1.1. This is a three-year pay offer, which covers the settlement dates of 1 July 2004, 1 July 2005 and 1 July 2006.
2.1 Entitlement to each individual year of the pay award will be dependent upon two things. Firstly, you must be employed by Department for Work and Pensions¹ on both 30 June and 1 July of that year; and secondly, you must not have been marked unsatisfactory for the previous performance year.
3.1. Although this is a three-year offer, we have agreed with the unions that we should still meet every year to discuss any issues, which have arisen in the year; any changes of circumstance; and any other areas of mutual interest. We intend to meet formally in March of 2005 and 2006 to ensure that any issues can be addressed within a sensible timescale.
3.2. Each year management and the unions will jointly review the commitments made for the relevant year of the three-year agreement and consider whether or not any significant external factors should cause the agreement to be reviewed and, in particular, whether it would be necessary for the department to seek to re-open the deal with treasury.
3.3. The treasury has already agreed that the deal will be reviewed in the event of unforeseen circumstances resulting from changes to the labour market. This is relevant because economic pressures may impact on the department's ability to recruit and retain staff; for example the level of wage increases elsewhere in the economy could affect the competitiveness of the pay deal.
3.4. For simplicity we intend to take account of the prevailing rate of inflation as measured by RPI: any increase in RPI above 3.5% will trigger an approach by DWP to treasury for additional remit funding.
3.5. Treasury has also agreed that the deal will be reviewed in the light of the implications of the “Coherence Agenda” - work being led by the Cabinet Office with the Council of Civil Service Trade Unions, to introduce a more coherent set of terms and conditions across the civil service within the current delegated framework. If recommendations coming out of those pay coherence talks have implications for DWP’s pay arrangements, then DWP will re-open negotiations with treasury.
4.1. The total value of the offer is:
4.2. In addition to this there are non-consolidated bonuses worth £21.2m in year 1, £38.3m in year 2 and £36.0m in year 3.
4.3. In year 1 there is also a further non-consolidated recognition payment of £100 to all qualifying staff, costing £12.8m.
Effective from 1 July 2004:
Effective from 1 January 2005
Effective from 1 July 2005 and again from 1 July 2006:
| Effective from | ||||
| Feature | 1 July 2004 | 1 July 2005 | 1 July 2006 | |
| Increases to most pay scales | Minima | 5% | 5% | 5% |
| Maxima | 3% | 3% | 3% | |
| Progression based on Taper Reference Point (TRPt) set at 120% of new payscale maxima |
Admin grades and equivalents | 11% | 10% | 10% |
| Executive grades and equivalents | 10% | 9% | 9% | |
| Underpin increase |
Admin grades and equivalents | Better of: £600 or 3% | Better of: £600 or 3% | Better of: £600 or 3% |
| Executive grades and equivalents | 3% of new scale max | 3% of new scale max | 3% of new scale max | |
| Limit to increases | For all staff | 7% | 7% | 7% |
7.1. This document covers the main elements of the pay offer for each of the three years. If there are any specific individual cases that this document does not cover then staff should contact their line manager.
8.1. All staff will receive a salary increase based on a taper progression system except where this offer letter specifies differently.
8.2. This works by:
8.3. The reference point, which is known as the Taper Reference Point (TRPt), is set at 120% of the new pay scale maxima for each of the three years. The percentage rate of progression to this point will be slightly different across the years and will also be different for administrative and executive pay bands. The table above shows the values for all staff over the three years of the offer.
8.4. A calculation must be carried out in the following order to determine the amount of progression per individual:
This gives the amount by which the salary will be progressed. Figures should be rounded up to the next nearest £1.
9.1. The arrangements described above will generally provide staff with pay increases in the range of 3% to 7%. However, we wish to ensure that no staff receive less than this so we have introduced an guaranteed underpin of:
Admin staff and equivalents - better of £650 in year 1 (£600 in year 2 and 3) or 3%
Executive staff and equivalents - 3% of new pay scale max for that year
9.2. All staff are eligible for this guarantee for each of three years unless otherwise stated in this offer.
9.3. In some cases, application of the underpinning guarantee will provide a pay increase that would take an individual above the new pay scale maximum for that year.
