Low-Wage Work in the United Kingdom

5. Improving the Position of Low-Wage Workers Through New Coordinating Institutions: The Case of Public Hospitals

CHAPTER 5 Improving the Position of Low-Wage Workers Through New Coordinating Institutions: The Case of Public Hospitals Damian Grimshaw and Marilyn Carroll This chapter explores the characteristics of low-wage work in the United Kingdom’s public hospital sector (the National Health Service), which is the United Kingdom’s largest employer, with a workforce of some 1.3 million. We focus on two target occupations, assistant nurses and cleaners. One in five assistant nurses and three in five cleaners are estimated to be paid below the low pay threshold. The quality of jobs for these workers is necessarily shaped by the changing financial and labor market pressures faced by hospital managers , much like the other private sector occupations addressed in this book. However, unlike the other examples of low-wage work, in this chapter we show how new “coordinating institutions” negotiated by the social partners (employers, unions, and government) to cover the entire public hospital sector also play a major role. The context for the new institutions is complex. The overriding impression is one of conflicting political agendas, pilot initiatives, stalled and delayed policy reforms, and challenging (if not chaotic) demands for micromanagement coupled with strict national-level performance targets in everything from hospital finance to cleanliness . But as well as being at the center of a fast-changing political agenda of welfare services reform, the public hospital sector has also been at the vanguard of a raft of new policies and initiatives to reform pay, employment relations, and work organization. These reforms constitute an important change in the institutional architecture—improving basic pay, providing new career paths, reducing job insecurity , and extending terms and conditions to outsourced workers. From the perspective of labor market theory, these new institutions are illustrative of institutions that provide the social partners with the 168 capacity for cooperative engagement in collective discussion and negotiation (Elster 1998). Compared to other sectors characterized by a weak role for the social partners, the presence of coordinating institutions may improve information sharing, long-term trust, and the shared capacity to respond to future unanticipated challenges (Hall and Soskice 2001, 11–12). The most notable of the coordinating institutions are a new harmonized and coordinated national pay structure, a newly established, national, not-for-profit organization that supplies nursing temps, and a new governmental code that requires private subcontractors to establish terms and conditions equivalent to the national pay agreement . Our data suggest that the new institutions have established the basis for positive prospects for low-wage workers, reflecting the coordinated initiatives of trade unions (to improve the status of the very low-paid), government (to increase expenditures), and employers (to address skill development). Nevertheless, several notable tensions and obstacles remain. We begin with a review of the organization of the public hospital sector and its size, performance, and workforce composition. THE UNITED KINGDOM PUBLIC HOSPITAL SECTOR The publicly funded and publicly provided hospital sector, the National Health Service (NHS), dominates health care provision within the United Kingdom, accounting for around 85 percent of total health care spending. It is organized according to the principle of universal health services that are free at the point of use to the patient and funded through taxation.1 This means that spending on hospitals is highly politicized and scrutinized and that it must meet a range of competing demands, including increasing patient expectations and the politics of public sector expenditure. As such, politics, bureaucracy, transparency, and the United Kingdom-specific welfare state model all play important roles in shaping the context for patterns of work and employment. During the late 1980s and the 1990s, under successive Conservative governments, the public hospital sector experienced tight restrictions on spending coupled with market reforms (compulsory competitive tendering and the establishment of NHS “trusts” in place of hospitals). Data from the OECD show that while health care spending as a share of GDP in the United Kingdom already lagged The Case of Public Hospitals 169 behind Germany and the United States in 1970 (3.9 percent, 4.8 percent , and 5.1 percent, respectively), by 1999 a far larger gap had opened up (7.3 percent, 10.6 percent, and 13.0 percent).2 Politics matters with regard to health care spending, and the election of the Labour government in 1997 made a significant impact (Peston 2005). After an initial two-year freeze on public spending, the first three-year Comprehensive Spending Review...