More than half of public sector bodies planning changes to T&Cs

More than half of public sector employers are planning changes to employment terms and conditions over the next twelve months, research by law firm Eversheds has revealed.

The survey of 150 public sector bodies – mostly in the local government and healthcare sectors – also found that 90% consider reductions in staffing to be the single greatest challenge in the coming year.

Other findings include that:

• 66% are planning changes to their employment practices
• 56% of employers are currently operating a recruitment freeze
• 45% of employers are proposing a recruitment freeze
• 43% of employers envisage some form of partnership arrangement
• 21% of survey respondents anticipate a rise in outsourcing.

Eversheds partner Mark Hammerton said the survey responses revealed considerable diversity in terms of how changes will be effected.

“Whilst redundancies make the headlines, and for obvious reasons, employment contracts and policies are clearly being scrutinised across the board,” he suggested. “In particular, pay freezes, and even pay reductions, as well as the withdrawal of staff benefits or bonuses were anticipated by respondents.”

He added: “Recruitment is also severely restricted, if not precluded, for many. Just under half of respondents are targeting more robust performance or absence management processes.”

Hammerton warned that HR professionals would need to stay close to forthcoming proposals, ensuring, for example, that redundancy exercises or contractual changes are handled appropriately. Otherwise councils would be at risk of adding to the burgeoning number of tribunal complaints revealed in recent Employment Tribunal statistics, he said.

The Eversheds survey also supported the view that many public sector employers believe trimming staff is unlikely, on its own, to produce the degree of cost-saving needed for reasonable maintenance of service delivery.

Hammerton said shared services was a slowly building trend in recent years but was something the public sector is having to pursue more and more. “There is obvious merit and cost-saving in [partnership arrangements] for many,”  he argued. “There are also some relatively easy wins for organisations to work together more efficiently and effectively, for example, by combining administrative and service delivery teams. We are certainly seeing an increasing trend towards this, something which will inevitably continue to rise.”

However, Hammerton warned that such arrangements can bring unique problems for those embarking on them for the first time. “One problem is what legal structure will be adopted; from very informal arrangements, pooled staffing, secondments and pooled budgets, to the creation of a merged or shared service company?”

He added: “The results might possibly demonstrate a natural sector scepticism of the private sector’s ability to deliver genuine transformation in service and cost. A somewhat radical model is being trialled by Suffolk Council, which has announced it is to be a ‘commissioning council’ through which services are administered but not provided directly.

“Many will watch this space with keen interest. Could this prove to be the ultimate in clever, forward thinking or a step too far which might prove of devastating impact to the quality and extent of public services?”