Half of councils have now undertaken equal pay reviews

LOCAL GOVERNMENT

Half of councils have now undertaken equal pay reviews

New research published by the Local Government Employers has revealed that half of all councils have now undertaken equal pay reviews, but the “ability of local authorities to undertake these reviews is being hampered by the impact of ‘no-win, no-fee’ lawyers”.

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Jan Parkinson, managing director of the Local Government Employers, said: "Councils have been hamstrung in their ability to deliver on equal pay agreements as ‘no-win, no-fee’ lawyers have been holding up the process for many years. ‘No-win, no-fee’ lawyers have not served any useful purpose and instead have clogged up the tribunal system causing severe delays to claims and cost taxpayers more money in bureaucracy.”

State of play on equal pay reviews

Latest LGE information, based on 79 councils in England and Wales, shows that 47% of councils have now completed equal pay reviews and/or implemented the outcomes, compared with about 34% a year ago.

Costs of equal pay reviews

The total cost of pay reviews is currently estimated at £2.8 billion, made up of:

  • Total back pay - £1 billion

  • Ongoing costs - £1.5billion

  • Protection - £0.4bn.

Ongoing costs refer to the permanent change in the pay bill following the award of new grades to employees after a job evaluation exercise and the introduction of a new pay structure.

Protection is a transitional arrangement for a period of two or three years designed to safeguard the salaries of staff who find their grading reduced after job evaluation. LGE reckons this happens on average to about 20% of employees in a given authority. About 40% find their pay increased and 40% stay the same.

On average, staff in schools account for about 29% of equal pay costs for a given authority – up to about 75% in the most extreme cases.

A final word

"Local Government is in some ways paying the price for being open about this problem and declaring that it is going to do something about it. There are similar problems in the NHS and civil service, where the decision has been made to fight cases all the way in tribunals rather than try and reach agreement as we are doing. The situation in the private sector is completely hidden as they have no requirement to carry out pay assessments.” - Jan Parkinson, managing director, Local Government Employers.

Want to know more?

Local Government Employers (LGE) was created by the Local Government Association on 3 April 2006. LGE works with local authorities, regional employers and other bodies to “lead and create solutions on pay, pensions and the employment contract, to ensure the provision of excellent and affordable local services”. For more details visit www.lge.gov.uk