#45 - Representation At Work - Labour Law

Labour law Reading Session 5- Representation at Work

See Bogg’s Lecture NOTES

1. General Overview and Theory

CEM Chapter 8:

• Trade Unions perform 3 functions:

  • They represent workers in a disagreement with employers.

  • They provide a source of collective consultation with workers on new working practices, redundancy etc

  • They allow collective negotiation of the terms of employment to achieve better terms for workers

• As a result of the Whitley Committee report the government in 1917-1920 promoted creation of joint industrial councils (made up of labour and managers) to set terms and pay of workers in various industries. As a result 5 million extra workers were covered by collective negotiations from 1918-1921. This was picked up again from 1934-1946 after a lapse in the intervening years when high unemployment led to a shift in priorities away from protecting workers. However since the Donovan Commission in 1968 policy has radically shifted. Firstly the aim is more to facilitate a single enterprise collective bargaining (rather than on an industry wide level) and secondly a shift towards use of specific statutory instruments to promote it rather than using ministerial discretion to set up trade boards etc. Statutes granting recognition have shifted from the purpose of promoting the participation of workers in business decisions (as promoted by Kahn Freund) to encourage partnership to promote business efficiency (so that workers understand the business and can adapt to changes easily, feel at ease with management, want to contribute to success of the company etc).

• In 1979 82% workers were covered by collective agreement or Wages Council order. Now its 30-40%. Reason is withdrawal of legal protection from unions in 80s&90s, reduction in size of unionised industries e.g. extraction/manufacturing, and presumably increase in immigrant labour. UK has lower unionisation than other EU countries. Collective bargains account 98% Austria, 90% Belgium, 90-95% France, 90% Sweden. US unionisation is lower than UK. Millward, Bryson and Forth (‘All Change at Work’) say that propensity to recognise unions had begun to decline well before 1979 and new businesses tended not to recognise unions. There has also been a replacement of unions with joint consultative committees in the workplace. However there is overall a reduction in representation (union, committee or otherwise).

• Freedom of association is in the ECHR/HRA and the European Social Charter. It is unlawful to refuse someone a job because he is/isn’t a trade union member (TULRCA 1992 s. 137).

• Some argue that trade union membership should be mandatory because (1) collective bargaining can only be done from a position of strength if workers are all members (per Donovan commission) and (2) collective negotiating is a public good open to abuse i.e. if the employer pays everyone the same then it is unfair that non-union members should benefit from the efforts of the union, and long run this could lead to an underfunding and hence loss of trade unions due to lack of members. (per Donovan commission). Hanson says union activity does NOT benefit non-members, because in 20^th century unions have tended to impose restrictive practices, lowering output and profitability, which leads to lower investment and, long term, lower wages. Collective bargaining also means employers don’t treat individual workers on their merits and allows lazy employers to treat workers en masse. As a result they don’t get the best out of their employees.

• The representational model of collective bargaining (i.e. union recognition on an individual enterprise basis) has led to far lower levels of collective bargaining than mainland Europe where sectoral bargaining tends to take place between employers’ associations and unions. The representative model, especially that which is envisaged by UK recognition legislation, is based on the genuine consent of individual workers to the process, which is revocable and with the whole process localised to small bargaining units.

• There are other forms of representation. Mandatory works councils could be used for employers to consult and hopefully agree terms with workers, which have been used successfully in Germany. However there is a fear that in Britain they could end up competing rather than working alongside unions (though in Germany members of the works councils also tend to be members of a trade union). However works councils may depend largely on an employer for funding and support and hence can’t really draw on support from outside the workplace nor undertake expensive legal actions. Works councils or staff associations may avoid the emergence of a trade union which could be more hostile to the employer.

Davies and Kilpatrick (2004) 33 ILJ 121, ‘UK Worker Representation after the single Channel’:

• Other EU MSs developed several channels of representation: (1) monopoly recognised union reps; (2) second channel alternatives e.g. workers councils i.e. direct consultation; (3) Third channel i.e. workers’ reps on the board of companies. UK traditionally only used the first as a single channel mechanism. Also UK traditionally didn’t legislate on representation. Both these facets have been abandoned increasingly.

• What should the UK have done when forced to give up the single channel representation system in Commission v UK?

  • Endorsing single recognised union not possible due to EU law, while direct worker consultation is likely to be impractical unless there are a small number of workers and a rep is unavailable.

  • The realistic other option therefore is to create alternative forms of consultation to/alongside union representation.

• The outcome of the UK’s reaction will have an effect on collective bargaining, ICE, and bargained adjustments to statutes (e.g. applies in working time regs, redundancy procedure/payments, parental leave etc). Traditionally there were ad hoc consultation and info rights e.g. for redundancies, transfer of undertakings and health and safety, though the ICE directive makes it applicable to all matters.

• D&K argue that union representation is preferable to non-union representation, and should therefore be promoted, and there ought to be a way of choosing which union to recognise based on which is the most representative of the workers in the bargaining unit. However where there is no representative union structure, elected representation is better than no representation at all. However non-representation is never an acceptable option.

  • Unions are independent, tend to have specialist expertise and skills, have a comparative knowledge of other workplaces, and are financially independent of the employer. These are advantages over other forms of workplace representation. However this doesn’t meant that unions should have a monopoly on workplace representation. Works councils/committees of workers to consult on key issues could be another forum through which workers can make their views known, alongside unions (and could actually increase the voice of the union in the workplace where its views are expressed on these committees).

  • There is a problem of employers recognising unrepresentative unions (see the NUJ v MGN case, below). The quality of services and negotiations pursued on behalf of a bargaining unit containing few if any members of the union is likely to be poor (as unions will always be more accountable to their members than to non-members).

  • In France and Germany, collective bargaining is entrusted to unions, while I&C are entrusted to elected representatives e.g. on works councils. However the tasks aren’t completely divided (so this isn’t an argument for such a division in the UK) because in France unions have the exclusive right to nominate candidates for the councils/committees, while in Germany unions can send non-voting reps to councils, and tend to dominate them anyway. Some say that elected works councils could detract from union power, while others like D&K think they can coexist provided they coexist with statutory support.

• They argue therefore for a union priority rule i.e. a recognised union should get top priority. They also say that it would be better to replace the requirement of the employee ‘recognising’ the union with a requirement for the union to be ‘sufficiently representative’. This has not been adopted: with regard to consultation in specific cases such as redundancy, elected reps will be used if there is no recognised union, even if there are perfectly representative unions available which are simply not recognised. This is unfortunate because of how much better union representation is. Under the ICE Regs, the union has no role in selecting the worker representatives, and in legislation there is normally no link between union structures and elected representative structures, though union members/officials who are employees can be candidates in elections for reps under ICE regs. The trigger procedure in the ICE Regs actually excludes unions from initiating the creation of an I&C structure.

2. Design

Simpson (2000) 29 ILJ 193:

3. Implementation

1. Collective Bargaining

1. Independence of trade unions

Trade Union and Labour Relations (Consolidation) Act 1992 (TULRCA):

s.5: In this Act an “independent trade union” means a trade union which—

(a) is not under the domination or control of an employer or group of employers or of one or more employers' associations, and (b) is not liable to interference by an employer or any such group or association (arising out of the provision of financial or material...