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Islington Tribune - ROISIN GADELRAB
Published: 5 October 2007

Care staff paid to take lower wages

Report says Town Hall handed £2.9m to private firm to give lump sums to workers

A PRIVATE company was handed nearly £3 million by Islington Council to buy out care workers from their contracts so that they could be re-appointed on reduced wages an investigation has found.
An internal inquiry at the Town Hall, led by deputy chief executive Andy Jennings, concluded that Islington did nothing wrong when it paid the money to Care UK, the firm that runs three of its care homes.
However, Care UK said last night it did not recognise the £2.9 million cited in Mr Jennings’s report, as the amount it had received.
Details of the deal had been kept secret until Mr Jennings delivered his final report on Monday. His investigation was meant to end the controversy surrounding Care UK’s strategy of paying lump-sum payments to staff and then rehiring them on heavily reduced salaries.
Eighty-three staffers saw their wages go from £23,000 to £12,000.
Unison, the biggest trade union at the council, said there were questions still to be answered because their records show that only £1.5 million was used to pay off the staff, leaving the other half of Islington’s deal not accounted for.
Mr Jennings main criticism was that communications with unions could have been eliminated with “a more open information flow”.
Labour councillor Paul Convery said the scrutiny committee would be looking into the case, adding: “The council have played it very defensively and have cloaked it in an umbrella of commercial confidentiality.
“We know from the trade unions who negotiated the pay-off that the package cost Care UK £1.5 million. We’re asking why £3 million was paid up when Care UK only needed £1.5 million.”
Andrew Berry, deputy branch secretary of Unison, said: “The report does not answer what happened to the £3 million when only £1.5 million was spent on the buy-out.”
Liberal Democrat social services chief Cllr John Gilbert said the £3 million would be value for money compared to an overall reduction in the cost contract.
He added: “Care UK could go and spend that money however they want. They gave a lump sum to the workers. I don’t know how they were using the rest. I don’t think anybody expected it all to go to the workers.”
A spokesman for Care UK said: “We don’t recognise the figure of £2.9 million as the figure we received.”

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