NEWS RELEASE

For immediate release 17 June 2003

TSSA AND SERCO SIGN RECOGNITION DEAL

RAIL union TSSA and Serco Online Services have signed a recognitionagreement for call centre staff.

Serco Chief Executive Christopher Hyman and TSSA General Secretary RichardRosser signed the deal, covering 300 operators and supervisors at Serco'scall centre in Cardiff, which provides the National Rail Enquiry Service(NRES).

The agreement, which has been under discussion since August 2001 means thatTSSA is now be able to negotiate with Serco on behalf of employees on issueslike pay, working hours and time off.

TSSA General Secretary Richard Rosser commented:

"This deal is good news for both Serco Online Services and its employees. Welook forward to working in partnership with Serco Online Services to ensurethat the staff will continue to contribute to, and share in the futuresuccess of the business.

"I am pleased that TSSA and Serco Online Services have been able tonegotiate a voluntary agreement.

"Thanks to the constructive relationship that has developed between theunion and the local management team, together we have established what wasalways the preferred option of both the Company and the union - the creationof a voluntary framework for recognition and partnership that is based onopenness and mutual trust.

"Unlike Serco Online Services, many companies prefer to spend more timeobstructing unions than respecting the wishes of their employees to have arecognised union.

Serco Online Services' mature approach to industrial relations iscommendable - this agreement gives us a solid foundation to achieving truepartnership with the company."

Pat Harris, Operations Director for Serco Online Service said:

"We firmly believe that partnership is only effective when it both addsvalue to the business and directly benefits the employees. I amparticularly pleased that our recognition agreement with the TSSA isunderpinned by a shared commitment to the continued success of NRES and allits staff".

Christopher Hyman, Serco Group plc Chief Executive said:

"We are very pleased to have reached a partnership agreement with the TSSAat NRES. Together we want to create a workplace characterised by new andmore effective ways of working between our managers, our employees and theTSSA. We believe that all of our stakeholders will benefit from thesearrangements."

ends

For further information, please contact:
Mike Katz, TSSA Head of Communications (020) 7529 8033 or 07956 925969
Kevin Johnson Serco Media & Public Relations Manager (020) 8334 4122 or07718 004344

Notes to Editors
1. TSSA represents 32,000 members in administrative, clerical,managerial, professional and technical jobs in the railways, buses, theLondon Underground, the travel trade, canals, ports and ferries, and roadhaulage.

2. The recognition agreement was signed on Monday 16 June, at Serco's National Rail Enquiry Service centre in Cardiff.