Lords highlight positive impact of trade unions on economy

29 February 2016

In the fourth day of Committee Stage of the Trade Union Bill in the House of Lords last week, peers from Labour and the Liberal Democrat Parties highlighted the positive impact trade unions have on the economy.

Baroness Prosser, for Labour, proposed a new clause to the Bill, which would instigate a new code of practice that would encourage employers to “establish mechanisms via trade unions that encourage and enable effective employee engagement in industrial relations”.

She referred to a report by the Involvement and Participation Association, which found a strong link between employee engagement and productivity, and highlighted that the UK is falling behind other developed countries in terms of its output.

The report showed the UK to be 17% less productive than the rest of the G7, and that only one in three workers feel that managers allow them to have a say in decisions.

Furthermore, research by the Chartered Management Institute shows that only 13% of managers have any management training – a statistic Baroness Prosser described as “shocking”.

Lord young of Norwood Green, for Labour, implored the government to consider the amendment as a way to balance out an otherwise completely negative Bill.

“As it stands, the Bill is really a lost opportunity,” he said. “It does not address the real problems facing British industry: low productivity … ; skill shortages; and a lack of management training.”

Lord Stoneham of Droxford, a Liberal Democrat, was also among the peers who supported the amendment, pointing out that strong engagement between employees and employers is “very important to improving the country’s competitive position, and to improving services in the public sector”.

Despite this evidence, the Conservative Party did not budge in its argument against the amendment, with Tory peer the Earl of Courtown suggesting that it is “not right” to prescribe how employee engagement should occur.

“The current approach is flexible and means that business have a variety of ways in which to engage with and involve their employees in their businesses,” he said.

This is an extraordinary argument considering that the government has been attacked several times by the Lords in other debates on the Trade Union Bill for the very reason that it prescribes how employers and employees should engage with each other and removes flexibility and choice in workplace disputes.