What were the main effects of the 1979-1997 Conservative governments’ reforms to collective labour law and what distinguishes the approach taken by the current Labour administration?
Collective Labour Law: The Impact of 'New' Labour
What were the main effects of the 1979-1997 Conservative governments' reforms to collective labour law and what distinguishes the approach taken by the current Labour administration?
In order to answer this question "collective labour law" must be explained and defined so the effects of each government can be focussed in the appropriate area. This essay will then move on to examine the situation prior to 1979 so as to assess the extent of the Conservative administrations' impact of collective labour law at that time, a type of 'before and after' measurement. Having done this, the emphasis will switch to examining Thatcherite and Conservative ideology hoping therefore to explain the mechanics of the legislation that the Tories then introduced. It's effects will then be assessed.
After this point this essay will turn it's attention to Labour Party ideology, in order to use it as a means of putting into context the legislation which the party has introduced, this will then be assessed in greater detail. The link between 'New' Labour's administration and the European influence will also be examined at this point in the essay, and how this has impacted on British collective labour law. A summary will then be given and all conclusions will be drawn together in order to answer the set question.
Brown (1993) said, "It is generally more useful to use the term [collective labour law] to cover a broader set of joint regulatory behaviour, whereby employers deliberately permit representatives of employee collectives to be involved in the management of the employment relationship." This generally means that employers choose to liase with union representatives to discuss the manner in which the company is run and debate issues affecting its' employees. Collective labour law is the legislation outlined by the government that regulates this area of bargaining and discussion, including union regulation, recognition, membership, organisation and industrial action (of all kinds).
The Labour Party, formed in 1893, has its' roots firmly in the industrialisation era. It is traditionally working class in membership. Jon Monks (cited in Salamon pg104) said that "Labour and the trade unions had shared values: primacy of collective bargaining, expansion of the welfare state and state intervention to promote economic growth and employment." The Labour Party was elected to power in 1974. Though as 'New' Labour the party has now adopted "The Third Way" at that time, it still supported the Corporatist ideology, part of which meant supporting the trade unions and collective bargaining. During this time, trade unions "accounted for ninety per-cent of party membership, [provided the party with] eighty per-cent of its' annual income [and] sponsored fifty per-cent of it's MPs" (Salamon pg105). The Employment Protection Act of 1975 (and Employment Protection (Consolidation) Act of 1978 encouraged trade union membership and activities as well as legislated so that statutory time off had to be given in order to enable union officials to complete their union duties. The act also facilitated trade union recognition by employers (under section 11 of the EPA 1975) with the instigation of a set union recognition procedure involving ACAS (Advisory Conciliation and Arbitration Service), and obliged employers to consult and share information with unions regarding organisational changes and matters directly affecting employees. However in an effort to protect all employees, not just union members, the act also provided legal procedures for extending the terms and conditions of the employment contract where major unions were not recognised and could not bargain on behalf of the employees. The legislation from that particular Labour administration also promoted conciliation, arbitration and employees participation (in the bargaining process). The act also tried to regulate incomes with the setting up of 26 regional wages councils to standardise incomes and set recommended minimum wage levels.
In 1980 trade union membership in the following unions was; Transport and General Workers Union, 1887000, the Amalgamated Engineering Union, 1166000 and the General Municipal Boilermakers Union stood at 916000. In 1979 total union membership stood at 13447000 with a union density of 55.4% (Bain & Pierce 1983).
It can be seen from the above that the Labour administration of 1974-1979 was one of support for trade unions, collective bargaining and collective labour law. Membership of trade unions was, it can now be see, at an all time high.
However, all this was to change once the Conservatives came to power under Margaret Thatcher in 1979. According to Farnham, (1999, p215) "...[the change in State policy] had considerable implications for public policy on employee relations, which shifted from one focused on 'voluntary collective bargaining' in conditions of full employment and strong trade unions (with attempts ...
This is a preview of the whole essay
It can be seen from the above that the Labour administration of 1974-1979 was one of support for trade unions, collective bargaining and collective labour law. Membership of trade unions was, it can now be see, at an all time high.
However, all this was to change once the Conservatives came to power under Margaret Thatcher in 1979. According to Farnham, (1999, p215) "...[the change in State policy] had considerable implications for public policy on employee relations, which shifted from one focused on 'voluntary collective bargaining' in conditions of full employment and strong trade unions (with attempts at 'bargained corporatism' through 'social contracts) to neo-laissez-faire."
