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The white paper in action: where does it leave NHS jobs?


7 December 2010

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The proposals in the Health White Paper are starting to take shape, and NHS PCT managers on the commissioning side and managers at the Strategic Health Authorities will be at the heart of resulting organisational change. All this is happening at a time when they are understandably concerned about their own jobs and there will be many questions about employment rights. 
 
There has been much debate about whether PCT staff members' rights will be protected if certain functions transfer to GP consortia or other bodies such as the new NHS Commissioning Board or local authorities for public health. The answer is that it will depend on how the transfer is brought into effect and what actually transfers, which may vary across the country. If the functions that transfer are so fragmented post transfer, there is likely to be a strong argument that TUPE does not apply. This is very rare in the public sector because of guidance (Cabinet Office Statement of Practice) which is still current regarding protecting public sector staff members' rights even if there is not legally a TUPE transfer. 
 
"If they are carrying out public functions, new employers will be subject to the equality laws requiring the promotion of equality under the Equality Act"
 
Even if there is a transfer, there is also the possibility that if services are reconfigured differently under the new bodies, the staff who carry out that function (such as commissioning) are not assigned and will not transfer.
 
It is not clear at the moment that the TUPE regulations will apply to the transfer of statutory functions. The regulations do allow reorganisation of a public administration or the transfer of administrative functions between public administration bodies to not be covered by TUPE in certain circumstances. Although there is no statutory definition of what constitutes a public administration body, the case of Adult Learning Inspectorate v Beloff suggests that a public body is one 'whose functions involve the exercise of public authority'. It is therefore possible that this definition includes transfers of staff between two NHS bodies.
 
In broad terms, if TUPE applies staff will transfer to the new employer and be entitled to have their current terms and conditions of employment protected. Employment with the new employer is treated as continuous from the date of the employee's start with the first employer. New employers will potentially have to deal with a large number of staff at a time when they are just getting themselves up and running. Not only will new employers have to recognise staff members' terms and conditions, they will also inherit preexisting agreements such as collective agreements and recognition agreements with trade unions. Any existing claims or liabilities for claims (such as discrimination) will also transfer.
 
If they are carrying out public functions, new employers will also be subject to the equality laws requiring the promotion of equality under the Equality Act.
 
If there is no TUPE transfer, most of the affected staff will face redundancy and will be entitled to a redundancy payment, usually calculated in line with Agenda for Change. Figures quoted suggest this would represent a national cost of £1.5billion. Where employees are to be made redundant, there is also an obligation on their outgoing employer to carry out a collective consultation for a set period of time. The length of any consultation will depend on how many employees are being made redundant. Failure to do this could represent a significant amount of compensation for the employees concerned, payable by PCTs and SHAs.
 
Until the eagerly awaited HR framework is published, the only thing that is certain for managers is the uncertainty. There are concerns about losing talent, skills and corporate memory, something which is happening already because of key staff understandably wanting to secure their financial futures.
 
 
Rachael Heenan is a partner and the National Head of Health Employment at national commercial law firm, Beachcroft LLP. As a leading health specialist, Beachcroft offers a range of cost-effective employment services to private and public health employers. For more details of our GP consortia employment pack, please contact Rachael Heenan on rheenan@beachcroft.com
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