Shropshire fires gun on "dismissal and re-engagement" process for all staff

Shropshire Council has formally set in train a “dismissal and re-engagement” process for all staff in a bid to make £7m in savings.

Under the proposals, which were approved by a full council meeting last month, all staff will have their contracts terminated and then be offered immediate re-employment on new terms and conditions.

The main changes include a 5.4% cut in pay, amended conditions in relation to sick pay, and an increase in annual leave. The reduction in pay will be phased in over two years, which Shropshire said would help staff adjust to lower earnings.

The council said the plan would allow it to avoid large-scale redundancies and protect services to the public. Dismissal letters have now been sent to staff.

Shropshire had previously warned that it needed to make savings worth £76m over the next three years.

Jackie Kelly, head of organisational development at the local authority, said: "Despite a 90-day consultation period and a series of negotiation meetings, we have been unable to reach a collective agreement on these changes with the trade unions.

“Therefore, Council has decided, reluctantly, to make these changes by way of terminating the contracts of all current staff, and then making all staff an offer of immediate re-employment on new terms and conditions with effect from 1 October 2011.”

Kelly said the authority appreciated that the formal nature of the legal process might lead to some anxiety. She added that Shropshire intended "to continue offering reassurance, guidance and support" to all its staff over the coming months.

"Although we failed to agree the changes with the trade unions, with UNISON in particular raising objections, we are keeping dialogue going and continuing to meet with them to see if there is still a possibility of getting a collective agreement before 30 September to implement the necessary changes,” Kelly said.

Last month Shropshire’s chief executive Kim Ryley said the council simply did not have the money to carry on paying the number of staff it now has at its current rates.

“I am confident that these changes will be in the interest of our staff in the long term because, by making sacrifices now, they reduce insecurity about future employment,” he said, adding: “We have no plans to make further changes of this kind.”

But UNISON warned that industrial action over the proposals had moved a step closer, with its regional organiser Rick Tuder saying the move was “cruel and particularly spiteful given that local government workers are already facing a two-year pay freeze”.