Thatcherite and Tory ideology was indeed one of laissez-faire, liberalist (neo-unitarist) foundations. It was a kind of economical Darwinism, survival of the fittest. Mrs Thatcher is famous for having apparently said that there is no such thing as society. For this reason it is not possible to legislate for the benefit of it, only for individuals. According to Salamon (2000: p292) the Conservative government "aimed to redress the perceived power imbalance in favour of trade unions and allow management to re-exert its' prerogative which was to promote 'responsible trade unionism', to protect individual members against 'union tyranny' and to promote employment opportunities and labour flexibility through de-regulating employment." It can be seen from this statement that the Conservative government very much believed in the individuals' right not to join a trade union, and to give back 'control' (it having been removed by the unions' ability to strike without notice) of industries to the organisations themselves.
Blyton and Turnbull (1994 p155) describe Mrs Thatchers' opinion as being that "the nationalised industries which should have virtue on their side were hopelessly distorted and confined by state control and the absence of market competition. The unions, who were beneficiaries of these monopolies were accomplices to the most scandalous inefficiencies and had to be stripped of power."
This philosophy could perhaps explain the reason why the Conservatives chose to introduce eight acts of legislation affecting the unions within thirteen years. These acts covered three main points. They restricted the scope of lawful industrial action thereby reducing trade union power. They established "rights to disorganise" (Lewis cited in Salamon p107) by establishing non-membership rights thereby undermining the maintenance of collective relations. The final point is that the legislation intervened in the internal affairs of trade unions by promoting a representational democratic model, thereby reducing the influence of 'activists' in union decision making. The acts themselves are listed as follows:
The Employment Act 1980; this reduced employment rights under 'unfair dismissal' and reduced in instances in which dismissal could be classed as unfair. It also placed restrictions on 'closed shops' (where all employees must be union members) in that an employee could work in a closed shop but not be a member on the grounds of "strongly held political convictions". New closed shops now needed 80% of its' work force to be in agreement or 85% of all those voting in order to make their place of work a closed shop. A right to be re-instated after maternity leave was introduced, the trade union recognition procedure was repealed, a code of conduct regarding picketing was established and secondary picketing (picketing away from the site of the dispute) was outlawed. Secondary and 'sympathetic' (workers in differing industries striking in support of other workers) strikes had restrictions placed on them. The grounds for refusal to join a trade union were extended.
The Employment Act 1982; this reinforced many points from the previous act including the restrictions on closed shops, and protection and compensation payments for non-members. Ballots on closed shops had to be taken in all existing arrangements across the UK, and 'union labour only' commercial contracts became illegal. The act made it legal to selectively dismiss striking employees and redefined 'trade dispute' in that political strikes became illegal. The act also removed trade union immunities from the civil courts (which affected strike action).
The Trade Union Act 1984; this act concerned itself with the internal affairs of the trade unions. It stated that ballots had to be held every five years to elect officials to the unions' National Executive Committees, secret ballots had to be held before industrial action took place (and not more that four weeks before the action was to take place). Ballots also had to be taken to establish who the union was to give its' political funding and this had to be reaffirmed every ten years. The act also redefined 'political objects' on which the unions' political fund could be spent.
The Wages Act 1986; after this act the wages councils (of which there were twenty six) were only allowed to specify a single minimum wage rate of pay and a single overtime rate which applied to every worker regardless of skill. Workers under twenty one were no longer covered by this wage protection.
The Sex Discrimination Act 1986; this removed the exemption that the small firms (five or less employees) had from the Sex Discrimination Act of 1975.
The Employment Act 1988; under this act a union must hold separate ballots for industrial action if those who are likely to take part in such action have different places of work. Ballot papers must ask whether the member is prepared to take strike action or action short of a strike. Members were given the right not to be 'unjustifiably disciplined' by their union, and a new commissioner for the Rights of Trade Union Members was appointed.
The Employment Act 1990; when this act was passed pre-entry closed shops became illegal, unions became vicariously liable if any of its' officials called for strike action without following the proper procedures, employers were given greater freedom to dismiss any employee taking unofficial strike action, and further restrictions were placed on secondary action.
