Ref No. 578/02 Date: 17 December 2002

TO ALL BRANCHES WITH MEMBERS EMPLOYED BY BT PLC

Dear Colleague

BT Telecoms Industry Conference 2002 carried proposition 80 on this issue which instructed the TFSE as follows:

"That this Conference instructs the incoming Telecoms and Financial Services Executive to negotiate with BT a company wide long service award scheme that properly recognises the commitment and dedication shown by its employees"

The proposition reflected the great frustration which members felt at the difference in treatment of BT employees who had reached certain length of service milestones. Some Lines of Business operated an award scheme whereas others did nothing to recognise length of service. The issue was exacerbated because although BT, according to its Board of Directors, was one company, was in effect giving the appearance of operating as separate different, individual business units as far as the Long Service Award Scheme was concerned."

The Union's initial representations to BT were rejected by the company which confirmed that the corporate arrangements allow for individuals to receive a personal letter from the CEO at various length of service milestones and that this was the only form of company-wide recognition. Individual businesses were, however, able to operate their own arrangements in parallel.

Following further representations from the Union, and as a result of the very clear demonstration of employee opinion, particularly through 'BT Today', the company has now written to confirm that revised arrangements will be introduced across the BT Group with effect from 01 January 2003. Full details of the new arrangements are attached. In summary they are as follows:

People reaching their 25, 30, 35 and 40 year anniversaries with BT will continue to receive a personal letter from the CEO. In addition, with effect from 01 January 2003, people reaching their 30th anniversary with the company will receive a Recognition Shop voucher for £100, to be presented by their Line Manager, and they will be invited to attend a recognition event that will be attended by senior managers. There will either be a one-off, or a series of events to recognise people who have already reached their 30th anniversary.

Precise details of the events are still being finalised and BT will produce a comprehensive briefing shortly, a copy of which will be provided to the Union when it becomes available.

BT has indicated that whilst individual managers and heads of business units will no doubt continue to add their personal congratulations, it is intended that the arrangements outlined above will apply consistently throughout the BT Group.

This response from BT and the new arrangements to be introduced from 01 January 2003 satisfactorily meet the terms of the Conference proposition.

Yours sincerely,

W McClory
Assistant Secretary