There is an urgent need for greater collective bargaining in the UK

18 September 2013

By Professor Keith Ewing and John Hendy QC

The right to agree wages and conditions collectively with employers made a huge difference to workers’ lives. We need it back urgently.

One of the consequences of getting older is that you can remember a different world.

In our case, a world in which trade unions were widely, if not universally, seen to be a good thing.

And a world in which it was taken for granted that trade unions should be engaged with employers in setting terms and conditions of employment.

This role of trade unions took place by means of collective bargaining.

But it was not collective bargaining as many activists know it today. In that different world trade unions engaged not with employers individually but with employers collectively.

In this way trade unions and employers did not set terms and conditions of employment for individual enterprises or individual workplaces.

On the contrary, through the joint industrial councils they established working conditions for entire industries or sectors of the economy.

The impact was immense, even if taken for granted for those who operated within the system at the time. Four out of five workers in this country had their terms and conditions governed by a collective agreement. That remained the case from the end of the second world war until the 1980s.

Since then we have seen the neoliberal onslaught on trade unions and the attack on collective bargaining, the coverage of which has declined sharply since 1980.

Now we would be lucky if we could say that as many as a quarter of British workers enjoy the protection of a collective agreement.

This is not simply an interesting historical fact.

The erosion of collective bargaining is an economic disaster causing misery for millions of workers.

It has led to a decline in the share of national wealth being paid in wages and an increase in national wealth being hoarded by the rich.

It has also led to greater inequality and the emergence of a two-tier workforce in which those in the bottom tier are struggling in a world of plenty. Struggling on low pay, zero-hours contracts and several part-time jobs to make ends meet.

They are surviving, not living.

But not only are there economic and social consequences for this great historic shift in the workplace, there are also legal consequences, and a legal imperative that underpins the economic and social case to rewind the erosion of collective bargaining.

Whether the government likes it or not, Britain — like other countries — has an obligation under international law to promote collective bargaining, a commitment reinforced by various treaties that have been signed by both Labour and Tory ministers since the end of the second world war.

These include International Labour Organisation conventions 98 (1949) and 151 (1978), the European Social Charters of 1961 and 1996 and the EU Charter of Fundamental Rights of 2000, to say nothing of the great UN human rights covenants of 1966 or indeed the European Convention on Human Rights.

One of the most distressing features of the erosion of collective bargaining and its impact on workers is that it has continued despite the trade union recognition legislation introduced by the last Labour government. This was supposed to provide a legal basis to support collective bargaining.

But it failed, as many predicted it would, just like the US system it appears to mimic has failed.

The hoops and hurdles put in the path of workers who want collective representation are too onerous and provide multiple opportunities for employers to resist bargaining with a union.

In our new report for the Institute of Employment Rights we argue that a fresh start is required and that as a movement we need to adopt a much more ambitious collective bargaining strategy, based on what we once had and what successful European economies still have.

For the current generation of trade unionists it means doing collective bargaining differently — aiming for multi employer agreements that apply throughout the sector, laying down terms and conditions that apply to every worker, whether or not their employer recognises a union.

In this way trade unions will again be in the vanguard of the campaign to raise wages and equalise incomes, to deal with the problem of the two tier workforce and to confront head-on the cancer of zero-hours contracts and whatever other monsters emerge.

The sceptics will say that it is all too difficult.

But we have done it before. Most notably we did it in the 1930s, when wise minds realised that the economic crisis of the time could be solved only by raising wages and that the only way to raise wages was to resurrect collective bargaining structures that had perished in the 1920s.

If a collective bargaining strategy could be done then, it could be done now.

But if it is to be done it will require the same commitment to the use of state resources today as it did then, most notably a commitment to create the structures within which collective bargaining takes place.

It will also require a renewed state commitment to ensure that employers take part in these procedures and that the terms of collective agreements negotiated in this way benefit the workers for whom they are intended.

It is a big challenge.

Over to you, Mr Miliband.

Originally published in the Morning Star

The authors’ Reconstruction After the Crisis: A Manifesto for Collective Bargaining was launched at a joint IER, CTUF and CLASS fringe at the TUC on Sunday September 8. It is now available for purchase.