Protection for outsourced public-sector workers

Implementation date: Not expected before 2026

The Employment Rights Bill reinstates the "two-tier code" relating to the protection of workers under public-sector outsourcing contracts. 

The Bill includes provisions to require contracting authorities to ensure that workers employed by a supplier on an outsourced public-sector contract are treated no less favourably than those transferred in from the public authority (ie avoiding a two-tier workforce). Transferring workers must be treated no less favourably than when employed by the public authority. 

The Bill provides for the publication of a code of practice containing guidance for contracting authorities. The previous "two-tier code" was withdrawn in 2011.

It is not yet known when these measures will come into force. In its Next Steps to Make Work Pay policy paper, the Government said it expects to begin consulting in 2025 on the various measures covered in the Bill and that it anticipates that "the majority of reforms will take effect no earlier than 2026".