E m c A R M S T R O N G

BRITISH TRADE-UNIONS

can they stay in business?

T rm British trade-union movement has never lacked self-appointed critics or ad-

visers. During its early period of rapid, ff insecure, growth following the repeal of the Combination Acts in 1824-25,1 Andrew Ure wrote:

" . . . the factory operative, little versant in the great operations of political economy, currency and trade, and actuated too often by an invidious feeling towards the capital- ist who animates his otherwiso torpid tal- ents, is easily persuaded by artful dema- gogues, that his sacrifice of time and skill is beyond the proportion of his recompense, or that fewer hours of industry would be an ample equivalent for his wages. "e

Many bitter battles were indeed waged before the "artful demagogues" and their followers achieved recognition as respectable partners in the community.

Mr. Armstrong is a Lecturer in Industrial Relations at the College of Advanced Technology, Birmingham, England.

Recognition the trade-uruon~ m~w nave. A few years ago, Sir Winston Churchill ex- pressed the view that the trade-unions were entitled to consideration as a new estate of the realm? Although by 1958 the unions actually represented, about 44 per cent of the work force in Great Britain, it is estimated that their influence, exerted through collective bargain- ing, extends to 75-80 per cent. Yet misgivings

The Combination Acts of 1799 and 1800 had, in effect, outlawed collective action by workpeople. The repeal of these acts and their partial replacement in 1824-25 per- mitted certain types of collective action, but strikers were still liable to prosecution.

2 Andrew Ure, The Philosophy of Manufactures ( Lon- don: Charles Knight, 1835). Ure was a physicist who became keenly interested in the vitality and opera- tion of Britain's expanding industries; see the opening re- marks of the preface: "The present is distinguished from every preceding age by an univ~sal ardour of enterprise in ,arts and manufactures." Ure is considered to be one of the early writers in the field of management thought.

3 Since Great Britain has no written constitution, there are differences of opinion as to what constitutes the estates of the realm, but King, Lords, and Commons are generally included in any definition.

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76 BUSINESS HORIZONS

as to their role in society remain. A committee of conservative lawyers states in a study that:

"Many there are who feel some apprehen- sion about their power; . . . that the great powers the unions have been given may be used tyrannically or in a manner contrary to the best interests of the country as a whole."4

Proposals have been made to change the law so that the right measure of protection may be afforded the individual trade-union member, the union, and the country as a whole. Only with these changes, it is felt, can the trade- unions truly become the new estate of the rea ln l .

The reaction of the British trade-unionist to this gratuitous advice is to look first at its source. If this is suspect by his standards, he usually rejects or ignores it. He believes, per- haps with some justification, that sophisti- cated arguments pu t forward in the interest of the individual, the union, and the nation are merely a subterfuge to weaken the power and influence of the trade-unions. This reaction tends to limit discussion for reform to an aca- demic level; union leaders, rather like British businessmen, generally refuse to be drawn into public debate on what they often consider to be "domestic" affairs.

The criticism of trade-unions, however, does not come only from those the unions might consider opposed to their interests. Construc- tive and well-disposed commentators such as B. C. Roberts and E. Wigham ~ feel that advice is needed. The trade-unions are now at a crucial stage in their development. To say that they are at a crossroads is to use too simple an analogy; rather they are moving into an area of thickets that will need to be cut

4 "'A Giant's Strength-Some Thoughts on the Constitu- tional and the Legal Position of Trade Unions in England," a study prepared in 1958 by a Committee of Members of the Inns of Court Conservative and Unionist Society (London: The Inns of Court Conservative and Unionist Society and Christopher Johnson Publishers, Ltd., 1958), pp. 7, 14.

5 B. C. Roberts is a Reader in Industrial Relations, Uni- versity of London, and E. Wigham is the labor corres- pondent of T he L o n d o n Times.

through decisively and boldly if the forces of trade-tmionism are to retain their cohesion and dynamism. Some headway has been made in recent years, and the outlines of the prob- lems that face unionism have perhaps become clear enough to permit a summary of their character.

