Unions plan offensive on privatised services

THE Government's policy of contracting out public services could be thrown into disarray by a legal offensive on behalf of more than 3.5 million workers, writes Barrie Clement.

A campaign of litigation co- ordinated by the TUC will use European law to prevent contractors introducing inferior pay and conditions for public service workers they take on.

Competitive tendering has meant that many companies keep their costs low by reducing wages and cutting benefits, unions say.

The British government has insisted so far that the European Community's Business Transfer Directive, which protects employees' rights when a company changes ownership, only applies to private business.

However, a revised directive, expected to be endorsed by the EC Council early next year, will make it clear that it applies to public services. The view will be confirmed by the European Court of Human Justice, TUC officials say.

Unions expect an 'avalanche' of retrospective legal action. Thousands of individuals could be empowered to seek remedies for any loss they have suffered because the Government failed to incorporate the original directive into domestic law.

The latest draft of the directive applies to all 'public undertakings carrying on activities of an economic nature, whether or not they are intended to operate for gain'.

The TUC has set up a 'legal working group' to advise unions on how to interpret the directive and take retrospective action.