NHS subject to competition laws re pay?

[mwunderground]

I wondered if any employment law experts here know whether the NHS is subject to competition laws regarding pay between trusts.

Recently several London trusts have got together and standardised their rates for bank pay and reduced them dramatically (staff would be earning £7 an hour less for bank work than they do when employed)

They are also currently working to ensure agency staff rates are brought in line with these bank rates by agreeing which agencies they will work with and how much they will pay as a group.

I know in the private sector this would be wage fixing and potentially unlawful but is this the case for the NHS where after all basic pay IS set nationally and would it be worth the staff groups impacted to consult employment lawyers? Could anything be done about it?

Talk to the Competition and Markets Authority. They can determine whether this is a breach and, if so, take action against the trusts.

A couple of days of no-one being available for bank work would soon change things I am sure!

I agree, but the groups impacted particularly are midwives and specialist nurses and they are possibly the least politically organised group.

Also I think the trusts have decided they are prepared to live with unsafe staffing and fines for unit closures in the short term in order to push this through. I get their point of view, they are financially teetering on the edge, bank and agency is a huge expense for them and this is in some ways easier than addressing staff recruitment and retention or other factors that impact bank and agency use.

I’m not especially familiar with the NHS structures but it looks like hiring and managing of bank staff is outsourced by the NHS to various bank agencies, each of which covers a group of NHS trusts? Some are huge and cover loads of trusts (NHS Professionals) and some only a few (eg Bank Partners).

The agencies are direct competitors and shouldn’t be collaborating on pay

However it may be that there is no collaboration between agencies, it’s just one of the massive agencies like NHS Professionals that has changed its rates - but it covers so many trusts that it looks like those trusts are collaborating, iyswim. Then the question is whether NHS Professionals is so large and has sufficient market power that extra rules apply to it under competition law (like Microsoft has extra rules because of being so market dominant).

There may also be extra rules for companies that do what is basically a public authority function.

It’s all a bit complicated. I do agree it’s worth raising with CMA. They may point you somewhere else and/or take a while to reply but at least it’s something.

in this case, the relevant trusts do not subcontract bank, infact it is the fairly recent move in house which has prompted the review of rates. We could all go to NHS Professionals which indeed pay around £15 an hour more in other trusts, some of which are in travelling distance but it is worrying that when their contracts run out they too will bring bank in house and it will become a
monopoly.

In addition there is currently a piece of work to address agency rates by agreeing together to use a small number of agencies and agree pay with them so agency pay in these trusts does not exceed bank rates.

I have a CS not NHS background but from my knowledge it will depend on the organisational structures under DH&SC and concepts of delegated authority.

A good example is NHS provides continuity of service if an employee moves from one NHS employer to another. You can only guarantee this if there is an understanding that all NHS employers are bound by the same rules and at some level are considered to be one employer e.g. NHS England.

WRT pay there is the NHS Pay Review Body (NHSPRB) that I think(happy to be corrected) sets pay structure and rates for all NHS employers.

WRT bank rates etc. this appears to be parts of the NHS collaborating to agree a consistent approach and use economies of scale to jointly contract with Agencies and as part of this set Bank and Agency rates.

From an individual perspective the flexibility and higher pay rates for bank and agency work is attractive for them.

However, strategically from an organisational perspective having direct employees on a set pay range which is higher or equal to agency/bank rates means being an employee becomes more attractive. More direct employees theoretically reduces costs i.e. no agency fees, and gives you more known resource to allocate as you see fit.

Contact the Competition Pro Bono scheme - you’ll get 2hrs with a competition lawyer who can advise. I don’t know enough about the NHS structure to advise without research or understanding what is actually happening in practice but in principle, competition law will apply to the NHS where it’s operating as an undertaking (eg where it’s procuring work or acquiring a competitor etc). I can’t believe that they would fall foul of competition law here but hey, it’s the NHS so anything’s possible

Scheme