Cheshire trade unions are calling for waste services to be brought “fully in-house” at their local council and have criticised plans for a Local Authority Trading Organisation (LATO).
Cheshire West and Chester council is currently setting up a LATO to deliver waste services in the area, after Kier pulled out of its contract six years early due to “significant change in the market”. The new LATO service is expected to begin in April 2020 (see letsrecycle.com story).
But the West Cheshire Trade Union Congress (TUC) have said the LATO plans will “establish a ghetto of poor employment conditions which will be a threat to all existing council staff”.
The group criticised the council’s characterisation of the LATO as being based on “co-operative principles”. It says most of the former-Kier employees set to be transferred to the LATO will have worse terms and conditions of employment than previously and will not have the same benefits as staff employed directly by the council.
“The Council say they are bringing the service into the public sector again, but they are intent on doing little more than re-badging the company while denying staff the benefit of council conditions,” said Cecilia Jones, secretary of the West Cheshire TUC.
“Unlike staff in other Council companies these workers will even be denied access to the Council pension scheme and their employment terms will be significantly inferior.”
“The Council say they are bringing the service into the public sector again, but they are intent on doing little more than re-badging the company.”
Kenny Cunningham – chair of West Cheshire TUC – noted that the organisation welcomed the council’s decision not to put the service out to tender again, but wanted to see a fully “in-house” option which it believes would save money and better protect staff.
LATOs are council-owned companies which often take over the running of services from private companies. They are run for profit, but profits are reinvested into the council’s services. Local authorities were given the power to create these trading companies under the 2011 Localism Act.
Cheshire West and Chester council have defended their plans for LATO managed waste and says they have been found to be the best option after an appraisal that was presented to the council’s cabinet.
Councillor Karen Shore, cabinet member for environment, said: “The cabinet report makes it clear that there may be scope for the LATO to trade and secure external work in the future. This would be far more restrictive if the service was delivered in house.
“Staff will transfer on existing terms and conditions into the LATO. Some of the staff are already on local government terms and conditions and are members of the Local Government Pension Scheme (LGPS), and that will continue.”
The council say their LATO will commit to paying the Living Wage and work to reduce the number of agency staff. Staff who are not on the local government pension scheme will continue on existing terms and conditions and will be offered a comparable pension scheme to their current one.
Provision of the in-house service is forecast to cost the council £14.5 million to run in 2020/21, rising to £17.4 million from 2025/26. The council predicts that increased income and efficiency savings will offset the cost of this service.
The council serves around 340,000 residents.