News

Staff discuss possible pay protest

By Pete Castle
April 20, 2009

More than 1,000 workers at one of the area’s largest employers are planning to strike in protest over pay.

Staff at defence technology company Qinetiq are talking about a possible walkout in May from the company, which has its headquarters in Farnborough.

Qinetiq, which employs around 2,300 people at its Cody Technology Park base on the north side of Farnborough Airport, announced last week that it would not increase pay to staff this year, despite making healthy profits last year.

While the pay freeze will affect all staff, including directors, it is expected that huge bonus payments to company bosses will go ahead as planned.

Hundreds of union members are meeting in Farnborough today (Friday) to decide whether to go ahead with a ballot that could lead to industrial action — the first in the company’s history.

The announcement last week that none of the company’s 7,000 UK workforce would receive a rise led to outrage from unions.

Union representatives are furious that a company which made record profits last year and is forecast to continue to do so is effectively cutting staff pay. Last year staff were given a 3.7% pay increase on average.

Union bosses have accused Qinetiq of deliberately delaying scheduled pay talks in order to push staff to work harder in the last few weeks of the financial year, which ended on March 31.

Prospect, the union for engineers and other white-collar professionals, has around a third of the Qinetiq workforce as members. National organiser David Luxton said there had been an “outburst of anger” from Qinetiq staff at the news of the pay deal.

Staff are angry that news of the pay freeze was kept quiet until after the end of the financial year, he said.

“There is a lot of support from staff [for strike action] who are incensed that they have been working hard and delivering their targets, only to find that there is no increase in pay at all.

“They are so angry at what the company has done to them.”

Staff were particularly angry that the company had “done little to justify” the decision not to increase pay.

While the company has pointed to the general recession and a general squeeze in funding at the Ministry of Defence — by far Qinetiq’s biggest single customer — it was wrong to use those fears to punish staff, Mr Luxton said.

Prospect pointed to pay deals awarded to MoD staff, who will get a 3.27% pay rise this year and a 3.7% rise next year.

The union boss accused Qinetiq of “cynically and deliberately delaying the negotiations”.

“The way it was handled was just shambolic,” Mr Luxton said.

While the pay of Qinetiq directors would also be frozen, the company’s bosses will not suffer too much hardship.

Last year chief executive Graham Love’s bonus was £214,000 — equivalent to around 61% of his salary.

When the former government-run company floated on the stock exchange in 2006, Mr Love was awarded shares in the company worth £21million after investing £110,000 of his own money.

In 2007, he sold shares he paid £29,000 for a year earlier for nearly £6m.

The rewards scheme for directors was heavily criticised last year by the National Audit Office and the House of Commons Public Accounts Committee.

Last month Mr Love bought another 100,000 shares in the company. He now holds 5,085,568 shares — or 0.77% of the company — which this week were worth £6.8m.

Sir John Chisholme, the chairman and former chief executive, owns 11,501,016 shares worth £15.3m.

In a statement, a spokesman for Qinetiq said: “There are no plans for anyone in the UK business to receive a pay increase at this stage. The UK is currently experiencing the most serious recession since the 1930s and like many other companies we are looking at the way in which we operate.

“We are not committing to any additional costs when the future big picture economic environment is so uncertain.”

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