L E A D E R S H I P P R O B L E M S

Quality

When discussing this problem with students, I often begin by writing on the blackboard, "Where are the young Ernie Bevins ~ of to- day?" After a few moments ' thought, the stu- dents sometimes answer that such leaders might be in the class I am teaclfing-as indeed they might. In other words, the yotmg lad of Ernie Bevin's caliber is today in an institution of higher education, enjoying facilities denied to Ernie Bevin himself. His contemporary counterpart is probably thinking of entering one of the professions or industry where he will hope to gain a management position. In short, greatly improved educational and career opportunities may deprive the trade-union movement of top-flight leaders- in contrast with the past when social injustices ensured a supply of very able men to the unions. Fur- thermore, the removal or mitigation of such injustices has in turn removed some of the strong motivating forces for being a trade- union leader, a point I shall refer to again in this article.

This is not to say that the ta-ade-union move- ment will lack leaders, but it may mean that their quality will decline and leave the unions at a disadvantage vis h vis increasingly profes- sional managements that are recruiting more and more university graduates as potential

6 Ernest Bevin, one of the most able and eminent union leaders in Britain's history, was largely responsible for the development of Britain's biggest union, the Transport and General Workers Union (T.G.W.U.). Appointed by Sir Winston Churchill to be Minister of Labour and National Service during the coalition government of World War II, he became Foreign Secretary during the Labour govern- ments of 1945-50 and 1950-51 until his death in 1951. He finished his formal education at the age of eleven.

BRITISH TRADE U N I O N S - - C A N THEY STAY IN BUSINESS? 77

managers. Will the unions be pushed then into the position of employing highly compe- tent professional negotiators? Such an idea is an anathema to the British trade-unionist. He believes firmly that his leaders should prove their worth by rising from the shop floor. The British trade-union movement with its strong social ethic has always been opposed to the career concept of leadership. A leader is ex- pected to be a man with a strong sense of service to his union and its members; this ex- plains in part why the top men are poorly paid in relation to the work and responsibilities they undertake. Compared with management in Great Britain and top trade-union leaders in the United States (to take simply the non- corrupt unions), British trade-union leaders are indeed poorly paid. Admittedly, there are satisfactions other than financial ones in being a trade-union leader, but even the general Secretary of the Trades Union Congress 7 has delicately suggested several times that the rank and file should reward their leaders bet- ter.

The rank and file, however, are against a high level of remuneration. I have talked with many shop stewards and ordinary union mem- bers in recent years, and it is quite a common idea that to earn more than £ 1,000 s a year is somehow offensive. "Fancy" salaries might accustom their leaders to the social life and standards of management, a dangerously cor- ruptive influence. It is not unusual for mem- bers to express the view that their leaders should be paid no more than the highest earn- ings of an ordinary member, of the union. Such attitudes are, of course, rather different from those of union members in the United States and reflect the influence of class con- cepts in the thinking of many British unionists. The American unionist supports business

The T.U.C. is the co-ordina t~ng body for trade-unions. It is somewhat similar to the AFL-CIO.

S A direct monetary conversion into dollars would be misleading. To give some idea, however, of what ~ 1,000 a year represents, the following'Ministry of Labour figures are useful: In October, 1959, the average weekly earnings of adult male workers were 271 shillings and 1 penny, or about ~ 705 a year.

unionism. Many British unionists cling to their belief in a union that has, in addition to its bargaining function, socialistic ideals'. Ad- mittedly, I have oversimplified the attitude of the British union member, but it remains true that many are afraid that their leaders, if re- warded too well, may lose touch and sympathy with working-class traditions and aspirations. The ordinary member often feels that his lead- ers are already too remote because of the very structure of the union and that they have i,n- sufl~cierit sympathy with domestic shop-floor problems; such problems are of far greater concern to the individual than the fact that one of his union officials has. now been "ele- vated" to the membership of, say, the Restric- tive Practices Court. 9

Organization

The feeling described above explains, in part, the great and still growing importance of the shop steward. For many union members, the shop steward ~?epresents their only close con- tact with the union. Branch (local) meetings are poorly attended. Active in the recruitment of new members, in plant negotiations, and in the settlement of grievances, the shop steward grows in importance as factories grow in size. In large plants where a number of unions have members, a shop stewards' committee is often formed. This consists of stewards of the vari- ous unions with whom management negoti- ates, who meet to co-ordinate po!icy on plant issues. Such committees, although they may well be recognized by local managements, have no formally acknowledged position in trade-union structures and are not recognized in agreements reached between associations of employers and trade-union officials.

