Agenda item

To provide Members of the Human Resources and Council Tax Committee with an update on a number of key Human Resources activities, including the pending Pay Review and Pay Award, the procurement of a new HR & Payroll System and the introduction of a new Employee Benefit – Salary Finance.


The Committee had before it a report from the Assistant Director (Partnerships) (report A.1) which provided Members with an update on a number of Human Resources activities.


Procurement of a new Payroll & HR System


The Committee heard that Tendring District Council (TDC) currently used a Human Resources and Payroll software solution provided by Iris FMP TeamSpirit (version 23.1.2). The current system was due to be retired (no longer supported by the provider) on March 31 2024 and as a result, there was a requirement to purchase a new software solution.


Members were told that the TDC payroll function facilitated payment to approximately 700 staff; at the time of writing that compromised permanent (521) and temporary (16) members of staff; apprentices (10) and casual workers (150).


The Committee was made aware that membership in the Local Government Pension Scheme (LGPS) was automatic for most TDC employees; therefore, all elements of employer and staff contributions and management activity, including the production of monthly returns, were required.


The Committee was also told that there was also the need to facilitate a separate Elections Payroll (in order to process data files provided by the Elections Team) to pay those working on behalf of the Returning Officer at any Election.


Officers informed the Committee that the objective of procuring a new system was to deliver an integrated Human Resources and Payroll software solution that sought to automate the administrative functions of each discipline, providing an end-to-end solution that supported the entire employee lifecycle from recruitment to end of employment.


It was reported to the Committee that a detailed specification had been prepared to outline TDC’s requirements in respect of the Human Resources and Payroll software to support TDC’s activities in those areas, including the following requirements:-


  • Adequate security controls throughout the Human Resources and Payroll disciplines.


  • The provision of accurate information for statutory and Government returns as well as internal management information.


  • A flexible approach allowing TDC to implement and use any additional module(s) according to their own timetable and/or requirements.


The Committee was also informed that the Council’s financial controls would also be embedded within the chosen system to achieve greater efficiency with the use of automated processes and decision-making.

Members were also told that, in line with the expectations set out in the Council’s constitution, a framework agreement had been identified rather than the Council undertaking its own tender process (due to the significant number of suppliers, it was expedient to use a framework approach rather than a full tender process). This framework was available via Crown & Commercial Services (G Cloud 13, lot 2). The framework allowed for a contract period of up to 4 years (3 + 1) and could be awarded directly rather than through any further competition.


Members were made aware that the procurement exercise entailed a long, medium and short list process, whereby the Authority’s requirements were described, and suppliers were narrowed down against those through each list or stage. MHR iTrent had come out as the only supplier that could specifically meet the Council’s requirements.


Members were informed that MHR iTrent currently delivered services to 47% of UK Local Governments. In addition, it was noted that other local authorities in Essex also used the MHR iTrent system, which could provide further value for money opportunities/flexibilities as part of potentially exploring shared service options going forward.


Furthermore, Members heard that, in terms of key milestones and delivery, subject to Cabinet’s agreement to the additional necessary funding as part of the review of carry forwards from 2022 – 23, which they had considered at their 6 October 2023 meeting, it was anticipated that contracts would be signed early in October and implementation would commence shortly after. A dual payroll process would be undertaken in January, February and March 2024 to ensure the system was fully tested before going live on 1 April 2024.


Procurement of InfinitStats System to support the pending Pay Review


Members were reminded that this Committee had previously requested that Senior HR Officers engaged the services of the East of England Local Government Association ((EELGA) a politically led, cross-party organisation that worked on behalf of the 50 local councils in the East of England) to expand on the earlier Pay Review undertaken (which had looked at the recruitment and retention issues for Tendring District Council, reviewing current solutions in place and seeking alternative options. Also benchmarking the Council’s offer and against current market, with options for consideration where appropriate) to carry out a comprehensive, service wide review of TDC’s pay structure as follows:-


  • Across the whole staffing establishment, in the context of neighbouring authorities and regionally.


  • In the context of professional and technical areas – that would be an extension of the work already undertaken by EELGA and would also consider those areas in which Market Forces Supplements* were currently applied.


*A Market Forces Supplement was an additional temporary payment to the basic salary of an individual job or specific group of jobs where market pressures would otherwise prevent the Council from being able to recruit or retain staff with a particular skill or group of skills as endorsed by the Human Resources & Council Tax Committee.

The Committee heard that upon completion of the review, TDC was looking for formal recommendations for corrective action (if applicable) both in terms of the current salary position and the likely position in 3 – 5 years. That was particularly important in the context of the current fiscal savings agenda and would allow TDC to set an appropriate salary budget position.


Members were made aware that the EELGA had responded to the request to say that whilst  they could support the workstream, they were unable to undertake any separate pay benchmarking outside of InfiniStats (in the region), and therefore that assignment would require the Authority to be signed up to the system.


Officers told Members that once they had InfiniStats, the Authority planned to engage an EELGA (Talent Bank) Associate who could then utilise TDC’s and other Councils’ data in the context of undertaking the pay review and provide formal recommendations as outlined above.


Members were assured that the additional benefits offered by using InfiniStats to support that workstream would mean that the Authority would have access to regional and local pay data on an ongoing basis.


