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Agenda for Change – what’s all the fuss?

1 December 2005

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Patricia Gray
Patricia is a management adviser, trainer and facilitator in general practice. She is a Fellow of the Chartered Institute of Personnel and Development and was a practice manager/partner for 11 years.

T  01279 777371
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There can’t be many practice managers who haven’t heard about Agenda for Change (AfC), but some may be wondering, so what? How can the new pay and conditions of service structure being implemented for all NHS staff (excluding doctors for the time being) have anything much to do with general practice? After all, GPs are independent contractors and are not bound by the NHS pay and conditions for staff. The GPs, either partners or singlehanded, make their own decisions about what to pay their staff and what other rewards to offer, such as annual leave and paid sick leave. No one from outside the practice has ever interfered with these decisions before, so why should things change now?

What is going on?
It is worth reflecting for a moment on what AfC is all about and considering the implications for general practice. It is also worthwhile being aware that there appears to be something going on at the moment. The British Medical Association (BMA) and Royal College of Nursing (RCN) have already written to GPs encouraging them to implement AfC for their staff. It has now become apparent that the Department of Health has set up a working party with representatives from the BMA, RCN, primary care trusts (PCTs), Strategic Health Authorities, Primary Care Contracting and NHS employers, which is looking at how to encourage GPs to adopt AfC for their staff. A recent Department of Health (DH) discussion paper made it clear that because the new GMS contract provides increased investment in primary care, the DH expects practices to adopt AfC as a means of improving employment procedures. The paper refers to the additional profits for GP practices from the Quality and Outcome Framework (QOF) achievements and says that practices are expected to reinvest a proportion of these profits back to staff costs.

All this has fuelled speculation that the renegotiated GMS contract, effective from next April, may include quality points under the QOF for implementing AfC, or perhaps some other contractual mechanism to encourage or even cajole practices to conform with the NHS pay and conditions.

How did we get here?
AfC came about because the previous reward system in the NHS, negotiated by a myriad of Whitley Councils, all with different pay structures and conditions of service, was long overdue a complete overhaul.
After five years of negotiation and a true partnership of management and staff involvement, a reformed and simplified system was agreed with the same pay bands and the same conditions covering all staff. The new system was tested by 12 early-implementer sites before going live from October last year. Currently, the system is being phased into all NHS employers with a target date of the end of September 2005, although there has been some slippage due to the massive amount of work involved.

The system is underpinned by a job evaluation process that is based on an analysis of the factors contained in the job and a level awarded to each factor with a weighted score. The total of the scores denotes the pay band for the job. It is important to remember that job evaluation is all about the job, not the performance of the person doing it. The process requires robust and accurate job descriptions and personal specifications, which are studied by local panels made up of representatives of management and staff to determine whether the job can be matched to one of the 200 national profiles of common jobs that exist throughout the NHS. If the job can be matched, the band for that profile is adopted. It is expected that 80% of NHS jobs will be matched in this way. The jobholder’s salary package under the Whitley system is then compared with the pay scale of the new band and, generally, the employee is assimilated on to the next point up the scale, which results in an immediate small increase in pay, backdated to 1 October 2004.
If the job cannot be matched to a national profile, perhaps because it is a unique job or a specific management role, the process is passed to a job evaluation panel, who require the jobholder and the manager to complete detailed questionnaires about the job and be interviewed. Sometimes the job is matched or evaluated to a band lower than the current salary package, and then the employee’s current salary is protected without any increases until the new salary scale catches up or for a maximum five years.
Other local panels have been set up to check for consistency and to hear appeals, which an employee or group of employees are entitled to lodge within three months of being informed of their new pay band.
So, just where are we now?
Despite the amount of work that the system has involved, AfC has been generally very well received by management and staff in the NHS and has been seen to be fair and more flexible than the previous system. Local or national recruitment problems for certain types of staff have also been addressed through the ability to increase pay up to 30% either short or long term. There are also increases in basic pay for working in high-cost areas, such as London.

In the absence of advice about how to pay staff, many GP practices have been using Whitley scales and sometimes conditions of service to determine how to pay their staff. Some practices are more “Whitleyish” rather than true “Whitley”, as they have used a pay point somewhere in the middle of the relevant pay scale rather than the whole pay scale with the annual increments as well as annual cost-of-living increases. Fewer practices have adopted Whitley conditions such as annual leave, overtime arrangements, paid sick leave and maternity leave. Other practices have never used Whitley for pay and conditions, as they have found it to be inflexible or perhaps too costly.
For those practices that have used Whitley, they must consider what to do from April next year when the Whitley scales disappear. If they have referred to Whitley in their contracts of employment, staff handbook or employment policies, or indeed if the staff are under the impression that their pay is linked to Whitley, it is essential that the practice advises staff what the new system will be.

At the moment, it is not clear whether their will be some coercion from the government, but many practices are considering the benefits of adopting AfC. These include: keeping in line with NHS employers, especially where competing for the same staff; keeping in line with local practices that have already chosen the AfC option or are being run by the PCT; using the process to assess the relative value of all jobs to the practice and getting demarcations between jobs right; and increasing permanent benefits for staff with a tried-and-tested scheme.

The disadvantages of adopting AfC include: the increased costs with the impact of annual increases on a pay scale as well as annual cost-of-living increases; the future costs of staff progressing along a pay scale to the maximum point; the time and training involved if the practice adopts the job evaluation or matching process; and the increased costs due to increases in annual leave and sick leave. The minimum annual leave under AfC is 27 days per year, and the maximum is 33 days (dependent on length of service) plus eight public holidays, which is considerably more than the average practice offers its staff.
What of the future?
Here is a suggested checklist to help practices decide about the future:

  • What system do you currently operate for pay and conditions?

   1. If you use Whitley, or are Whitleyish, you must make a change from April 2006. Options (at the moment!) include:
(a) Adopt AfC in entirety (pay scales, conditions of service, etc).
(b) Adopt AfC pay scales only.
(c) Use AfC pay scales for guidance only.
(d) Decide whether to use the job evaluation process to determine the correct banding for the job or whether to simply assimilate staff pay to the next point on an appropriate band.
(e) Decide whether to do the evaluation internally in the practice (to keep control) or to arrange with other practices to evaluate all the jobs as a locality (to improve objectivity and share resources).
(f) Change to another system not linked to AfC.
(g) Decide how to involve or consult with staff about a new system.
(h) Write and confirm the change to staff as a variation to their contract of employment.

      2. If you do not use Whitley, your options are:
(a) Do nothing – wait and see.
(b) Network around and see what other practices are doing.
(c) Consider the implications of AfC.
(d) Discuss the advantages and disadvantages with the partners.
(c) Decide whether to consult or get feedback from staff.
(d) Ask the PCT’s advice.

  • What financial resources are available to pay for staff?

Move away from the idea of budgets funded by the PCT and move towards looking at total income and total expenditure to determine a sensible budget for paying staff. Are you paying staff enough to keep them motivated and rewarding good performance? Many practices have given their staff a bonus in recognition of their hard work during the first year of the new  contract – but is it sensible to continue paying bonuses when you are only really rewarding staff to do a good job? Bonuses can become an expectation. On the other hand, although permanent increases to pay may be fairer, they result in an  ongoing extra cost.

  • What are the benefits from working with other practices?

You may already belong to an effective manager’s group where you can consider the implications together. If you decide to go for AfC as a locality you will be able to support one another and share resources. There is going to be the tricky dilemma of who will evaluate the managers’ jobs – so you may want to make sure that your job description is up-to-date and reflects your true level of responsibility!