CONFIDENTIAL
Version History
SCHEDULE A2
RELATIONSHIP AND GOVERNANCE
Version No. Date Comments
1.0 31/08/06 Agreed version as at date of signature of CCN 1200
2.0 24/01/07 Baseline copy of 1.2
3.0 30/01/09 Baseline copy of 2.2
6.0 15/06/09 Moving all schedules to V6.0 as agreed with Fujitsu
6.1 23/12/09 Applying changes as per CCN 1268
6.2 30/03/10 Applying changes as per CCN1271c
7.0 10/05/10 Moving all schedules to V7.0 as agreed with Fujitsu.
8.0 21/02/12 Moving all schedules to V8.0 in accordance with
CCN1294d
9.0 13/01/14 Applying changes as per CCN1400
10.0 10/09/15 Moving all Schedules to v10.0 in accordance with
CCN1506
11.0 31/03/16 Applying changes as per CCN 1423c, CCN 1500a, CCN
1600 and moving all schedules in accordance with
CCN1604
12.0 03/07/2017 Applying changes as per CCN 1607 and moving all
schedules to V12
13.0 Moving all Schedules to V13
14.0 20/12/2021 Updating as per CCN1623b, CCN1649, CCN1678,
CCN1700 and moving all Schedules to V14.0
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2.2
SCHEDULE A2
RELATIONSHIP AND GOVERNANCE
OBJECTIVES
The Parties intend that the relationship and governance arrangements under this
Schedule A2 will help achieve the aim of ensuring an effective working relationship
between the Parties and the overall success of the Agreement.
The relationship and governance arrangements under this Schedule A2 will be used,
inter alia, to monitor, and assist with the aim of achieving, the Joint Objectives set out
in Recitals E(d) to (g) (inclusive) of this Agreement.
THE RELATIONSHIP
Decisions shall be taken through the following mechanisms (each a “Relationship”):
2.1.1. Systems Integration Partnership and Executive Relationship;
2.1.2 Service Management Relationship;
2.1.3 Commercial Relationship;
2.1.4 the Demand Planning Board; and
2.1.5 I Programme/Release Relationship,
by the Post Office Subject Lead and the Fujitsu Services Subject Lead for each
relevant Relationship.
Annex 1 to this Schedule A2 sets out in relation to each Relationship:
2.2.1 the Post Office Subject Leads of that Relationship and any other Post Office
appointed members;
2.2.2 the Fujitsu Services Subject Leads of that Relationship and any other Fujitsu
Services appointed members;
2.2.3. the responsibilities of that Relationship;
2.2.4 the frequency with which that Relationship will meet, unless agreed otherwise
by the Parties; and
2.2.5 certain other general information relevant to that Relationship.
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3.1
3.2
3.3
3.4
3.5
3.6
3.7
3.8
3.9
3.10
GENERAL PROVISIONS
Save to the extent that a matter is one of the “Reserved Matters” described in
paragraph 5 of this Schedule A2, Decisions agreed between the Subject Leads of each
Party (or their fully empowered deputies) for the appropriate Relationship will be
effective and binding on the Parties (whether or not such Decision is made at a
scheduled meeting of a Relationship), provided in each case such Decisions are within
the scope of the relevant Relationship's responsibilities as described in Annex 1 to this
Schedule A2 and such Decision is recorded in accordance with paragraph 3.5.
Each Relationship shall be conducted through “meetings”, comprising, for the purposes
of this Schedule A2, telephone conferences, teleconferences or other means of
discussion as the Parties consider appropriate from time to time.
The Subject Leads for each Relationship will agree what (if any) regular or occasional
meetings they wish to hold (and their frequency), where otherwise not stated in Annex 1
to this Schedule A2, in order to discharge the responsibilities and purpose of the
relevant Relationship.
Members of a Relationship may, with the consent of the other Party's Subject Lead for
that Relationship (such consent not to be unreasonably withheld or delayed), invite
other persons to attend meetings of that Relationship.
For any Decision of a Relationship to be effective and binding on the Parties, it must be
in writing and signed by the Subject Leads (or their fully empowered deputies) of that
Relationship.
At least once in every calendar year, the members of each Relationship shall discuss
and review whether the frequency with which their Relationship meetings are held
should be altered.
The Parties agree that day-to-day operational issues arising under or in connection with
this Agreement will be managed through delegated authority, including through
operational review forums, project boards and problem management working groups
that are established from time to time by the Parties, with a view to resolving them in a
timely manner.
Any operational issues which cannot be resolved in a timely manner in accordance with
paragraph 3.7 shall be considered by the relevant Subject Leads at the first available
opportunity.
The Parties agree to use their reasonable endeavours to make Decisions through
timely and effective communication through the appropriate Relationship and not to
unreasonably delay Decisions.
The Subject Leads of each Relationship will agree measurement criteria from time to
time for determining the effectiveness of the relationship between the Parties in
meeting the Joint Objectives set out in Recitals E(d) to (g) (inclusive).
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4.2
5.1
5.2
5.3
In addition to the Subject Leads for each Relationship, each of the Operations Director
for Post Office and the Commercial Division Director for Fujitsu Services shall
supervise the Agreement and shall hold such meetings as they jointly consider
necessary to monitor the strategic direction of the relationship between the Parties
under this Agreement.
Nothing in this Schedule A2 shall restrict either Party from exercising any right
conferred upon it under this Agreement and notwithstanding anything to the contrary in
this Schedule A2, no decision to exercise or waive any such right shall require the
concurrence of the other Party.
PROGRAMMEIRELEASE RELATIONSHIP
The Programme/Release Relationship shall:
4.1.1 provide a governance structure for each programme and/or Release under this
Agreement through the following boards:
4.
1.1 the 'Programme/Release Board(s)';
4.1.1.2 the ‘Acceptance Board(s)’;
4.1.1.3 the ‘Acceptance Dispute Board(s)’; and
4.1.1.4 the ‘Joint Release Authorisation Board(s)’..
4.1.2 through each relevant board, consider, inter alia, future work or changes
generated by ongoing and planned feasibility studies and other areas of
potential work generated through the SIP.
Annex 1 to this Schedule A2 sets out the Subject Leads, other members,
responsibilities and frequency of meetings of each of the boards within the
Programme/Release Relationship.
