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

Review of facilities management services led to staff

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review of facilities management services, led to staff downsizing Yes – set a fixed price for contract duration BankL Yes – especially following centralisation of bank procurement policy Yes – strong client pressures 12.3 Upwards pressures on pay Our case study evidence suggests a range of formal and informal procurement practices can positively influence pay, or at least protect it from deterioration. Table 12.3 summarises the results from the six cases. The first observation is that there is a longlasting influence of TUPE regulations on pay rates for many subcontracted cleaning staff. Transfer of Undertakings (Protection of Employment) regulations protect employees’ terms and conditions, including pay, when an activity is transferred to a new employer (known as ‘service provision changes’). Five of the six cases involved some cleaning staff on rates of pay that have been protected since their transfer under TUPE rules, although at the 84
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IMPROVING PAY college only one of the 30 transferred staff remained six years after the contract began. While beneficial for transferred staff, it can nevertheless create a problem of pay consistency with two or more tiers of conditions. At the airport, for example, there are three rates of pay among cleaners in similar jobs directly employed by CleanA1: staff transferred from the previous cleaning company are paid £7.50; a smaller group transferred from the airport’s previous in-house team, all working the night shift, earn an enhanced pay of around £9.50; and all other staff are paid £6.31 an hour. Rather than harmonise pay upwards to the more generous TUPE rates, CleanA1 prefers to manage staff on unequal pay. Informal diffusion of client expectations about decent pay In all six cases, client organisations professed some degree of interest in the levels of pay earned by the subcontracted cleaners. At HotelW, senior procurement managers said they audited the payroll of the cleaning company and also kept a record of cleaners’ signing in and out of the workplace – evidence of some concern that cleaners’ pay complied with national minimum wage rules. In other cases, client organisations argued that cleaners’ pay ought to align with standards enjoyed by the client workforce. For example, managers at CollegeS told us the college had a responsibility to ensure outsourced cleaners earned decent levels of pay, ‘that we are paying fairly for what we are getting’ (CollegeS, Procurement manager), and specified a minimum wage rate slightly above the national minimum wage at £6.50 into its contract price with CleanA2. The role of the client, as noted above, is in some cases very influential in the run-up to budget agreements for the following financial year. While the airport had maintained a tight lid on previous annual budgets, the Contract manager was now considering uprating the fee to provide for higher pay in light of a shared recognition that ‘there is a pay issue at the moment’, both among minimum wage workers on CleanA1 contracts and other cleaners on protected pay conditions.
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