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Firms warned they face ban from public contract bids if involved in blacklisting

The First Minister restated the Scottish Government’s commitment to tackling ‘blacklisting’ yesterday, unveiling new guidelines for public bodies that require companies seeking public sector contracts to disclose whether they have been involved in the practice.

Mr Salmond announced the move ahead of the Scottish Government-Scottish Trade Union Congress biannual meeting, coinciding with a UK-wide ‘day of action’ against blacklisting.

The policy guidance includes new standard Pre-Qualification Questionnaire questions requiring suppliers to disclose if they have breached laws against blacklisting. If found to have used a blacklist, a bidder will have to show it has taken appropriate remedial action.

The Scottish Government has also included a new contract clause in its standard terms and conditions, allowing contracts to be terminated if a supplier is found to have breached the relevant legislation.

The Procurement Reform Bill, currently before Parliament, will enable the Scottish Government to make regulations on how a firm’s suitability to bid for contracts is assessed – providing an opportunity to place the new policy guidelines on a statutory basis.

The First Minister said:

“The Scottish Government is opposed to blacklisting in any form, given the serious impact it can have on the career, livelihoods and lives of those affected. Companies awarded public contracts must maintain high standards of business and professional conduct.

“As part of our on-going engagement with the STUC and interested Trade Unions, we have been considering how we can enhance current procurement guidelines, building on the existing assessments for bidders’ suitability for such work, to tackle blacklisting. Everyone has a right to work and to raise concerns, including through a union. They should not expect to be inhibited in any way by choosing to exercise these rights. And they can expect this Government to use the powers available to us to take action in future against firms that engage in blacklisting.

“We are making it absolutely clear to any company wishing to tender to supply, build or service parts of our national infrastructure, or to deliver our public goods and services, that blacklisting will not be tolerated and that they face being excluded from bidding for public contracts if found to be taking part in this unacceptable practice.”

STUC General Secretary Grahame Smith commented:

“The STUC welcomes the Scottish Government’s procurement guidelines, which follow extensive and constructive discussions with unions. They make it clear that public bodies should only give new public contracts where blacklisting employers have taken appropriate remedial action in a number of key areas including making an apology to the affected workers; issuing a statement on future conduct; and proving compliance with any tribunal ruling made against them in relation to blacklisting. The STUC also welcomes the provision for the potential removal of an existing contract from any firm which is proven to have lied in its tender submission. The STUC is committed to working with the Scottish Government to monitor the use of this guidance and provide further evidence where we believe the practice of blacklisting continues.”

Notes to editors

Blacklisting in this context is the practice whereby companies use, compile, sell or supply details of individuals who are or have been a trade union member with a view to using that list to discriminate in relation to recruitment or treatment of workers. The main pieces of legislation relevant to blacklisting are:

In addition:

• The Data Protection Act 1998 protects the way information is used / misused, e.g. passing on data relating to individuals to blacklisting companies.

The Scottish Government guidelines were developed in partnership with the STUC, Unite, UCATT, GMB and Unison and apply to all public sector buying organisations. Compliance, including the use of the new sPQQ questions and contract clause, is mandatory for the Scottish Government, including agencies such as Transport Scotland. The wider public sector, including local councils, will be encouraged to follow the guidance. It can be read here: http://scotland.gov.uk/Topics/Government/Procurement/policy/SPPNSSPANS/policy-notes/SPPNsissuedin2013/SPPN42013

SG-STUC biannual meetings take place twice a year and are a key element of the formal Memorandum of Understanding agreed between the two organisations, setting out how they work together and can expect from each other to help improve the development and implementation of policy. The Scottish Government and the STUC share a commitment to partnership working on strategic issues and in areas of common interest – an approach underlined by the First Minister in his address to the STUC annual congress in Perth on April 16 this year (http://www.scotland.gov.uk/News/Releases/2013/04/STUC16042013).

The Scottish Government recently introduced the Procurement Reform (Scotland) Bill to the Scottish Parliament, on 3 October 2013. It aims to establish a national legislative framework for sustainable public procurement that supports Scotland’s sustainable economic growth through improved procurement practice. The Bill will include enabling powers allowing Ministers to make regulations concerning the selection of companies to bid and on how their suitability should be addressed – in effect offering an opportunity to place the new policy guidelines on a statutory basis. The enabling powers will provide Scottish Ministers with the flexibility to address issues such as blacklisting, while working within EU law. The Scottish Government is also considering what amendments might be appropriate to the Public Contracts (Scotland) Regulations 2012.

The Scottish Affairs Committee at Westminster is investigating the use of blacklisting of workers in the construction sector.