Decision status: Recommendations Approved
Is Key decision?: No
Is subject to call in?: Yes
Salford City Council - Record of Decision
The Reasons are that following the decision to transfer the security and concierge service in Pendleton back to the council in February 2021, we are now in a position to confirm the revised costs for the service and serve legal notice on the residents affected of the reduction in service charge.
Investigations show that the system can be transferred back to the council and a mobilisation plan has been developed to ensure the service remains operational during this period. The costs in the report reflect recent discussions with staff affected by TUPE and contractors’ assessments of the work required to transfer the service back to the council.
The report sets out the Council’s intention to bring back in-house the security and concierge services to Council-owned tower blocks in Pendleton. A Service Level Agreement (SLA) with Salix Homes for them to provide remote and on-site concierge services, CCTV monitoring and mobile patrols to the blocks is currently in place, but it is not clear in the report when that “Either party may terminate the provision of the Services by Salix under this Appendix by giving not less than six (6) months’ written notice to the other party",so the arrangement may be terminated by the Council serving 6 months' notice to terminate on Salix, without financial compensation becoming due. Salix are also obliged to continue to provide the services during the notice period, and to cooperate with the Council when the services are transferred to a new provider - the Council.
The Council is under a duty to provide "Best Value", and hence reserves the right to provide the services through whatever resources will provide that best value, which gives the Council flexibility to consider in-house provision without going out to the wider market.
The Council has carried out consultation exercises with tenants, residents, and partners and made a robust analysis and assessment of the service provision, concluding that bringing the service in-house will deliver best value for residents and the Council.
There are likely to be TUPE implications with the proposal, and no doubt HROD and Employment Legal Teams can provide more advice as the project develops. Whilst it is not clear how many employees may be in scope for TUPE, there is an obligation on both transferor and transferee (Salix Homes and the Council) to inform and consult with employees/unions, “long enough before the transfer” to enable consultation to take place, including any measures to be taken following transfer.
The Council will undertake an exercise to obtain Employee Liability Information (information about employees who are in scope to transfer with the service which Salix must provide to the Council at least 28 days before any transfer) as part of its due diligence exercise to enable the Council to form a reasonably accurate assessment of liabilities, costs etc of the staff transfer.
For information, if not already done as part of the assessment and options appraisal undertaken so far, as part of the due diligence exercise the Council should ascertain whether there are any; commercial agreements/contracts associated with the service which will need to come over and novated to SCC?; business assets which will need to be transferred to the Council; property, licence or lease issues, assignments or transfers to the Council may be required; and early engagement with ICT to ensure systems are transferrable/compatible with Council systems to maintain the service upon transfer.
Further analysis and review of the TUPE and other associated costs of the transfer of the Security & Concierge Service, from Salix to SCC, was undertaken between Service/Operational Managers, HR and Finance staff as well as consultation with existing Security Service staff in respect of rota requirements. This exercise resulted in a revised annual cost of service of £316,703 (as outlined in the body of the report). The full saving from the transfer will be passed directly back to the tenants in the form of reduced weekly Service Charges. All cost will be reviewed on an annual basis to ensure that the service charge to tenants are providing best value.
Procurement Advice obtained: Deborah Derbyshire
The advice provided is that this is a service that will be brought back in house with the potential of TUPE. Procurement recommend that a variation to the current contract in relation to the termination clause to be reduced from 6 months to 3 months.
HR advice obtained: Michelle Brass
The Salix employees that are employed directly on the security contract will TUPE transfer to the Council on existing terms and conditions of employment (Salix contracts) as of 1st September 2021. Under TUPE, the employees are protected entitling them to the same terms and conditions, with continuity of employment, as they had before the transfer. To date there are 6 security guards employed who are in the scope of this transfer.
Salix have been carrying out formal consultation with the employees affected as part of the TUPE process, of which SCC have also been in attendance to ensure meaningful dialogue has taken place in advance of the transfer. The measures initially suggested have since been amended following on from these consultation meetings, resulting in the requirement for the additional recruitment of 2 members of staff based on SCC terms and conditions. This is currently out to advert.
The formal Employee liability information must be provided by Salix no later than 28 days prior to the transfer of the undertaking, it would be expected that Salix would work closely with the council HR & OD department on the implications of the transfer and provision of meaningful employee data prior to the 28 days to enable a smooth transition of employer/service provider and to enable the council to determine if any measures need to be introduced and consulted on.
The following documents have been used to assist the decision process:
Report to Lead Member Briefing for Housing – 20th July 2021.
This matter has also been considered by the Lead Member for Environment, Neighbourhoods & Community Safety who is supportive of the decision.
The appropriate scrutiny panel to call-in the decision is the Growth & Prosperity Scrutiny Panel.
FOR DEMOCRATIC SERVICES USE ONLY
Publication date: 20/07/2021
Date of decision: 20/07/2021
Decided at meeting: 20/07/2021 - Statutory Deputy City Mayor & Lead Member for Housing Briefing
Effective from: 28/07/2021