Centrica boss: ‘firms need way to change terms and conditions’

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The boss of British Gas owner Centrica has told MPs he is ‘committed’ to reaching a settlement with the GMB Union in their dispute over plans to ‘fire and rehire’ engineers, but said organisations need to have some ability to change their terms and conditions.

Chris O’Shea told the Business, Energy and Industrial Strategy Committee that he would do everything he could to keep people in well-paid jobs, but there was a need to streamline the British Gas business to remain competitive.

“I would rather continue to do everything I can to protect these jobs than go through another round of redundancies,” he told MPs yesterday.

“If we continue on the path we’re on we will lose direct labour and [will need to] replace it with contractors because we’re not competitive.”

The company has asked around 20,000 engineers to work 40 hours per week instead of 37 in line with the rest of their colleagues, and start their working day in the customer’s home rather than their own home.

GMB Union members staged a five-day strike earlier this year and a four-day strike over the past weekend in a bid to get Centrica to back down over its plans to get workers to accept new terms and conditions, or lose their jobs.

O’Shea said around 83% of British Gas engineers had accepted the new terms, which would result in around 20% of them receiving a pay rise and a “significant” number seeing their holiday allowance increase.

Asked whether he knew how the threat of dismissal had affected employees, O’Shea said he was “not immune” to the pressures the dispute had placed on staff.

“Undoubtedly what I’m asking people to do is difficult… only yesterday my wife and teenage son had a package with excrement delivered to them with a note about fire and rehire,” he said.

“This is something that affects absolutely everybody – I’m not immune to this.

“I didn’t want to cut people’s pay, and I thought it was reasonable to ask people to work 40 hours per week.”

He suggested MPs needed to look at ways organisations would be able to easily implement changes to employees’ terms and conditions “under limited circumstances”, and consider changing when section 188 notices – which need to be issued to trade union representatives when a company wants to dismiss 20 or more staff within 90 days – need to be submitted.

Centrica sent the section 188 notices to all staff in July, before the negotiations with the union had begun.

GMB Union national secretary Justin Bowden told MPs that Centrica’s threat to “fire and rehire” employees who did not agree to the new terms and conditions before negotiations had taken place had “poisoned the well” from the beginning of the process.

O’Shea said British Gas planned to create 1,000 new apprenticeships by the end of next year, already having received 5,000 applications.

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