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10 September 2009

Pay deals constant at 2.0%

The three-month median (mid-point) pay increase was 2.0% in the period from June to August according to Labour Research Department's (LRD) Payline database. Once account has been taken of late settlements, it is clear that the three monthly figure has not changed since April. The figure is based on 74 agreements, with fewer negotiated pay deals being done over the summer period.

It should be noted that this is one percentage point higher than the median figure released by pay analysts Incomes Data Services (IDS), which put the mid-point at just 1%, and this difference may reflect weaker pay bargaining in non-unionised organisations, which are less well-represented on Payline.

Long-term deals in LRD's figures continue to hold up the median increase, with few employers reneging on their agreements. However, new deals recorded on Payline showed a median of 1.5% (from 46 deals).

Among the pay settlements recorded in this three-month period, there were 16 pay freezes (22%), 14 of which came in new agreements (equivalent to 30% of new deals). The figures suggest no change in the imposition of freezes, with the much-vaunted 'green shoots' of economic recovery as yet giving no indication of breaking through into pay settlements. However, although pay deal activity is low in summer, for the first month this year there were no freezes recorded on Payline in August.

"As in previous months this year, the three-month figures to August show that pay is generally continuing to hold up despite inflation figures and despite the recession," LRD's pay and conditions researcher, Lewis Emery, said. "When the trend is downwards, long-term pay deals are still showing that they can deliver a good result both in the public and private sectors, and the consistent increases they provide are helping to give stability to the economy and to financial expectations for both employers and employees."

The figures are published in the September issue of Workplace Report. The October issue of Workplace Report will carry a full analysis of the year's pay round of negotiated deals, including pay freezes.

Table of three-monthly pay medians, showing all deals and new deals only. Figures from December 2008 to August 2009.

Pay settlements
(LRD Payline)
Three-monthly medians
(All Deals)
Three Monthly Medians
(New Deals)
October-December 3.8% 3.6%
November-January 3.2% 2.7%
December-February 3.0% 2.5%
January-March 3.0% 2.0%
February-April 2.0% 1.5%
March-May 2.0%1.5%
April-June 2.0%1.5%
May-July 2.0%1.7%
June-August 2.0%1.5%
* Figures for earlier months are revised as new agreements are reached.

Table of monthly pay medians, showing all deals and new deals only.
Figures from December 2008 to July 2009.

Pay settlements
(LRD Payline)
Monthly medians
(All Deals)
Monthly Medians
(New Deals)
December 08 4.0% 4.0%
January 09 3.0% 2.35%
February 09 2.5% 2.0%
March 09 2.25% 2.0%
April 09 2.0% 1.2%
May 09 2.1% 2.0%
June 09 2.5% 2.5%
July 09 1.95% 1.4%
* Figures for earlier months are revised as new agreements are reached.
Notes for Editors

  • Payline is LRD's database of negotiated agreements reported to LRD by unions. It includes around 2,300 agreements with information on pay, terms and conditions and other aspects of the employment contract.
  • Community, FBU, GMB, PCS, RMT, TSSA, UCU, UNISON and UNITE union members have access to this database as do BFAWU and NUJ officials and the TUC. For more information contact pay@lrd.org.uk
  • Pay settlements are negotiated rises on basic pay, and exclude bonus, increment, overtime and other allowances.
  • Labour Research Department is an independent organisation founded in 1912 to produce research on behalf of trade unions and the labour movement. More than 1,800 trade union organisations, including 55 national unions, are affiliated to it, representing more than 99% of TUC membership.


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