COMMERCIAL IN CONFIDENCE 0. Meet Fujitsu Progress Update © Copyright Fujitsu Services Limited 2010.

1COMMERCIAL IN CONFIDENCE

COMMERCIAL IN CONFIDENCE

‘Meet Fujitsu’Progress Update

© Copyright Fujitsu Services Limited 2010


ConsultationConsultation Initial meeting end of April

8 meetings to date, next scheduled 20th July

Extensive work undertaken by the Consultation Forum to develop Matrix 9 different sets of Terms & Conditions Now complete with ‘Measures’ and Representatives

plan to share this with you from this week

Topics covered include:- Terms, Conditions & benefits New locations – Blackpool & Sheffield Pensions & Flexible benefits Processes, Policies & Guidelines


CommunicationsCommunications 1-2-1’s

Complete for everyone who asked for a 1-2-1 (206 in total) Received positive feedback on the two-way dialogue Gathered massive amounts of useful information (individuals, roles,

teams) Questions captured: working through these

• General questions – replies being added to Microsite

• Individual questions/personal – emails will be sent direct to individuals

Microsite Continues to be updated with material and Q&A

information

Group mailbox Responding to queries regularly


TrainingTraining Skills Profiles/Checklists

Thank you for completing these

Being used to help us create bespoke training plans to meet your needs in line with the requirements of the service we are providing


PremisesPremises Blackpool contractor practical completion achieved on target on the 1st

July. Fujitsu specific fit-out started, the project is on target to deliver these premises for September 2010.

Blackpool move planning will commence in the near future, Fujitsu will be involving the consultation forum in the detail.

Fujitsu are currently in the advanced stages of finalising arrangements for premises in Sheffield. Feedback from the 1 to 1’s has been considered as an integral part of this process in terms of requirements for this location. As soon as commercials are complete the exact location will be communicated.

Norcross – knowledge transfer process has now been agreed with both HPES and the DWP. This process will confirm our technical requirements going forward which will inform the decision on whether testing remains at Norcross at Day 1 or moves to Blackpool.

London - Fujitsu are in dialogue with the DWP around use of the current space on site for the Adelphi and Caxton House. These are progressing well.


Re-planningRe-planning

The transition of DWP’s Desktop Services from Hewlett Packard Enterprise Services (HPES) to Fujitsu will complete later than the originally planned date of September 2010. We have made good progress to date and expect to complete Transition either late 2010 or early 2011.

The Department’s priority is to deliver the benefits of Fujitsu’s transformed Desktop Services solution (i.e. a predominantly “Thin Client” solution) with no disruption to service to its customers and staff. This requires some flexibility in the handover of the Desktop Service between the two suppliers (HPES and Fujitsu). The additional time is required to ensure the smooth and seamless transition from HPES to Fujitsu. All the organisations involved continue to work closely together to achieve this.


Your Choices For DWPYour Choices For DWP

Copyright 2009 Fujitsu Services Limited

Fujitsu’s Benefit OfferingTo

Transferees who currentlyhave Flex Funds

Fujitsu’s Benefit OfferingTo

Transferees who currentlyhave Flex Funds

We are in Consultation but this is an update on what has been discussed to date.

Final decisions have not been made


Your Choices Your Choices

Company Provided Benefits Flexible Benefits which is similar to My Choices Employee Discounts Other Schemes

There are a few employees who have special arrangements, this is a general update which cannot cover every situation. If you have a specific individual issue you may wish to stay after the session has ended so that you can ask it on a 1 2 1 basis


We understand that you have a contractual right to some benefits and buy others

Recently some rights have been delivered by way of a reduced benefit and cash or flex fund

Our policy is to offer the contractual benefit in full where possible

Annual election are in June/July for the year commencing 1 August

Benefit elections for joiners are completed electronically within a 3 week window from join date; benefits start from first of the month

Flex Funding and Benefit AdministrationFlex Funding and Benefit Administration


Fujitsu Provided BenefitsFujitsu Provided Benefits

4 x salary life assurance (via pension arrangement)

4 x salary accidental death (lesser payments on

disablement)

Subject to you joining the FJUK pension plan

Additional lump sum on death of 4 x salary if you leave a

spouse/dependant

Permanent Health Insurance (similar to LTA in HP)