RESERVED MATTERS
New, increased, reduced or modified obligations or responsibilities of either Party can
only be effected by making changes to this Agreement in accordance with the Change
Control Procedure. Nothing in this paragraph 5.1 shall restrict either Party from
agreeing Work Orders.
Commitment of new expenditure by Post Office can only be approved through the
processes described in Schedule D2 or Schedule A3.
To the extent that a Decision under this Schedule A2 has had or will have an impact
on:
5.3.1 the costs of Fujitsu Services (of an amount greater than £10,000) which Fujitsu
Services would have dealt with under the Change Control Procedure and
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8.1
8.2
reflected in a change to the Charges had that impact been understood at the
time the Decision was made;
5.3.2 the achievement of any Service Level or other obligation of Fujitsu Services
under this Agreement;
5.3.3. any contractual or project date agreed between the Parties in relation to this
Agreement; or
5.3.4 any Post Office Responsibilities which would have been dealt with under the
Change Control Procedure had such impact been understood at the time the
Decision was made,
that Decision will be reversed (to the extent it is reasonably practicable to do so) by the
Relationship which made that Decision with effect from the date of such reversal, and
the matter dealt with under the Change Control Procedure. Each Party shall bear its
own costs of complying with such Decision until it is reversed in accordance with this
paragraph. Any disputes arising in relation to such reversal will be resolved in
accordance with the Dispute Resolution Procedure.
ESCALATION PROCEDURES.
Any dispute arising out of or in connection with this Agreement, including any matters
arising out of or in connection with this Schedule A2, shall be resolved in accordance
with the Dispute Resolution Procedure.
RELATIONSHIP MANAGEMENT
The Parties shall jointly monitor the operation of the relationship and governance
arrangements under this Schedule A2 and initiate remedial action (including escalation
if required in accordance with paragraph 6) if these are not being followed.
ASSOCIATED DOCUMENTS
The following CCDs are associated with this Schedule A2:
Document Reference Document Title
1 BP/STD/003 "Standard Terms and Conditions for
Work Orders"
The following CRDs are associated with this Schedule A2:
Document Reference Document Title
NO CRDs APPLICABLE
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9.1
9.2
9.3
9.4
95
GOVERNANCE FOR OPERATIONAL SERVICES AND THE TOWERS MODEL
Fujitsu Services acknowledges that the supplier that Post Office chooses as its Post
Office Service Integrator for the new Towers Model may act as Post Office's managing
partner. Subject to paragraphs 9.4 and 9.6 below, the Parties acknowledge and agree
that Post Office Service Integrator shall be entitled, on behalf of Post Office, to
exercise any rights or perform any obligations of Post Office under this Agreement,
provided that only Post Office shall be entitled to exercise its rights under Clauses 47,
58 and 66 of the Agreement and paragraph 7 of Annex 2 to Schedule A2.
For the purposes of the Post Office Service Integrator performing its role as a
managing partner for the Post Office and subject to paragraphs 9.1 and 9.4, references
in this Agreement to Post Office shall be interpreted to refer to or include Post Office
Service Integrator as relevant. Post Office's opinion shall prevail in the event of any
dispute as to whether a reference refers to or includes the Post Office Service
Integrator. Delegation to the Post Office Service Integrator shall be without prejudice
to Post Office’s right to exercise its rights under any provision of the Agreement on its
own behalf. For the avoidance of doubt, nothing in this paragraph 9 is intended to
create a separate contract between Fujitsu Services and Post Office Service Integrator
or to assign or novate this Agreement or any part of it to Post Office Service Integrator.
In the event that Post Office appoints the Post Office Service Integrator to manage
some or all of its IT services on its behalf, Fujitsu Services shall perform all its
obligations owed to Post Office under this Agreement to the Post Office Service
Integrator as if the Post Office Service Integrator is Post Office. To the extent that
Fujitsu Services fails to perform its obligations under the Agreement, Post Office
retains the ability to enforce its rights against Fujitsu Services and require it to perform
those obligations. In the event that either Party considers co-operation and
collaboration between Fujitsu Services, Post Office Service Integrator and other Tower
Contractors is not in accordance with this paragraph 9, then either Party may escalate
the issue through the Dispute Resolution Procedure.
Without prejudice to Post Office's right to exercise its rights under any provision of the
Agreement on its own behalf, in the event that Post Office Service Integrator exercises
the rights of Post Office under Clauses 23, 24 or 25 of the Agreement, Fujitsu Services
shall only be required to disclose details of the aggregated price of performing the
Services and not details of pricing for specific Services or details of the cost base it
uses to calculate such prices which may indicate Fujitsu Services’ pricing strategy or
pricing levels to Post Office Service Integrator.
Without prejudice to paragraph 9.1 above but subject to paragraph 9.6 below, the
Parties acknowledge and agree that Post Office Service Integrator shall be entitled to
attend any of the meetings described in this Schedule either in addition to Post Office
or on behalf of and as the representative of Post Office. The Post Office Service
Integrator may in some instances be the sole representative of Post Office at such
meetings or governance boards and will be responsible for the relationship relevant to
those meetings or governance boards. Where Post Office Service Integrator attends a
meeting on behalf of Post Office, Post Office Service Integrator shall be entitled to
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9.6
9.7
9.8
9.9
exercise such rights and perform such obligations as Post Office would be entitled to
exercise or perform at such meeting.
Post Office shall ensure that it has a representative at the following governance boards
in addition to or instead of Post Office Service Integrator:
9.6.1 Executive Relationship;
9.6.2 Commercial Relationship; and
9.6.3 Acceptance Board Dispute.
As part of its transition to the Towers Model and in order to ensure the smooth and
effective delivery of end-to-end services to Post Office, Post Office may require its
suppliers of IT services to enter into good faith negotiations and agree non-disclosure
agreements with other Tower Contractors and/or other third parties (“NDA(s)”) and
operating level agreement(s) (“OLA(s)") setting out each supplier's respective
obligations and dependencies to Post Office and each other supplier. Fujitsu Services
shall, where reasonably requested by Post Office, use its reasonable endeavours to
enter into NDA(s) and OLA(s) with Post Office Service Integrator and/or any Tower
Contractors and/or any other third parties within 3 months of such notification by Post
Office. In the event that Fujitsu Services has not or considers it will not be able to
enter into NDAs and/or OLAs within such 3 month timescale, Fujitsu Services shall
promptly notify Post Office of any issues preventing compliance with such 3 month
timescale and the Parties shall work together to address the issues in good faith within
a reasonable timescale to be agreed mutually. In the event that the Parties are unable
to agree a reasonable timescale, either Party may escalate the matter through the
Dispute Resolution Procedure. For the avoidance of doubt, Post Office shall not be a
party to any such NDA or OLA.
