BOROUGH OF POOLE

COUNCIL EFFICIENCY AND EFFECTIVENESS OVERVIEW AND SCRUTINY COMMITTEE

4 SEPTEMBER 2008

UPDATE REPORT ON EQUAL PAY

1.0PURPOSE AND CONTEXT

To update Members on equal pay project progress – for noting

  • Significant project where experience from other Councils suggests there is potential for employee relations, legal and financial risks
  • Previously reported regularly to Resources Overview Group (ROG) – suggest Members read reports to meetings on 2/4/07, 7/6/07, 29/11/07 and 24/4/08

2.0JOB EVALUATION

  • Final scores letters issued to service unit staff at end June 2008 – target achieved
  • Number of queries lower than anticipated, very little antagonism expressed, support from Service Unit Heads has been good and much appreciated
  • Final scores for schools staff due to be released late September/early October, with portfolio of model job descriptions
  • Arrangements are being developed to build job evaluation into normal recruitment, restructure, vacancy clearance and business planning processes; thus it will be part of normal business processes to ensure equal pay applies
  • A permanent Equal Pay Officer is being recruited to undertake this work in future

3.0PAY MODELLING

  • Joint working with Accountancy
  • Seeking to find a model which meets principles agreed – see ROG report 29/11/07
  • Useful meeting with ex-Director of York on their experiences
  • Will meet again with union officials once we have a model we feel will work
  • Exploring composite agreement with HMRC – tax position, benefits impact raised by unions – may be possible to mitigate negative impact of lump sum payments, and reduce complex administrative work

4.0LABOUR MARKET SUPPLEMENTS

  • Draft policy and procedure has been subject of consultation with Service Unit Heads and trade unions; final document will be approved via Equal Pay Steering Group
  • Principles are that they must have clear justification, be affordable from unit’s budgets, and subject to review
  • Will report annually on actions taken and data analysis through Joint Information & Consultation Committee framework or other appropriate forum
  • Equivalent process for schools is being considered

5.0FINANCIAL IMPLICATIONS

  • Medium Term Financial Plan 2008-09 onwards has set aside £2,565,000 for equal pay reviews; of this £687,000 has been committed to cover previous equal pay audits and project team costs
  • Leaves approximately £1,878,000 ongoing funding to achieve a fair equal pay settlement
  • Further reserve of approximately £400,000 exists to fund one-off costs
  • Interim equal pay action has substantially reduced our claims exposure
  • Financial assessment is being made of costs to complete the equal pay review, and a value for money assessment of potential claims exposure
  • Variation in pay bill likely to be greater in some services than others, which may potentially result in increased cost of some services affecting their viability
  • Department for Communities and Local Government (DCLG) allows possibility of a capitalisation direction to fund significant equal pay costs through borrowing – not proposed at present, but position will be kept under review
  • Use of non earmarked reserves and budget savings may need to be considered further, and will be reported to Members as necessary

6.0LEGAL AND EQUALITY IMPLICATIONS

  • The full equal pay review will reduce further the risk of successful claims
  • No claims received to date in Poole – any received should be assessed on their merits to ensure fair and equal pay. Claims cannot be precluded.
  • Project links with wider equality issues; the work undertaken can inform wider pay and reward audit work after implementation of job evaluation
  • Recent case law developments affect the equal pay environment – Court of Appeal decision leaves GMB and other unions potentially exposed to substantial claims from their members and may make unions cautious about signing collective agreements; another judgment calls into question pay protection arrangements which favour men more than women
  • Case law decisions are assessed as we progress
  • Pay modelling includes gender equality impact assessments
  • Difficult project activity which strives to achieve fair treatment in employment, ensure equal pay principles apply and minimise risk to the Council

COLIN HAGUE

HEAD OF PERSONNEL AND TRAINING SERVICES

\\artemis\democratic\committeeminutes\report\Council Efficiency and Effectiveness Overview and Scrutiny Committee\CEE040920083 Equal Pay.doc