While there is nothing sinister per se in such a committee, it can be, and sometimes is, used for subversive purposes. Each steward is an- swerable to his own union, but the committee

9 The Restrictive Practices Court is a recently created division of the High Court. Its function is to determine whether specified business practices are operating against the public interest and, ff so, to declare them void.

78 B U S I N E S S H O I U Z O N S

as a whole is answerable to no higher author- ity. The door is thus wide open for commu- nists, extremists, and troublemakers to enter into and dominate such committees. A Court of Inquiry 1° into industrial relations at Briggs Motor Bodies Limited (set up by the Ministry of Labour in 1957) revealed that one such committee had called more than five hundred unofficial stoppages in the plant in two years. Moreover, large sums of money had been col- lected, the use of which was not subject to the authority of any union headquarters.

In the absence of formal agreements be- tween unions, shop stewards' committees, or unions within unions as they are sometimes called, will remain a problem and an embar- rassment both to oflqcial trade-union leader- ship and to management. The activities of the committee at Briggs were roundly condemned by the president of the Amalgamated Engi- neering Union ( Britain's second largest union) as "a sort of Frankenstein monster," answer- able to no union authority, n Irresponsible ac- tion, often in the form of calling wildcat strikes (these are not illegal), in defiance of agree- ments reached between management and trade-union officials is doing much to lower the prestige of the unions in the eyes of the public. Industrial disputes, not unnaturally, have greater news value than the thousands of peaceful settlements that ocenr daily and go unreported.

Quite apart from the organizational changes necessary before satisfactory control can be exerted by the unions over such committees, there is the deeper issue of why the commit- tees often command considerable support from the man on the shop floor. One reason

to Under the Industrial Courts Act, 1919, the Minister of Labour has the power to set up an independertt fact-find- ing inquiry into the causes of serious industrial disputes that are or may be damaging to the public interest. Al- though not legally binding, the recommendations of the court almost invariably lead to a settlement of disputes.

XlA T.U.C. inquiry into unofficial slsrikes started on November 16, 1959. This inquiry was completed in Au- gust, 1960. While irresponsible elements in the union movement are censured, it seems from the findings of the inquiry that provocative management is often the cause of wildcat strikes.

has been given: Many union members feel that their leaders are too remote and that their only contact with the union is through the shop steward. Another reason may be that the in- dustrial relations climate in a factory is bad. It is a truism to say that where relations are bad, management is often partially to blame. In actuality, however, the blame for this situa- tion may be more difficult to apportion: It can be debatable whether it is management that is tough and the stewards obstructive, or the other way about; moreover, in some cases, both management and workers may justly de- serve the stewards that they get. If sensible, mature union members are unwilling to take on the responsibilities of stewardship, then irresponsible elements are given the opportu- nity to foment trouble at every source of ir- ritation until obstructive and aggressive action erupts.

A suggested method for improving both the tone of industrial relations and communication between union o~cials and shop-floor leaders is better training for shop stewards. Some of the more progressive unions are putting this into effect; they have well-developed plans for the education of shop-floor leaders. The training, which is not narrow and doctrinaire, is often conducted through the medium of "neutral" colleges. For some years now, my own department has had an arrangement with one of Britain's largest unions whereby shop stewards are sent to college for a month's full-time residential course. Their lead has recently been followed by one or two com- panies, who have also been nominating stew- ards to attend such courses.

In brief, most trade-union leaders want the power of their unions to be wielded with re- sponsibility at all levels. They sense that the public is increasingly suspicious that their power is being wielded irresponsibly. The lawyers' pamphlet quoted at the beginning of this article voices this suspicion; its title, "A Giant's Strength," is taken from Shakespeare's Measure for Measure:

"O, i t is exce l len t

To have a giant's strength; but it is tyrannous To use it as a giant."

