‘New Labour’ and the contemporary employment relationship - HR Management

With the election of ‘New Labour’ in 1997 there has emerged a rather contradictory programme of change and continuity in employment relations. A modernising agenda has been actioned which moves away from the philosophy of state-sponsored wealth redistribution through social ownership to the support of private capital, private enterprise, individualism and a continuation of Conservative expenditure limits.

The new administration made it quite clear that the vast majority of the initiatives undertaken by the previous Conservative administration to reform the employment relationship would remain in place. Hence, the anti-union legislation enacted in the past 20 years remains largely untouched such that Britain still has the most restrictive regime of any Western developed nation towards collective representation at work. There has been no noticeable resurgence of the special relationship between Labour and unions evident in previous administrations, while the Labour government has retained an enthusiasm for a deregulated labour market with flexibility as a key factor (Rose, 2001).

While retaining some of the frameworks which shaped employment relations over the past 20 years, New Labour has also introduced policies which aimed to redress somewhat the power imbalance between management and labour which have also necessitated the state to develop a model of ‘good’ employment relations. The key focal points of the administration to date have been the notions of social partnership, fairness at work and recognition of European employment regulation (McIlroy, 1998). In his commentary, McIlroy emphasises the difficult choices facing the trade union movement in reaching a compromise with the new Labour administration, who were not prepared to abandon the Thatcherite foundation of the contemporary employment relationship.

There is some speculation regarding the future of the party–union link – whether it goes further down the path McIlroy (1998: 559) describes as ‘arm’s-length organisational relationships’. Given the current tension between public sector unions and the government, where Bach (2002: 320) notes, ‘public sector trade unions leaders were disappointed by the lack of progress in improving their members’ pay and working conditions’, plus the bitter Fire Service dispute and the election of more left-leaning trade union officials recently, a distanced toleration would seem, at best, most likely.

However, the notion of social partnerships is one issue where moderate unions have indicated a willingness to comply with political will but, as McIlroy argues, these partnerships do not reflect the robust Rhineland model where consultation, communication and representation are strongly regulated. Hence, suspicion and doubt remain regarding their real utility to employees as the weak UK version clearly underpins the desire to retain flexibility, deregulation and competitiveness, more in accord with the US model (Clark, 1998).

In consequence, the current government refers to the mutual responsibilities between employers and employees and is equally encouraging to both unions and management to engage in dialogue to introduce change, improve productivity and resolve disputes. From trade unions, there has been some support for the social partnership concept (Monks, 1996), although this has been with an element of pragmatism, recognising that the ‘New Unionism’ agenda must be seen to be moderate and conciliatory to maintain support from employers and the state (McIlroy, 1998).

Support for partnerships from unions is, of course, not entirely based on pragmatism. In a number of polls commissioned by the GMB in the late 1980s and early 1990s, it became apparent that employees had concerns relating to issues which were beyond the traditional remit of collective bargaining. These included job fulfilment, worthwhile work, and job security, all of which were ranked above pay in importance. John Edmonds (1997), the GMB General Secretary, argued that the former are most effectively addressed through partnership discussion rather than collective negotiation.

This union stance towards social partnerships has fuelled the contemporary debate surrounding the most appropriate strategies for unions to adopt in the workplace to ensure their continued relevance as both employee representatives and bargainers. More recently, there is some indication that the union movement is growing disillusioned with the notion of partnership, particularly as practised by the Labour government. Based on their disappointment with the nature of proposed changes in the public sector, in July 2001 the TUC openly expressed doubts about the government’s ability to generate meaningful partnerships.

If the union movement feels those who are supposed to be most supportive of the notion of partnerships are not committed to them, this must surely raise questions regarding the whole ethos. Union disillusionment with this process has been further emphasised with Mark Serwotka, the General Secretary of the Public and Commercial Services Union (PCS), openly declaring a clear break with the partnership agenda in his determination to return outsourced employment to the public sector and to use strike action if necessary to achieve this goal (Turner, 2003a).

