The cost of equal pay disputes in UK councils could spiral out of control unless HR professionals take a proactive approach, the body representing local government employers has warned.
The government’s single-status agreement, devised in 1997, requires councils to harmonise pay and conditions for comparable posts. This affects 1.5 million public sector employees, and implementing the agreement before the April 2007 deadline is creating headaches for local authorities.
The latest figures suggest councils in the North East have already paid out about £100m. Birmingham City Council has warned a deal could cost £200m in legal costs, wage rises and back pay, and Cumbria County Council may have to fork out as much as £50m. Coventry City Council, which is currently facing strike action from three trade unions over equal pay, said it was facing an extra £7m in costs.
Sarah Messenger, service director at Local Government Employers, said: “Equal pay is a big problem and there are going to be significant costs. HR professionals should be working with unions at a local level to reach a collective agreement.
“The government has said that equal pay costs must come from local government funds. Councils will have to look at how the costs can be met,” she told Personnel Today.
Steep rises in council tax and cuts to local services could not be ruled out, Messenger said.