Newcastle City Council has proposed to end premium rates of pay which would affect a third of its workforce in an attempt to reach its £30m budget gap.
The proposed changes would affect weekend and night staff who would see a reduction of two hours to their premium rate. The joint trade unions have said in response “industrial action cannot be ruled out at this stage”.
In September the council announced a plan to save £30m by next year and £70m over the consecutive three years. If these changes went ahead it would save the council £2.5m per annum.
The council completed its Single Status Agreement in 2010, which ensured staff received equal pay for work of equal value. By replacing premium rates of pay to the plain rate, the council hopes to close the gap in the budget.
Colin Burr, a union member from GMB said: “It attacks those groups who are predominately the lowest paid and rely on allowances and weekend enhancements, to make a living.”
Staff from a wide range of positions would be affected by these changes. The night premium rate would start at a later time of 10pm instead of the current 8pm. Two thirds of the council’s workforce who do not work evenings, shifts or weekends would be unaffected by these changes.
Councillor Veronica Dunn, Cabinet Member for Resources, said: “This is not something that we want to do at all. However Government cuts mean we have to make massive savings to protect services and jobs.
“I fully recognise this will be extremely unpopular among staff – but let me assure them that we remain committed to fair pay. Our recent decision to increase the Newcastle Living Wage to £8.25 per hour will give some protection to our lowest paid staff from the full effect of these changes.”
The four trade unions affected include UNISON, GMB, UCATT and Unite, who met with the council officers the morning of the announcement. Some budget proposals for 2017 were released to staff, unions and press but with these particular changes withdrawn, according to the joint unions.
Paul Gilroy, Branch Secretary of UNISON Newcastle said: “It’s a disgrace that Newcastle’s Labour Council have turned on their workforce to slash staff salaries by up to a third, particularly after recently agreeing to increase the pay of the Chief Executive and Directors.”
Mr Burr, from GMB added: “Unfortunately once again not only trade union members will be affected by this, but the most vulnerable in our society will potentially suffer by this proposal.”
Dave Eglon from UNITE, and Steve Conwell from UCATT said: “A Labour run Council should hang their heads in shame. They are taking money off the most vulnerable and lowest paid workers at [Newcastle City Council] by stripping bare their terms and conditions.”
The council state that if the changes to pay are implemented, wages will not be reduced for six months. Allowing staff time to plan for their financial loss, as well as receiving targeted support.
Councillor Veronica Dunn said: “The Government has made it clear it wants all councils to be self-financing by 2020 which means we must become more competitive. If we don’t become more commercially viable we will struggle to protect the most vulnerable.”
The council proposes no further changes to other terms and conditions during this announcement.
The joint trade unions will meet with their members and formally respond to the council in the next few days.