Post Office may wish to make changes to the governance structure in this Agreement
to align with its new Tower Model and to implement changes associated with any OLA.
All such changes shall be managed as a change to the Agreement and implemented
via the Change Control Procedure. Fujitsu Services shall be entitled to charge for any
additional costs or risks as a result of changes to the existing governance structure in
accordance with the Change Control Procedure.
Fujitsu Services shall collaborate reasonably with Post Office Service Integrator and
the Tower Contractors by adopting Good Professional Practice in relation to
collaborating and co-operating with Tower Contractors to enable Post Office to
maximize the benefit of the strategic IT supply chain and optimal target operating
model selected by Post Office for its IT and change transformation programme
including by:
9.9.1 responding to and following the Post Office Service Integrator's instructions,
including meeting all timescales, where provided in accordance with the terms
of this Agreement;
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9.10
9.11
9.9.2 save as set out in the Agreement, reporting to the Post Office Service
Integrator as if it were Post Office;
9.9.3 co-operating with the Post Office Service Integrator where it seeks to manage
and resolve issues between the Tower Contractors including any Incidents;
9.9.4 providing the Services in accordance with collaboration requirements and
responsibilities set out in Schedule F.
For the avoidance of doubt, Fujitsu Services shall be entitled to charge Post Office for
its demonstrable additional costs in complying with this paragraph 9.9 which the Parties
shall agree through the Change Control Procedure to the extent to which such costs are
not covered by the (i) Charges relating to the other Services provided under this
Agreement and (ii) de minimis amount of time being equivalent to 15 man days of
additional effort (over and above those activities performed by Fujitsu Services prior to
the implementation of some or all of the Tower model) in any quarter (being January to
March, April to June, July to September and October to December) incurred by Fujitsu
Services in complying with this paragraph 9.9.
Fujitsu Services shall at all times work with Post Office and Post Office Service
Integrator, in good faith, to develop governance processes, collaboration arrangements
and meeting structures in relation to the provision of the Services in order to:
9.10.1 facilitate consistent management, reporting, and sharing of information
between Fujitsu Services, Post Office Service Integrator and Post Office (as
applicable); and
9.10.2 support and assist the delivery of the Services to Post Office and the delivery
of other relevant Tower services by Post Office Service Integrator and other
Tower Contractors, to Post Office.
The Fujitsu Subject Lead for the Executive Relationship (or a suitable alternative in
terms of seniority, decision making ability and knowledge of this Agreement) shall
attend meetings of the governance board entitled “Supply Chain Member Board”
instituted under the agreement between the Post Office Service Integrator and Post
Office.
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Annex 1 to Schedule A2
Relationships
The Parties acknowledge that the job titles of the Relationship members identified in this Annex
1 may change over time (particularly if either Party introduces any new internal management
structure) and that should this occur the appropriate attendees would be the persons holding the
equivalent position to those identified below.
Executive Relationship
Post Office Purchasing Director for Post Office (Subject Lead for Executive
Members Responsibilities)
Head of Change and IS (Subject Lead for SIP-Related Responsibilities)
and Post Office Service Integrator (at Post Office discretion)
Fujitsu Services I Business Unit Director (Subject Lead)
Members
Responsibilities Executive Responsibilities
e Monitoring the overall success of the relationship, including
resolution of any Disputes escalated for Executive Review under the
Dispute Resolution Procedure.
e Approval of new initiatives (HNG-X and non-HNG-X).
e Overseeing management by the Commercial Relationship of
matters arising in respect of Market Testing under Schedule D6.
e Monitoring the performance of Fujitsu Services’ obligations in
connection with this Agreement for the purposes of determining
matters relevant to Fujitsu Services' appointment as Preferred
Systems Integrator and disclosing the results of such monitoring to
Fujitsu Services in accordance with Schedule A1.
e Gain Share and Strive monitoring, including agreement of baselines.
SIP-Related Responsibilities
e Strategic direction and use of SIP resource - (a) agreeing the
quantity and type of SIP resource to be provided by Fujitsu Services
and (b) approving the programmes and initiatives to which the SIP
resource or any Fujitsu Services SIP Team Members shall be
applied in order to best achieve the Joint Objectives set out in
Recitals E(d) to (g) (inclusive).
e Agreeing the sharing of any benefits accruing from a cost saving
initiative or future development work in accordance with the
principles of Schedule D3 relating to the SIP and overseeing the
management, operation and delivery of the SIP under Schedule
B1.2.
e Reviewing and managing opportunities for the Preferred Systems
Integrator and the SIP; maintaining a list of such opportunities in a
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Working Document.
Post Office benefits realisation monitoring.
Assisting with the aim of achieving the Joint Objective set out in
recital E(g), including co-ordinating visits from time to time by
agreed members of Post Office staff to any Fujitsu Services
laboratories so as to have access to Fujitsu Services research and
technical expertise.
Service Management Relationship
Post Office Head of Operations Control (Subject Lead) and/or Post Office Service
Members Integrator
Fujitsu Services I Customer Service Director (Subject Lead)
Members
Responsibilities .
Ensuring continuous improvement in the service management
environment through pro-active management.
Reviewing Operational Services performance, including against
agreed Service Levels and agreeing remedies payable (if any) in
accordance with the relevant terms of this Agreement.
Reviewing network performance.
Reviewing operational reliability of infrastructure used to deliver the
Services (whether the Infrastructure or the infrastructure used to
deliver the Post Office Cloud) and considering/recommending
remedial courses of action (e.g. full or partial technological refresh
or Service Level relief).
Resolving operational issues including, but not limited to, those
arising from non-conformance to agreed Service Levels.
Reviewing future change plans to ensure the live environment is
prepared for Operational Services.
Capacity management in relation to Service Management Services.
Monitoring Operational Business Change processes.
Frequency Monthly
Other general There will be a monthly service review meeting for which Fujitsu Services
information shall prepare reports in the formats agreed from time to time.
