Two-tier workforce

Q: Staff in our section who were transferred under TUPE last year have kept their terms and conditions, but our employer is recruiting new staff on lower pay. Shouldn't they be paid the same?

A: The Transfer of Undertakings (Protection of Employment) Regulations 2006 (TUPE) protect only those employees who were employed at the time of the transfer, so there is generally nothing in law to stop an employer hiring new staff on inferior conditions.

However, the situation is different for public sector workers who are contracted out, as codes of practice exist to prevent a "two tier" workforce from developing in contracted-out situations.

The Code of practice on workforce matters in local authority service contracts covers local government workers in England in respect of contracts advertised on or after 13 March 2003. It states that the pay and conditions for new recruits should be "overall no less favourable" than those of former public sector staff. Similar provisions apply in Wales, and to public-private partnership (PPP) contracts in Scotland. And in 2005 the Code was extended to the wider public sector, including the civil service, the NHS and maintained schools.

The remedy is through a binding dispute resolution scheme rather than the courts.