Government set to axe code on employee rights

30 Jul 10
Some employment rights could be scrapped for new recruits to contracts that have been outsourced to the private sector
By Jaimie Kaffash

28 July 2010

Some employment rights could be scrapped for new recruits to contracts that have been outsourced to the private sector.

Cabinet Office minister Francis Maude has indicated that the coalition is ‘minded’ to abolish an informal code agreed between the previous Labour government, unions and employers. The two-tier workforce code guaranteed that new employees to jobs previously in the public sector would receive terms ‘no less favourable’ than those of transferred staff. Maude said that forcing employers to stick to this ‘would distort the market when we are trying to encourage new entrants into the outsourced market’.

A Cabinet Office spokesman told Public Finance that ‘this will bring greater efficiency in government operations and will enhance public sector markets’.

Unions warned it could lead to a ‘demoralised’ workforce. A Unison spokeswoman said it was ‘early days’ and nothing had been decided. However, she added: ‘It would be a big mistake. It would contradict everything that the government has said it wants to do around low pay. Any move to do away with the protections that outsourced workers receive would hit the ones on the worst terms and conditions.’

This came on July 28, the day after Maude was quizzed by the Commons public administration select committee on his Bill to reform civil service redundancy pay (see news analysis).

PASC chair Bernard Jenkin later told PF the civil service unions could succeed in their struggle to preserve their redundancy terms. ‘Article 1 of the Human Rights Convention talks of the right to hold your “possessions”. There is a question whether these accrued rights amount to possessions.’

He cited the court case won by the Public and Commercial Services union in February over reforms proposed by the previous government, saying this suggested Article 1 would apply.

Unions have also challenged the legality of the ‘money Bill’ mechanism, which allows the government to bypass the House of Lords. However, Jenkin added: ‘Maude seemed very confident that his legal advice would prevail.’

See cover 'Outside in'

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