Centrica, the owner of British Gas, has told thousands of staff they will have to accept new working conditions or face more redundancies.
The new conditions do not include overtime pay at the UK’s largest gas and electricity company but would be in line with the “median market” the firm stated, emphasising it would remain an “attractive employer” after the changes.
According to the BBC the firm said if employees did not sign the contract, there would have to be a fresh wave of redundancies as a “last resort”, on top of the 5,000 job cuts that were announced in June.
Centrica said it had opened talks with unions and that the contract changes were crucial because many of its 21,000 staff had “outdated” variations of terms.
Covid-19 impact on jobs
Unions were highly critical of the changes with Justin Bowden, of the GMB union, said: “It remains to be seen whether the leadership thinks it can cut its way out of crisis or if it has a plan for growth and the ability to negotiate.”
Competition from smaller more agile rivals has seen Centrica lose three million customers over the past decade. It reported an £849m loss last year and said it aimed to make overall savings of £2bn by the end of next year.
The company said the changes would not affect base pay or pensions.
It warned that a Section 188 notice, which employers have to give workers and unions pending any moves for large-scale redundancies, would be a last resort if workers did not agree the new terms.
“We’ve been open about the changes we need to make to win back customers, grow our company and protect jobs in the long run,” the company said in a statement. “Our employees’ base pay and pensions will be protected but simplifying and modernising their terms is essential if we’re to become more flexible and price competitive. We have over 80 different employee contracts with 7,000 variations of terms, many of which are outdated and stop us delivering for customers.
“We want to continue with constructive talks and the s.188 notice provides an option of last resort if it turns out we can’t work together to achieve this. We understand the impact this will have on colleagues and this is not an option we want to use but we must make these changes and we must conclude these talks before the winter period.’’
The company told Personnel Today that T&Cs underpin how “flexible/competitive we can be” but they “currently prevent us from doing so – for example – today if an engineer is located close to a customer, we can’t send that particular engineer because of invisible T&C’s barriers”.
The spokesperson said Centrica would remain an attractive employer even as it changed and “our T&Cs will be in line with the market median”.
According to a presentation seen by the BBC, Centrica proposed to fix overtime pay at the same rate as regular hours. Overtime at the firm can currently double the hourly rate, depending on a worker’s contract.
Under the new contract, engineers who were might be asked to work shifts between 8am and 8pm in the busier winter period could be allocated hours any time between 6am and 11pm, said the BBC.
Centrica’s move echoed that of British Airways in May, which also met with strong disapproval from workers and unions.
One Centrica engineer told the BBC: “What is really painful is that when this coronavirus kicked off, we all rose to the challenge.”
“We were going into houses. We were feeling proud, as we were key workers,” he said. The mooted contract changes were a “huge slap in the face.”
He also referred to suspicions among workers that the revised conditions were being implemented during the coronavirus crisis so that employees couldn’t have meetings and discussions about them.
Centrica wanted to reach a deal before winter, it said, after consultation with unions which had already started.