research-report-96-coming-clean-contractual-and-procurement-practices.doc

Tupe regulations secured the living wage rates for

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company easier. TUPE regulations secured the living wage rates for transferring staff and CleanD only had to agree, in the form of a formal undertaking, to pay a living wage to all other staff on the CouncilL site (that is, new recruits plus any redeployed CleanD employees): for us, the [living wage] policy is already there, so what we’re doing is making sure this procurement policy aligns with our corporate policy, so in a sense we are in the right place in this case. (CouncilL, Senior Procurement manager). At the bank, managers received a request from CleanE to pay the London living wage subject to their agreement, ‘because we have to pick up the bill, whatever CleanE wants to do’ (BankL, Property manager). For the bank, it was perceived as important for its corporate social responsibility agenda in London, and the public 86
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IMPROVING PAY debate about unfair pay in the banking industry generally, to commit to the London living wage. The extent to which the higher basic pay is absorbed fully by the bank or part subsidised by CleanE is unclear from our data, due to conflicting perspectives from contract managers interviewed. However, CleanE has made a policy commitment to seek to pay the living wage to all its UK workforce, although it emphasises that its pay policy is contingent upon client willingness to pay higher fees. It claims to be working with client organisations and includes a living wage option in all its new tender submissions. It remains to be seen how effective this policy will be. Both parties to the contract identified several benefits of paying the living wage, including lower staff turnover and less sickness absence. As the Procurement manager at BankL told us: From the contractor’s point of view it’s actually quite a benefit. You are not getting the [high] level of turnover and churn, so you’re not continually having to recruit. 87
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COMING CLEAN: CONTRACTUAL AND PROCUREMENT PRACTICES Table 12.3 Procurement and contractual practices with positive pay effects Role of TUPE in protecting pay Informal diffusion of client expectations about decent pay Trade union role in setting pay at cleaning company Commitment to a living wage in procurement AirportE 70 staff transferred from previous contractor, most on contractor pay rates but some still on rates from previous airport in-house arrangement Client consideration of future rise in contract fees to support higher pay None No CollegeS 30 transferred but only 1 remains in a supervisory post Some consideration in setting the contract fee None (only grievance/discipline) No (although under consideration for 2014 contract renewal) HotelW Transfer of staff 10 years ago – only housekeeper on salary still remains HotelW audits payroll of CleanB for minimum wage compliance None (only grievance/discipline) No HospitalE Approx. 500 transferred No Yes, very strong influence in extending hospital pay conditions to CleanC No CouncilL Approx. 75 transferred TUPE protected living wage rates of transferred staff Strong (negotiated living wage
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