Legal counsel

A two-tier workforce can be created where employees transfer under TUPE – for example from a local authority to a private care provider.

Although the terms and conditions

of the former local authority staff will be protected under TUPE, the private care provider is ordinarily free to engage new

staff on whatever terms and conditions it considers appropriate. In practice, this can lead to a two-tier workforce with new recruits being engaged on significantly worse terms than those who have transferred under TUPE.

On 23 July 2002 the government published, for consultation, a circular on best value and performance improvement. The circular recommended that new recruits should be employed on terms and conditions which are “broadly comparable” to those of existing staff, other than in relation to pensions for which different rules apply.

This proposal gives rise to a number of issues, not least of which is what is meant by “broadly comparable terms”. Is this limited to pay or does it extend to all benefits, allowances and working practices?

Trade unions are pressing for all staff to be engaged on the “same” terms, but some private-sector organisations have threatened to pull out of public/private sector partnerships if this proposal is implemented.

The issue that needs to be addressed is who will pay for the increased costs that

will arise if the proposal is implemented as currently suggested or with modifications.

It is hardly surprising, then, that an

all-party meeting on 16 January was postponed to allow representatives from government, business, and trade unions more time to consider their respective positions.

The government may be committed to

the principle that all staff engaged in providing public services, whether employed by the public or private sector, should be employed on the same terms, but whether

it is prepared to insist on this is a different matter.