Almost 10,000 Lloyds staff to receive back pay over denied pay rises

Almost 10,000 current and former employees of Lloyds Banking Group – the vast majority of whom are women – are each to receive hundreds of pounds in back pay after the bank denied them pay rises.

The staff are to be handed the payments after a long-running dispute between the bank and the LTU union over contracts that staff were asked to sign after the rescue of HBOS in 2008.

The contracts did not specify the hours that staff would be required to work which, the LTU said, had an adverse impact on women, particularly those working part-time with caring responsibilities.

“These are not Libor-rigging investment bankers but women trying to do the best for their families. They deserved better from Lloyds Banking Group,” said Mark Brown, general secretary of the LTU.

Refusal to sign the contract meant that staff were denied annual pay increases in 2011 and received only partial ones in 2012, the LTU said. The payments are thought to average around £500 each. Among the 10,000 are around 2,000 employees who now work for TSB, the high street bank in which Lloyds still owns a 50% stake. Most of the staff work in branches.

Women make up 65% of Lloyds’ workforce and the proportion of women who did not sign was 78% while 55% of those who did not sign were part-time employees compared to 20% of full-time staff.

Lloyds is making the payment after a decision a year ago by an employment tribunal in a case brought by three female staff. “While the tribunal decision applied only to three colleagues, we have decided to review the pay of all current colleagues who did not originally sign our harmonised terms and conditions in 2010. Where this shows an individual would have been entitled to a pay increase in 2011 and 2012, we will make the appropriate adjustment to pay and pensionable pay,” a spokesman for Lloyds said.

Brown said that Lloyds knew the policy of asking staff to sign the contracts would have a disproportionate effect on part-time female employees.

“And despite knowing the impact of its policy on relatively low-paid women, the group went ahead anyway, hoping that its discriminatory actions wouldn’t be challenged. Well, they were challenged and the bank has now had to pay out millions in compensation to low-paid women the length and breadth of the country,” Brown said.

Members of other unions at Lloyds – including Accord which largely represents HBOS employees – agreed to terms with the bank two years ago.

The bank is in the process of cutting another 9,000 staff after axing 45,000 roles since the rescue of HBOS in 2008. The first tranche of those 9,000 cuts was announced last week when Lloyds told staff who sell insurance products that 1,250 jobs were to go.