamzen]

I would have thought if Arriva want to change the terms to suit their requirements they would offer that change of terms alongside something the union wants which could be a pay rise or could be an improvement to other conditions.

Almost invariably pay and T&Cs are negociated in the same talks, and are usually linked in some way. However if Arriva have a longer term plan to change T&Cs within the scale of the deal offered, they should at least make these changes clear. Not knowing the exact wording of the offer I can't comment further, but if an offer extends for four years but there is no mention of specific changes in T&Cs for the same (especially when staff there are probably expecting at least some), I would be particually cautious about signing up to anything that long.

What would happen if the TOC said no DOO/DCO in return for no pay increase above RPI+0.1% with both being for the life of the franchise?

If DOO was the major concern, then they might have a case. However I suspect Arriva have other cost saving ideas other than DOO, so if I were the one making the mark on the ballot paper I would still be loath to agree.

 

[Chester1]

DOO / DCO is part of Northern's franchise agreement. Arriva don't have a choice and seems to be heading towards a DCO Scotrail type deal. If it was their choice I think they wouldn't implement it.

 

[Bantamzen]

DOO / DCO is part of Northern's franchise agreement. Arriva don't have a choice and seems to be heading towards a DCO Scotrail type deal. If it was their choice I think they wouldn't implement it.

Nonetheless, it is only right that they properly discuss the T&Cs of such an implementation, as well as pay closer to the time when more details / timescales / impact on crew roles is better understood by all. As I read it, this is what Northern staff are most concerned about.

 

[ainsworth74]

DOO / DCO is part of Northern's franchise agreement. Arriva don't have a choice and seems to be heading towards a DCO Scotrail type deal. If it was their choice I think they wouldn't implement it.

It is but my understanding is that the agreement has plenty of wiggle room on the subject and is, of course, a proper franchise rather than a management contract like GTR (so the DfT can't meddle to quite the same degree without Northern saying 'okay but we're going to reduce our premium by £xm' or 'okay but we're going to need £xm more in subsidy' or even 'no we're quite happy with the agreement thank you very much'!).

So, for instance, the franchise agreement would appear to be satisfied if Northern introduced DCO with ten bell dispatch by a safety critical guard. This is the same way that Voyagers work for example. The driver is in complete control of the doors but will only close them on instruction from a guard and will only set off when given RA by a guard (though I suppose you could use CD/RA where dispatchers are provided).

If I were the RMT/ASLEF and Northern came to me offering that along with a guarantee that it would last at least the length of the franchise (currently due to end March 2025) I'd struggle to turn it down I think.

Nonetheless, it is only right that they properly discuss the T&Cs of such an implementation, as well as pay closer to the time when more details / timescales / impact on crew roles is better understood by all. As I read it, this is what Northern staff are most concerned about.

I wonder if a two year deal with an optional third (i.e. either party can walk away after two and go back to the table otherwise a third year on the same deal) might not be something a compromise that could work? Also worth remembering that we're already most of the way through the first year of the deal as we're negotiating the pay increase from April 2016!

 

[FordFocus]

DOO / DCO is part of Northern's franchise agreement. Arriva don't have a choice and seems to be heading towards a DCO Scotrail type deal. If it was their choice I think they wouldn't implement it.

If I was the unions and Northern, I'd sort out the 2016 and 2017 pay award with no strings attached. Then try and sign some form of a Scotrail type agreement in 2018 onwards.

I think the DfT will interfere in a Scotrail type deal though.

 

[lejog]

It is but my understanding is that the agreement has plenty of wiggle room on the subject and is, of course, a proper franchise rather than a management contract like GTR (so the DfT can't meddle to quite the same degree without Northern saying 'okay but we're going to reduce our premium by £xm' or 'okay but we're going to need £xm more in subsidy' or even 'no we're quite happy with the agreement thank you very much'!).

So, for instance, the franchise agreement would appear to be satisfied if Northern introduced DCO with ten bell dispatch by a safety critical guard. This is the same way that Voyagers work for example. The driver is in complete control of the doors but will only close them on instruction from a guard and will only set off when given RA by a guard (though I suppose you could use CD/RA where dispatchers are provided).

The Franchise Agreement (p31) defines DCO as:

“Driver Controlled Operation” means operation of a train by a driver alone without the need for a conductor (or any other Franchise Employee)

although Northern have to plan for a second employee to be on board, there doesn't need to be one for a service to run.