Commercial Relationship
Post Office Purchasing Manager (Subject Lead, in relation to procurement, ordering and
Members approval of changes to the contract clauses and schedules)
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Contract Manager (Subject Lead, in relation to commercial, business,
governance and other issues)
and Post Office Service Integrator (at Post Office's discretion)
Fujitsu Services
Members
Director, Commercial (Subject Lead)
Responsibilities
« Management and administration of the Agreement.
e Agreeing amendments to the Agreement subject to the Change
Control Procedure.
e Overseeing the ordering, invoicing and payment process in
Schedule D2.
e Overseeing the carrying out of Work Orders.
e Reviewing changes to the CCD entitled "Standard Terms and
Conditions for Work Orders" (BP/STD/003).
e Agreeing Change Work Orders in relation to Work Orders.
e Reviewing performance of and, where necessary, improvements to
the Change Control Procedure.
« Management reviews of Open Book, Gain Share and Market
Testing.
e First level escalation for Disputes about the interpretation of this
Agreement, about invoice amounts or terms, and about other
matters referred to the Commercial Relationship.
e Monitoring, reviewing and reporting of events and progress and
issue resolution in respect of Market Testing under Schedule D6.
Frequency
Monthly
Programme/Release Relationship
Each of the following boards shall be established for each relevant programme or Release
(including Project HNG-X save in relation to the HNG-X Acceptance Board and the HNG-X
Acceptance Dispute Board which shall be constituted as described in Schedule B6.3.)
Programme /Release Board(s)
Post Office
Members
Business Partner relevant to the subject matter of the programme or
Release (Subject Lead),
Programme and/or Release manager,
Design Authority (if appointed), and
Business change manager (if appointed), and/or
Post Office Service Integrator; and
Commercial manager (as required)
Fujitsu Services
Members
Fujitsu Services’ SI Director (Subject Lead)
Programme and/or Release manager
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Others, as appropriate for the programme or Release.
Responsibilities
e Delivery of programmes and Releases to time and budget.
e Managing and resourcing Work Packages which relate to major
development programmes.
e Managing contingency budgets approved in Work Orders
including, where appropriate, delegating authority to appropriate
managers.
e Directing the holding of meetings of the ‘Joint Release
Authorisation Board’.
e Project management and governance in accordance with this
Agreement or, to the extent not in conflict or inconsistent with this
Agreement, PRINCE 2 standard practice. For example:
. review and resolution of operational issues arising in
design, development and testing; and
« review progress and performance against plan.
Notwithstanding the Parties’ use of PRINCE 2, or any other design or
project management methodology, the provisions of this Agreement shall
not be varied by such use unless the Parties agree otherwise in
accordance with the Change Control Procedure.
Frequency
As determined by the Subject Leads.
Other general
information
e There will be one ‘'Programme/Release Board’ for each major
programme/ Release.
e The Subject Leads will discuss current and future demand for such
boards.
Acceptance Boards (for each Release)
Post Office
Members
Mandatory attendees:
Head of Change and IS (or designate) — Chair,
HNG-X Programme Manager (or designate),
Requirements & Acceptance Manager,
HNG-X Acceptance Manager,
HNG-X Design Authority, and/or
Post Office Service Integrator
Optional attendees:
Testing Manager in each case for the relevant Acceptance activity,
Post Office Commercial Manager
Fujitsu Services
Members
Mandatory attendees:
SI Director (or designate)
Commercial Director (or designate)
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HNG-X Programme Director
HNG-X Acceptance Manager
HNG-X Solution Architect
Optional attendees:
Testing Manager
in each case for the relevant Acceptance activity.
Responsibilities
« To agree the Acceptance status of the relevant Release (including
distribution of HNG-A Application updates by Fujitsu Services to
the EUC Tower Contractor for onward release management) and
provide a recommendation to the ‘Joint Release Authorisation
Board’.
Frequency
As required to monitor progress towards each Acceptance Gateway.
Acceptance Disp
jute Board
Post Office
Members
Mandatory attendees:
Head of Change and IS (Chair)
HNG-X Programme Manager
HNG-X Acceptance Manager
HNG-X Design Authority; and/or
Post Office Service Integrator; and
Post Office Commercial Manager
Optional attendees:
Testing Manager in each case for the relevant Acceptance activity.
Fujitsu Services
Members
Mandatory attendees:
SI! Director
Commercial Director
HNG-X Programme Director
HNG-X Acceptance Manager
HNG-X Solution Architect
Optional attendees:
Testing Manager
in each case for the relevant Acceptance activity.
Responsibilities
e Consider and resolve Acceptance disputes arising under Schedule
B6.3.
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e Consider and resolve Acceptance disputes arising under Schedule
B1.1.
Frequency
As and when required to resolve issues arising during the Acceptance
activity.
Joint Release Authorisation Board
Post Office
Members
Head of Operations Control (or nominated representative) (Subject Lead)
Delivery Integration and Assurance manager, and/or
Post Office Service Integrator
Fujitsu Services
Members
Fujitsu Services’ SI Director (Subject Lead)
Customer Service Director and the appropriate Customer Service
Introduction Manager.
Responsibilities
Agree the criteria and processes by which Releases, of HNG-X Central
Infrastructure updates or HNG-X Application updates, will be authorised for
release into field trial or live operation and carry out readiness reviews of
stakeholders accordingly. (N.B. Joint Release Approval Boards, or similar,
held between Post Office and EUC Tower Contractor members to
authorise the release of HNG-A Application updates may be held jointly or
separately from those for HNG-X Central Infrastructure updates or HNG-X
Application updates, but distinct authorisations for Release must be given
to the different parties)
Frequency
As and when directed by the 'Programme/Release Board’.
Demand Planning Board
Post Office
Members
Head of Change and IS (Subject Lead)
+ other representatives as agreed from time to time, and/or
Post Office Service Integrator
Optional attendee:
Head of Contract Management
Fujitsu Services
Members
Development Director (Subject Lead)
Commercial Director
+ other representatives as agreed from time to time
Responsibilities
« Communication of service development plans — Post Office and
Fujitsu Services
e Agree high level planning assumptions for future developments of
services
e Joint planning to manage the allocation of pre-paid or pre-committed
resources and any progressive commitment to incremental resource
above that level including:
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« Agreement of the Inner Core Team and Outer Core Team,
or the Core Team (as applicable), (including any
subsequent replacements required)
e Agreement of the Standing Team, (including any
subsequent replacements required)
e In accordance with Annex 3 to Schedule A2 initiate, monitor and
ensure progress on development of service definitions and terms and
conditions for additions to the contracted services
e Recommend additions to contracted services, including introduction of
the Inner Core Team and Outer Core Team, or the Core Team (as
applicable) and Standing Team, (that will then be formally introduced
by CCN)
« Oversight of agreeing Work Packages
Frequency
Monthly
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2.2
3.1
Annex 2 to Schedule A2
Dispute Resolution Procedures
INTRODUCTION
The Parties shall use the Dispute Resolution Procedure to resolve any Dispute.