BRITISH TRADE U N I O N S - - C A N THEY STAY IN BUSINESS~ 79

Such steps as the education of shop stewards indicate that unionists are attempting to allay the fears of the public and to improve the quality of members in key positions.

N E W C H A R G E S

Arbitrary Power

The unions, developed as a check to the exer- cise of arbitrary power, are now themselves accused of using power in an arbitrary way. The public remembers the instances of non- strikers being "sent to Coventry" (or socially ostracized) when their fellow workers re- turned from strike action; of thousands of men on strike and others thrown out of work be- cause one man would not join a union; of the idle production lines of the new Morris-Austin "baby" cars when export demands were boom- ing, idle as the result of an unofficial strike by a small section of men over a pay claim that could be settled by agreed procedures. The fact that such practices are condemned by prominent trade-union oflleials is less likely to be remembered.

In recent years, suggestions have been made several times that there should be changes in trade-union law to curb such irresponsibility. The lawyers' study is one manifestation of this pressure for new legislation. Union critics maintain that unofllcial strikes should be made illegal; that supervised ballots should be held among members before a strike can be called; that the basis of the political levy should be changed again from "contracting out" to "con- tracting in. ''x2

lz Political levy: Trade-unions are permitted to collect and use money for political purposes provided that certain conditions are met. One of these conditions is that the in- dividual member shall be allowed to contract out of paying the political subscription without prejudice to his ordinary rights as a trade-union member. Unless he contracts out, he will automatically pay the political subscription. To change the condition to "contracting in," that is, to the expression of a serious interest in the union's political objectives, would seriously reduce the size of political funds. This in fact happened when "in" was substituted for "out" in legislation passed after the General Strike of 1926. "In" became "out" again in 1946 during the period of the Labour government. It is estimated that the trade-unions provide two-thirds of the revenue of the Labour party.

These and other reforms, often proposed by people who have little direct personal experi- ence of industrial life, have not gained much popular support. But it will be interesting to see whether there is considerably more pres- sure exerted on the government to do some- thing about the unions when the next series of union "iniquities" is revealed. With an ap- preciably increased majority, the Conservative government may feel that it has a suflleient mandate and can command sufficient public support to carry out legal changes to restrict the power of the unions. Although the reform of trade-union law has previously been politi- cal dynamite, it may have become far less explosive since October 7, 1959.

Failing the Nation

Another charge now being made against the unions is that of "failing the nation." Ironi- cally, this is a phrase from the Labour party's program in th.e recent general election. Had a Labour government been returned to office, it would have considered taking into public ownership or submitting to public control those firms that, in its opinion, were failing the nation in terms of, say, their investment or de- velopment programs. Some critics believe that this charge can be leveled with greater justice at the urdons. Echoes, both vociferous and blandly persuasive, of Andrew Ure's re- marks are dearly audible. Weighty arguments are advanced that purport to show that the in- satiable demand of the trade-unions for higher wages is responsible for inflation. To lay the responsibility for infafion entirely at the door of the unions is, of course, to ignore many of the other variables in the economic life of. an essentially market-economy country, where free collective bargaining is. accepted as the method for determining basic levels of wages. In the years since 1945-which have generally been ones of full or overfull employment-em- ployers have often raised wages beyond the point to which they have been pushed by the unions in collective agreements.

Nevertheless, failing the nation can open up

80 BUSINESS HORIZONS

a number of interesting speculations. Despite a hat trick of reverses, the Labour party, com- mitted to a program of greater economic planning for the country, may conceivably be returned to power one day. If this should hap- pen, can the area of wage negotiation be left unplanned and subject to little government influence or control? During the period from 1945 to 1950 when the welfare state was being created, the Labour government thought it was necessary to urge upon the unions in clear- cut terms the need for wage restraint as an indispensable measure against inflation. For a time these appeals were successful, but even- tually the strain exerted on the union leaders by their members became intolerable, and sectional interests in the form of wage claims reasserted themselves.

