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"Harbour Litigation Funding is financing a case fronted by former Ofcom official Justin Le Patourel that alleges the telecoms group abused a dominant market position to charge “excessive” prices for landline customers, many of them elderly. BT is contesting the allegations."
I think the law needs to take a serious look at Justin Le Patourel. His actions are akin to insider dealing IMO. he is using his knowledge gained at ofcom to pursue a case for personal gain. This stinks.
Roll on Friday
Thanks Aus3009 for the explanation.
Thanks Fleccy for your explanation too - and regarding the extra 20K being added to the 50K salary then income tax of earning of 70K was what I thought would be annual salary income for someone in that position - which would mean they would be a higher rate tax payer for that tax year if I am not wrong as they past the threshold from Basic rate to Higher rate.
If this is the case how it works - wonder how many people considered this or were unaware of the tax implications of leaving with a package between Jan-March time (if BT offered packages for them to leave during that quarter) as they would have earned close to a years salary with an addition of whatever the is excess of the 30K lump sum and 18K in pension pot which I think Joe said was C3 but anyone on higher would fall straight into HR tax band).
Interesting stuff when corporations offer leaver or voluntary packages to employees knowing well they could end up with lesser amount than they receive if they’ve not got an exit plan or financially savvy.
@Joe: Seems like BT offered the option of 3 hours drive to work - knowingly someone in the right mind would not take that job for the same money or unless it involved long driving as they had done in the past.
Much appreciated for the response.
"In Q1 2017 the total number of voice only lines were 1.5 million. (Approx 1 million on BT) see Fig 1.5 in the linked document."
Should read Fig 1.4, not 1.5
More reading in relation to this:
https://www.ofcom.org.uk/__data/assets/pdf_file/0014/107321/standalone-landline-evidence.pdf
"Customers who purchase SFV services can be divided into two distinct customer groups:
• Voice-only customers: these customers purchase an SFV service but do not take fixed
broadband from any supplier; and
• Split-purchase customers; these customers purchase an SFV service and a standalone
fixed broadband service, i.e. they purchase these services separately and therefore do
not derive any benefit from purchasing these services in tandem.
1.8 Split-purchase customers can be further divided into two sub-groups:
• Split-supply customers: these customers purchase an SFV service and a standalone
fixed broadband service from two separate suppliers; and
• Split-service customers: these customers purchase an SFV service and a standalone
fixed broadband service from the same supplier; i.e. they do not bundle these services"
"In Q1 2017 the total number of voice only lines were 1.5 million." (Approx 1 million on BT) see Fig 1.5 in the linked document.
"However, the number of customers who purchase a standalone fixed broadband service also includes customers on the Virgin Media network (who do not need to pay a line rental to receive a standalone fixed broadband service). Virgin Media advised that at the time of asking [] of their customers purchased standalone broadband. We estimate that this means that [] Virgin Media customers purchase a standalone fixed broadband service, and have no SFV service from any provider as at Q1 2017 given our estimate that [] BT SFV customers are Virgin Media standalone broadband customers."
I think there's a lot to unravel here, but as I said in a previous post I don't understand where these figures of over £1 Billion compensation come from. If BT lose I would think the majority of the claimants will be in the Standalone Fixed Voice category, and anyone who has taken broadband out with Virgin Media should also be categorised as SFV and only covered between 2015 and 2018, since BT would have no idea these people were getting broadband from VM. I think there are a lot of things to unwind in this case, but I can't see this costing BT anywhere near £1 Billion if they lose the case.
https://assets.publishing.service.gov.uk/media/5a82a4eaed915d74e6236e6f/ofcom-review-of-the-market-for-standalone-landline-services.pdf
"You are excluded if you are a:
- BT customer who took a landline service aimed at business users;
- BT Basic or BT Home Phone Saver customer;
- individual living in the Hull area as this area is supplied by KCOM Group Ltd and not BT;
- individual who did not purchase any landline services from BT before 8 December 2023.
In addition, if you purchased landline services from BT after 1 October 2015 but stopped
doing so before 8 December 2023, any purchases of landline services from BT that you
resume making after 8 December 2023 are not included within this"
More information relating to the claim:
https://www.callclaim.co.uk/media/cd3phtat/2023-12-13-revised-opt-out-notice-with-links.pdf
"Landline-Only:
Any time between Oct 2015 - Apr 2018 (Oct 2015 – today for certain business customers)
Unbundled:
Any time between Oct 2015 – today (save that individuals who did not purchase any landline services from BT before 8 December 2023 are not included in the claim. Further, for individuals who purchased landline services from BT after 1 October 2015 but stopped doing so before 8 December 2023, any further purchases of landline services made in the period after 8 December 2023 are not included in the collective claim)."
