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Since 2017 the Labour party has proposed mandatory sectoral collective bargaining (SCB) as a comprehensive strategy to rebuild the trade union voice across the entire economy. But how feasible is this approach, given current low levels of union membership and bargaining coverage? And would it really produce the stable and productive economy promised?
Out of the blue
When the Labour party promised to 'roll out sectoral collective bargaining (SCB)’ in 2017, it emerged out of the blue, neither resonating with Marxist radicals advocating militant union organising from below, nor social democratic pluralists promoting moderate forms of union‐management partnership. The latter secures employer recognition, coupled with individual employment rights and EU initiatives such as European Works Councils and provisions for the Information and Consultation of Employees (ICE). For both sides, supportive state reforms have been part of the picture, but not the main driving force.
The intellectual roots of mandatory sectoral collective bargaining lie in the Institute of Employment Rights’ (IER) Manifesto for Labour Law (2016).2 The IER was established in 1989 and has close relations with the trade union and Labour party left.
The IER’s first six proposals drive the new approach. A new, Cabinet‐status, Ministry of Labour (a title last used in 1970) would promote collective bargaining, supported by ACAS. Sectoral employment commissions would lay down mandatory wages and conditions for all workers in each sector, including non‐union firms and employees. SCB would be complemented by enterprise bargaining. The return of a revamped tripartite NEDC as a National Economic Forum is proposed. Active state sponsorship of SCB is designed to increase dramatically trade union membership and coverage, while its efficacy depends on this.
Feasibility of a state-restored Sectoral Collective Bargaining
Today, only 20 per cent of workers belong to trade unions and collective bargaining covers 25 per cent of the workforce, both largely confined to the public sector.
Most British private sector national industry bargaining, now retitled SCB, fell apart some fifty years ago. So, the proposed reforms start from scratch across most of the economy.
For the IER, collective bargaining ‘gives workers a greater say through their trade unions’. Such single channel voice means that unions exercise collective employment rights on behalf of employees. Hence, the IER reject two key planks of New Labour’s employment policy: a primary reliance on individual employment rights; and accommodation to Conservative legal reforms on strike or election ballots and secondary picketing. The IER manifesto is very clear on reversing the latter. Chapters six and seven promise that British trade unions would be freer than ever, more able to strike, to engage in secondary action and picketing, and to manage their own internal government.
This begs a second, crucial question: what would trade union roles and responsibilities be once the state granted them these new institutional rights and powers?
The aim is to rapidly regain, even overtake, the levels of SCB coverage currently found in some successful EU economies. However, reluctance to discuss the IR failures of our past, the lessons of active workplace partnership and the wider social responsibilities of trade unions, leaves a sense of ambivalence about the manifesto’s goals. At a time of nostalgia for full‐blown state-socialism in the Labour party, it’s hard to ignore that old left strategy of using trade unions and strikes to dislocate capitalism.
Why mandatory Sectoral Collective Bargaining is no panacea
The British and comparative history supporting the ‘restoration’ of SCB is one‐sided. For example, it is misleading to suggest that ‘The model of collective bargaining practised in Britain until the 1980s was not dissimilar to arrangements in other European countries’. This was true of union membership and bargaining coverage, but not of SCB, which had already decayed badly, long before the onset of Thatcherism.
Strikes, inflation and restrictive practices were the central IR problems of our failing postwar industrial economy. Public disorder through mass picketing became a major public concern. As a direct consequence, trade union policies like single union no‐strike deals in the 1980s and partnership in the 1990s, were explicit overtures to employers, public opinion and the state, which fostered a more constructive image of British trade unions.
The IER’s comparative case for SCB is unconvincing. The manifesto fails to grasp the national social processes that make strong trade unions and SCB a constructive and valued part of society.
Political sociology: trade union power in a liberal democracy
Strong trade unions and collective bargaining depend on active support or, at least, passive consent from a diamond of stakeholders: employees, employers, public opinion and the state. In a liberal democracy, power depends primarily on legitimate authority, not force.
The IER assumes that Britain’s 31 million ‘workers’ all share the same interests and desire for trade union representation. Furthermore, conscripted trade union membership undermines their status as voluntary associations and brings back the closed shop in all but name.
There is no quick fix
In normal liberal-democratic circumstances the state doesn’t create SCB from above. In places like Germany and Sweden, public opinion and the state support strong, independent, civil society actors, who maintain stable historical SCB.
These conditions and institutions don’t exist in Britain today. So there is no quick fix to the our complex problems of work and employment; no comprehensive new IR system waiting in the wings.
Most IR academics researching workplace voice today are aware of this. Growing voluntary trade union membership would be a good thing and the state could facilitate this with piecemeal reform of recognition law. Some other ideas in the IER manifesto might prove useful.
Yet it is simply not possible to restore trade unions to the central role they played in our past, or still do in some other coordinated market economies. Nor is it clear that nominal SCB institutions would be more effective at promoting efficiency and equality than individual employment rights and a well‐monitored minimum wage.
For instance, the German trade unions have recently conceded a NMW, recognising that they can’t reach those at the bottom of their labour market through SCB. In contemporary Britain, it is unlikely that many low paid and insecure members of the precariat will ever join trade unions and pay regular union subs. And without a dramatic rise in union membership, SCB will never get off the ground.
A realistic reform agenda
In my view, we must reconcile to a ‘mixed economy’ of employee voice. Brown and Wright have outlined a credible public policy package for ‘decent labour standards’ in Britain, founded on individual employment rights. They suggest extending the scope of the NMW and Low Pay Commission, as instances of social partnership at national level, possible wages councils, improved enforcement and consumer campaigns. Indirectly, all these would also strengthen the position of trade unions and good employers. There are good non‐union employers too, with their own voice channels, and there is a voluntary, living wage campaign. Works Councils elected by all employees are a further possibility.
Much can still be done, but any return to the union single channel is both impractical and undesirable. The IR future holds many possibilities but restoring the now distant past is not one of them.