Employee Assistance Plan (EAP)


It has proven difficult to get 100% clarity on the composition of the flex fund and the mechanism for its review

The three items that Fujitsu generally provide ‘free’ should be removed from the current flex fund Full contractual holiday entitlement Life Assurance PHI (Long Term Disability)

For private medical we give you an option continue current allowance or take entitlement at contractual level of cover and lose allowance

The remainder of the flex fund continues Paid as a fixed cash allowance Remaining funding includes, where relevant, Dental, LTA/PHI change

allowance

Flex Fund Move to Fujitsu - OverviewFlex Fund Move to Fujitsu - Overview


You will be given your contractual entitlement, which, from 2010, is a fixed number of days, and the funding in your Flex fund removed

Example: Currently an employees has entitlement to 25 days holiday (plus public holidays) plus Flex funding for three additional days. Going forward: The employee will be given full 28 days contractual entitlement The Flex fund will be reduced by the ‘cost’ of three days i.e. 3 x 1/260

x salary

If you are eligible for Your Choices you will be able to buy or sell up to 5 days each year. Currently you elect to buy/sell before the start of the calendar year With Fujitsu you make that decision in July of that holiday year, when

you should have a better idea of what you want to select. You then pay/receive cash for 12 month from August. So in July 2011 you will decide what holiday you wish to buy/sell for

2011

Holidays in DetailHolidays in Detail


You will be given life assurance at the level of 4 times your Reference Salary

The Flex fund will be reduced by the current My Choices cost to purchase this level of life assurance

There will be no opportunity to flex down the life assurance and take additional cash

In future years cover will continue to be paid by Fujitsu – so no dependence on a review of the allowance

Everyone eligible for Your Choices will be able to select additional life assurance

Life Assurance in DetailLife Assurance in Detail


Permanent Health Insurance (PHI) and Long Term Absence (LTA) are the same thing, just different names

Assuming that you join the FJUK Plan you will be given PHI cover at the level equal to 50% of Reference Salary after 52 weeks absence: Payable to age 65, or return to work (not just 5 years) Indexed to inflation, max 5% Additional 5% of salary paid to pension to cover employee contribution Fujitsu pays employer pension, based on ‘full’ salary, not cash received There is no reduction to allow for state benefits (ESA)

Company sick pay will be used to cover the period from 26 to 52 weeks where you would previously have had LTA

The Flex Fund will be reduced by the current My Choices cost to purchase contractual LTA

There will be no opportunity to flex down the cover and take additional cash

In future years cover will continue to be paid by Fujitsu – so no dependence on a review of the allowance

PHI in DetailPHI in Detail


Fujitsu’s arrangement has one level of cover which is similar to Scheme 3 (the top scheme) and has no excess

You will have a one time choice, two options: 1. Keep the allowance in Flex Fund:

Continue to have the right to select cover through Your Choices Purchase costs are age related

2. Have your Flex Fund reduced by the current My Choices cost of your contractual entitlement and Fujitsu will give you that level of membership as a Company paid benefit: Able to modify cover through Your Choices If you flex down no cash will be given, but reduced tax cost In future years cover will continue to be paid by Fujitsu – so no

dependence on a review of the allowance

Private Medical in DetailPrivate Medical in Detail


Dental BenefitDental Benefit Your funding remains in the flex fund You decide whether to purchase cover through Your Choices


A modified Flex Fund amount will be paid as a fixed Cash Allowance

For life assurance, PHI and holiday: Fund reduced Similar package of benefits given Fujitsu takes risk of increased cost

Medical One off choice, two options Keep the allowance or take company eligibility Continue to decide the level of benefit you want, via Your Choices Fujitsu takes risk of increased costs if company eligibility selected

Remainder of Flex Fund including dental etc will be paid monthly as a fixed Cash Allowance, along with salary

Summary of SolutionSummary of Solution


Health ScreeningHealth Screening A majority of employees have a right to a health screen once

every few years Fujitsu cannot easily replicate this benefit Employees can purchase a screening in three ways

Your Choices - Healthcare Cash Plan Your Choices - Health Screening BUPA Health Assessment