There may, subject to the other provisions of this Annex 2 to Schedule A2, be up to five
stages (each a "Stage") to the DRP as follows:
1.2.1. the Subject Lead Review to be carried out in accordance with paragraph 2;
1.2.2 the Executive Review to be carried out in accordance with paragraph 3;
1.2.3 the Board Review (including facilitation by an expert) to be carried out in
accordance with paragraph 4;
1.2.4 provided that the Parties agree to such procedure, mediation (to be carried out
in accordance with paragraph 6) or expert determination (to be carried out in
accordance with paragraph 7); and
1.2.5 where any mediation does not resolve the Dispute or the Parties do not agree
to the use of mediation or expert determination, or as otherwise provided for in
this Agreement, resolution through the courts of England.
The Parties may relax the timescales referred to in the DRP by mutual agreement
(such agreement not to be unreasonably withheld or delayed).
SUBJECT LEAD REVIEW
Subject to paragraph 2.2, as soon as either Party becomes aware of a disputed matter
it shall refer the Dispute to the Subject Leads best qualified to deal with the Dispute
(taking into account the nature of the Dispute and the responsibilities of each Subject
Lead) for resolution within five Working Days of the date of referral (the “Subject Lead
Review’). If the Dispute relates to the interpretation of this Agreement or to the amount
or terms of invoices, then the Dispute shall be referred to the Commercial Relationship
for resolution.
As soon as either Party becomes aware of a disputed matter in relation to the SIP it
shall refer the Dispute to Executive Review described in paragraph 3.
EXECUTIVE REVIEW
In the event that the Subject Leads of the Relationship to which the Dispute is referred
under paragraph 2 fail to resolve that Dispute, the Dispute shall be referred to the
Systems Integration Partnership and Executive Relationship for resolution in
accordance with this paragraph 3 (the "Executive Review"). Each Party shall, no later
than five Working Days after such failure (or as soon as reasonably practicable if the
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3.2
3.3
3.4
Dispute is in relation to the SIP), provide the other with a Statement of Dispute. If the
Parties agree to do so, such statements may be provided sequentially by one Party
responding to the Statement of Dispute of the other.
The Subject Leads of the Systems Integration Partnership and Executive Relationship
or other individuals nominated by each Party suitably empowered to deal with
executive matters (the “Nominated Executives”) will be responsible for collating all
relevant information relating to the Dispute and for progressing the Dispute through the
DRP until it is resolved or determined.
The Executive Review shall take place within ten Working Days of the referral with the
object of resolving the Dispute by way of good faith negotiation.
The Parties may agree, before the Executive Review referred to in paragraph 3.3 takes
place, or if that review fails to resolve the Dispute referred to it, to appoint an expert
facilitator (the “Facilitator") to assist with resolution of the Dispute on the following
basis:
3.4.1. The Facilitator will be appointed as soon as reasonably practicable;
3.4.2 The Facilitator shall be an individual who:
3.4.2.1 holds qualifications in respect of the subject matter underlying
the Dispute; and
3.4.2.2 is approved by both Parties (such approval not to be
unreasonably withheld or delayed).
3.4.3 In the event that the Parties fail to agree upon an individual as the Facilitator,
the Facilitator shall be appointed at the request of Post Office or Fujitsu
Services (whichever is the earlier) by the President for the time being of the
Institution of Engineering and Technology so long as such appointee shall meet
the criterion in paragraph 3.4.2.1.
3.4.4 The Facilitator shall act as a facilitator and not as an expert or arbitrator and his
fees shall be borne by the Parties in equal shares.
3.4.5 Within five Working Days of appointment of the Facilitator the Parties shall
submit to the Facilitator:
3.4.5.1 each Party's Statement of Dispute (as amended to reflect
matters discussed so far), such statement also to be disclosed to
the other Party; and
3.4.5.2 a joint agreed statement describing the scope of the initial
guidance required from the Facilitator.
3.4.6 The Dispute shall be referred to the Facilitator to obtain such initial guidance
and the Parties shall request that the Facilitator gives such guidance within 15
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43
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5.1
Working Days of receipt of the Statement of Dispute from both Parties. The
Facilitator shall not be required to determine the Dispute unless the Parties
agree that he shall be appointed as an Expert in accordance with paragraph 7.
3.4.7 Once the Facilitator has given to the Parties his initial guidance on the Dispute,
the Nominated Executives shall meet within five Working Days of the initial
guidance being given and attempt to resolve the Dispute with the advice and
guidance of the Facilitator within ten Working Days of the meeting.
BOARD REVIEW
If the Dispute is not resolved by the Executive Review, the Parties may, if both Parties
agree, refer the Dispute for review by (i) either or both of the Operations Director of the
Post Office and/or the Procurement Director of the Royal Mail Group plc and (ii) the
Commercial Division Director, Fujitsu Services (the “Board Review’).
The Board Review shall take place within five Working Days of the referral with the
object of resolving the Dispute by way of good faith negotiation.
If the Dispute is not resolved within ten Working Days of the Board Review, the Parties
may, if both Parties agree, refer the Dispute to a Mediator (for resolution in accordance
with paragraph 6) or to an Expert (for determination in accordance with paragraph 7).
If the Parties do not reach agreement whether (a) to refer the Dispute for resolution by
Board Review, within 15 Working Days of completing the Executive Review, or (b) to
refer the Dispute to a Mediator or an Expert pursuant to paragraph 4.3, either Party
may seek resolution of the Dispute through the courts of England. Notwithstanding the
requirement in paragraph 4.2, if the Board Review has not taken place within 20
Working Days of referral, either Party may seek resolution of the Dispute through the
courts of England.