Economists given to chiding the unions tend to overlook the fact that the power of the union rests ultimately with the man in the cloth cap -and sometimes his wife. The unions may well have been glad to revert to their customary role of protecting their members' living standards after carrying out, in an un- easy way, a policy of restraint so as not to em- barrass the political party that they were largely instrumental in creating and that now had the country's interest to safeguard as well as that of the unions. Perhaps the central dilemma of the trade-union movement lies in this kind of situation. Although the unions have been among the most ardent advocates of socialism, they show considerable reluc- tance to face up to some of the implications of adherence to this doctrine. Trade-unions owe their existence to the emergence of a capitalis- tic society. Their idealism drew its strength and appeal from the widespread desire to remedy the grosser abuses of an earlier capi- talistic society, and the unions have indeed played a valuable role in producing a greater measure of social and economic justice. Now they are faced with new decisions. I put their position to my students in the form of ques- tions:

Do the unions, while wanting public owner- ship and control of much of industry and the

essential services, wish to retain the [unctions of private enterprise for themselves?

Have the trade-unions a vested interest in the retention of capitalism, even of some un- employment?

Frank Cousins, leader of the Transport and General Workers Union, Britain's largest union, is in no doubt on this score, "Our object is not to enable the worker to live under capi- talism, but to do away with capitalism. ''13

When the Conservative party is in power, the trade-unions are clearly more comfortable. Their traditional functions can be more read- ily exercised. Just as the Scots find it easy, when playing soccer against England, to recognize the "auld enemy" by their white shirts, so the unions feel that there is greater justification in hammering home attacks against a Conservative government.

To suggest, as some observers do, that the trade-unions appear unaware of the central dilemma outlined above is, in my opinion, to underestimate their political acumen. It would be more accurate to say that the unions give little public indication that they are coming to grips with the problem of how they are to modify their development ff the society that gave them their birth and their purpose is it- self transformed. One should remember, how- ever, that in the nationalized industries the unions have effectively preserved and carried out their traditional role. They have never wished to control such industries, to usurp and accept the responsibilities of management's functions. They have retained their indepen- dence, as they must ff they are to survive, and are sufficiently strong to make the nationalized boards and the government take their views into account when policies are being formed that affect their interests. For example, in its most recent report, the T.U.C. General Coun- cil reaffirmed the right of the tmions to strike in nationalized industries.

Nevertheless, should more industries and services be natio.nliT.ed or made accountable to the public interest in some way, the unions

13 The Observer (London), August 28, 1960, p. 4.

BRITISH TRADE U N I O N S - - C A N THEY STAY IN BUSINESS? 81

will clearly not be able to pursue a blithe free- enterprise approach to pay claims. They will have to concern themselves more with the relation of wage claims and wage income to the health of the national economy. A number of the more astute union leaders are aware of this, and there are informal discussions among them from time to time on the need to co- ordinate the wage policies of unions. Such ventures must be cautious since the ordinary member, as in the U.S., pays more attention to what the union is doing for him than to the ramifications of national economy; the latter, he says, is after all the government's responsi- bility. Inevitably, he is slow to learn how much the employer, the industry, and the na- tion can afford to pay without harm to their separate and collective economies.

There is, of course, another factor in the general si tuation-the possibility that more unionists are losing their interest in socialism. If every adult trade-unionist and every adult memlger of his family were to vote for the Labour party, the Conservatives would never be returned to power. In the 1959 election, however, the Labour party received 44 per cent of the votes cast compared with 47 per cent in 1955; obviously the enthusiasm for socialism has weakened. Herbert Morrison (now Lord Morrison), until a few years ago the second man in the Labour party and now elder statesman, is reported to have com- mented, "The Labour party will have to make a more careful study of the British working and middle classes ff it is to return to power. We are a litde in danger of letting policy be shaped and determined by intellectuals."

Should his advice be taken? Should the Labour party continue to bend its energies to the recruitment of people from all classes of society? Morgan Phillips, Secretary of the Labour party, favors this policy; he recently expressed concern that the unions are making insufficient progress with the recruitment of white-collar workers, many of whom show rehletance to join the T.U.C., staunch ally of the Labour party. 14

14Morgan Phillips, Labour in the Sixties (London: The Labour Party, 1960), pp. 11-14.

