The best job title I ever had was Head of Employment Law at the CIA. The novelty never wore off. The Chemical Industries Association (well what did you think?) was a really interesting place to work – and I was there at a really interesting time. Labour had just been swept to power and one of its key manifesto commitments was to introduce a right to union recognition ‘where a majority of the relevant workforce vote in a ballot for the union to represent them’.
I spent just over a year monitoring the legislation as it went through Parliament and lobbying (rather ineffectually) on behalf of employers in the chemical industry – many of whom were distinctly worried about being forced to deal with trade unions. There were lots of CBI committee meetings as we went over the proposed law line by line, proposing amendments along the way.
The law that emerged was deliberately dull and complicated. I challenge you to to read through it in one sitting! (seriously, don’t try to do that). The idea was that collective bargaining worked best when both the union and the employer reached a voluntary agreement that suited their particular situation and the procedure was designed to facilitate that at every stage – with the Central Arbitration Committee empowered to rule on areas of dispute.
There are certainly things that unions would like to change about the current scheme. A union has to work hard to convince the CAC that a majority of members are likely to support recognition before a ballot is
organised – and a recognition ballot is only valid if at least 40 per cent of the proposed bargaining unit vote for recognition (sound familiar?). There is also a loophole for employers who can agree to recognise a sweetheart union and forestall a claim from one that will give them a less comfortable ride. On the other hand, employers have always been worried about the CAC ordering recognition without a ballot where union membership has reached 50 per cent of the bargaining unit.
In truth, the law was always a compromise between the interests of employers and the rights of employees and unions. The Labour Government went out of its way to design a system that employers could live with. They learned from the earlier trade union recognition scheme that collapsed under the fervent opposition of some employers and which was repealed almost as soon as the Thatcher Government came to power.
The statutory recognition procedure has now been up and running for more than 15 years (oh where has my youth gone?) and neither the Coalition nor the Conservative Government have shown any real interest in repealing or amending it. For some on the left, that in itself will be a damning criticism. The procedure chugs along nicely, rarely attracting much outside attention. The latest annual report of the CAC shows that so far there have been 955 applications for union recognition with the CAC ordering recognition in 281 cases. To be clear, that is not 281 cases in the past year – that is counting since the scheme came in. So while the procedure has certainly resulted in an increased number of union recognition agreements, it has hardly been transformative. The level of collective bargaining coverage in the UK remains at just 29% – well towards the bottom of the EU table. Even that figure is kept artificially high by the relatively high proportion of recognition in the public sector (63%) compared with just 16 per cent in the private sector
So it is not surprising that Labour under Jeremy Corbyn would want to revisit the subject. Though it is fair to say that his policy still needs some work on the fine detail. In Saturday’s Guardian he wrote:
Unions such as the GMB are resisting the race to the bottom in the labour market by representing Uber drivers, for example, in their fight to win holiday and sick pay rights. But the best way to guarantee fair pay is through strengthening unions’ ability to bargain collectively. That’s why it should be mandatory for all employers wit
h over 250 staff to bargain collectively with recognised trade unions.
Let’s leave aside the fact that a law based on the number of staff you have can be a bit tricky when we really don’t know who counts as ‘staff’ – particularly when it comes to companies like Uber. This is, on the face of it, a pretty radical proposition. The Guardian added this:
Aides to the Labour leader said a Corbyn government would “repeal” 1999 union legislation that was passed by a Labour
government to introduce a new French-style framework of union rights.
I’m not sure that emphasising the French experience would be a great way of winning over sceptical voters to this policy. But my main problem is the practicality of imposing a law along the lines Jeremy Corbyn appears to be suggesting.
The Fairness at Work Agenda pursued by the Blair Government was based on a form of industrial democracy. The idea was that the workforce should be represented by a union if that was what the majority of them wanted. That, in essence, is the organising principle of the whole scheme. If that is to be swept away then are we left with the idea that employees will be represented by a union whether they want to be or not? You may think it odd that employees might be against the idea. Workers are generally better off when collective bargaining is in place, so why wouldn’t they want it? But the truth is that many employees will be sceptical or think that they may as individuals lose out in favour of some of their colleagues. Will Labour really go to the polls suggesting that employers should be forced to recognise trade unions even where there is no support for the union within the workforce itself?
That is essentially the French experience where collective bargaining coverage is extremely wide but actual union membership is just 8% – one of the lowest in Europe. The key difference is that collective bargaining is part of the regulatory system in France, with legally binding sector-level agreements. It might be worth pointing out that a few years ago John Hendy QC and Professor Keith Ewing (leading employment lawyers of the left) proposed a manifesto for collective bargaining that focused very much on sector-level agreements. This doesn’t seem to be what Jeremy Corbyn is now proposing, but I wouldn’t be surprised to see his thinking move in that direction. That would still be an incredibly radical policy and a major departure from the voluntarist model of UK industrial relations that dominated the 20th Century.
So far, however, all we have is a line in a newspaper column. There is a long way to go before a fully-fledged policy can emerge. Elsewhere in the Guardian article Corbyn references workplace 2020 which he describes as a ‘national conversation with the self-employed, business and the public, supported by the trade unions, to develop a new settlement for business and the workforce’. That sounds great, but as far as I can tell, Workplace 2020 hasn’t actually done anything yet – as you’ll see if you follow the link above.
Ultimately though, I just can’t see the UK adopting a system that divorces the rights of a trade union to recognition from its level of support within a a particular employer. And that is only one issue that will have to be addressed. Leaving aside the question of what the employees in the business actually want, introducing compulsory collective bargaining is far from straightforward. It is all very well telling an employer that it has to recognise a trade union – but which union? What if there are different unions representing different sections of the workforce? Will there need to be separate recognition agreements for each union or single table bargaining or will one union have to win out? Will the recognition have to cover the whole workforce? What about senior managers? What about non-unionised professionals? Will the employer be entitled to agree individual terms with individual employees or will it have to apply a collective agreement to the whole workforce? Could a group of employees demand to opt out of collective bargaining? How do you force an employer to bargain in good faith?
Any new Government is limited in what it can do in a subject like employment law – even the modest recognition scheme introduced under Blair took a huge amount of work and Parliamentary time. A completely new system of employment law and industrial relations might not be the best priority for a new Government given everything else that is likely to be going on.
And one final question. Is it really a good idea to adopt a policy that will allow the Labour Party to be painted as a 1970s throwback in hock to the trade unions? It is all very well playing fantasy employment law in left-wing think tanks – but the role of the Labour Party is surely to come up with practical proposals that might actually be implemented following a general election victory.
Basically this just isn’t the sort of proposal you make if you seriously expect to be in a position to have to implement it.
Which is quite telling, I think.
On Tuesday morning Owen Smith published his manifesto for employment rights. It is interesting that he makes rather more specific proposals than Jeremy Corbyn about amending the statutory scheme to make it easier for unions to gain recognition. In particular he places some emphasis on sectoral collective bargaining which suggests that he is at least aware of the Hendy/Ewing work on this area.
He does however set out an absolutely massive shopping list including full employment rights from day one of employment and a return to a Wages Council system to prevent exploitation in vulnerable sectors. There is more policy detail here than we have seen from Labour under Jeremy Corbyn’s leadership – which is presumably the deliberate point that he is making. However what he sets out is a huge reform program. If that was front and centre of the Labour manifesto then improved employment rights would need to be the issue that electorate cares about the most for Labour to stand a chance of winning. In a leadership election sweeping and radical proposals might be what is called for. But whatever the future Labour leadership, they will have to be a bit more focussed when it comes to formulating a plan for Government.