'No level playing field' in Pathways to Work contracts

Charities have accused the Department for Work and Pensions of failing to ensure a level playing field in the tendering process for Pathways to Work contracts after it emerged that the company awarded the largest number of contracts did not factor in the cost of transferring staff from the public sector into its bid.

WorkDirections UK won six of the first 16 regional contracts awarded earlier this month. After taking legal advice it decided it did not need to apply Tupe conditions, which protect the employment conditions of staff when transferred to a new employer.

Several charities bid for Pathways contracts, but only one – the Shaw Trust – was successful, winning two contracts. Catherine A’Bear, chief corporate affairs officer at the trust, said it – along with several other charities – had understood the DWP’s invitation to tender to indicate that Tupe regulations would apply.

“We are disappointed that not everyone is operating in the same way and the DWP hasn’t stuck by what it originally put in the invitation to tender,” she said. “You need the commissioning department to be really clear what they are asking for, and to be consistent in measuring people according to that.”

Disabled people’s organisation the Papworth Trust was one of the unsuccessful bidders for Pathways contracts. Adrian Bagg, chief executive of Papworth, said it was vital that the confusion over Tupe regulations was ironed out as soon as possible. “We understood that Tupe-ing staff across was part of the bid," he said. "That has also been our experience in bidding for other contracts."

A spokesman for employment charity Tomorrow’s People, which is the preferred supplier in private sector training firm A4e’s successful bid for the Devon & Cornwall contract, said the charity had also assumed Tupe regulations would apply. “The Government should have accepted responsibility at the beginning and made clear whether it applied,” he said.

Anna Scott, a professional support lawyer at Trowers & Hamlins solicitors, said the latest regulations made it clear Tupe would apply in any outsourcing situation. However, a DWP spokesman said that during the course of the contracting process it had become clear that no staff would transfer from the public sector to the private sector as a result of Pathways contracts.

A spokeswoman for WorkDirections UK, a private welfare-to-work provider, said all bidders for the Pathways programme were clearly told they should obtain their own legal advice as to whether Tupe regulations would apply. “WorkDirections did this and received advice that Tupe regulations were not likely to be considered to apply,” she said.

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