Lawyers block BBC Technology strike

Re. Proposed Sale of BBC Technology Ltd

You have asked us to respond to the letter dated 21st July 2004 from Gerry Morrissey. We hope our response provides greater clarity to the points raised.

1. Pensions

1.1
We appreciate that staff are trying to understand a lot of detail that is being issued to them regarding the Siemens pension scheme as well as their options relating to the BBC scheme. We are conscious that staff would like to know the terms of the bulk transfer deal from the BBC scheme. That had influenced our thinking in seeking to finalise the bulk transfer arrangements within months of the sale. However, if it is felt that it would be preferable to defer the bulk transfer arrangements to sometime in Spring 2005, then we would adjust our planning accordingly to accommodate this.

1.2
During the presentations to staff, it has become clear that there is a perception that their new pension scheme would be exposed because it is being established as a separate scheme. We have been able to provide assurances that whereas the rules of the scheme are distinct, the funds of the scheme would form part of the overall Siemens UK investments and thereby provide greater financial security. We have also guaranteed the scheme for 3 years, whereas no such commitment has been extended to Siemens current pension scheme members, nor does any such guarantee apply to BBC scheme members. Siemens has recently undertaken a strategic review of pension benefit provision in the UK and I can confirm that there are no plans in place to remove the final salary scheme options to current employees for future service. Of course, the provision of pension benefits needs to be regularly reviewed in the light of economic conditions, business profitability, demographic implications and so on. It is therefore simply not possible to give a cast iron guarantee that the scheme might not have to fundamentally change or be cancelled at some point in the future. We will commit to giving at least 6 months notice in the event that the company determines that any fundamental changes are required. If ever there were to be any such changes, then I can provide the assurance that such an approach would not just be applied to the Tower Plan, but would be applicable throughout Siemens UK. It goes without saying that this would therefore be a major decision for the organisation to pursue. It would not do so lightly nor would it proceed without considering other alternatives, including seeking higher employee contributions. Above all else though, we must emphasise that we are a people services company, completely reliant on the commitment, motivation and dedication of our staff. We would therefore only propose changes if we felt it was absolutely necessary.

1.3
The BBC and Siemens have reached a commercial understanding that will now mean that the definition of Final Pensionable Service will relate to pensionable salary over the last 12 months of service. The definition of pensionable salary has of course been enhanced considerably.

1.4
There is one point in our pensions matrix that you have asked us to detail in this letter. We confirm that in the event that redundancies are regrettably required, unreduced pensions for those aged 50 or more will apply, in line with BBC current practice.

1.5
Staff joining the Tower Plan would remain members of that Plan whilst employees of Siemens, irrespective of which part of the Siemens organisation they worked for.

2. Terms and Conditions of employment

We have already given commitments regarding substantive terms and conditions of employment. We would be prepared to extend the period pertaining to Agreed Statements to 3 years, with the exception of the list as indicated in our earlier letter. This is because these latter ones relate to core policies that impact as regards our style of managing people, in particular our Staff Dialogue scheme.

We appreciate that one of the principal concerns about the possibility of substantive changes being made relates to the Agreed Statement on Redundancy. We have also carefully noted that there is an understanding by BECTU for the business realities to be faced. We have therefore reflected on this point and confirm that we will agree to apply this Agreed Statement in the event that we regrettably have to announce and implement redundancies within 3 years of the sale of the business. This period will therefore cover any major transformational changes that may have to be made.

We are of course assuming that the above commitments may need to be read in relation to any changes imposed by statute, if at all.

3. Double TUPE's

It is our declared policy that staff joining from BBCT, and in scope staff from BBC News and Nations, will be employed by Siemens. I reconfirm that there is no intention to employ staff in any other external organisation. For the avoidance of doubt, just like the BBC, our organisation goes through periodic restructuring, and staff can therefore be internally transferred within the Siemens UK group of companies. We would request BECTU to understand this, and in turn, reassure them that the TUPE obligation would be honoured in the event that they are legally applicable. Any other possible developments would be subject to proper consultation at the time, and Siemens would ensure that the legal rights of it's staff would be fully protected.

4. Locations

We can confirm that staff would not be required to work outside of the city where the BBC employed them at the time of transfer. No such changes would be imposed, but as we are contemplating changes to current locations, we can also confirm that our approach would be one of information and consultation around these plans, with staff affected invited to consider a change of location.

We readily understand the concerns that staff have regarding their likely future place of work, and so we have tried to be as informative as we can be at this stage of proceedings. Based on our current understanding of BBCT service delivery to the BBC, our location strategy is outlined below. There are some areas where our plans are still in development and these are highlighted, and of course please bear in mind that negotiations are continuing with the BBC that may have a bearing on the matter too.

Service desk (affecting circa 75 people based in London)
Our medium term plan is to have two service desks, one in Bristol and one in Durham or another of Siemens existing locations. Migration from the current Bristol / London model will be phased. In the first instance, Siemens will continue the BBCT approach of replacing posts in London with posts in Bristol for new recruits and as people resign, change role or retire.

After 6-9 months, when new service desk tools are installed we are looking to establish the new Siemens location with a view to migrating activity out of London to this location and to Bristol. We currently envisage that this will be complete two years after the start of the contract.

Telephony
We have no plans at this stage to move this service from London

Applications support
Our general approach is to locate applications support close to the customer. These services will continue to be delivered from existing locations for the foreseeable future. Siemens Business Services is also establishing an applications management centre in Glasgow that will be able to provide additional capacity and potentially offer career development opportunities to transferring staff.

Other technical and operational support
We do not currently have plans for major moves, other changes will rely on rationalisation of service delivery. We are conscious that staff may have concerns about possibler moves to Bracknell and can confirm that we do not currently have plans to move service delivery activities to Bracknell.

Functional support and commercial
Functional support and commercial activities will be consolidated over time with Siemens Shared Services and with Siemens Business Services commercial activities. These will be located within a combination of existing Siemens locations, the new consolidated building in London and possibly Maidenhead. Detailed plans have not been developed at this stage

London locations
As previously highlighted, we will look to consolidate London locations into a single building in the W1 / W12 environs in the period 1-3 years after contract commencement.

Other locations
For the foreseeable future activities will continue at Bristol and Maidenhead. On-site services will also remain close to the customers, on-site at BBC locations.

We are planning to consolidate office locations in Belfast, bringing together the BBCT staff in Belfast in the Siemens Business Services offices in central Belfast.

Siemens continually reviews its location strategy to ensure that it's business can deliver commitments to customers and at the same time remain competitive. It is possible in the medium to long term that location changes will be required either to support the BBC (for example in the nations and regions) or to support continuous improvement. Any such changes will be undertaken with normal consultation.

We note there are references to other secondary issues, with which we are not immediately aware, but we would make ourselves available to talk about these at the appropriate opportunity.

Yours sincerely

Nicola Hodson
Business Development Director
Siemens Business Services