Stephen Byers, Secretary of State for Local Government, has come down in favour of a Code of Conduct to protect the right of workers employed by private companies to deliver public services. UNISON and the CBI have welcomed the decision as the best way forward to both protect workers and give companies flexibility, but the GMB union believes it is a sell out to the private sector. Although the decision is about local government services it will clearly be applied to the health service and all other public services.The package of measures to be introduced to put protection into effect includes a Code of Practice on the treatment of new recruits working on local authority contracts alongside transferred staff. Contractors will have to offer employment to new staff on fair and reasonable terms and conditions which are broadly comparable to those of transferredemployees. Pension rights will also be safeguarded. Unions will have the right of consultation, but not negotiation, on the contracts of new recruits.
The Code will be written into individual contracts between local authorities and contractors and its application will be included as part of the Best Value inspection and enforcement regime. The operation of the package will be kept under review to ensure that it delivers fair terms and conditions for new recruits. A review and monitoring system will be set up. It is likely that the task of policing the Code will be given to the Audit Commission.
The GMB objections to the package are that the code has no statutory force, it does nothing to remove the ambiguity in current TUPE legislation, the expression ‘broadly comparable’ is open to interpretation and the end result could be the exploitation of workers as one company passes a contract on to the lowest bidder. The union claims that this could lead to several tiers of workers, each tier receiving diminishing rewards as contracts change hands.