Mandatory Union Recognition and the UK Employment Relations - Essay Example

Mandatory Union Recognition: Does it Signal a New Era in UK Employment Relations Introduction At the heart of the Employment Relations Act 1999, which sought to alter the industrial relations picture in UK, was the provision to introduce the statutory scheme for union recognition in which employers are obliged under the law to recognise unions in their workplaces. This collective bargaining scheme has long been the norm in other European countries, including the US, but this was a newfangled idea in UK and so it took a long period of acrimonious debates and consultations before the scheme was finally emplaced on June 6, 2000 after the new law received royal assent on July 27, 1999. Before the ERA 1999, union membership and recognition in UK were characterised by voluntarism, in which employers and employees could bargain over the terms and conditions of employment without any legal interference. With the statutory system ushered in by the new law, voluntary recognition of unions is no longer allowed and it becomes unlawful for British employers to deny recognition to unions under any circumstances. That conveys the impression that ERA created a radical change in British industrial relations. This paper takes the contrary view, however, and proposes that while the new industrial relations law looks revolutionary in principle, there are no fundamental changes in actuality for the change to qualify as "earth-shaking" in the UK context. Trade Union Movement The trade union movement in UK used to be such a potent political force that it unseated two governments in the 1970s and may have helped brought the ruling New Labour Party into power. Nonetheless, it is believed that the movement has a soft underbelly because of the movement's vulnerability to attacks from the state and the employer sector (Howell, 2000). The reason is the state policy of voluntarism in collective bargaining negotiations, which finds expression in the Department of Trade and Industry campaign to woo other European investors into UK. In its printed brochures to attract foreign investors, the DTI states that employment regulations in UK are largely on a voluntary basis with no requirements for mandatory union agreements and fewer restrictions on both recruitment and dismissal (Machin, 2001). Thus, the state consistently denies political access to trade union, restricting their role to the industrial arena. This combines with a mindset among British employers as a class to prefer individual dealings at the expense of collective relations with employees (Howell, 2000). The problem for the trade union movement in general was compounded by the workplace trends at the turn of the millennium when the nature of jobs took on a new dimension such that there are now more employees on part-time and temporary contracts, more jobs are being outsourced, tight definitions of jobs are out, and functional flexibility is in. The possible causes of the decline in unionism include the increasing use of subcontracting, automatic machines and flexible working. Other developments include the fragmentation of the workforce in most establishments, and the decline in the proportion of workers covered by established systems of consultation and negotiation. There is also the advent of American-influenced human resource management, which eschews collective representation and instead promotes individualism. This means that employers increasingly deal with employees on a more personal basis, thus eliminating the need for union representation and making union organising more difficult. As a result, industrial relations became more and more characterised by individualised or personalised actions instead of collective power and solidarity. In UK, the trade union movement started to feel the decline in union recognition as early as the late 1970s when Thatcher made the attack on union power the key item in her change agenda. In 2001, union coverage dropped to 47 percent from 50 percent in 1997, with the closure of unionized employees especially notable in the manufacturing sector (Gall, 2005). So far, the UK trade unions have lost 40 percent of their membership, such that their political, social and economic influence has dived to a level unknown since the post-war period (Howell, 2000). It was noted that union membership fell during periods of both recession and growth. Today, total union membership in UK is 7.9 million less 5.4 million with a 30 percent density. This reflects in the strike rates, which have fallen faster in UK than in any OECD countries (Machin, 2001). The simultaneous decline in union recognition and membership means that collective bargaining was no longer the prevailing system of industrial relations. Employers generally set the terms and conditions of employment with minimal constraints from trade unions or pro-labour statutes. UK has actually more trade unions than any other European country, such as Germany, which has only 12. However, this is considered more a source of weakness than