Making the difference to your business

Employee Consultation Forum

Meeting 24th July 2012

Proposal

Move pay date for all existing employees currently paid on 15th month to 28th (Or last working day prior to 28th where the 28th falls on a weekend)

Business Benefits

Significant positive impact on DUK Cash Flow DUK is financially strong (Plimsoll report) Business is trading profitably and cash generative but… We have intra month pressures that impact supplier payments Big message from employee survey was need to address supplier

payment concerns In-line with majority of UK Payrolls Return to one payroll as opposed to current two (all new

starters since Sept 2011 and Executive Leadership Team are paid at end of month)

Reduces exposure to overpayments for leavers Increased time for internal payroll checking – linked to month

end results

Employee Impact

Basic Salary plus any fixed payments (e.g. shift/ allowances) Currently paid monthly, half in advance and half in arrears Move to monthly in arrears In the transition month employees will be paid 2 weeks later than

usual

Commission/Bonus payment Currently paid 1 month in arrears Orders not verified currently go into following months payment Date change will allow all payments to be included

Overtime & Other variable Allowances Currently paid 1 month in arrears, approx. 22nd - 22nd each month This reference period will move back by 2 weeks

Employee Support

2 months advance notice to manage financial commitments

Advice and guidance through Q&A documents to all affected employee e.g. payments such as mortgages, bills, loans

121’s with nominated Manager/HR as required to answer questions and discuss any individual concerns/requests

Mid month interim loan available to employees on request and repayable over agreed term:

e.g. a loan equivalent to 25% of monthly net (after tax and NI) base salary, paid back over 6 months

Loan Example

Base salary of £24,000. Loan equivalent to (£24,000/12 months) = £2,000 @ 25% = £500 (minus approximate tax and NI deductions).

Paid back from November 2012 for 6 months – Last payment April 2013

Employee Support (cont.)

Time and support during working hours to make any necessary personal arrangements

Communications running up to the pay date change

If the transition is agreed by end August, October payment will include 6 weeks of overtime for relevant employees

If majority of affected employees requested December payroll date can be paid prior to Christmas, 5

working days prior to 25th December

Transition Proposal/Timescales

The sooner in place, cash benefits available to Company

2 month notice in advance of the date changing

Consultation with affected employees over next 2 weeks

Further ECF meeting on 7th August to review feedback

Guidance and 1-2-1 meetings during following 4 weeks

Proposed transition in the month of October 2012

Transition Proposal/Timescales

How it works

September payroll paid on 15th September

Employee loan paid on 15th October (for employees who require it)

October payroll paid on 26th October (last working day before 28th)

November payroll paid on 28th November

December payroll paid on 18th December (5 working days prior to 25th).

January 2013 onwards payroll paid on 28th month or last working day before 28th if it falls on weekend (with exception of December to be agreed)

Q & A