Since the formation of PCNs there have been many questions about how to manage the potential risk of employment liabilities arising at the end of the five-year period. In theory practices could find themselves with large redundancy bills should the funding come to an end or there not being appropriate mechanisms to manage the additional staff recruited into the PCNs.
This is especially important for those PCNs operating a flat or lead practice model rather than a subcontracted structure but it is an important consideration for any provider of PCN services.
The Update to the GP Contract has attempted to address this concern by highlighting three measures purporting to address the issue (clause 1.20 page 13).
This is a brief analysis of the three measures and looks at whether these measures have changed the situation and looks at further steps Clinical Directors and PCNs should be taking when assessing employment models.
What are the measures?
The three measures can be summarised in the following ways:
- Ask community-based partners to engage the extra staff on the PCN’s behalf
- The funding will be guaranteed within the ‘core general practice cost base beyond 2020/24’…’like the practice global sum’
- The law on the transfer of staff (TUPE) will apply
On the face of it these seem useful but, other than point 2, it could be argued that this simply represents the previous position and nothing has actually changed.
Asking a community-based partner to engage the extra staff on the PCN’s behalf
This has always been possible and is in action in various areas across the country. It could reasonably be extended to represent the option of asking any third-party to take on the risk by directly employing the individuals involved.
Charities, federations, specialist providers such as AQP providers, and NHS Trusts have all offered and provided this solution in different ways.
Whilst the third party would hold the liabilities it raises other issues that need to be considered:
A. Is the third-party providing the staff or a service to the PCN?
(i) If it is a staffing only model, ask the following questions:
(a) Is this subject to a VAT charge? Remember even NHS Trusts should charge VAT on arrangements of this nature although advice from VAT specialists will help to clarify this
(b) Who is the line manager?
(c) What risks are there for the practices if the individual makes a mistake, are they covered by the practice or the provider?
(ii) If it is a service model, ask the following questions:
(a) What is the service specification that is being delivered?
(b) How is this performance managed and what powers does the PCN have to influence it?
(c) How are issues and clinical governance arrangements managed?
B. Is this arrangement financially viable?
(i) All third parties have overheads and may include a sum covering this. This has been recognised with the freedom to support social prescribing charities but it remains a cost for other providers.
(ii) It is recommended that you carefully consider the additional charges for the service and whether these make the arrangement economically viable even when the risks at the end of the contract are factored in? Remember that larger providers such as NHS Trusts often have larger overheads than general practice is used to.
C. In the event of a change in circumstances with the PCN or third party is it possible to transfer the individuals over or are you at risk of losing these individuals to others should your agreement change?
D. Will the individual understand their role within this structure and how will you ensure that they are properly integrated into the PCN member practices?
E. Most importantly ensure that any arrangement with a third party is covered by a well-structured contract to reduce uncertainty and to avoid confusion.
In summary this position has not changed from last year but it is a good opportunity to review and to reflect on how these arrangements are structured.
The funding will be guaranteed within the ‘core general practice cost base beyond 2020/24’…’like the practice global sum’
It is reasonable to say that this does give some assurance that the money will continue within the system, but it does not directly respond to issues about employment liability.
The existence of money reduces the risk but if the method of providing the money shifts away from a collaborative working model in four years’ time, individual practices employing people may find that they no longer have the mechanisms to access the funding potentially held by other practices.
By way of example, if the funding was placed into the baseline of the practice global sum the role could effectively be unfunded and in areas with bad relationships this could result in an additional redundancy liability for the employing practice.
In reality this, is relatively low risk and the Update indicates that it certainly is not the intention of the current commissioners. It is recommended that this element is kept under review and noted as a risk for future years. It should form one of the core negotiating points once the 2023/24 negotiations commence.
Practices may consider entering a form of indemnity to cross cover the risk of funding being split in this way in the future. This would give additional and legally binding assurances between the parties which may settle some nerves.
The law on the transfer of staff (TUPE) will apply
As with point 1 this was always the case. TUPE is a matter of law that acts automatically if the appropriate criteria are applied.
The biggest problem with highlighting this as a measure to address the concern is the assumption that it would apply in this environment.
This is a complex area of law which is entitled to multiple articles in itself, but the key question that has to be answered is whether a service provision change affects ‘an organised grouping of employees…which has the principle purpose [of] carrying out of activities…on behalf of the client’.
Put more simply this requires the following:
- A clearly defined group of employees
- Providing a clearly defined service or activity
- On behalf of a client (the CCG)
For this to apply the starting assumption within the Update has to be that each of the additional staff members recruited on behalf of the PCNs are allocated to a specific service requirement.
In practice, is this likely to be the case? Consider the following three common scenarios:
- Social prescribers may be a distinguishable group providing a clearly defined service. If the CCG decides to re-commission this as a standalone service it may be possible to create the structure permitting a TUPE transfer.
- The home visiting requirements are a defined service and it would not be too difficult for the commissioners to recommission this as a standalone service. However, if it is provided by a mix of clinical professionals who have different day jobs and responsibilities across different practices is it possible to say that there is an ‘organised grouping of employees’? There may be a small core team that could be identified but in most models this is unlikely to be the case and TUPE is unlikely to apply
- First contact physiotherapists may provide support with on the day demand within the practices and help reduce day to day pressure to release the GPs and other team members to deliver other parts of the specification. If the DES ended it may not be possible to define a service that directly matches this with the same degree of integration with day to day practice and consequently TUPE may not be possible
These are hypothetical scenarios and solutions could be found for them all, if structured correctly, but it should help you to understand the degree of complexity that applies to this area of work.
It is without doubt that TUPE provides important and useful protections for both employees and employers, but it is not appropriate to rely on it as a key measure to avoid employment liabilities.
If you wish to increase the chances of relying on TUPE it is recommended that you consider the following in your staff planning:
- Is it possible to define shared services within your PCN? This should not prevent integration with practice teams but it will help ensuring that everyone understands the different aspects of both PCN and practice work
- Where possible can roles and responsibilities be defined within the context of these specific services so functions can be clearly allocated should it be necessary
- Obtain organisational and HR advice when you are seeking to make a change to help increase the chances that these protections can be used.
Are these measures enough?
The only definitive solutions is a legally binding indemnity from the commissioners relating to redundancies directly resulting from a change of policy. This remains unlikely and even if it could happen it is sometime away.
It is therefore remains important to ensure that the degree of risk is monitored and is properly understood. Taking some of the steps and/or asking the questions mentioned above may prove a useful stage in this process.
In practice these risks are not new within the NHS, with most providers of time-limited contracts having to manage them. Every provider of APMS and AQP services recognises that staff redundancies could happen every few years if a policy change or contract amendment does not go their way.
This is not an excuse as this level of uncertainty provides no benefit to the NHS or its workforce but we can gain some assurance that there are tried and tested methods of managing the risk. It must remain a priority that we recognise and monitor the risk by ensuring that it is at or near the top of all risk registers and remains a frequently point of discussion with the commissioners especially during future contract negotiations.
The three measures within the Update are a good initial step to help clarify the situation but this should not be perceived as ‘the solution’ as taking this approach could result in serious staffing and funding problems at the end of the contract.