STATEMENT OF DISPUTE
A “Statement of Dispute” means a signed and dated statement of a Subject Lead
containing the following information:
5.1.1 the name, job title, postal address and contact telephone number of the Subject
Lead making the statement on behalf of one Party and that of the Subject Lead
of the other Party to whom the statement is given (each such Subject Lead
being a “Dispute Owner”);
5.1.2 an adequate description of the Dispute, from the perspective of the Party on
whose behalf the statement is made;
5.1.3 any dates by which an output or decision is required for operational reasons;
and
5.1.4 any recommendation for the resolution of the Dispute which the Dispute Owner
considers appropriate.
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5.2
6.1
6.2
6.3
7A
7.2
7.3
74
Within five Working Days of the completion of each Stage of the DRP the Dispute
Owners of each Party shall, if the Dispute has not been resolved, prepare a joint
statement including:
5.2.1 the findings of the Stage in question; and
5.2.2 the output or decision required from the next Stage of the DRP,
to be used by or in connection with the next stage of the DRP.
MEDIATION
At any time after the Executive Review, the Parties may agree that the Dispute shall be
referred to mediation. In the event that the Parties agree to mediation, the Parties will
be responsible for appointing the mediator (the "Mediator"), but in the event that they
are unable to agree on a Mediator either or both of the Parties shall request the Centre
for Dispute Resolution ("CEDR") to appoint a Mediator.
The Parties shall, with the assistance of the Mediator, seek to agree the mediation
procedure. In default of such agreement, the Mediator shall act in accordance with
CEDR rules. The Parties shall, within five Working Days of the date on which the terms
of the mediation are settled, meet the Mediator in order to agree a programme for the
exchange of any relevant information and the structure to be adopted for the mediation.
Subject to agreement between the Parties, the mediation shall take place within 30
Working Days of the appointment of the Mediator.
EXPERT DETERMINATION
At any time after the Board Review, the Parties may agree that the Dispute shall be
referred to an expert ("Expert"), appointed by the Parties, for final determination of the
Dispute.
The Expert shall be appointed as soon as reasonably practicable and shall be an
individual who:
7.2.1 holds qualifications in respect of the subject matter underlying the Dispute in
question; and
7.2.2 is approved by both Parties (such approval not to be unreasonably withheld or
delayed).
In the event that the Parties fail to agree upon the Expert to be appointed, the Expert
shall be appointed, at the request of Post Office or Fujitsu Services, by the President
for the time being of the Institution of Engineering and Technology so long as such
appointee shall meet the criterion specified in paragraph 7.2.1.
The Expert appointed under paragraph 7.2 shall act on the following basis:
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7.4.2
74.3
7.4.4
745
746
the Expert shall act as an expert and not as an arbitrator;
the Expert shall decide the procedure to be followed in the determination of the
Dispute and shall be requested to make his determination in writing within 20
Working Days after his appointment or as soon as practicable thereafter;
the Expert's determination shall (in the absence of manifest error) be final and
binding on the Parties;
any amount payable by Fujitsu Services to Post Office as a result of the
Expert's determination shall be paid within ten Working Days of the Expert's
determination being notified to the Parties;
any amount payable by Post Office to Fujitsu Services as a result of the
Expert's determination shall be included in the next invoice for the Charges and
paid by Post Office in accordance with Schedule D2; and
the costs of the determination, including the fees and expenses of the Expert,
shall be borne by the Parties in such proportions as may be determined by the
Expert.
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c)
a
)
Annex 3 to Schedule A2
Planning of Pre-Committed Resource
INNER CORE TEAM TO 31ST MARCH 2015
The Parties shall agree an Inner Core Team of resources for the period up to 31st
March 2015 under the auspices of the Demand Planning Board. The Inner Core Team
for such period shall consist of those Fujitsu Services personnel who have specialist
knowledge and experience of the infrastructure and/or processes used to support Post
Office’s needs under the Agreement and whose loss would cause a significant increase
in cost or time for the implementation of future change whilst new staff were trained in
or re-discovered that key knowledge.
The Inner Core Team for the period up to 31st March 2015 is initially set at 9 full time
posts covered by 12 people. Post Office shall have the final say on posts, skill sets and
who is included within the Inner Core Team from the list of candidates recommended
by Fujitsu Services but shall not unreasonably refuse candidates and shall provide
reasons where it reasonably refuses. The Demand Planning Board shall record in its
minutes which areas of the business Fujitsu Services feel is not sufficiently covered to
enable mitigation actions to be taken if necessary.
Limited changes: The Inner Core Team shall be fixed (in terms of variety of skill sets
and numbers of posts and persons) from the date of signature of CCN1271c and such
elements may not be varied prior to 31st March 2015 other than under the process set
out in paragraph 3 below in relation to skill sets only.
The additional provisions regarding the Inner Core Team set out in paragraphs 11 and 12
below shall apply with effect from 1st April 2015 except that paragraph 11 will not apply
in the event that the Inner Core Team is terminated by Post Office pursuant to
paragraph 12 below.
OUTER CORE TEAM TO 31st MARCH 2015
The Parties shall agree an Outer Core Team of resources for the period up to 31st
March 2015 under the auspices of the Demand Planning Board. The Outer Core Team
shall consist of those Fujitsu Services personnel who have specialist knowledge and
experience of the infrastructure and/or processes used to support Post Office’s needs
under the Agreement and whose loss would cause a significant increase in cost or time
for the implementation of future change whilst new staff were trained in or re-
discovered that key knowledge.
The Outer Core Team for the period up to 31st March 2015 is initially set at 15 full time
posts covered by 18 people. Post Office shall have the final say on posts, skill sets and
who is included within the Outer Core Team from the list of candidates recommended
by Fujitsu Services but shall not unreasonably refuse candidates and shall provide
reasons where it reasonably refuses. The Demand Planning Board shall record in its
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c)
3.
°)
minutes which areas of the business Fujitsu Services feel are not sufficiently covered to
enable mitigation actions to be taken if necessary.
Right to cance! Outer Core Team: Post Office shall have the right to cancel the Outer
Core Team effective from the second anniversary of signature of CCN1271c. Post
Office may exercise such option in writing to the Fujitsu Services Commercial Director
up to 21 months from signature of CCN1271Cc only. If such break option is not
activated, the Outer Core Team shall continue in place as normal until 31st March
2015.