One time settlement of £30 pa for those eligible


Flexible Benefit Enrolment Flexible Benefit Enrolment

Enrolment Period

Three weeks from joining the Company, selection takes

effect from 1st of the month after you complete your

selection

Annual enrolment period is in June/July to take effect in

August

Holidays and Health Screening may only be selected

during the annual enrolment period in June/July for the

benefit year which starts 1st August each year

Managed via Salary Sacrifice which we call Salary Swap


Employee Discounts Employee Discounts

Available via Your Choices on Café VIK www.fujitsudiscounts.com for a wide range of discounts

and offers High Street Shops Supermarkets Holidays VIP events And many more

Additional offers available on Café VIK


Other SchemesOther Schemes

Available via links on Café VIK Cycle to work Scheme Payroll Giving Introduce a Friend Family & Friends PC Offers at www.fujitsufamilyandfriends.co.uk


Appendix


Flexible Benefits Flexible Benefits

Benefits on which you can save NI

Private Medical Cover for employee, spouse/partner and/or children,

if not Company provided

Healthcare Cash Plan (employee and children, employee & family)

Dental Cover (employee, spouse/partner and/or children)

Critical Illness (employee spouse/partner and/or partner)

Personal Accident Cover (employee, spouse/partner and/or children)

Spouse/Partner Life Assurance

Spouse/Partner Health Screening

Travel Insurance (employee, spouse/partner and/or children)


Flexible Benefits Flexible Benefits

Benefits on which you can save income Tax and NI Childcare Vouchers Holiday - Buying up to 5 days Employee Health Screening Additional Life Assurance

Benefits on which there is no saving in tax or NI Retail vouchers – up to 9% savings on the face value of vouchers

from a wide range of retail stores Holiday – Selling up to 5 days


Your ChoicesYour Choices

Copyright 2010 Fujitsu Services Limited

Fujitsu’s Pension Offering

Fujitsu’s Pension Offering


Fujitsu UK Pension PlanFujitsu UK Pension Plan

Joining Contributions Benefits Investment Transfer (from HP, or elsewhere) Timing


Why join? Why join?

Free money - Fujitsu will contribute to your pension account, helping you save for your retirement.

If you join the Plan you have added security for your family because, if you die as a contributing member, in addition to the lump sum of 4 x your salary, if you have an eligible dependant they will receive the benefit of an additional lump sum of 4 x salary.


How does it work?How does it work?

Defined Contribution : Money Purchase

Works like a bank account. Fujitsu’s contributions and your contributions are paid into

an individual account in your name and used to purchase investments.

At retirement the investments are sold so you have a “pot” of money to use for providing benefits

Fujitsu pays for the costs of running the Plan and the insured benefits

Tax relief is given at source, no need to recover anything via a tax return.


JoiningJoining

Prior to TUPE, you will be asked if you want to join. Provided you complete the form before TUPE, you

will enjoy full membership from day one. Failing this, you will have an annual opportunity to

join later with effect from August each year but contributions will not be backdated

Fidelity are the Plan administrators and will send you a PIN to access your online account


ContributionsContributions

Contributions, based on Reference Salary You must contribute at least 3%, through salary swap.

Fujitsu will pay 6% If you pay 4%, Fujitsu will pay 8% If you pay 5% or more, Fujitsu will pay 10%

Contributions are paid through “Salary Swap” They are fixed until the next benefits enrolment period Full tax relief plus NI saving


Salary Swap (also called Salary Sacrifice)Salary Swap (also called Salary Sacrifice)

What is it? An efficient way for you to pay your contribution Gives NI savings for you and Fujitsu

How it works Your full basic salary is called your Reference Salary Your gross salary (before Income Tax and NI contributions) is reduced

by the cost of the contribution Fujitsu then pay this cost on your behalf You pay less tax & NI contributions as they are based on this reduced

salary Benefits, pay review & overtime are based on pre-reduction “Reference

Salary”


Total invested v cost to youTotal invested v cost to you

Assumes basic rate taxpayer contributing 5% via salary swap during 2010/11 tax year. Total invested is £3000 and £4,500 respectively – over 4 times the net reduction in employee's pay.

