Public and Commercial Services Union

On 18 March 2005 the Prime Minister announced the Code of Practice on Workforce Matters in Public Service Contracts (also known as the Two-Tier Workforce Code). The Code is designed to prevent the emergence of a two-tier workforce when public sector employees are contracted out to a new service provider, ensuring that new recruits (i.e. those employed directly by the contactor after they have taken on outsourced staff) receive comparable treatment to the transferred staff, whose terms and conditions are protected by the TUPE regulations. 

Under the Code, employers will be obliged to give new employees an overall comparable packages to that received by the outsourced staff, i.e. the package may not be the literal same salary but it should be broadly comparable, and should include similar terms and conditions such as flexible working, leave, family friendly policies, etc (although pensions are not included, and can not be used for comparative purposes). 

Since then the Cabinet Office (in conjunction with civil service trade unions, government departments, contractors and ACAS) has been working on a Code of Practice to assist with implementing the Agreement, including application of an Alternative Dispute Resolution Code, aimed at maximising its effectiveness. The Code will apply to every outsourcing - except trading funds - after 18 March 2006. A copy can be found at the Cabinet Office external website.

The TTWF Code and its accompanying  procedures are useful tools for PCS representatives to employ when dealing with privatisation and outsourcing proposals. Private companies bidding for outsourced work should provide detailed information as part of the bidding process explaining the steps they will take to ensure full compliance with the Code, including future monitoring arrangements. Although useful, the extent to which PCS representatives can dictate just how a company complies with the Code will also depend on the level of detail representatives can persuade the outsourcing department to put in the original tender, and on parallel negotiations with the employer.