Limited Changes: The Outer Core Team shall be fixed (in terms of variety of skill sets
and numbers of posts and persons) from the date of signature of CCN 1271¢ and such
elements may only be varied:
i) in relation to numbers of persons and posts only, on Post Office giving 9
months’ notice after that date. Post Office shall not reduce the numbers of
persons and/or posts of the Outer Core Team as initially set by more than 20%
during the initial 2 years from signature of CCN1271c. During years 3-5 from
signature of CCN1271c, assuming Post Office has not invoked the break option
at point 2(b) above, Post Office may reduce the numbers of persons and/or
posts of the Outer Core Team by up to 20% in total of the size existing at the
second anniversary of signature of CCN1271c during the remainder of the
Term of the Agreement. Should Post Office not have utilised the full 20%
reduction during the initial 2 years, then the remaining balance is not carried
over to the 3rd-5th years.
ii) In relation to skill sets only, under the process set out in point 3) below.
VARIATIONS TO SKILL SETS OF THE INNER AND OUTER CORE TEAMS:
Where forecast utilisation of a specified skill set within either the Inner Core Team or Outer
Core Team is less than 50% for three or more succeeding months, Post Office may request
at the Demand Planning Forum for that skill set to be exchanged for another skill set where
consistent demand is shown. Post Office may, after the first anniversary of signature of
CCN1271c, change 1 person in the Inner Core Team and 2 people within the Outer Core
team under this provision each year.
Where the replacement persons are from the Inner Core Team, the Outer Core Team or
the Standing Team, it is expected that Post Office will normally backfill that post, leaving
the total within each team unchanged. Post Office’s rights in respect of team size
reductions under the other provisions of CCN1271c would be unaffected.
Post Office's entitlement to discounts will be unaffected by exchanges of personnel under
this paragraph.
Only in the event that the Post Office has requested the substitution, any re-skilling
requirements for the replacement resource will be chargeable to the Post Office provided
that Fujitsu Services shall take all reasonable endeavours to minimise the need for such re-
skilling.
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a)
Fujitsu Services undertakes to use all reasonable endeavours to ensure that the Inner
Core Team and Outer Core Team personnel are not removed or replaced for the
duration of the Agreement However, in the event that any of the Inner Core Team or
Outer Core Team personnel become unavailable for any reason (including without
limitation death, injury, sickness, career advancement or resignation), Fujitsu Services
shall have the right upon giving 30 days’ notice in writing to Post Office to replace such
an individual with another individual whose abilities and qualifications are appropriate
for the services to be performed by such individual. Fujitsu Services shall submit to
Post Office the CV of any such replacement and shall take any representation from
Post Office in response under due consideration. Post Office shall not be charged for
any training required to bring such staff up to the required standard of knowledge.
CONFIDENTIALITY
Post Office may reproduce, copy and disclose Personnel Information relating to the Inner
and Outer Core Teams:
i) to Post Office's Subject Leads for (i) the Systems Integration Partnership and
Executive Relationship, (ii) the Commercial Relationship and (iii) current members
of the Demand Planning Board;
ii) to its professional advisers provided such reproduction, copying and disclosure is
necessary for the purposes of this Agreement; or
iii) as required by law,
iv)
provided that Post Office shall procure that the persons referred to in paragraphs (i)
and (ii) above shall not themselves disclose Personnel Information (except
amongst themselves) without the express written consent of Fujitsu Services.
Post Office may discuss Personnel Information with and disclose Personnel Information to
Fujitsu Services Listed Personnel.
STANDING TEAM TO 31st MARCH 2015
The Parties shall agree a Standing Team of resources for the period up to 31st March 2015
under the auspices of the Demand Planning Board. The Standing Team during such period
shall consist of an agreed number of personnel per grade sufficient to meet the Fujitsu
Services forecasted minimum level of resources required, over and above the Inner Core
Team and the Outer Core Team, to match the minimum Fujitsu Services forecasted
workload anticipated within the next rolling 9 month period. This is initially set at 20.9 full
time posts covered by 23 people. Post Office may terminate individual resource from this
team on 3 months’ notice after completion of the first 9 months. Post Office shall have the
final say on what quantity of personnel for each grade is included within the Standing Team
from the recommended list provided by Fujitsu Services. For replacements, Fujitsu
Services shall recommend its suggested candidate plus at least 1 other qualified candidate
and Post Office may request further candidates where, for good reason, neither of the
submitted candidates is acceptable. Fujitsu Services remains the final arbiter on who fills
each post, as long as they meet the required qualifications and experience.”
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7. REPORTING
i) Fujitsu Services shall present to each Demand Planning Board the following
reports. The Demand Planning Board may request other reports as necessary to
facilitate resource management.
(1) Resource requirements for committed and projected business
(2) Allocation of Inner Core Team, Outer Core Team and Standing Team
personnel against the resource requirements at 7(i)(1) above.
(3) Requirements for additional specialist or volume-driven resources
(4) Shortfall in utilisation of any Inner Core Team, Outer Core Team or Standing
Team members. Fujitsu Services shall make available the CV of any personnel
having spare capacity to Post Office to facilitate their re-allocation.
(5) Actuals against Fujitsu Services forecasts in relation to resource requirements,
allocation ad utilisation.
(6) Such information as is required to allow Post Office to allocate costs to
individual changes for re-charge to internal customers.
8. ESTIMATING
8.1 In the event that forecast estimates prove inaccurate in practice, Fujitsu Services shall
identify:
a) any persistent causes of such inaccuracy
b) in extreme cases of inaccuracy, the cause(s) of such inaccuracy
8.2 In the case of any persistent causes identified under 8.1(a) above, the Party owning
the area from which the cause originates shall, with the reasonable co-operation of the
other Party where required (which shall be supplied free of charge), generate an action
plan for addressing the cause which shall be presented to the Demand Planning Board
for ratification.
8.3 In the case of any extreme cause of inaccuracy identified under 8.1(b) above, the Party
owning the area from which the cause originates shall, with the reasonable co-operation
of the other Party where required (which shall be supplied free of charge), shall
generate an action plan for reducing or eliminating the chance of that cause re-
occurring which shall be presented to the Demand Planning Board for ratification.
8.4 The Party owning the area from which the cause originates shall fund any action
required under the action plan.
8.5 The Demand Planning Board shall agree any further measures it deems necessary to
rectify continuing inaccuracy in estimates.
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9.
10.