690 1035

0500

10001500200025003000350040004500

Total invested

20000 30000

Salary

Employer contribution

NI Saving

Tax relief

Employee contribution


If you want to save more …If you want to save more …

There are two ways:

Fixed contributions: Can be changed each August Called Additional Swap Contributions (ASC) Not subject to tax or NI Can also be changed at a relevant Life Event

Variable contributions: Can be changed each month Called Additional Voluntary Contributions (AVC) Not subject to tax Are subject to NI


Retirement benefitsRetirement benefits

Value of your fund at retirement depends on level of contributions paid and investment performance of the investment options you choose

Currently up to 25% of fund can be taken as tax free cash sum

Remainder used to buy a pension, for the rest of your life, with an insurance company

You decide whether to buy a pension which; Increases in payment or stays level Includes a dependants pension on your death

Amount of pension depends on value of your fund, type of pension and rates in the insurance market


Death BenefitsDeath Benefits

Death In Service Benefits for a contributing member Current value of contributions made to your ‘account’ Lump Sum of 4 x basic salary If you leave a spouse or financial dependant, a second lump sum of

4 x salary is payable Bereavement grant £1,000

To avoid these benefits becoming part of your estate and potentially being subject to inheritance tax, the Trustee decides who receives the benefits. Please complete the form on the Your Choices selection site to let them know who you would like to receive the benefits. This can be updated at any time.


InvestmentInvestment

Central Range Funds Adventurous Fund (default) Balanced Fund Cautious Fund

Select a target retirement age (default 65) Over 10 years, as you approach target retirement age,

switches from Central Range Fund to Bonds (Over 15 year) and Cash

Alternatively you can Self-Select 3 Central Range Funds, plus; 16 other funds


Transferring Accrued Pension RightsTransferring Accrued Pension Rights

We are happy for you to transfer pension rights that you have accrued in other pension schemes

Transfers are managed by Fidelity (who administer the Plan)

We believe that it would be appropriate for you to take individual advice as to whether to transfer any previous pension rights.


Tools to help youTools to help you

FJUK pensions portal on Café VIK*;

Plan Booklet Full details of investment options Links to PlanViewer (administrators

website) where you can; View and manage your account online Use tools to project your expected pension and

model the effect of different contributions Find out more about investments and your attitude

to risk

* Available once you have joined Fujitsu Services


Questions?


Appendix


Salary Swap illustrationSalary Swap illustration Member on salary of £30,000 contributing 5%

5% salary reduction

Salary paid to employee

Employee NI contribution

Employee 5% contribution

Taxable salary

Employee NI saving

Salary deduction

N/A £30,000 £2,671 £1,500 £28,500 N/A

Salary Swap

£1,500 £28,500 £2,506 N/A £28,500 £165


Risk and reward in saving for retirement

Risk

Reward/Return

Deposits

Bonds

Equities

The value of your investmentcan fall as well as rise


Fujitsu UK Pension Plan – Default InvestmentFujitsu UK Pension Plan – Default Investment

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

10 9 8 7 6 5 4 3 2 1 0

Years to Retirement

Adventurous Bond Fund Cash Fund


Investment options Investment options

Fund Type Total Charges Adventurous UK and Overseas Equities 0.41% Balanced Range of Investments 0.46% Cautious Range of Investments

(lower risk) 0.41%

Fidelity Cash Maintain Capital 0.40% Fid/BGI Index Gilts > 5yr

Indexed Gilts over 5 years 0.2%

Fid/BGI Bonds Corp Bonds 0.25% Fid/BGI Indexed Gilts >15 years

Indexed Gilts over 15 years 0.2%

Fid/BGI Consensus Low cost average pension style

0.27%

Fid/BGI UK Equity UK Equity tracker 0.21% Fid SL UK Equity UK Equity active 0.8%


Investment options continuedInvestment options continued

Fund Type Total Charges Fid/BGI European Equity European Equities 0.35% Fid/BGI World Equity World (excluding UK)

Equities 0.27%

Fid/HSBC Amanah Islamic compliant 0.75% Fid/F&C Stewardship Ethical 0.76% Fid/BGI US Equity US Equities 0.35%

Fid Pacific Equity Pacific (ex Japan) equities 0.94% Fid Emerging Mkts Emerging markets 1.17%

Fid Japan Equities Japanese equities 0.89% Fid/SL Property Mainly commercial

property 0.75%

COMMERCIAL IN CONFIDENCE 0. Meet Fujitsu Progress Update © Copyright Fujitsu Services Limited 2010.

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