FAQs on pay negotiations

Hi all 

Your Unite team are getting a lot of questions from members about the ongoing pay negotiations. Please see below for answers to frequently asked questions. If your question isn’t on the list, please let us know. 

Best wishes

Jacob

Unite convenor, St Mungo’s

With so many mixed messages appearing in emails and on Mungosnet, we understand that some members may be starting to find information about current negotiations between Unite and St Mungo’s confusing. With this in mind, here is a quick recap of where we’re at: 

Why are we negotiating? 

As we are facing a cost-of-living crisis and had such a low pay “rise” last year, St Mungo’s staff have experienced a real-terms pay-cut affecting non-managerial staff on lower wages the most. In recognition of this during earlier negotiations, St Mungo’s did raise the mileage and travel allowance, however the issue of pay remains on the table.   

What about these £1925 and £500 payments I keep hearing about?

The £1925 is the pay increment agreed at NJC for the financial year of 2022/2023, backdated to April 2022 when this financial year began. This is a small obligatory pay increase outside the control of St Mungo’s. The only pay offer St Mungo’s has itself made is a proposed one-time payment of up to £500, which is subject to tax and NI deductions. This would also be dependent on salary, so not all staff would even receive the full £500, even before tax.  

Why haven’t St Mungo’s agreed to a pay rise yet?
The Senior Management Team have acknowledged the impact of the current financial crisis on their staff, but say that they cannot afford to raise wages without putting the organisation in financial jeopardy, risking jobs. At our last negotiating meeting, their sole offer was the one-off payment of up to £500 noted above. 

If they can’t afford it, how can they pay it? 

This is where Unite and St Mungo’s disagree, for the following reasons: 

• Financial reserves: St Mungo’s trustees state that they need a £14-£18million cash reserve for financial stability, and they currently have £22.5million. When Unite have raised this, management have only said that cash reserves are sometimes different at different times of the year so this doesn’t mean they have that much to spare.  Additionally, St Mungo’s also has fixed assets valued at £83.7m. We therefore believe St Mungo’s has more than enough surplus to raise staff pay. 
• Company accounts: We have asked to see St Mungo’s company accounts to better understand our collective financial situation, which they assure is so dire – as indeed is legally required for senior management to share with us according to our union recognition agreement. However, management have repeatedly refused to share this information, citing no clear reason why. What verifiable information we do have on St Mungo’s financial position comes primarily from public records (such as Companies House) and tells a different story to what we have heard in negotiation meetings. It is hard to think what good-faith reason senior management could have to continue withholding information to which Unite has both a legal and logical right. 
• Failure to make reasonable savings: We welcome St Mungo’s announcement last week that they will commence making savings in areas suggested by Unite for the past few years, and again at recent negotiation meetings. Addressing exorbitant agency costs (£7.6million in 2021/2022) and the practicality of maintaining TMS in a post-pandemic world of agile working have been a long time coming, but none of this means St Mungo’s can’t afford to give us a decent pay rise. Senior management continues to expand, with the gap between lowest and highest wages rising exponentially. Public records show 23 managers are now on £70k or more, our late CEO Steve Douglas took home £189k annually and Emma Haddad’s salary is unknown. If St Mungo’s were really in such financial straits that they could not afford to pay frontline workers more, they would not be able to afford these expenses either – but they clearly can. 
   
  
  How realistic is the threat of job cuts though? 
  
  It can’t be entirely written off, but this would be a choice rather than an inevitability, dependent on what Senior Management chooses to prioritise financially (as explored above). It’s also important to be remember aware that: 

• St Mungo’s earns its money by fulfilling contracts, usually with local authorities, and if it doesn’t employ staff to fulfil these contracts it doesn’t earn that money  
• If another organisation won a contract previously held by St Mungo’s, staff would be transferred to the new organisation under TUPE rules, which would protect their terms and conditions. 
  
   
  So what happens next?  
  
  We want and have always wanted St Mungo’s to negotiate a reasonable pay increase with us – as our new CEO Emma Haddad recently pointed out, “people employed in low-wage jobs [are] at greater risk… and there is no additional help for those facing rising rents.” We still have hope that St Mungo’s will walk their talk and we’ll be able to resolve this amicably, and this is why we have recently begun mediation through ACAS. However, in the absence of meaningful progress, we will have no choice but to move towards strike action.