The radical critique of the concept of social partnerships, however, questions the whole feasibility of such relationships in the first instance. Kelly (1996) argues that it is difficult to form meaningful relationships with a party that wishes you did not exist. Equally, Kelly argues that in an inequitable power arrangement, as exists between capital and labour, the likelihood of meaningful partnerships being established is impossible unless far-reaching coercive measures can be applied.

Briefly, Kelly believes that given the current state of management strength and the ambivalence towards unions from the current government, there is little rationale for employers to enter into true partnerships with unions when they can achieve their goals through flexing their prerogative. Critically, Kelly also believes that a partnership stance will undermine the role of collective bargaining and narrow current agendas further. Bacon and Storey (1996: 43), however, describe the ‘fracturing of collectivism’ and instead argue that unions must find new ways of representing the individual in the workplace and engage with partnership channels.

At the same time they recognise that partnership initiatives have been frustrated in a number of firms, owing to the lack of management commitment to the process leading to nothing more than a rhetoric of partnership. While it is not yet evident how collective bargaining will be affected by the notion of partnership, a number of suppositions are possible. The enactment of the Employment Relations Act (1999) has signalled the current government’s intention to tacitly support union recognition, if rather cautiously. There has also been some indication of an emergence of new consultation and partnership agendas (Roche and Geary, 2002).

This may be unpalatable to unions but, if they are to be seen to support partnerships, they may have to accept a continued restriction of negotiation, and expansion of consultation. However, management will still have to enter into debate around key issues, and demonstrate progress, if partnerships are to be maintained. What is not in doubt is that partnerships are contentious and their success will depend upon employer and employee representatives being able to demonstrate that they are reaching consensus through cooperation, without one set of interests being consistently subordinated.

From limited evidence based upon partnerships in the water industry in the UK and vehicle manufacturing in the USA, Towers (1997: 226) comments that there is ‘an essential need for equal partnership reinforced by collective bargaining which accepts the legitimacy of conflict or interests as well as encouraging and institutionalising co-operation’. Further evidence will be required to assess the impact and success of social partnerships. However, recent empirical examinations of partnership in practice found that, while there are mutual gains for both employees and management, the advantage is skewed in the favour of management, who set the partnership agenda and appear to protect their own prerogative (Guest and Peccei, 1998; Roche and Geary, 2002).

While the changes to national policy regarding the management of employment relations might be viewed as cautious at best and highly conservative at worst, New Labour have actively engaged with recognition of European regulation, which is a notable change from their Conservative predecessors. Whereas the Conservatives had rejected the social aspect of European Union membership, preferring to maintain their autonomy to foster free market individualism, the Blair administrations have recognised this dimension. However, it should be noted that Labour still favours minimal compliance and, in some cases, has not recognised measures in full or met agreed deadlines.

So, for example, the Working Time Directive can be applied in such a way that the impact on the working week is minimal. Equally, the initial attempt to use ‘employees’ rather than ‘workers’ in the Part Time Workers Directive would have effectively excluded most of the labour that might benefit from the regulation. Even now, the regulation is extremely narrow in its application and, as noted earlier, in the case of new directives such as that on information and consultation, unions are expressing doubts regarding the government’s level of commitment to implementation.

For unions, the issue of EU regulation is critical as it offers them the opportunity to police the manner in which they are incorporated in the workplace, thus adding value to membership and a more formal role in engaging with management over the terms and processes of implementation.

  • Summary

When the Labour government was elected to power in 1997, it was anticipated that there would be some revival of trade union influence over policy and economic development. However, successive Labour administrations have not demonstrated any enthusiasm to develop a close relationship with the trade union movement. Rather, they have enacted legislation which has strengthened union rights but the overall focus has been upon the individual at work and incorporating weak versions of European regulation rather than supporting collective labour rights. The outcome of this ‘distancing’ stance has been a growing disillusionment by the union movement with the Labour government.

This has been articulated by the election of ‘left wing’ activists to positions of prominence, and protracted disputes in the public sector such as that in the Fire Service, with the government threatening the union with legislation which would enable them to impose a settlement. There can be little doubt that the ERA (1999) did strengthen unions’ ability to influence terms and conditions of employment. However, this fell short of what the trade union movement expected of the Labour government and it appears unlikely that any further government support will be forthcoming.

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