24 January 2003
The row over the 'two-tier workforce' has been reignited with the government postponing publication of its long-awaited employment code after both unions and the private sector accused ministers of reneging on 'done deals'.
Sources said this week that there were now real fears that the code could be left in limbo, with ministers reluctant to publish something guaranteed to invoke the wrath of either the unions or the private sector.
This dispute, the latest in a long line since the announcement of the review by then Local Government Secretary Stephen Byers 18 months ago, centres on wording and on the issue of arbitration.
The unions are deeply unhappy that new employees joining outsourced services would only be offered 'broadly comparable' terms and conditions to colleagues who transferred from the public sector. The unions were pushing for the term 'no less favourable', which they claim is much more definite and less open to abuse.
According to sources, ministers were willing to consider this change but the Confederation of British Industry has lobbied hard against it.
Unions are also furious after winning apparent guarantees that ministers would insert an arbitration clause into the code. If the code, which would be mandatory and written into contracts, is broken, unions want to be able to enforce its conditions through arbitration.
But sources say the CBI 'got wind' of the change and demanded that the government stick to its original proposals.
Unions are now angry at what they see as a major U-turn by ministers. 'We thought we had a deal but it was unpicked at the last minute,' said one insider. Unions were also warning that if the issue isn't settled by Labour's spring conference on February 14, another public row would ensue, similar to the tenor of exchanges seen at the party conference last year.
The CBI is also unhappy at the turn of events and is anxious for the government to publish the code so it can begin implementing it. 'The CBI and the TUC both welcomed the code and signed up to it,' said Amanda McIntyre, head of modernising government at the CBI.
'We are now in a situation where the code is in limbo but is in the public domain and we are seeing all kinds of interpretations,' she warned.
McIntyre added that imposing restrictive arbitration clauses would inevitably deter some companies from offering innovation. 'We await the code's rescheduling,' she said.
For the unions the situation is less clear cut. The GMB and the T&G have the added complication of looming general secretary elections and neither wants to be seen to back down. A source indicated that there may even be attempts to find new wording for 'broadly comparable' that would suit all sides.
PFjan2003
