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Jon Dews: How to manage outsourcing effectively

Monday 20 June 2016

Jon Dews, Senior Adviser at Acas, discusses the difficulties around outsourcing.

Jon Dews Jon Dews

Jon Dews is an Acas Senior Adviser based in Birmingham.

He covers all aspects of employment relations, including training and workplace practice.

 

Outsourcing is a fact of life for many people in the UK today. According to The Times (10/12/15) almost 10% of the UK workforce are working in 'outsourced arrangements'. This equates to 3 million jobs. In the 3rd quarter of 2015 over £2bn of outsourced contracts were agreed, an increase of 69 per cent on 2014.

But although we may all agree that outsourcing is on the rise, there is less consensus about the impact it is having on the economy and working life. From a macro point of view, the Business Services Association (BSA) recently published research that linked its potential impact on productivity. The BSA argue that an increase of 1% in outsourcing adds £2bn in productivity gains annually to the UK economy. In the public sector alone, outsourced frontline public services generate £48.1bn in revenue.

From a micro perspective, however, outsourcing can also be more directly associated with loss of jobs, worsening of terms and conditions of employment and a general sense of insecurity.

What's the Acas perspective? Here in the Midlands, as elsewhere in the UK, Acas works with companies from every sector and of every size to help manage difficult periods of upheaval and change. Change is another fact of everyday working life and it's hardly surprising that a recent report from Good Practice, 'Inside the heads of UK managers', found that bringing people along during period of significant change is a manager's biggest challenge.

Getting outsourcing arrangements right not only involves sound legal practice and an understanding of Transfer of undertakings (TUPE) but effective planning, clear and timely consultation processes and due diligence. This is where Acas can help.

In our experience difficulties around outsourcing can be exacerbated by poor preparation and hasty consultation arrangements, with many employees and their representatives given little clarity about what is happening. Even where there is clarity of process many aren't clear about the impact on their terms and conditions.

Acas can help employers who are contemplating business transfers and outsourcing with developing effective information and consultation processes that really improve the interface with employees and trade unions.

Visit the Acas West Midlands regional page to find out about our TUPE masterclass event on 30 June 2016.

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