UK - Unions have given cautious welcome to a Government proposals aimed at protecting the pay and benefits rights of workers who have been transferred from the public to the private sector.
The proposals - released by the Department for Transport, Local Government and Regions (DTLR) - state that local government staff transferred to the private sector will be allowed to remain in their existing public sector pension scheme. Otherwise, the DTLR claims that the workers will enjoy broadly comparable pension benefits.
Whilst John Monks, the TUC general secretary, felt that the proposals were “a step in the right direction”, he did have reservations. Monks believes that a greater level of detail is required, questioning who exactly will determine what is “broadly comparable”.
However, Monks was generally pleased that progress has been made on the issue, and declared that compelling employers to make a matching contribution of 6% to the retirement funds was “good news”. Dave Prentis, his counterpart at Unison, also welcomed the proposals, describing them as a “breakthrough”.
Despite the welcome that they gave the proposals, both Monks and Prentis said that will continue to press the Government to allow new workers into the public sector defined benefit pension plans.
Additionally, Prentis said Unison will continue to fight the outsourcing of public sector jobs, despite the proposals: “They will in no way detract from Unison’s ongoing campaign to persuade the government that genuine reform of the public services must come from within, not from the private sector. Privatisation is not the answer.”
Under the proposals, companies employing new recruits on local authority contracts would, under a new code, have to offer them terms and conditions that were overall broadly comparable to those of transferred staff. Firms will also have to be required to make a minimum 6% contribution to a pension scheme.
The Government said that the code - which will be supported by statutory guidance - will be written into the individual contracts between local authorities and contractors. Inspectors will monitor authorities' compliance.
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