Therefore, once the review by EELGA had been concluded, a report of the findings and the associated recommendations for action (if applicable) would be presented to a future meeting of the Human Resources & Council Tax Committee.


Introduction of a new Employee Benefit – Salary Finance


Members heard that, as a result of the current cost of living pressures, TDC employees, like everyone else, might be struggling more than ever with their finances, which could place additional pressure on their mental health and ability to be productive at work.


The Committee was told that supporting the financial wellbeing of TDC’s employees was one of the most effective ways the Council could improve their personal and professional lives.


Officers informed Members that, according to recent research undertaken by Salary Finance – 2023 (figures related to 15.6 million working people):-


  • 53% of people had struggled more with their finances since Covid-19;
  • 2x as many people worried about their financial situation every day;
  • 95% of those people say that it had had a negative impact on their mental health;
  • 43 million hours had been lost each week to poor financial wellbeing; and
  • 40% of people had stated that their financial situation affected their ability to be productive.


The Chartered Institute of Personnel and Development (CIPD) believed that all workplaces, regardless of size or sector, should offer financial wellbeing support to employees (February 2023).


The Committee also heard that the Council did not currently hold a contract with any salary finance company. Previously, the Council had had a contract with Neyber; however, that company had been bought out by its biggest competitor, Salary Finance.


Members were made aware that, as a due diligence exercise, HR Officers had researched the salary finance market to ensure TDC employees were offered value for money and the best service possible from a reputable finance company.


The Committee was informed that following that research into Salary Finance, it was identified that they were a well-established, reputable financial wellbeing provider. It was the largest employee finance wellbeing provider in the UK, helping over 4.5 million employees. Their services were used by a large number of private, public sector (including many local, district and borough Councils), and not-for-profit organisations. Their services were also endorsed by the Public Services People Managers Association (PPMA).


It was reported that Salary Finance offered a range of different options to suit each individual employee. That could be a loan, an advance, savings and/or an education platform. The percentage rates were more favourable than those of high street lenders and gave the employee the flexibility to repay their loan, advance, or savings through their salary. The service was free to the Council, as the employer, and therefore an easy way to offer support to employees.


The Committee heard that there was no specific cost to TDC for using the service, apart from the administrative costs for the Payroll and HR teams, which would be responsible for setting up individual arrangements with employees and Salary Finance.


It was planned that, following the 12-month initial contract, the service provision would be reviewed and if TDC was satisfied that the service met TDC employees’ needs, TDC would look to extend it for a rolling 12-month period*.


Officers told the Committee that it should be noted that Salary Finance was part of the suite of financial wellbeing support for TDC employees. The Council already provided financial advice through other ways to support TDC employees during those particularly challenging times. The Council was also planning to promote free cost of living support sessions for employees over the coming months, which were being provided by the Suffolk and North-East Essex ICS, who were partnering with HSBC.


*If the Council decided not to extend the contract with Salary Finance, any employees who had existing arrangements would not be affected as Salary Finance would continue to comply with all of its outstanding obligations with no impact to the organisation. Similarly, should an employee leave the employment of TDC, any financial obligation would transfer to them.


Pay Award Update 2023/24


The Committee heard that the Council was part of the National Employers arrangements (The National Agreement on Pay and Conditions for Service), whereby pay awards were negotiated nationally between local authority representatives and trade unions, with those arrangements covering around 1.4 million people across around 300 councils.

Members were told that a full and final pay offer had been made by national employers in February 2023 as follows:-


  • With effect from 1 April 2023, an increase of £1,925 (pro rata for part-time employees) to be paid as a consolidated, permanent addition on all NJU pay points 2 to 43 inclusive.


  • With effect from 1 April 2023, an increase of 3.88 per cent on all pay points above the maximum of the pay spine.


  • With effect from 1 April 2023, an increase if 3.88 per cent on all allowances (as listed in the 2022 NJC pay agreement circular dated 1 November 2022).


The Committee was informed that two of the Trade unions had called for a re-negotiation, one of whom had a current ballot of its members for industrial action (due to conclude on 24 October 2023). However, if the offer was to be accepted by the unions, an employee on the bottom pay point in April 2021 (earning £18,333) would have received an increase in their pay of £4,033 (22.0 percent) over the two years to April 2023. For an employee at the mid-point of the pay spine (pay point 22), their pay would have increased over the same period by £3,850 (13.99 percent).


Two out of three unions needed to agree in order to put into action the 2023 pay award.


Members also heard that National Employers continued to advise very strongly against imposing any pay offer before the collective process had concluded as that carried the risk of fragmenting the unity of the employers’ position as well as having wider legal implications.


Finally, the Committee was told that once the pay award was agreed upon, HR Officers would work with Payroll colleagues to ensure that it was processed as soon as possible including the backdating arrangements to 1 April 2023.


It was unanimously agreed and:-


RESOLVED that the Human Resources & Council Tax Committee noted the contents of the report, including the Officer Decisions already taken in consultation with the Chairman of the Human Resources & Council Tax Committee, and the decisions taken by the Portfolio Holder for Corporate Finance & Governance (as outlined under the ‘Previous Relevant Decisions’ heading of the report).

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