strength based on the dictum that fewer trade unions translate to smaller, more powerful organizations (Ackers & Wilkinson, 2003). Pivotal Case The dwindling membership of UK trade unions means less resources to underwrite the costs of organising and winning recognition for non-unionised workers. There is also a perceived shortage of union activists that are willing to make personal sacrifices to unionise workplaces (Farber, 2001). In one instance, leaders of one workers' group were noted as complaining that the trade union they approached for assistance refused to help them organise because "they said it was too expensive (Machin, 2000)." The challenges faced by the UK trade union movement are more difficult than anywhere else because of opposition from employers as represented by the powerful Confederation of British Industries (CBI) as well as from the indifference of employees themselves. Before the UK Parliament even discussed the Employment Relations Act, the trade union movement had a chance to flex its muscle when it stood behind the workers of Co-Steel Plant, whose management refused union recognition to its workers. Instead, the steel workers were asked individually to sign a new employment contract indicating that they would give up their union membership. Those who refused to sign were threatened with outright dismissal. All but ignored by management was the workers' joint affidavit that a substantial majority of Co-Steel Plant workers had opted for union representation through collective bargaining (Gross, 2003). In the ensuing labour unrest at the steel plant that was not without incidents of violence, the umbrella group Trade Union Congress stepped into the fray and brought the case before the International Labour Organisation. TUC used the case as weapon in its campaign to change employment relations in UK so that voluntarism was eliminated and replaced with the statutory scheme. Since 1995, the TUC has engaged in an all-out campaign for statutory reform to reverse the growth of non-unionised workplaces in UK. The Co-Steel Plant case served as exhibit-A at the ILO forum in TUC's attempt to pressure the British government into adopting a major industrial relations reform. The ILO Committee on Freedom of Association heard the case and, after exhaustive on-site investigations and hearings, concluded that the case represented the worst case of unfair labour practice and amounted to a blatant violation of freedom of association guaranteed by ILO, of which UK is a founding member. This ILO indictment came when the Conservatives were in power, which acted in character by doing nothing substantial about it. In fact, the successive Conservative governments led by Thatcher and Majors had by turn repealed the earlier British experiments with the statutory recognition scheme as embodied in the Industrial Relations Act 1971 and the Employment Protection Act 1975 (Gall, 2005). Statutory Scheme Only when the Labour Party came to power did UK acted favorably on the ILO intercessions and, in due time, statutory recognition was finally introduced into the country's employment relation landscape (Simpson, 2000). Through the new Employment Relations Act, employers can no longer deny recognition to unions under any circumstances. In addition, ERA also criminalises the popular employer practice in UK of identifying union members taking part in strikes and similar collective action for later blacklisting or dismissal as "trouble-makers." Employers that engage in these unfair labour practices, including discrimination in the recruitment and treatment of workers, face imprisonment or fine depending on the gravity of the offense (Office of Public Sector Information, 1999). There are three critical provisions in the new law: (1) the threshold level set at 21 employees such that workplaces with less than 21 employees are exempt from statutory recognition, (2) the specification that statutory recognition will only be resorted to when both parties have exhausted all means to reach a voluntary agreement, and (3) the union applying for recognition must constitute 10 percent of the total workforce in an organisation. Because of these three key provisions, ERA merely pays lip service to the statutory scheme in collective bargaining and essentially perpetuates the status quo (Gross, 2003). According to TUC, the provision exempting workplaces with less than 21 workers effectively denies protection to one-fifth of the private sector workforce estimated at 4.593 million. These workers are employed in small and medium scale businesses that traditionally show lack of interest in unionism because they thrive on a mutually profitable paternalistic relationship with their employers. Official surveys place the actual number of private sector workers at 8.1 million, with the proportion of workers likely to be excluded reaching 31 percent or 10 percent more than the TUC estimates (Gall, 2003). Whatever the correct figure, TUC says the mandatory exemption for workplaces with less than 21 employees is highly susceptible to abuse by employers, who