9.4. Where this happens any increase in excess of the new maximum will be paid as a non-consolidated non-pensionable lump sum.
9.5. Support managers 2 and 3 will have different underpin arrangements. They will receive the better of 3% of the new revised pay scale maxima or £650 in year 1 (£600 in year 2 and 3).
10.1. A one off payment of £100 will be made to staff in recognition for all the hard work done in the previous year and the goodwill and patience that staff have shown whilst waiting for the pay negotiations to conclude.
10.2. This will be a non-consolidated, non-pensionable, pro-rated payment and will be paid to all staff who are entitled to the pay award and who have had at least one days paid service with the department between the 1 July 2004 and 31 January 2005.
11.1. Any increase payable under this offer will be limited to 7% in any year. This does not include any individual performance bonus or recognition payments, which will be paid to eligible staff in addition to the basic pay rise.
11.2. The exceptions are:
12.1. Unless otherwise notified, pay awards will be calculated and applied in the same way for specialist staff as for the equivalent generalist grades/bands.
12.2. Legal trainees are to be treated differently from generalists in the following way. Pay scale minima and maxima will be increased by 3% for staff on the pupil barrister/legal trainee. Neither salary progression (see paragraph 8) or the underpin (see paragraph 9) will apply to these staff, as they are effectively on a fixed point, so their salary increase will therefore be 3%.
13.1. Cleaners do not have a pay scale as such, but a single pay rate.
13.2. These pay rates will be increased by the amount of the cash underpin for administrative grades (£650 in year 1 and £600 in years 2 and 3).
14.1. Staff on any pay scale maximum will move automatically to the new pay scale maximum. The taper progression system will not be applied in these cases.
14.2. Any increase in excess of the new maximums as a result of applying the underpinning guarantee will be paid as a non-consolidated non-pensionable lump sum.
15.1. Any staff who, following the relevant years pay award, would be below their new pay scale minima will be uplifted to the new pay scale minimum.
16.1. Any staff who have transferred into DWP on or after 1 April (in any of the three years), from another government department do not have an automatic entitlement to the DWP pay increase from 1 July for that year.
16.2. In these circumstances, corporate payroll will contact the previous department to ascertain if they are entitled to the DWP pay award or the exporting department’s pay award.
16.3. This policy also applies to staff on loan or secondment from other government departments or organisations.
16.4. Any entitlement to the pay increase in both of these circumstances will be paid separately from the main pay award but will be effective from 1 July for that year.
17.1. The consolidated increase will erode any mark time pay in payment from 1 July. Mark time pay will not be eroded (except ‘TEC’ staff - see below) by any non-consolidated lump sums above the revised annual DWP maxima.
17.2. As part of TUPE arrangements for ‘TEC’ staff, it was agreed any staff that transferred onto the UNI2000 payroll from 1 January 2003 on mark time pay arrangements would receive their award as a fully non-consolidated amount. This non-consolidated amount will erode the mark time pay.
18.1. Some staff from the former ITSA (ITSG), the former EO/HEO accountancy, and former SEO/G7/G6 accountancy passed finalist pay bands have reserved rights to a maxima that remains above the DWP maxima for the grade. These reserved rights apply to the staff shown in the table below:
| Grade/band | Maximum |
| ITSA (ITSG) HEO (London outer) | £31,127 |
| ITSA (ITSG) HEO (London inner) | £31,927 |
| ITSA (ITSG) PES (National) | £16,821 |
| EO accountant (National) | £23,550 |
| EO accountant (London outer) | £26,430 |
| EO accountant (London inner) | £27,270 |
| HEO accountant (National) | £29,410 |
| HEO accountant (London outer) | £33,300 |
| HEO accountant (London inner) | £34,330 |
| SEO accountant passed finalist (National) | £37,070 |
| SEO accountant passed finalist (SPLZ) | £39,570 |
| SEO accountant passed finalist (London outer) | £39,990 |
| SEO accountant passed finalist (London inner) | £41,040 |
| Grade 7 accountant passed finalist (National) | £49,420 |
| Grade 7 accountant passed finalist (London outer) | £52,720 |
| Grade 7 accountant passed finalist (London inner) | £53,770 |
| Grade 6 accountant passed finalist (National) | £59,720 |
| Grade 6 accountant passed finalist (London outer) | £63,710 |
| Grade 6 accountant passed finalist (London inner) | £64,580 |
18.2. Staff with reserved rights to the above pay scales will retain the right to progress to the frozen maximum of that scale until such a time as the DWP maximum exceeds the frozen maximum. All payments up to the level of the frozen maximum will be made as a consolidated award.