Alternatively, should the Labour party re- vert to its original policy of concentrating its appeal on the working class, the traditional source of its strength? With this policy, the Labour party now faces a di~culty; the work- ing class is a much more elusive concept today than it was. The once distinct divisions be- tween classes have become blurred. Moreover, big business is helping in this process of subtle confusion. The practice of Imperial Chemical Industries Limited is worth considering here. The I.C.I. is one of the largest and most power- ful concentrations of private enterpris6 in Great Britain, and has also many intricate in- ternational connections. It has been one of the targets of the pronationalization advocates. Conscious of this, the I.C.I. has conducted a well-planned and intelligent advertising cam- paign to "sell" the I.C.I. to the public. Con- ducted in the form of dialogues with sketch illustrations, the advertisements demonstrate how conscious the I.C.I. is of its duty to the public; what a progressive, humane concern it is in terms of research, technological de- velopment, 'and low-cost service to the con- sumers; and what a good exporter and benevolent employer it is. The company im- plies that it has all the desirable qualities of a socially responsible business organization.

It would do less than justice to the motives of the I.C.I. to suggest that the campaign has been inspired merely by the threat of nationali- zation, and it would be churlish to believe that such a threat also prompted the company's employee shareholding scheme. But if those employees who are socialists now become capi- talists through the holding of shares in a com- pany that their party has on its list of possible candidates for nationalization, is it just pos- sible that their political beliefs may be .tinged with doubts and misgivings? Life is indeed becoming increasingly difficult for those who like to keep their politics in water-tight com- partments. Aware of the complex shifts of capital distribution and political opinion, the Labour party has been forging a less radical political program of public ownership and accountability. This has not been well received

82 BUSINESS HORIZONS

by those unions whose socialist convictions still run true and deep.

The fact remains, however, that the old ral- lying cries no longer stir people as in the past. Apart from pockets of unemployment and de- pressed groups in the population, such as large numbers of old-age pensioners, the people of Great Britain generally, as Prime Minister Macmillan says, "have never had it so good." Married sons in the Midlands earning high wages find Dad's tales of the dole in the thirties a bore. Their interests are centered on the car and the refrigerator they are to start paying for shortly. Hence, the Labour party, despite much good work accomplished during 1945-51, has now lost some of its popular ap- peal. What good causes are there left to fight? Increasingly, members of the Labour party are coming to accept the idea that Great Britain is likely to remain a mixed economy of public and private enterprise. If this is so, the dif- ferences between the two major political parties, in domestic affairs, may become ones of emphasis rather than philosophy, although this will be hotly denied in many quarters, especially political ones. But then, politicians,

like trade-unions, have a vested interest in the maintenance of differences.

THE trade-unions have surmounted for- midable barriers in the past. In those stirring times, there was a clear division of interest. The obstacles were tangible and capable of precise definition. Some remain so today, but as government intervention increases ( no mat- ter which party is in power) in order to keep pace with a society that grows more intricate in its economic functions, as the over-all pros- perity of people in employment rises, and as the old social strata are eroded, the trade- unions are confronted with a complex of new problems.

Personally, I am convinced that the trade- unions will survive (my modest support will no doubt please them ), for whether capital is publicly or privately owned or controlled, in a democracy it would be foolish to credit government or management with God-like qualities. What the unions must do is adapt themselves more rapidly to the dynamic forces that are changing society.

W E CAN make of the trade unions exactly what the intelligence and progress of our members will permit. The organizations are of the most elastic character, and whatever action is agreed upon by the organized wage-earning masses can be formulated and achieved by and through the trade unions. It is expected that the leaders of the movement must exercise their best judgment. To artificially and prematurely expand the scope of the organization is to encounter the danger that the whole fabric may be rent asunder and thus leave all in a plight of misery and despair.

-Samuel Gompers

1892 CONVENTION PROCEEDINGS,

PRESIDENT'S REPORT