Trade Union Reform and Employment Rights Act 1993; under this act employees were given the right to decide which union they joined. Postal ballots had to take place now before any strike could occur, and unions had to provide employers with at least seven days notice before any strike action could take place. The twenty-six wage councils were abolished and ACAS' requirement to 'encourage collective bargaining' was removed.
At the end of the Conservative run of administration (finally finishing with John Major as Prime Minister in 1997) it is evident that the legislation very much followed the Conservative ideology of individualism, legislating for the individual and stripping collectives of their powers, as evidenced by the following figures. In 1990 the Transport and General Workers Union membership stood at 1224000, the Amalgamated Engineering Union at 702000 and the General Municipal Boilermakers Union membership stood at 865000. In 1978 the total number of working days lost that year was 9405000 but in 1995 that number was just 415000. From this can be seen the total effect that the Tories had on collective labour law and bargaining.
Blyton and Turnbull (1998 p263) said, "Throughout the 1980s the Thatcher government had made a virtue out of standing firm." The Conservatives had actively discouraged collective bargaining and hindered the trade unions as much as possible, so much so that union membership had dwindled to the figures in the previous paragraph. In 1997 trade union membership stood at 7154000 employees, a massive drop of 6293000 from that of 1979, and a union density of 30.2%, again a big drop of 25.2%. The effects of the Conservative era of power can clearly be seen here. When John Major and his party were defeated, the unions were virtually powerless, with their membership drastically reduced.
Labour is traditionally the party of the trade unions as has previously been discussed. However, since the birth of 'New' Labour things have changed considerably. In the 1980s Labour became concerned by their apparent 'unelectability' so it's leaders reformed and modernised the party image, which included 'loosening the link' between themselves and the trade unions, even incorporating a Business Manifesto for their 1997 election campaign. At this time the party also adopted "The Third Way". This replaced the previous Corporatist ideology behind the party. The Third Way is a 'middle ground' between the traditional socialist views of the old left wing party and the right-wing views held by the Conservatives. The result of the image overhaul and change in strategy is that the trade unions became part of a coalition supporting Labour, but not the "senior partners as of old" (Salamon: 2000).
Accordingly the New Labour Party focuses much more on the fact that labour flexibility has become an increasingly important issue for government strategies which are "aimed at improving economic competitiveness and reducing unemployment" (Salamon pg 282). Unconditional labour market de-regulation could have a detrimental effect on socially desirable employment policies such as social benefits, training, employee protection legislation and even the national minimum wage.
Labours' "employment strategy [now] emphasises 'inclusion', 'social partnership' and 'fairness at work' (but without special favours towards trade unions)" (Salamon pg 292) It has re-introduced the statutory union recognition procedure, introduced a national minimum wage and has signed up to the Social Chapter (European Union legislation).
Metcalf (who is a member of the Low-Pay Commission) "believes that the commission is an exemplar of social partnership which "rehabilitated the unions and employees into a process that contrasts sharply with the "there is no such thing as 'society'" confrontational Thatcher era."" (Salamon pg293)
For this reason since New Labour came to power in 1997 the government has heavily legislated in many areas, and employment has not been excluded from this. One act in particular has directly impacted on Collect Labour Law, which is:-
The Employment Relations Act 1999. This act effects trade union recognition and de-recognition (bringing back in the standard procedures), access to workers when industrial action is being considered and ballots are taking place. It also affects ballot procedure. The time between ballot result allowing action to take place has doubled from twenty-eight days to two months. Unfair dismissal is also affected as workers can no longer be dismissed for lawful industrial action. Finally, union membership rights were changed slightly in that the act states people can not be refused employment because of their trade union affiliations. Everyone has the right to belong to a trade union and the right not to be excluded from one. Along with this element of the act is a section dictating that compiling a 'blacklist' of union members by employers is also illegal. This act strengthened the trade union and employee position, but it could also be argued that it is not a great overhaul of the law given the Labour Partys' legislative history during previous administrations. Labour could be seen to be attempting to pacify the unions whilst trying not to alienate big business.
The remaining major issue to be considered in this area of the essay is Europes' influence on Collective Labour Law and the government in the United Kingdom. Once Labour formed the government in 1997 the Conservative decision to opt out of the Social dimension of the Maastricht Treaty of 1992 was reversed under the treaty of Amsterdam 1997 and in so signing, Labour consented to the treaty and all its' terms.
