Public Sector Outsourcing

Expected October 2026

The legislation will amend the Procurement Act 2023 to protect transferring workers on outsourcing contracts, and those working alongside them.

The reinstatement of the two-tier code will be coming in place in October 2026.  The two-tier code was withdrawn in 2011 and replaced with ‘Principles of Good Employment Practice’ which could be applied on a voluntary basis.

The legislation  will reinstate the two-tier Code to prevent a workforce where private sector employees working on an outsourced public sector service contract have worse terms and conditions than those employees who were transferred to work on it from the public sector. So, in effect, where public services are outsourced, the contractor's direct hires are not treated less favourably than the incoming public sector workers, and vice versa (preventing a "two-tier workforce").