18.3. The ITSA (ITSG) EO (National) former pay scale has now been overtaken by the revised 2004 DWP pay scale.
18.4. The following anomalous pay scales will be overtaken by revised pay scales during the course of this offer:
19.1. Staff who have protected rights to temporary promotion (TP) and who were/are on TP on the 2004 settlement date, will have both their substantive and higher grade/band salaries progressed as normal.
19.2. Staff who were not on TP on the settlement date in each year, will have their substantive salary progressed as normal.
19.3. Any subsequent period(s) of temporary promotion, beginning after the settlement date in each year, will attract the more favourable of:
20.1. Those staff who had a protected temporary responsibilities payment (TRP) rate in 2002 following merging of the split bands, will continue to receive protection in each year of this multi-year offer as follows:
21.1. Staff who have been marked unsatisfactory for the previous performance year are not eligible for the pay award. The only exception to this is where unsatisfactory performers are below their new pay scale minimum, their pay will be increased to that new minimum.
22.1. In addition to the main pay increase, staff who receive a top, higher or majority level under the performance and development system will receive an individual performance bonus in recognition of their individual contribution.
22.2. These payments will be made to all qualifying staff in year 1 of the pay award and to staff in grade AA/band A to grade SEO/band E in years 2 and 3. For each year the amount of the bonus will be based on the performance level received for the preceding performance year. For example, bonuses payable in respect of the 1 July settlement date (in any of the three years) will be dependent on the individual’s performance marking for the performance year ending on 31 March of each calendar year, e.g. the bonus payable for July 2004 will be based on PDS for 2003/04.
22.3. Staff should read these tables in conjunction with para 24 - performance bonus money, which discusses individual business flexibility on bonus arrangements.
| Top | Higher | Majority | |
| Grade AA/band A | £260 | £195 | £65 |
| Grade AO/band B | £325 | £245 | £85 |
| Grade EO/band C | £390 | £295 | £100 |
| Grade HEO/band D | £520 | £390 | £130 |
| Grade SEO/band E | £780 | £585 | £195 |
| Grade 7/band F | £910 | £685 | £230 |
| Grade 6/band G | £1,040 | £780 | £260 |
| Top | Higher | Majority | |
| Grade AA/band A | £390 | £260 | £130 |
| Grade AO/band B | £490 | £325 | £165 |
| Grade EO/band C | £585 | £390 | £195 |
| Grade HEO/band D | £780 | £520 | £260 |
| Grade SEO/band E | £1,170 | £780 | £390 |
23.1. The bonus arrangements for staff in grade 6/band G and grade 7/band F from year 2 (Pay 2005) will differ from previous years and will differ from the arrangements for bonuses for AA/band A - SEO/band E.
23.2. We are introducing an element of managerial discretion into the award of individual bonuses for these two grades. Line managers will recommend a bonus payment within a range set for each grade and level of performance generated by the performance and development system (PDS).
23.3. Recommendations will be approved and authorised by a nominated business budget holder in conjunction with their HR business partner and the jobholders’ representatives (usually the line manager who attended the assessment panel).
23.4. Jobholders in grades 6/band G and grade 7/band F will receive notification of their bonus award from their line manager. This must be read in conjunction with the general eligibility rules for bonuses detailed in this pay offer.
23.5. The general eligibility rules for bonuses detailed in this pay offer will apply to all grades/bands including grade 6/band G and grade 7/band F.
23.6. Staff should read these tables in conjunction with para 24 - performance bonus money, which discusses individual business flexibility on bonus arrangements.
23.7. Further details of the new arrangements will be made available to those staff affected nearer the time.
| Top | Higher | Majority | |
| Grade 7/band F | £1,175 to £1,555 | £785 to £1,035 | £395 to £515 |
| Grade 6/band G | £1,370 to £1,750 | £915 to £1,165 | £460 to £580 |
23.8. Further details of the new arrangements will be made available to those staff affected nearer the time.
24.1. The performance bonus values that are shown in this offer apply to the corporate individual performance bonus scheme.