Maastricht (1992) could be considered as the 'Constitution of the European labour Market'. It dealt principally with issues of fair remuneration, a national minimum wage, improvement in working conditions, unions rights and development of the employee's rights to consultation and information.
There were three immediate effects (in the form of European Directives handed down by the European Commission) when the UK joined the treaty. The European Works Council Directive, Parental Leave Directive and the directive covering the burden of proof in Sex Discrimination cases. The only directive to have any direct impact on collective labour law was the European Works Council Directive. This was aimed at large multinational firms and ensured proper communication between employee representatives (such as shop stewards) and management.
The Working Time Directive is one further outcome of the agreement to the Social Chapter. The basic rights and protections that the Regulations provide are a limit of an average of 48 hours a week which a worker can be required to work (though workers can choose to work more if they want to), a limit of an average of 8 hours work in 24 which night workers can be required to work, a right for night workers to receive free health assessments. a right to 11 hours rest a day, a right to a day off each week, a right to an in-work rest break if the working day is longer than six hours and a right to four weeks paid leave per year.
As can be seen from the above legislation Labour has not acted according to their ideological heritage, preferring instead to develop greater support for market competition, deregulation and privatisation. The party more strongly believes in the 'Stakeholder Economy', 'Welfare to Work', 'Social Partnership' and 'Fairness at Work' (Salamon pg21) principals and schemes. Most of the legislation is concerned with individual rights at work and not at all with collective labour law or collective bargaining.
To a certain degree Labour now has little control regarding employment legislation as it is handed down to the government by Europe. However, it was 'New' Labour's choice to sign the treaty and harmonise the United Kingdom with the other member states and so must accept and implement all directives that are issued.
The effects of the previously mentioned legislation can be seen in the following figures. In 1999 trade union membership in the following unions was; Transport and General Workers Union, 881625, the Amalgamated Engineering Union, 717874 and the General Municipal Boilermakers Union stood at 712010. Whilst the TGWU and GMBU show a decline in membership (and so in the powers of collective bargaining), the comparison is in fact to 1990 when the Conservatives still had another five years in power, membership has actually slightly increased since 1997
In 1999 trade union membership stood at a combined total of 7801315 employees, an increase from 1997 (when 'New' Labour came to power) of 647315. The number of working days lost due to industrial action also dropped in 1999 to 266400 from 415000 in 1999, a drop of 148600 (all above figures from Salmon pg113).
So as can be seen above the actions of both parties during their respective administrations have had a profound effect on collective labour law and collective bargaining, with the Tories having most impact. Labour is conspicuous in that it has done comparatively little to over turn the Tory instigated legislation. The actions of both parties can be explained by their ideologies, with Labours changing radically during the last decade. Their approaches have differed in that the Conservatives stripped the unions (which are the primary partners in bargaining and negotiation) of the majority of their rights and were not concerned with how ruthlessly it was done. The individuals' rights were improved, but only as a means of weakening union power and increasing the strength of big businesses and employers in accordance with Conservative thinking and strategy. The Tories refused to sign up to the Social Chapter as they believed that employment legislation should come from within the country that is to be affected by it and in joining would lose total legislative control.
In contrast to this Labour have signed up to the Social Chapter and tried to make the employment situation better for employees as individuals. This is because according to the third Way which "creates a perceived political and cultural ideology within which management, unions and employees have to work" (Salmon pg 21) it would benefit both employers and employees.
It can be seen from this that both parties have similar outcomes from their legislation (in so much as figures for union membership and days lost in industrial action have only improved in comparatively mediocre terms and figures) though each party has taken a different approach for differing reasons.
Bibliography
Books
Farnham, D. (1997) Employee Relations In Context London: CIPD
Salamon, M. (2000) Industrial relations Theory and Practice: London, Prentice Hall (4th edition)
Blyton, P. and Turnbull, P. (1998) The Dynamics of Employee Relations, Basingstoke: Macmillan (2nd edition)
Cully et al. (1999) Britain At Work, London: Routledge
Incomes Data Services Ltd (2000) Trade Unions Employment Law Handbook: London: IDS
Websites
http://www.cipd.co.uk
http://www.dti.gov.uk
http://www.libr.port.ac.uk
http://www.labour.org.uk
http://www.conservatives.com
http://www.tuc.org.uk
Other Sources
IRS Employment Review 1999
