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With the government implementing a two year pay-freeze to support its “austerity programme” and planning changes to public sector pensions, concerns arise that health-care organisations might be effected by widespread industrial action for the first time since the 1980s.

Unions reluctantly accepted the necessity of the two year pay freeze though are now campaigning for a significant increase for staff when that deal expires in April 2013. Unions are strongly resisting other changes to employment terms, especially the reduction n the value of pensions.

NHS budgets are under more pressure than they have experienced for a decade and employers are contemplating ways to change the Agenda for Change pay systems which were established nationally in 2004.

By the end of 2010, the organisation NHS Employers had proposed a national enabling framework for local pay negotiations which would have allowed local agreement for freezing pay increments in return for a commitment on preventing compulsory redundancies. At that time, with strong indications from the unions that they would reject local pay negotiations, the initiative seemed to stall.

NHS Employers Chief Executive Dean Royles said recently “It is essential that local employers have meaningful discussions with local trade unions and staff about the workforce implications of the financial challenges for their organisations.”

Through 2011, planning conversations have continued on the management side and NHS Employers has recently reflected employers concerns, suggesting current national pay structures place unsustainable pressures on the NHS pay bill and proposing greater flexibility and local pay deals as potential solutions. Foundation Trusts, with their freedom to negotiate local employment terms with their staff, may follow Southend University Hospitals NHS Trust in starting to change the way pay works. The Nursing Times recently highlighted a number of cases where organisations were describing these tentative steps towards devolution -

• Mid Cheshire Hospitals has been quoted as  “working alongside other providers at a regional level to consider options to negotiate alternative terms and conditions” on areas including incremental progression and sick pay,
• University Hospital of South Manchester is said to be considering “proposals for changes to terms and conditions outside of the national framework”,
• Central Manchester University Hospitals’ attempt to withhold pay increments from employees with poor attendance is being challenged by unions,
• Birmingham and Solihull Mental Health was completing an options appraisal “regarding a move away from Agenda for Change” by 2014,
• Royal Surrey County Hospital polled staff to see if they would accept changes to employment terms in exchange for fewer job losses.

Employers understand the NHS employment market is a complex one and history has taught them that competitive behaviour between neighbouring Trusts has been damaging in the past. At present it seems NHS bodies will share thoughts, ideas and opportunities for change, seeking to move “in concert” on a menu of options and proposals to be discussed with local staff.

An even more dynamic strategy seems to be emerging with Calderstones Partnership NHS Foundation Trust working to set up a spin-out social enterprise subsidiary which will employ staff on non-NHS terms and conditions. With new services being established through this vehicle, services might be run at lower cost, though transferring existing services will pose more challenges with both TUPE and equal pay requirements to be met.

So what change could and should be made in NHS organisation’s pay strategy?

Read the rest of this entry →

Central Manchester University Hospitals Trust recently announced it’s plans to withhold incremental pay increases for employees who have taken more than 18 days off sick or had four separate sick absences. This move forms part of it’s plans to save £120m by 2014 while protecting services.

The Trust was keen to point out that the new policy, being introduced from 1 October 2010, would be discretionary and would be applied in a manner that would not be discriminatory for people with long-term illnesses or those with disabilities.

NHS organisations are clearly looking for ways to save money but potential savings from implementing this policy would probably be “vanishingly small”.

UNISON officials reflected there was nothing in existing contracts providing that staff could be denied increments on the basis of absence and expressed the view NHS Trusts acting in this way would be in breach of the existing employment contracts and confirmed it would take legal action on behalf of affected staff.

In an article in Personnel Today, a legal adviser from Beachcrofts said the legality of the scheme would depend on what the staff contracts of employment say and how flexible the Trust is in applying the policy. He suggested it was unlikely the employment contracts were so prescriptive as to set out a mechanism for deciding upon pay rises and considered employers would normally have flexibility to consider a variety of factors when looking at pay rises.

So what is the position and how will the organisation fare if it proceeds without a local negotiated agreement? Read the rest of this entry →

The NHS White Paper, “Equity and Excellence: Liberating the NHS”  represents the completion of a devolution journey the NHS has been undertaking for over a decade. Moving all service providers either to Foundation Trust status or to one of a number of social enterprise models, it effectively de-nationalises NHS organisations.

In future, NHS services would be delivered through a wide range of diverse organisations – based on different legal frameworks and working in different ways.

When it comes to workforce issues, most people are currently focusing on the impact on those involved in commissioning, planning, inspecting, monitoring and managing the NHS. Staff losing jobs, reassigning function to new GP consortia, possible TUPE transfers and skills retention challenges.

But what does all this mean for the workforce delivering care? When the dust settles, these are the people we rely on to maintain high quality patient experiences.

While it might feel a little early, it’s worth considering what the provider organisations emerging from the shake up might look like. Read the rest of this entry →

Photo: HowardLake, Flickr

The NHS White Paper allows individual employers the freedom to determine pay for their own staff. While this is a relatively small provision in the paper, it has potentially serious implications.

Quickly spotting this and commenting in the Public Finance blog, Duncan Brown has expressed serious reservations about the potential for a major deconstruction of the national pay framework Agenda for Change.