Building union and employer partnerships for a new capitalism

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Mark Stuart is Professor of Employment Relations and Director of the Centre for Employment Relations Innovation and Change (CERIC) at the University of Leeds

Ahead of the Chancellor’s speech at Conservative Party Conference (1100-1230), Prof Mark Stuart writes for us on today’s UnionHome theme: partnerships and the new economy.


Should trade unions work with employers in social partnership to forge a new capitalism? This was the topic for discussion at a Unions21/ Progress fringe at this year’s Labour Party conference. The position was put most provocatively by Nita Clarke of the Involvement and Participation Association (IPA). She asserted that unions have no choice but to follow the partnership approach. There is no alternative! Firstly, the mobilising rhetoric of a new winter of discontent is unlikely to bear fruit; and anyway strike action remains at historically low levels and does not resonate with working people. Second, to argue against partnership is to present unions as either stuck in the past or as victims: neither appeals to the new generation of workers that unions so badly need to attract.


But is partnership the only game in the town? Does it offer real opportunities for unions?  It is more than a decade since this was last a hot topic of debate. During its first term of office New Labour set up a Partnership Fund to promote union-employer cooperation and the topic was widely debated in academic circles. Opinion, and evidence, was divided. To be sure, there were examples of good practice, but, while these were rightly celebrated, they were in the minority. As I argued with my good colleague Professor Miguel Martinez Lucio (Manchester Business School), partnership agreements were often either ‘marriages of convenience’ or ‘shot gun weddings’. They were established to address poor industrial relations or to allow for restructuring, and, as a consequence, their maintenance or ongoing joint gains for workers (and their unions) as well as employers could not be assured.



It is true that in some cases union leaders appeared to argue against partnership. But this was often more to do with the emotive nature of the word ‘partnership’; no union leader has ever been against good employers or good working conditions for their members. And this is the crux of the matter. Partnership in practice was often seen to deliver relatively little. Partnership has continued, to some benefit, in the joint union-employer work around learning and in areas of the public sector, notably the NHS. But to date it has not formed the basis for a new capitalism.



Is the time right for a new debate on partnership? There seems little ground for optimism.



First, research shows that to flourish partnership needs certain preconditions. The TUC used to articulate the six principles of partnership; the IPA has similar principles. Based upon mutual rights and responsibilities, employment security was seen as central, as was employee voice in strategic business decisions. While there was some evidence of joint working and labour hoarding at the depth of the crisis, employment security does not seen a key priority for many employers at the current time. It may well be a promise they cannot keep. Certainly not in the public sector which is currently going through a most profound period of restructuring. More generally, there is little evidence of increased voice or involvement of employees in the decision making processes of private sector firms: where union density is now a pitiful 14 per cent and collective agreements not much higher.



Second, partnership requires institutional supports, in the form of regulation or law. In other countries this may take the form of legal rights for employee participation in company structures or collective bargaining, or strong structures of sectoral level bargaining may be present. None of this exists in the UK. Nor is it likely to be forthcoming: quite the reverse. The coalition government is intent on rolling back employment law and employees’ rights even further, even while they admit that the UK has one of the most weakly regulated labour markets in the World. The exception to this is in Scotland. Research by Professor Nick Bacon (Cass) and Peter Samuel (Nottingham) has shown how a legal mandate in Scotland on partnership working in the NHS has led to a flourishing of employee participation in strategic decision making and increased joint working, to the benefit of service delivery and coordinated initiatives around public health. More general provisions do exist through the Information and Consultation of Employees Regulations (2004), but research suggests this statutory instrument has remained peripheral; and further rights may be necessary to facilitate its utilisation by employee representatives.



Third, partnership should not be confused with concession. To be meaningful partnership requires some form of parity between parties. To work effectively in partnership with employers means, therefore, that unions need sufficient countervailing power to at times be able to say no. Given the current state of the labour market, levels of union recognition and government antagonism, the power of unions is self evidently weak. This applies equally to their ability to win strike action. However, it does not follow that union members are unwilling to protest or that the wider public regards such protest as a relic of the past. While the number of working days lost last year was a fraction of the past, the number of workers involved was the highest for 30 years. In crude terms, if partnership requires certain preconditions and institutional supports to work effectively, then unions may first have to struggle to achieve this. In this context, the current emphasis on large scale demonstrations, increased community engagement and political critique seems entirely logical.



It is fanciful to assume that any new form of capitalism will simply emerge from unions and employers working together in partnership. First, there is no platform for effective partnership working in any general sense. Second, there is little evidence that capitalists see the need for change. Partnership will without doubt represent one future option for trade unions, but it will be one of many. The most pressing task ahead is the battle of ideas around what any new form of capitalism may mean and how this should be supported by the state.


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