Civil service unions are recommending that their members vote through a three-year pay deal that would see HM Revenue and Customs’ staff wages rise by 13% over the next three years.
Both PCS, the civil service’s biggest trade union, and ARC, the FDA union’s HMRC branch, have urged their members to vote through the deal, which was more than a year in the making, in ballots in the coming weeks.
If union members agree to it, some 60,000 staff will get three consecutive years of pay rises. Average pay across grades AA to G6 will go up by 3% this year, 5% in 2021-22 and 5% in 2022-23.
The increase comes alongside an overhaul of staff contracts that HMRC says will make working practices fairer by reducing discrepancies in pay, leave allocations and working patterns.
The package is intended to address what HMRC first perm sec Jim Harra has called a “crisis” of pay and working conditions. In October 2019, Harra told MPs staff were “very, very dissatisfied” with their pay and that there was “inherent unfairness” in working conditions, including some staff being paid more than others for the same job.
HMRC has been negotiating with the unions since July to reach the settlement.
In a statement, ARC’s committee said it had decided to recommend that members accept the deal “because we believe it delivers real benefits to members in the immediate and long term”.
It said it was “confident” that it had achieved its goal of maximising the pay bump staff will get while lessening proposed changes to terms and conditions, “especially in the current context of public sector pay restraint”. The deal comes as most civil servants face a pay freeze, as announced by the chancellor, Rishi Sunak, last year.
FDA national officer Jawad Raza said the announcement came after a year in which its HMRC members had done "incredible things" in response to the coronavirus pandemic.
“Thousands of staff will now be getting a pay rise significantly above inflation, which they well and truly deserve," he said.
And Lorna Merry, PCS revenue and customs group president, said it was a “positive deal” that “goes some way to addressing HMRC’s major low pay and progression issues”.
Pay increases will be weighted towards the lower end of the pay scale, meaning that administrative-assistant national pay is set to rise by around £3,400 over the three years covered by the deal, and those in London will see their pay packets rise by £5,300.
PCS said that during the negotiations, it had been “determined to address the major low-pay problem in HMRC”. Pay for the lowest-earning officials in the department – those at administrative assistant grade – was so low that the department had been forced to raise it slightly each year in line with national minimum wage increases.
The union said the weighting means the deal is “positive” from an equality perspective, as a disproportionate number of women, black and disabled staff work in the lower grades. This means HMRC’s gender pay gap will be halved in 2022 to 5.4%, it said.
The two unions – the only two that are recognised in collective bargaining on the deal with HMRC – have broadly welcomed the reform package put forward alongside the pay offer.
ARC praised the “family-friendly policies” being brought about by the reform, including enhanced paternity pay and a more consistent flexi-time entitlement.
Raza said the flexible working policy was a step towards addressing a "pervasive long hours culture" at HMRC.
The department has also taken a "progressive approach" to remote working, as the new contracts entitle all employees to work at least two days a week from home, Raza said. “As a result of the pandemic, our members have also expressed an overwhelming preference to continue working from home if it’s no longer the default," she added.
Merry at PCS noted that HMRC had agreed to consult with unions on future changes to working conditions.
“While we have agreed some changes to working practices, through our negotiations with HMRC, we have built in mitigations and safeguards for affected members. This is a positive deal and really shows the importance of being part of PCS,” she said.
HMRC has begun a communications campaign to inform its staff about the pay offer, including a series of live streams by senior officials to explain the deal and answer questions, which Harra kicked off yesterday.
Harra told CSW a “huge effort” was underway to “make sure that everyone is well informed about the offer so that they can make a well-informed decision”.
And he said the ballots, which open on 8 February and will run for three weeks, will be civil servants’ opportunity to be heard on the pay offer.
“I want everybody to have their say, but they can only have their say if they're in a trade union,” he said.
Speaking to CSW yesterday, the perm sec said: “One of the things I'll be saying on the live stream is: your views on this are very interesting but if you're not a trade union, they're ultimately academic because we have collective bargaining, and there will be a ballot.
“My priority is to make sure that colleagues are well informed by what this offer means to them, and that they see the benefits of it, and that they take part in that ballot and vote yes.”