Headlines: December 23rd, 2010

When central government functions are outsourced to the private and third sectors new employees hired to work alongside ex-public sector employees will no longer have a right to the same terms and conditions as their ex-public sector colleagues.

The decision will remove a barrier to smaller organisations that want to deliver public service contracts. SMEs, charities, social enterprises, voluntary groups and staff owned mutual providers of public services will all benefit from greater freedom to manage their business without central government interference. However, this change will have no impact on the TUPE terms under which public service staff transfer to new organisations.

The employment conditions for new employees were part of the Two Tier Code and this has now been replaced by a voluntary agreement known as ‘The Principles of Good Employment Practice’. This agreement sets clear standards and gives employers freedom to provide terms for staff which are motivating and affordable.

Local government has its own version of the Two-Tier Code, and this remains in place. Local authorities will continue to apply the code to outsourcing contracts.

Publicnet understands that the two tier code for local government may soon be replaced by a voluntary arrangement, similar to The Principles of Good Employment Practice.