SPARE CAPACITY
i) In the event that a member of the Inner Core Team, Outer Core Team or the
Standing Team is unallocated to a particular task for any period, Fujitsu Services
shall notify Post Office as soon as possible, in any event at the next succeeding
Demand Planning Board. Fujitsu Services shall use all reasonable endeavours to
locate work either on or off the programme to utilise this spare capacity and report
its findings to Post Office. Where staff are used other than to support Post Office
programmes or services, charges shall be reduced accordingly and Post Office
shall not pay anything for any time any persons are working on non-Post Office
matters or are unavailable for reasons of sickness, corporate training, leave etc.
Where staff are available but are unable to be utilised or re-deployed, charges
shall fall to Post Office.
ii) In the event that Fujitsu Services is unable to locate sufficient work to fill such
spare capacity, Post Office shall have the option to identify work for the individual,
either on contract work, within the SIP or on work currently outside the Agreement.
In the latter case, such work would be brought within the contract scope to ensure
that a contractual framework was provided for the services performed.
OFFSHORING
In the event that the Parties agree that it is possible to Offshore either a Standing or an Inner
Core Team or Outer Core Team role, Fujitsu Services shall:
i) provide to Post Office a revised potential cost for that role to include the re-training
etc required. Fujitsu Services shall also provide all reasonable information in
relation to any potential risks from the Offshoring to allow Post Office to make an
informed decision on whether Offshoring is advisable in the particular case. Where
the costs of such investigation exceeds 2 man-days, such investigation shall be
chargeable to Post Office at the appropriate rate provided that the nature of this
investigation (including as to its scope and duration) have been agreed in writing by
the Post Office prior to the commencement of such investigation ; or
ii) consider the proposal under the Gain Share principles.
The choice between (i) or (ii) above shall be entirely at Post Office’s discretion.
11.
11.4
INNER CORE TEAM FROM ‘st APRIL 2015
During the period from 1% April 2015, unless terminated in accordance with paragraph
12 below or increased or decreased in accordance with paragraph 11.3 below, the Inner
Core Team shall be set at 16 full time posts covered by 25 people. Post Office shall
have the final say on posts, skill sets and who is included within the Inner Core Team
from the list of candidates recommended by Fujitsu Services but shall not
unreasonably refuse candidates and shall provide reasons where it reasonably refuses.
In selection of the Inner Core Team Post Office shall take into account that during the
period when Transitional Support Services are provided and Post Office is in transition
to the Towers Model a different mix of skills may be required to retain the knowledge
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12.
12.1
13.
13.1
13.2
13.3
13.4
14.1
14.2
required to deliver the Services while protecting the reputations of Post Office and
Fujitsu Services. The Demand Planning Board shall record in its minutes which areas
of the business Fujitsu Services feel is not sufficiently covered to enable mitigation
actions to be taken if necessary.
The Charges for the Inner Core Team shall be calculated on a discounted basis in
accordance with Schedule D1. This discount shall be applied monthly as a credit to the
operating charge.
Post Office may increase or decrease the size of the Inner Core Team before or after
1** April 2015 by giving three (3) months’ notice to Fujitsu Services.
Removal of members of the Inner Core Team in accordance with paragraph 11.3
above will impact the discounting as per paragraph 10.4B of Schedule D1.
TERMINATION OF THE INNER CORE TEAM
Post Office may terminate the requirement for the Inner Core Team with effect from 1°
April 2015, without payment of any charge to Fujitsu Services, upon providing written
notice to this effect to Fujitsu Services on or before 30"" September 2014. In the event
of any such termination, the provisions of paragraph 11 above shall not apply.
OUTER CORE TEAM AND STANDING TEAM FROM 1* APRIL 2015
During the period from 1% April 2015, the Outer Core Team shall be initially set as a
commitment to spend £150,000 per month on Development Resources.
The full time posts supplied in the Outer Core team can be changed but require a three
month notice period and Post Office must confirm its requirement for resources 3
months in advance.
The discount structure for the Outer Core team is included in 10.4B of Schedule D1.
This discount shall be applied monthly as a credit to the operating charge.
There will be no Standing Team during the period from 1* April 2015.
CORE TEAM MODEL FROM 1* APRIL 2016
The approaches set out in paragraphs 11 and 13 shall expire at the end of31* March
2016.
From 1* April 2016 to 31** March 2023 for the remainder of the term, Post Office
commits to funding the “Core Team” which shall comprise 16 on-shore full time
equivalent posts covered by up to 25 people. Post Office shall have the final say on
posts, skill sets and who is included within this team, from time to time, provided such
persons and posts are chosen from the list of candidates recommended by Fujitsu
Services. Post Office shall not unreasonably refuse candidates and shall provide
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15.1
15.2
15.3
15.4
reasons where it reasonably refuses. In the event Post Office wishes to vary the posts,
skill sets and who is included in the Core Team it shall do so by giving three (3) months’
notice to Fujitsu Services, unless, in respect of who is included in the Core Team, a
member of the Core Team is guilty of misconduct, is underperforming or otherwise
exhibits unacceptable behaviour, in which case, Post Office may require the immediate
removal by Fujitsu Services of that member from the Core Team. Where a member is
removed from the Core Team as described above, Fujitsu Services shall promptly
replace them with a person satisfactory to Post Office (acting reasonably).
CRITICAL SMEs FROM ‘st APRIL 2023
From 1st April 2023, Fujitsu Services shall retain a list of Critical SMEs as identified and
agreed between the Parties for the duration of the Term. These Critical SMEs shall be
utilised in the delivery of Development and/or Operational Services (including for the
purposes of any knowledge transfer to Post Office or a Next Supplier) as allocated from
time to time in accordance with the Parties’ demand planning arrangements and Change
Control procedure.
Fujitsu Services will not remove any Critical SMEs from delivery of the Services, except
for the following reasons: (a) the individual resigns, (b) the individual retires, (c) the
individual goes on long-term sick leave, (d) the individual is dismissed for conduct or
some other substantial reason, or (e) the individual refuses to continue performing their
duties in respect of the Services.
Fujitsu Services will seek Post Office's input and will use reasonable endeavours to
reach agreement on an appropriate replacement for any Critical SMEs.
In the event that any Operational Service activity to which a Critical SME is aligned to is
terminated, Fujitsu Services shall have no obligation to retain that Critical SME or
provide a replacement for that Critical SME. In the event that one or more of the
Operational Service activities to which the Critical SME is aligned are terminated but
other such activities continue, Fujitsu Services shall inform Post Office before removing
or replacing such Critical SME; however, the removal of such Critical SMEs shall remain
at Fujitsu Services sole discretion.
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