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Co-operative Group 2011 Pay Review

the Co-operative Group

Management Agreement

2011 Review


An Overview of Negotiations
Colleagues will be aware that following a series of negotiation meetings with the Group in relation to the 2011 review of the management agreement, NACO was unable to reach a satisfactory conclusion to the talks.

Negotiations earlier this year resulted in the Group increasing their initial offer of 2.0% to 2.25%, with a final offer of 2.5% then presented to NACO in early summer. This figure fell short of the claim that had been presented by NACO and as a consequence we sought the views of the membership. The feedback was clear in that the offer was not acceptable and this was shared with the Group.

Despite this, the Executive maintained that the offer was correct due to the following factors:

  • the total reward package enjoyed by the management population, including bonus, variable pay and other benefits, should be factored in
  • the performance of Group, and in particular Food, in extremely challenging trading conditions
  • the offer was prudent and reasonable and compared favourably to retail competitors

NACO has continued to talk with the Group on this issue in an attempt to reinstate meaningful and constructive negotiations on the 2011 review. NACO considers the manner in which the Group Executive announced that it was to unilaterally implement the offer of 2.5% as unreasonable and at odds with the manner in which previous negotiations have been undertaken.

A Considered Response
The position has been reviewed by the Co-operative Group Council and the NACO Executive over the last few days to consider our position. As part of the debate the views of the membership that were received following the survey in the late summer featured as a major element.

The feedback that we have considered and the data utilised by the Co-operative Group Council and the NACO Executive included the following:

  • members recognised the economic slump that is currently being experienced by the country and the impact that this has had on pay negotiations with many pay freezes implemented this year
  • base pay increases received by managers in the retail sector have, in the main,  been below the offer of 2.5% ( Asda 2.0%, Morrisons 2.3%, Sainsburys 2.3%, Tesco 2.5% and Waitrose 2.0%)
  • the Group has not been immune to the economic downturn with performance significantly below that experienced in the previous year and the difficult trading conditions continue
  • Project Unity will result in fundamental changes to the business and members feel that job security is paramount and this should be the focus of attention at this time
  • Only a very small minority of the membership felt NACO should take further action in relation to the pay review, whilst the vast majority felt that the award should be accepted and NACO should move forward  

As a consequence, NACO’s position is as follows:

  • we remain dissatisfied and aggrieved at the manner in which the Group Executive has undertaken negotiations in 2011 and urge them to return to negotiations in 2012 with a commitment to reach a negotiated settlement
  • we recognise that the Group Executive strongly believes that the total reward package should be considered when reviewing base pay, in particular the bonus element
  • should bonus payments in 2012 not be at levels enjoyed by the NACO population in recent years we will seek to influence a re-evaluation of the other elements of the total reward package accordingly
  • that the differential in reward between the Co-operative Banking Group and the Trading Group that occurred this year should not be repeated in 2012, in line with the principles of Project Unity
  • we strongly advocate that the Group Executive takes heed of the feedback that has been shared during the talks in 2011 in particular the reaction to the disparity between the management pay review and the Executive pay review

Accordingly, NACO reluctantly agrees to the offer of 2.5% to conclude what has been a very disappointing and unsatisfactory set of negotiations for the 2011 review. Details of the variable pay matrix used in this year’s review process can be found on the NACO website at

NACO will ensure that the membership is strongly represented in the 2012 review and we will be seeking input from the membership on those negotiations in due course.

Moving Forward
NACO will now concentrate its efforts in supporting members through the difficult times ahead both in relation to Project Unity changes and any impact of the challenging trading conditions encountered by Group.

The NACO Executive and the Co-operative Group Council remain committed to protecting terms and conditions of employment and the job security of the NACO population in the Group.

This has led to negotiations in relation to enhanced redundancy terms achieving significant increases to the contractual entitlements for any job losses that may occur in relation to Project Unity and/or ‘business as usual’ restructures. Details can be found on the NACO website at