If I'm understanding it correctly:
Granny and other residential users who purchased a landline, but didn't want or need broadband might have a claim between Oct 2015 - Apr 2018, but certain business customers may have a claim up to Dec 2023. BT Basic or BT Home Phone Saver customers are excluded by the look of it.
The slightly confusing bit is the Unbundled section covering potential claims between 2015 to 2023, but I can't imagine there'd be many of those. I suppose it's possible that a small business might have had more lines, but you'd expect that would be on a different type of business contract with relevant discounted pricing; A business with 5 lines on the same number are going to on a different type of contract than landline only customers. My wife used to work in an Opticians and the Broadband was bundled with the landline, so that wont be covered in this claim and I suspect most other small businesses would also bundle broadband with the landline. I would think the unbundled landlines would be few and far between, but I'm only guessing. I don't understand where these figures stating over £1 Billion come from.
Whoops - theres more , this is page 2 of 2
BT said the claim related to a “technical” landline pricing issue that was “resolved by Ofcom in 2017”.
“We do not accept that our pricing was anti-competitive back then, and as such are committed to robustly defending our position at trial,” the company said in a statement.
Harbour said it had “committed an eight-figure amount to cover the costs associated with bringing the claim”. Only in the event of a successful claim would it “receive a multiple of that investment as approved by the court”.
Ellora MacPherson, chief investment officer at Harbour, said the case was a “reminder of the important role that litigation funders can play in ensuring consumer claims can be pursued to conclusion”.
The case is being heard by Mr Justice Waksman of the High Court, alongside economist Derek Ridyard and competition law specialist Eamonn Doran.
BT class action case to test new ground in English courts
The first trial in the English courts stemming from a wave of class action antitrust lawsuits starts on Monday, as telecoms operator BT faces a £1.3bn claim that it overcharged about 3mn landline customers.
Harbour Litigation Funding is financing a case fronted by former Ofcom official Justin Le Patourel that alleges the telecoms group abused a dominant market position to charge “excessive” prices for landline customers, many of them elderly. BT is contesting the allegations.
The case is being closely watched, as it is the first of its kind to reach trial since the Consumer Rights Act in 2015 allowed collective legal actions to be brought over alleged breaches of competition law.
It also comes as the financing of such cases is in the spotlight, particularly after a Supreme Court ruling last summer made it more difficult for litigation funders to be paid by taking a cut of any damages awarded.
“It will be instructive to see how any damages awarded are distributed to the class members — and how much ends up in the pockets of the lawyers and funders,” said Anna Morfey, antitrust partner at law firm Ashurst.
Momentum behind such lawsuits only took off after a Supreme Court ruling in late 2020 that allowed a class action claim against Mastercard to go ahead, paving the way for other cases.
Claims have been filed against other large companies including Apple and Sony, although several have been subject to hold ups and disputes over process. A trial date for the Mastercard case has not yet been set.
The BT case is to be heard over eight weeks in London’s Competition Appeal Tribunal. It is being brought on an “opt out” basis, under which potentially affected individuals are automatically included unless they choose not to be.
The legal claim follows a review by communications regulator Ofcom in 2017 that provisionally concluded BT held “significant market power” — a dominant position — in the standalone landline market and proposed price controls.
In response, BT voluntarily committed to cut landline prices by £7 per month from April 2018.
However, the claimants argue the price cut failed to compensate customers for previous overcharging, and also that so-called “split purchase” customers — those who separately purchased landline and broadband services — received no compensation.
Sarah Houghton, partner at Mishcon de Reya who is acting on behalf of the claimants, said BT “systemically overcharged” customers by “very substantial amounts”.
BT said the claim related to a “technical” landline pricing issue that was
Class action starts tomorrow.
"BT class action case to test new ground in English courts
The first trial in the English courts stemming from a wave of class action antitrust lawsuits starts on Monday, as telecoms operator BT faces a £1.3bn claim"
https://www.ft.com/content/05625f30-667a-4c02-aa4d-6e2646720164
I can't read the FT article as it's behind a paywall, but £1.3 Billion is twice the initial aggregate estimate in the summary at the start of the case:
"Aggregate damages have been given a preliminary estimate of £589 million (on the basis of 8% simple interest, comprised of £238 million for BT Voice Only Customers and £351 million for BT Split Purchase Customers"
https://www.catribunal.org.uk/sites/cat/files/2021-01/1381_Patourel_summary_260121.pdf
Can someone who subscribes to the FT clear this anomaly up?
