In this study from the Whitehall II cohort, we found an increased risk of work disability among employees who had previously experienced major organizational change - the transfer of public sector work to executive agencies run on private sector lines. Our findings are also consistent with our earlier study of this cohort which used the measure of organizational change but focussed on self-reported psychological and physical morbidity.7
The adjustment for health status assessed at the beginning of the follow-up and unemployment periods after the baseline suggests that our results were not attributable to pre-existing morbidity or unemployment experiences during the follow-up period.
To our knowledge, this study is unique in terms of its prospective design and the ability to take account of a range of covariates. We treated our exposure group (employees experiencing major organizational change) in the same way as an “intention-to-treat group” in a clinical trial, that is, those reporting the exposure at phase 3 remained in the exposure group regardless of what happened to them after that. This approach is to minimise bias caused by exposure changes related to the outcome of interest; particularly appropriate when data on exposure during the follow-up are incomplete, as is the case in the present study. Although differential loss to followup among those transferred to agencies is possible, major bias is unlikely as the analyses controlled for differences in pre-existing health. We therefore believe that our findings are likely to be generalisable across the Civil Service and probably beyond to other office-based public sector employees.
It remains to be investigated whether there is a direct causal link between major organizational change, in terms of a transfer into an executive agency, and work disability. The unintentional drawbacks related to such changes may involve job insecurity, increased workload, and perceived injustice, especially if the process is insensitively managed and leads to major disruption of established social support networks. Many of these adverse psychosocial factors have been shown to be associated with poor health outcomes.8,9,16–18
The intensity by which organizational change and job insecurity is perceived by individuals may be dependent on the labour market context.8
Work in the British Civil Service was believed to be secure “for life” and changes that took place during late 1980s and 1990s were most likely to be experienced as fundamental and beyond one’s control due to the change from secure to an insecure job.19
Empirical evidence from the UK has shown that increases in the unemployment rate result in increases in applications for incapacity benefit, suggesting that part of the rise in the incapacity rate is actually “hidden unemployment”.20
Therefore, transfer of employees into executive agencies may have put higher demands on the capacities of transferred employees, competition for jobs, and unstable careers, eventually resulting in withdrawal from the labour market since they no longer “fit in”.
As the outsourcing and privatisation of public sector services become more common worldwide, our observation that the risk of work disability was greater among employees who experienced major organizational change highlights an important potential cost attendant on moves toward privatisation of the public sector.
What is already known on this topic
- Major organizational changes, such as outsourcing and privatisation, have been shown to be associated with impaired health among affected employees.
- Whether this impaired health subsequently translates into long-term work disability is unclear.
What this study adds
- Risk of subsequent work disability was higher among civil servants transferred to an executive agency (a form of outsourcing) than among those not transferred.
- This may highlight an unintentional cost for employees, employers and society.