Reducing Local Government Reliance on Temporary Work Contracts

Local Government has historically faced high staff turnover rates, often leading to a reliance on temporary agency staff. In March 2021 it was recorded that 45.3% of those who worked in Local Government worked on a temporary or casual contract. Only 26.2% of staff were employed on a permanent contract. This is reflected in 78% of Councils reporting recruitment and retention difficulties. [1]

Covid-19 has increased pressures on Local Government, with the Government announcing £120 million of funding in January 2021 to support Local Government with these workforce pressures. [2]

We heard from Sarah France-Gorton, who is responsible for the resourcing solutions service. She discussed the success of North Yorkshire County Council(NYCC) Effective Integrating Resources Strategy and how the strategy helped reduce Council spending on temporary staff from £4 million to £250,000. [3]

North Yorkshire is the largest county in England. The need for agency work in NYCC was reflective of many issues shared nationally with a high volume of needs in both the number and the range of positions required.

Drivers

There were many factors driving the need to improve resourcing at the council, with some being unique to North Yorkshire due to the make-up of the county. Other issues are faced by councils nationwide:

Economic -The need to improve what was a high cost and high-risk turnover to the council. The high-risk of turnover was created by the need for agency staff to work on long assignments.
Lack of agency supplies due to the more rural make-up of North Yorkshire
Discontent in the permanent workforce due to some agency workers receiving preferential treatment and higher wages than the permanent employees.

Talent Mobility- With agency as a quick fix, was the growth of current employees and future workforce being considered?
A de-centralised approach to hiring created a quick-fix approach to hiring when permanent employees should have been considered more.

Solutions

By centralising management of all staffing requirements it becomes easier to find resourcing solutions. This creates a uniformed approach to hiring, taking the quick solution of agency work away from different departments.

All contracts, both permanent and temporary, go on one platform. This streamlines the process so that it is easier to track the amount spent on temporary workforce solutions.

Through engaging in conversations with suppliers in the local community, the council created strong relationships with trusted recruiters. This helped to level up the local economy.

Consolidating this centralised approach, all services now have to hire an agency or consultant through the central system. Agency work is now a last resort only to be taken when permanent staff are unable to complete a task.

This approach to hiring gives power back to the council where before the agencies had greater influence. Agency staff get a maximum pay of what permanent staff get and not the market rate.

Challenges

While the council has benefitted from the improvements to resourcing efficiency, the plan did encounter some challenges. Sarah explained these challenges and how they were overcome.

Changing the mindsets of managers when introducing the new system. Temporary or limited funding created a mindset of quick-fix solutions in hiring instead of considering future talent to replace an ageing workforce.
The clinical nature of the centralised approach- By hiring through a central solution, some feared it took the human nature out of the hiring process.
Supply for roles that are harder to fill. Some roles are more specific so harder to find good candidates for. By creating good relationships with professional recruiters, the Council established partnerships that improved the chances of filling these positions

Impact

An annual spend of £4 million was reduced to just £250,000. At least 20% of the saving was purely on 3rd party agency fees.

Less than 1% of the workforce now is made up of agency workers.

Over 7,000 people are now employed directly to the Council

Improved fulfilment and labour conditions in the permanent workforce as they feel more valued as employees.

Services have benefited. There has been no use of agency work in children’s social care for 6 years and this has greatly improved the quality of the service.

What can be learnt from North Yorkshire County council?

By centralising the hiring processes better relationships with staff are created. Promoting future talent where possible leads to a lower staff turnover rate.

The economic benefits enjoyed as a result of this approach show how centralising the process reduces reliance on agency hiring. The service benefits show how clear communication between managers is needed to ensure the right candidate is hired in a permanent capacity.

A similar 5-year strategy has been used by North Tyneside Council who also do not have agency staff on staff in children’s services. [4] It was challenging for both this council and North Yorkshire County Council, though both succeeded in their aims to reduce reliance on agency staff.

The success is not just unique to NYCC as other organisations have also succeeded, demonstrating that it is possible to reduce the national reliance on temporary agency staff in Local Government.

[1] Local Government Association, Local Government Workforce Summary data
[2] Workforce Capacity Fund (2021)
[3] Sarah France Gorton, Head of Resourcing Solutions North Yorkshire County Council, (2021)
[4]North Tyneside Council, North Tyneside Plan, (2018)

As of March 2021 45,3% of those employed in Local Government worked on a temporary or casual contract. Only 26.2% of staff were employed on a permanent basis. This case study examines North Yorkshire County Council’s Effective Integrating Resources Strategy and how the strategy helped reduce spending on agency staff by over £3.5 million.