can easily circumvent the law by paring down their workforce to below 21. As for the provision specifying statutory recognition only as a last-resort procedure, critics argue that this exposes the ERA's lack of real commitment to mandatory recognition. However, this is not so surprising given the position taken by the ruling Labour Party when its leadership pushed for the passage of ERA. The new policy, according to the Party, will be balanced with its commitment to maintaining the "most lightly regulated labour market of any leading economy in the world." This policy also reflects in the provision setting at 10 percent the proportion of workers seeking recognition before they can be assigned as the appropriate bargaining unit. Compared to other countries with dynamic trade union movements, this proportion is too small to be credible because it means that a greater number of workers are still free to negotiate with their employers individually. In the US, for example, once an applicant union proves that it constitutes 30 percent of the workers in an organization, it is automatically accorded statutory recognition. Conclusion Under the new law, the recognition process applies to an independent union or two or more independent unions acting in concert. The process starts once 21 or more workers in a workplace convey a formal request for union recognition with their employer, who has 10 working days within which to respond. If the employer does not respond or refuses recognition, the union may go the Central Arbitration Committee for assistance. If management maintains its position, the CAC will conduct a ballot among all the workers in the involved company, after which the employer will be forced to recognise the union if at least 40 percent of the workforce voted in favor of recognition. In effect, it is a long and circuitous process that gives employers all the time and opportunity to avoid recognising an union. A radical change in employment relations would have simply mandated that once an independent union fulfills all the criteria, the employer recognize it within the day the request was formally conveyed. Arbitration takes time and in the interim, the employer will be tempted to commit unfair labour practices against the unionising workers such as dismissal. This could be the reason why there has been nary a complaint from the Confederation of British Industries about the ERA. There seems to be some loopholes in ERA that employers may exploit to avoid unions in their premises, which are equated with impersonal employer-employee relationship and disruptive strikes. Although the law becomes similar to that of the American model on paper, the procedures leading to recognition are entirely different. This means that industrial relations were changed in name but not in essence, with the UK law still showing bias towards the employer sector. For example, the provision advising the parties in a recognition case to explore all means to reach a voluntary system of employment relationship before resorting to the statutory scheme does not represent a radical change in industrial relations. It favors the employers more than the employees, which attests to an unspoken but rather obvious Labour Party policy of distancing itself from trade unionists, who are steadily losing their power in society as evidenced by their declining membership. In fact, the party was believed returned to power on the basis of its appeal to business interests and to "middle England (Gall & McKay, 2001)." So why is TUC, which refuses to the three questionable provisions of ERA, not utilising its power and resources to contradict the Labour Party and work for the repeal of the new law The possible answer is that if it does, the Conservatives might recapture power to bring back the old voluntarism system. Works Cited 1.Ackers, P. & Wilkinson, A. (2003). Understanding Work and Employment: Industrial Relations in Transition. Oxford University Press. 2. Cully, M. & Woodland, S. (1998). Trade Union Membership and Recognition 1996-97: An Analysis of Data from the Certification Offer and the LFS. Labour Market Trends 106, No. 7. 3. Farber, H.S. (2001). Union Success in Representation Elections: Why Does Unit Size Matter Industrial Labour Relations Review. 4. Gall, G. (2005). Trade Union Recognition in Britain: Is a Corner Being Turned University of Stirling. 5. Gall, G. & McKay, S. (2001). Facing Fairness at Work: Union Perception of Employer Opposition and Response to Union Recognition. Industrial Relations Journal 94. 6. Gross, J.S. (2003). Recognition of LaboUr Unions in a Comparative Context: Has the UK Entered a New Era Chicago-Kent Law Review, Vol. 78. 7. Howell, C. (2002). Unforgiven British Trade Unionism in Crisis. In The Brave New World of European Labour: European Trade Unions a the Millennium, G. Ross & A. Martin (eds), Berghahn Books: Oxford. 8. Machin, S. (2000). Union Decline in Britain. British Journal of Industrial Relations, Vol. 38, No. 4. 9. Millward, N., Bryson, A. & Forth, J. (2000). 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