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TfL pay for performance: unfit for purpose

31 March 2014

Transport for London's plans to change their performance related pay system will mean a pay freeze for most staff and huge pension cuts for all.

frozen-money.jpg
© robf / Dollar Photo Club

TfL claim that staff in pay bands 1-3 (including all but the most senior managers) are overpaid in relation to ‘the market’ rate consultants have drawn up for them. They want to lower the pay bands and cap the pay of those above the top threshold - nearly half of all staff fall into this category. In real terms, this means a pay freeze with little prospect of a thaw in the immediate future.

In our view, the market sample they have chosen is totally inappropriate, including unrelated employers, those outside London and ignores the unique work being carried out by TfL staff. TSSA’s position is that TfL is a unique organisation set up to provide world class, sustainable and integrated transport services for a world class city. This mission is underpinned by the recruitment and retention of a world class workforce, dedicated to delivering a quality public service.

Now the Olympics have passed, TfL claim that staff are not performing well enough. They say that reducing pensionable pay rises and replacing them with non-consolidated discretionary bonus payments will improve performance. They have declined to supply a rationale for this – all serious business and academic studies show that decent levels of base pay and proper pensions are essential to a high- performing culture. TfL already have the ability to reward people they think have performed well – if they have not done so, that is down to their choices. TfL management cannot justify their position.

TfL claim they will save around £224 million by implementing their plans. But they have also said that cost is not the key driver and have refused to provide a breakdown of the projected savings. They say they have no savings target – probably because much of the cost reductions are within the pension scheme – something they have refused to discuss.

Most insidiously, TfL’s plans, if implemented, would mean TSSA’s influence over future pay agreements will be greatly reduced. We would no longer be able to ensure that our members receive a decent pay rise, even if the economic situation improves. Peter Robinson, Head of Reward at TfL, has claimed that the trade unions have out-negotiated TfL for years and we have forced TfL into pay increases higher than those paid by ‘the market’.

TSSA has never asked for excessive pay increases and TSSA members have never taken industrial action over pay at TfL. Similarly, we assume that, as a responsible employer, TfL has never agreed to base pay increases that have been unaffordable.

However, if TfL has genuine financial difficulties, we expect them to explain these and reach an agreement with us on a sensible and measured response. TfL management has taken the opposite approach: to try and impose drastic cuts, peg wages to external comparators and escape their pension commitments.

We want to see a joint review of the salary structure with a view to reducing pay anomalies. We want to see base pay and performance awards negotiated with TSSA. Rather than salaries being pegged to spurious ‘market’ comparators, we think TfL should retain control over its own pay awards. Maybe, they just need to review their own ability to negotiate!

We are ready to enter serious discussions with TfL. Why are they determined to press ahead with what will be unworkable and divisive proposals? It is clear there is a political agenda at work.

Unless the situation changes drastically, we will have no choice but to ballot members for industrial action for the first time ever at TfL. Let us hope that is not necessary but, let no-one be in any doubt, we will not stand by and allow our members’ pay and pensions to be decimated by short-term thinking and ideologically driven political agendas.
 

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