The way this recent pay review has been handled is a fine example of how a little confusion can go a long way. The contract your friend has is correct. All steps were increased by 5% therefore the first step is now 25320.00. Those who joined before December 31st should be on 26080.0 i.e. step 2 which is 3% higher than step 1.
I haven't seen this much this much head scratching since Ed was let loose with a keyboard. Must be time for a new altimeter setting procedure.