Utter Codswallop... Demand for data services is absolutely soaring... FTTP rollout is going very well, with greater efficiency over copper and many more opportunities for upselling digital services add ons, it's a no brainer when it comes to ROI. The EE 5G rollout is also going well. It's v.easy to lay into BT and criticise but... it's getting the high priority stuff done at the minute and so long as that continues the revenues will pour in to pay off debts. This stock is way undervalued and that'll correct very nicely over these next 18months ahead esp. as Labour enter No.10 to tee up a workable growth strategy. BT is a crucial business that'll contribute to tangible CO2 savings too. Get in now whilst the SP is at these levels and the only thing you'll regret is not having bought more!
Allison Kirkby has been a non-executive director of BT for five years
LBL/SHUTTERSTOCK/REX
When Allison Kirkby formally takes charge of BT on Thursday, it will coincide with third-quarter results from Britain’s biggest telecoms company. With only a brief trading update expected and no call with City analysts scheduled, she is likely to be afforded five months before setting out her strategy at the group’s annual results presentation in May. In the meantime, though, the stakes are high. And rising.
Shares in the former state monopoly have fallen by more than 7 per cent over the past month, back towards the bottom of a range of 100p to 200p and weighed down by talk of a possible “rebase” and doubts over the group’s prospects. Meanwhile, hedge funds have begun to circle. The level of publicly disclosed “short” positions in
Post full the times article if possible please
Https://www.thetimes.co.uk/article/allison-kirkby-has-big-calls-to-make-at-bt-22kqhlbfg
Compulsory redundancy is only relevant if the work you had has dried up. They then would have to say there is no other role, for it to be compulsory. If there are roles, it would later be constructive dismissal.
If they want you to work in a location or office for efficiency reasons they can do, but they can’t make you redundant unless you refuse that job on offer. Hence voluntary redundancy is a negotiated settlement above statutory to avoid tribunal cases, which could and would result in higher compensation pay outs in some cases as processes in large companies are rarely managed properly and solicitors find the flaws or collective mismanagement.
You are correct NDN , BT still does use wealthatwork. Who you are obliged to consult with , if you take any leavers package.
And believe me over the last few years alone , a lot of people have left BT through voluntary redundancy. If your dept/work group is offered vol redundancy and you decline the offer , they will then be told that they could be in "scope" for compulsory redundancy , which is paid at the legal minimum payout , which is capped at £19,000.
This has the effect forcing all the long termers (served over 12 years/on new grid contracts) to take vol redundancy , as this payout is capped at 1 years wages.
BT used to work with, WealthatWork to provide advice to all over 50s every 2-3 years with the offer of a 1 hour personal consultation free of charge to go over your personal situation. I can only assume that this is still in place, even if with another provider. This gives all staff members the latest information on what can be achieved. This company also worked, works, with other national companies including the likes of M&S, Boots to name but two. BT has always assisted its staff in the matters of voluntary redundancy and pension options and clearly still does. Good on them.
We were given the option of moving with the work which was 3 hours drive away or taking the redundancy package. We were given financial advice and told the maximum you can take as tax free cash was £30k. If I wanted to take the lot as cash the £18k would have been taxed at 40%.
Thanks for the heads up but it's 25% per pension I believe.
IP my understanding is if you earned say £50,0000 up to "March", and then received your redundancy payout of say £50,000 in March, £30,000 of your redundancy payout is tax free as long as it isn't part of your earnings, like notice period, holiday pay, etc. The extra £20,000 redundancy payout will be added to your income for the year, so you'll be taxed as if you earned £70,000 for the tax year in this example. I'm not a tax expert so I'll happily be corrected if I'm wrong.
Hi IP, government allows first £30,000 of a redundancy payment to be tax free.
After that some companies will spread further payments across the following tax year, so for instance if there are no earnings another £12,500 could be tax free.
Other options if companies are willing is to use pension tax free allowance. This is usually £40,000. This can be back dated over three years, so if you have only unused £30,000 of that allowance over last 3 years, a company could put up to £30,000 of pension payment into pension pot as a tax free lump sum. I believe this is what Joe has done with £18000 of his redundancy (30,000 tax free refundancy, 18,000 tax free lump sum in pension pot)
Is the amount of a redundancy package all exempt from Tax (ie. the 30K and the 18K?) even if you earned throughout the year? Eg. If you were made redundant and made to leave in March (so you effectively earned a salary before the end of a tax year until time of departure ie: March) would the redundancy package amount received be part of the salary earned in the tax year?
Hope that makes sense.
Just trying to understand redundancy’s and taxes esp. how BT plan their pay-offs or cutting of heads, or if it is all just coincidental when the firm’s staff are made to lose their jobs/made redundant as losing that many people over the next decade can/will be detrimental to the staff and firm no doubt.
I disagree, it's great for topping up.
The share price lately is terrible on this stock zero growth.