24.2. During the course of the three-year period, businesses will retain the flexibility, agreed as part of the pay 2002 settlement, to run team bonus schemes if they choose. Where businesses do wish to run a team bonus scheme this will be handled in line with the agreed procedures regarding consultation with trade unions.
24.3. No additional funding will be available for this purpose so, for staff included in the team bonus scheme, the individual bonus shown in the offer will be reduced by an equivalent amount so that the overall bonus pot available within that business remains the same.
24.4. Unless specifically stated elsewhere in this offer letter, this will not affect the bonus values shown for 2004 because money has already been set aside for team bonus schemes that ran in 2003/04. Staff will need to be aware of this possibility though in future years when referring to the above tables.
24.5. There may be occurrences, in individual businesses, where a combination of both team and individual bonus schemes operate in a performance year.
24.6. Individual businesses will be responsible for communicating these changes to their own staff.
25.1. These eligibility criteria relate to each year of this multi-year offer:
25.2. Movement into the senior civil service (SCS)
26.1. A ready reckoner will be available on the intranet each year. This will enable staff to calculate on an individual basis, an indication of what pay increase they can expect to receive.
The effective date for policy changes is the first Monday after the 2004 implementation date, unless otherwise stated.
For the purposes of this offer, the implementation date is the day that the pay award is actually applied on to the payroll systems (e.g. staff pay details, revised calculations etc.) This will be before the actual salary pay day.
27.1. With effect from 1 July 2004 the passed finalist pay scale will be abolished. Any individual already on those pay scales will move to the generalist pay scale on their current rate of pay, and will retain a reserved right to the 2003 maximum of the passed finalist pay scale.
27.2. This maximum will not be increased by this or any future pay awards. When the DWP equivalent pay scale maximum exceeds the frozen maximum, the reserved rights amount will have been exceeded and staff will then be subject to the corporate maximum.
28.1. With effect from the 01 July 2004 a new DWP wide accountancy training scheme will be introduced to replace the existing legacy ES and BA training schemes which currently run alongside each other. The details of the new scheme are shown in the table below:
| Financial management development scheme (FMDS) trainees | Locally supported trainees | |
| On joining the scheme | Trainee entry point or flexible starting pay (FSP) on generalist EO pay scale | Generalist EO pay scale minimum or FSP |
| Stage 1 (Foundation) | Normal progression through generalist EO pay scale | Normal progression through generalist EO pay scale |
| Stage 2 (4 papers) | Through banded to generalist HEO on normal promotion terms. Must have completed 2 years service, met the competency standards and displayed the potential to progress rapidly to G7 | Normal progression through generalist EO pay scale unless passes a promotion board to HEO |
| Stage 3 (Intermediate) | 10% up-rate of base pay on generalist HEO pay scale | Normal progression through relevant generalist pay scale |
| Stage 4 (Passed finalist (PF)) | Normal progression through generalist HEO pay scale with an additional £1000 non-consolidated one off lump sum (paid as an RRA) | Normal progression through relevant generalist pay scale plus £1000 non-consolidated one off lump sum (paid as an RRA) |
| Full qualification (FQ) (Completion of log book) | Base pay uplifted to generalist HEO pay scale maximum with an additional £2000 non-consolidated one off lump sum (paid as an RRA) (only payable if period between PF and FQ is one year or less) | Normal progression through relevant generalist pay scale plus £2000 non-consolidated one off lump sum (paid as an RRA) |
28.2. The terms of the ES legacy scheme will terminate upon implementation of these changes. Staff who are already on these legacy arrangements will move to the new arrangements, which are more beneficial.
28.3. Trainees who are through-graded from 1 July 2004 will in accordance with the department’s promotion rules, have their RRA converted to mark time pay.
28.4. The mark time pay is eroded by subsequent pay award increases, and in appropriate cases, by the second 10% pay uplift for successful completion of stage three of the accountancy syllabus, but not by the sum awarded to achieve either HEO scale minimum or a 10% increase over and above existing EO salary (whichever is more advantageous).
