Recently a Senior Boots manager informed staff that a glut of pharmacists is lowering market pay rates. The PDAU warned pharmacists in November 2014 that Market Based Pay (MBP) plans were the thin end of wedge (click here for the article).
One year on, there have been more developments. The PDAU understands that the median rate has already dropped by 2.4% in a calendar year and Boots pharmacists have been awarded only a 1.5% increase for those who are less than 80% of the market median rate; a 1.0% increase for those in the 80 -105% bracket and the majority at or over 105% of median rate have received 0.5% or nothing at all. This is in contrast to other categories of staff receiving on average a minimum of 2.5% if performing. Furthermore, the PDAU has obtained information which shows that Boots are taking advantage of the pharmacist over-supply to lower pharmacists’ rates.
Background
This was following the release of a YouTube video, (link to transcript) which was immediately removed when it became viral; in the video a senior manager explained how Boots intended to approach pharmacists’ salary reviews from 2015 onwards. It explained that salaries would be researched across the market and a median rate established. Pharmacists were to have their current salary compared to the median market rate. Those who were above the rate would either get a small increase in salary or no increase at all.
“If ever there was a reason for Boots to fight the PDAU tooth and nail [against its application for recognition] to deprive pharmacist employees of the right to negotiation on their terms and conditions then the content of this video is evidence enough”, John Murphy said at the time,
The agreement that the Boots Pharmacists’ Association (BPA) has with the company, which specifically excludes the right to negotiate on pay, is at the root of the problem. Because of this agreement the company can, under the present law, refuse recognition of the PDA Union on the basis that as it has a voluntary agreement in place with another union. It does not have to accept the PDAU as the pharmacists’ choice and that is why the PDAU has gone to the Court of Appeal to ask the Judges to overturn the Judicial Review decision. With reference to the fact that Boots does not need to negotiate on the introduction of Market Based Pay, John Murphy said “the fox is now well and truly loose in the hen house”.
In the November 2014 press release, the PDAU statement commented that, based on common sense and years of experience, it would make the following predictions:
- Applying this approach is an opportunistic way of taking advantage of the current supply and demand imbalance in the labour market and will reduce salaries by stealth.
- This approach will be an incentive to other pharmacist employers to lower their salaries, thus creating downward pressure on the median rate year on year.
- It takes little or no account of experience, expertise, loyalty and the investment that the longer serving employees have made in their career with Boots, thus leading to a de-motivated workforce.
- It will create a narrow band of salary, which will give limited scope for advancement and growth, unless a lower base level is set.
Boots refused to comment and these views in some quarters were considered as scaremongering.
Latest Developments
Sadly, these PDAU predictions have already started to come true. The PDAU is aware of company communications which indicate that the pay increases are lower than for other staff in the business as a result of market forces. Market forces are now being considered due to the introduction of Market Based Pay and the PDAU believes that this is being used opportunistically and that financially the balance is currently in the company’s favour.
The Company announced the pay rise for Pharmacists in November will be 1%. This is below the rise for other roles because the market rate for pharmacists nationally is dropping as a result of there being an excess of pharmacists in the market place and locum rates are also dropping.
One communication states “nationally, the glut of pharmacists out there is driving salaries downwards”. This message effectively tells pharmacists that their salary differentials are being eroded in comparison to their store colleagues.
It begs the question as to whether it was always the company’s intention to reduce pharmacists’ salaries when it introduced the Market Based Pay concept as a vehicle.
The reaction to the implementation of Market Based Pay from pharmacists on the Boots Company ‘Pharmacy Unscripted’ staff forum not only reinforced this prediction, but also indicated that some other predictions are becoming reality.
- “The letter from Karl Crane and Peter Bainbridge about market based pay in Nov 2014 stated “if you look at the current salary scales for level 1 pharmacists, the midpoint is £43000 which would mean that 80% would be £34400 and 120% would be £51600 based on a 40 hour week.” The company have decided to lower the scales to reflect market forces and the oversupply of pharmacists. I asked what the new scales were. The midpoint is now £42000. This means that 80% is now £33600 and 120% is now £50400.This is a drop of 2.4%”
- “The Company has revised the Market again, and has decided that the going rate for pharmacists has dropped again since the last exercise. This means that the target pay is now even lower than was at the start of the summer. I can only assume that more people will be affected”.
- “I have just had my letter for the annual pay review, classing me as performing and thanking me for my hard work but stating my pay would remain the same.
- The transparency of market related pay has been a joke from start to finish. It appears that the top of the scale has been lowered but I am still under that and still would be if I had been given a 1% rise.”
- Seems that to my original question at the start of this thread “is experience, loyalty and hard work valued?” the answer is still no.
- I didn’t imagine when I joined this profession that the more experienced I was, the less I would be valued
- That is the MARKET in action and with all the surplus of pharmacists out there nationally the rate is going down! I just wish our HR department was more forthcoming and provide us all with the details of all the scales, ranges and actual rate of pay rise (or none)to expect as pharmacists
- The market in action? Logically if the ambition is to retain the best it is not going to happen. Seems like an Arsenal policy where company unwilling to pay the top wages and the results are self-evident. In my previous area many talented pharmacists either left, went part time or moved away from that area as the pay for work expected of you, simply not worth it. I believe this is happening throughout the company. Going cheap might be beneficial in the short term but in the long term it will lead to failure of business objectives.
- So why should someone who has worked for the Company for many years (possibly at a time when bonus payments went onto your base pay too) and always performed well, now be penalised because of their length of service and previous reward! I personally feel it is fundamentally unfair
- Oversupply argument is the biggest load of b******s in history. There are tons of bankers but their wages and bonuses don’t go down. In the end you get what you pay for and quality is definitely decreasing day by day.
- I’m all for growing the business [in providing new services], but are the Boots Pharmacy Association consulted when new services come along, and do they ever make a point that pharmacists are increasingly learning new skills and taking on more responsibility without remuneration?
Because of the agreement that exists between Boots and the BPA, no pharmacist or pharmacist representative body has the right to negotiate with Boots on pay, terms and conditions. This leaves pharmacists at the mercy of their employer and who knows what will happen next?
We therefore urge Boots pharmacists to join the PDAU; unfortunately, it is only a matter of time before the terms and conditions of pharmacists are eroded further. Pharmacists should be concerned about this. The BPA has been powerless to do anything about this development and the Pharmacist Partnership Panel (PPP) has been equally powerless.
The PDAU anticipates the company will react to this communication by embracing the BPA and the PPP in trying to convince pharmacist employees that they are being properly listened to.
The reality is that neither the BPA nor the PPP have any ability to negotiate on pay, terms and conditions and whatever the outcome of discussions, the company’s decision will always prevail.
The only credible alternative is the PDA Union and if we succeed in our Appeal at the High Court we will be in a position to seek your approval to represent you. If we fail in our legal action, there are other mechanisms for gaining PDAU recognition which could have significant implications for the BPA.
We have a duty to act in the best interests of our members and all options will be explored; however, we believe it would be advantageous for the BPA and the PDAU to work together in the future.
There is strength in numbers and we urge you to join the PDAU
Pharmacists, who are unhappy with their salary under Market Based Pay and wish to challenge this, should contact the PDA Union for further advice.