 

[bb21]

While that was true at one time, today most office-based staff are not in a Union and they are deemed "management".

If there are union member "staff" at bb21's TOC I'd be very surprised if they didn't get the same increase as other clerical grades, e.g. ticket office staff.

Certainly many are not in a union, I can vouch for that as many do not have a high opinion of any of the unions.

Not sure about front-line roles in similar grades but I assume that they cannot have differing pay for the same grade between those in a union and those not? I can only assume therefore ticket office similarly had no increase either for those years.

Ah, office-based roles. We weren't really discussing office-based roles, especially as they must be outside collective bargaining if you've had no rise.

I see.

I'd like to know which particular bunch of meanies run your TOC though, so that we can all avoid working for them.

One that very much divides opinions on this forum, but I won't be revealing it in public.

I wouldn't be surprised by many calling them mean though. There are some on this forum who absolutely hate them.

And I have a question; after 4 years of no rises how many staff have resigned?

Career progression is generally good and upwards movement offers plenty of opportunities so people tend to move around a bit. There have also been quite a few new projects in recent years which probably helped in that respect.

Some must have resigned too, just that I am not aware of many.

 

[YorkshireBear]

There is a slight irony in this new breaking at a similar time to rail fare increases. "We don't fares to go up but we want to be paid more."

I am aware it is not that simplistic hence slight irony.

 

[northwichcat]

There is a slight irony in this new breaking at a similar time to rail fare increases. "We don't fares to go up but we want to be paid more."

I am aware it is not that simplistic hence slight irony.

Perhaps the solution is to withdraw free staff travel and offer bigger salaries instead?

 

[Phil.]

Perhaps the solution is to withdraw free staff travel and offer bigger salaries instead?

There was a proposal about this some twenty odd years ago. The general consensus at the time was an offer of circa £5k might be worth considering.

 

[Bantamzen]

Perhaps the solution is to withdraw free staff travel and offer bigger salaries instead?

I am (still) of the opinion that Northern could do a hell of a lot more in terms of revenue protection across their network. It is still easy to see how people could avoid fares on many routes, including many in the peaks. Whilst there is a noticeable increase in RPOs in the morning peaks (though not always from start of play), as the day wears on this seems to thin out at stations without barriers / staff. And people must have cottoned on to this, as travel between such stations and you'll always hear people asking for single fares in morning peaks even when it's fairly obvious that they are likely to be making a return by the same route (school kids are one example).

Quite what the answer is without serious investment in their stations I don't know. But frankly if a company isn't pulling out all the stops to ensure they collect the maximum amount of fare, then they get little sympathy from me when complaining about profits (although at the moment they aren't!).

 

[scrapy]

If I was the unions and Northern, I'd sort out the 2016 and 2017 pay award with no strings attached. Then try and sign some form of a Scotrail type agreement in 2018 onwards.

I think the DfT will interfere in a Scotrail type deal though.

Northern have already told the unions a Scotrail type deal is not on the cards because the DFT will not agree to it.

 

[northwichcat]

you'll always hear people asking for single fares in morning peaks even when it's fairly obvious that they are likely to be making a return by the same route (school kids are one example).

Solution they've come up for some schools is Educational Season tickets: http://www.midcheshirerail.org.uk/u... 2017 educational season application form.pdf If school kids have one of those they aren't spending the money for their fares on sweets and then claiming they don't have any money to buy a ticket.

But frankly if a company isn't pulling out all the stops to ensure they collect the maximum amount of fare, then they get little sympathy from me when complaining about profits (although at the moment they aren't!).

Ironically DfT didn't allow old Northern to employ RPIs because of the salary limit they imposed on the franchise. Yet they were allowed to award a 'revenue protection contract' to a third party as long as the income from it exceeded the cost of the contract. Then when the operator tried allowing the contracted RPIs on trains in one areas the guards threw them off because the RMT objected.

 

[FordFocus]

Northern have already told the unions a Scotrail type deal is not on the cards because the DFT will not agree to it.

Well the DfT will have an even bigger battle on it's hands then. Considering that drivers don't have DOO(P) in their contracts, imposition of DOO like on Southern will be near impossible.

But that's a few years away yet.