28.5. Group finance division have requested that any queries about the new scheme be directed to them rather than business partners.
29.1. Auditor pay scales for grade SEO/band E (MIIA). Grade 7/band F and grade 6/band G will be aligned with the equivalent grade accountancy pay scales.
29.2. Although the accountancy and auditor pay scales will then have the same maxima and minima, the pay scales will still remain as separate distinct pay scales.
29.3. The alignment will be achieved by increasing the relevant auditor pay scale minima and maxima on 30 June 2004 to match the accountancy pay scales. The SEO/band E national MIIA pay scale is the only exception to this. Unusually, the existing pay scale minimum is slightly higher than the equivalent accountancy minimum so the minimum will not be aligned at 30 June 2004.
29.4. Staff will be moved onto the new pay scales at the same salary they are currently on. The only exceptions to this are:
29.5. Pay 2004 will then be applied to the revalorised pay scales. However the pay scale minimum for auditors on the SEO/band E national MIIA pay scale will be increased by approximately 3% to achieve alignment with the equivalent accountancy pay scale minimum.
29.6. The 7% limit only applies to the pay 2004 element of this change.
29.7. The SEO/band E PIIA auditor pay scale will be removed. Staff currently on that scale will be moved across to the generalist SEO/band E pay scale but they will retain their current salary and will have reserved rights to the 2003 PIIA maximum.
30.1. Any staff who spend time travelling to and from a location where an overnight stay is required are only required to make one single home to office deduction when claiming travel time on each day.
30.2. This aligns treatment for all DWP staff on the more beneficial of the former legacy arrangements.
31.1. All travelling time (for time spent on official travel, outside office hours, or for official travel outside of their individual conditioned daily hours) for grades 6&7/bands G&F and equivalents will be abolished.
31.2. This change to policy does not apply for claims to travelling time for short trips overseas.
31.3. This change forms part of the overall reward strategy for grades 6&7/bands G&F and aligns travelling time principles with the abolition of overtime for these grades (abolished from 7 April 2003).
32.1. All staff who transfer on hardship grounds to a different geographical pay zone will be treated for pay purposes as a compulsory transfer.
32.2. This will allow them to keep their previous rate pay, if this is more beneficial, on a mark time basis.
33.1. All newly recruited legal trainees (pupil barristers & trainee solicitors) will progress to pay scale maximum after twelve months in post.
33.2. Anyone already in the process of being accepted, or who have already been accepted, onto the scheme but who are deferring taking up post until after the changes are implemented, i.e. the Monday following the implementation date of year 1 of the multi-year offer, will still be able to take up post under the former terms and conditions.
34.1. As part of the department’s commitment to improving annual leave entitlement, all staff in the grades AA - HEO/bands A - D, who have not already qualified for 30 days annual leave, will receive 30 days annual leave after 10 years reckonable service.
34.2. This will be effective from 1 January 2005.
35.1. Allowances will be increased by 3% from 1 July 2004, unless otherwise stated.
35.2. The following allowances, however, will not be increased:
35.3. Some other allowances will increase automatically as a result of basic salary increases (i.e. night duty addition and regular shift allowance).
36.1. With effect from the Monday following the implementation date of year 1 of the multi year offer, clothing allowance for uniformed staff will be abolished.
37.1. With effect from the Monday following the implementation date of year 1 of the multi year offer, visiting officer allowance for protective clothing will be abolished.
38.1. A review of all existing allowances will be carried out with the unions. The results of the review will form part of the negotiations for the second year of this award.
38.2. Temporary promotion and deputising top-up arrangements will feature within this review of allowances.
38.3. It is our intention to increase allowances in 2005 and 2006, in the same way as in 2004, unless the allowances review recommends changes, which would make this inappropriate.
Due to the number of pay scales these are only available by viewing the attached document.
¹References to the need to be employed by DWP should be taken to mean employed by DWP within the DWP bargaining group. The DWP bargaining group means the administrative group that incorporates grades AA/band A (and equivalents) through to grade 6/band G (and equivalents) inclusive. Although part of the DWP bargaining group, separate arrangements will apply to staff who are not currently employed on DWP terms and conditions.