Guidance

Contingent Labour Spend Control

Follow this guidance to ensure approval requirements are met for all proposed contingent labour spend with day rates of £1000 and above.

• From: Cabinet Office, HM Treasury, The Rt Hon John Glen MP and The Rt Hon Jeremy Quin
• Published: 26 January 2022
• Last updated: 1 February 2023 — See all updates

This was published under the 2019 to 2022 Johnson Conservative government

Documents

Contingent Labour spend approval form

MS Excel Spreadsheet, 62.7 KB

Details

This guidance sets out:

• the policy for Cabinet Office’s contingent labour spending control.

• the thresholds for spend controls

• the types of contracts in scope for this control

• How to apply - the approval process

Policy

The purpose of this control is to ensure that contingent labour contracts are only used where better value alternatives are not available. It does this by ensuring a justifiable need is identified by the organisation for contingent labour within their workforce plan, contracts are being managed cost effectively and adequate arrangements are made to recruit permanent or fixed term staff.

Spend control threshold

All CL contracts with day rates of £1000, excluding agency fees and recoverable VAT.

Types of contract covered by the spend control

This control covers central government organisations’ spending on contingent labour - contractors, agency workers, and temps - who will often, but not always, be recruited to undertake work in a BAU environment These contracts will generally pay on a time-based rate rather than delivery of an output or outcome.

The BAU environment

• The individual in the post will generally be directly managed by staff in the structure of the organisation and themselves be in a post that is recognised in the organisation’s structure.
• Operational roles will tend to be BAU.
• The type of activity undertaken by the role is likely to be ongoing - expected to remain for a reasonable duration (at least 12 months). In some cases, the role may be to provide a temporary boost to capacity for an ongoing activity (surge capacity).
• The activities carried out by the person in the role form part of the organisation’s core business, which may, in some cases, include very specialised activities requiring specialist skills. However, BAU activities should not include change activities, that transform the business or its ways of working.
• To be BAU the role is unlikely to be linked to a recognised project or change programme.

The following is out of scope of this control:

• consultancy: This is defined as the purchase of advice to fill a knowledge gap. This can include identification of options and recommendations, or assisting with implementing solutions, but should not be business as usual (BAU), therefore will be time-limited. Consultancy advice may relate to strategy, structure, management or operations of an organisation. Consultants should only be engaged where in-house skills are not available.
• professional services: These types of services seek to fill gaps to assist the procuring organisation to deliver or implement an operational service. As such professional services should not be purely (or mostly) advisory.
• secondments of workers from other organisations
• contingent labour contributing towards construction of a capital asset that is funded from a CDEL budget.

Approval process

Organisations are encouraged to develop and implement their own internal processes within their Corporate Governance structure. Securing organisational approval prior to a submission being forwarded for approval to the Cabinet Office is essential. It is recommended that Ministers or Accounting Officers are included in this process.

Submitting data / requesting approval

The attached form should be completed and submitted marked “URGENT CL APPROVAL REQUEST to the team mailbox. cabinetofficecontrols@cabinetoffice.gov.uk

You will receive a decision on your submission within five working days.

Contact for further information

Please contact cabinetofficecontrols@cabinetoffice.gov.uk for further information or to discuss any issues you have in applying this spending control.

Published 26 January 2022
Last updated 1 February 2023 + show all updates

1. 1 February 2023

   Spending controls reform _ Ministers Letter to Departments 21st December 2021_Operational guidance : Contingent Labour - changing thresholds and simplifying guidance. February implementation following impact workshops and consultation with department officials at an operational level.

2. 26 January 2022

   First published.

3. 13 January 2022

   Added Annex 3: Digital, data and technology contingent labour.