The Government has abolished the Code of Practice on Workforce Matters in Local Authority Service Contracts (the “two-tier code”). This follows the abolition in December 2010 of the equivalent Code for Central Government.  

Abolition of the code (which may be replaced by a statement of principles of good employment practice) is not retrospective, so existing contracts should not be affected, but it will depend on their precise wording: see our recent Employment Alert.

However, whilst new joiners will no longer have the protection of the two-tier code, employers will still have to comply with the (less generous) stakeholder requirements and, from next year, the auto-enrolment requirements. Furthermore, where TUPE applies, protection under the Pensions Act 2004 may operate.

The abolition of the Code is separate from the ongoing “Fair Deal” review (see Pensions Update, March 2011).