Labour’s manifesto for workers

Last autumn, shadow chancellor John McDonnell gave keynote speeches to the conferences of the TUC and Labour Party on workplace rights, pledging the next Labour government would end the anti-trade union era. The policies he advocated were based on recommendations contained in a recently published book by the Institute of Employment Rights, Rolling Out the Manifesto for Labour Law.

Two years earlier, in June 2016, when British politics was consumed by the Brexit referendum, the IER published A Manifesto for Labour Law: Towards a Comprehensive Revision of Workers’ Rights. According to the authors, this aimed for "a total break from the policies pursued by governments of both parties to varying degrees since 1979".

Its core proposals were incorporated into Labour’s radical general election manifesto the following year. It covered workplace democracy, sectoral collective bargaining, better workplace union recognition, and the radical reform of workers’ rights relating specifically to zero-hours contracts, equality at work, health and safety, and the enforcement of workers’ rights. All of these would be overseen by a new ministry of labour. Rolling Out the Manifesto for Labour Law sets out how they could be legislated.

These measures, most of which would be supported by socialists, represent a welcome change from the pro-big business policies of the New Labour governments of Tony Blair and Gordon Brown. Yet even a Corbyn-led Labour administration will struggle to fully implement the IER’s manifesto if it remains within the confines of capitalism.

The proposals on workplace democracy – recommending a minimum of two employee representatives on company boards, and votes at company general meetings – could potentially divide union opinion. Similar proposals in the 1970s were rejected by employers but also many trade unions, on the grounds that they would be perceived by their members as being party to detrimental management decisions without having any real control over the company.

Trade unions would cast just 20% of total registered votes at company meetings, hardly a strong democratic voice. The IER argues that "the most important thing for the future is not the initial percentage, but to establish the principle". The capitalists, however, would never countenance their ownership and control of the means of production, the source of their profits, being transferred to the working class, percentage by percentage. Genuine workplace democracy can be achieved only through public ownership, and democratic workers’ control and management.

After four decades of declining collective bargaining coverage, from 82% in 1979 to around 25% today, there will be more widespread union support for sectoral collective bargaining. The IER says that sectoral employment commissions composed of unions and employers would negotiate minimum terms and conditions for their industry. These would apply to all workers in the sector, including non-union recognised workplaces, and would be enforceable through a labour court. Negotiations would be supplemented at workplace or enterprise level.

The IER correctly states that these measures are essentially a reversion to the ‘post-war consensus’ that held sway in Britain, Europe and most of the industrialised world, which the IER says led to the most equal decade in history, the 1970s. But that was rooted in the unique economic, social and political situation at that time, which is unlikely to be repeated. Moreover, trade unions were at their most powerful in the 1970s, in terms of membership levels and militancy. Today, we live at a time of economic, social and political crisis. Across Europe the EU is in the process of dismantling collective bargaining arrangements.

The IER proposes a new ministry of labour which would establish a national economic forum on which workers’ representatives, employers, government officials and ‘independent’ academics would plan and scrutinise the impact of industrial policy on all sections of society, to "ensure fairness and efficiency for the benefit of workers, employers and the public interest".

This sounds remarkably similar to the National Economic Development Council created in 1962 by the then Conservative government. Even during a period of prolonged economic upswing the NEDC could not reconcile the conflicting interests of workers and bosses. Indeed, it generally acted in support of capital until it was abolished by Margaret Thatcher’s government in the 1980s in favour of more open class warfare against trade unions and the social gains of the post-war period.

Forced on employers at the end of the 19th century through mass industrial action, collective bargaining represented a compromise between employers, who wanted to maintain their managerial prerogative, and militant workers, who sought the more radical solution of workers’ control. Strikes during and after the first world war – against the backdrop of the 1917 Russian revolution – led to the extension of collective bargaining through the establishment of joint industrial councils, bodies not dissimilar to the IER’s proposed commissions. But the defeat of the 1926 general strike saw many employers withdraw from these arrangements.

During the second world war, the coalition government introduced compulsory collective bargaining while also banning strikes. Collective bargaining was extended in the following years, but the uneasy political consensus on industrial relations collapsed at the end of the long post-war economic upswing some two decades later. In the late 1960s and early 1970s, industrial action by workers defeated legislative attempts by a Labour and then Tory government to curtail the power of trade unions, as the ruling class sought to boost profits at the expense of workers’ living standards.

But defeats of workers in potentially winnable major industrial battles in the 1980s allowed the Tories to remove state support for collective bargaining, including dismantling most of the joint industrial councils, then known as wages councils. Draconian anti-union laws were also enacted, and remain on the statute books today. Labour’s 2017 manifesto commitment to repeal the Trade Union Act 2016, while welcome, would leave untouched the onerous statutory industrial action ballot and notification requirements.

The IER states its proposals would raise workers’ incomes, and hence increase demand in the economy. Does this chime with the Bank of England, whose chief economist recently warned that the historic decline of the role of trade unions has held back workers’ pay? John McDonnell has commented on productive meetings he has held with the Confederation of British Industry. But trade unionists need to be clear that any capitalist support for Labour’s employment policies will be limited, and strictly aimed at achieving capitalism’s goals. As the Financial Times editorial posed it in relation to Britain’s economic problems, for the political establishment the solution is ‘reform not revolution’.

The IER correctly says that the roll-out of sectoral collective bargaining cannot be left to the ‘labour market’, but naively adds it can only be achieved by "law and sustained government policy". The IER poses the question of what should happen if there is resistance from the employers, making the obvious point that it is usually employers, not unions, who refuse to participate in collective bargaining. Its answer is for a new ministry of labour to have the statutory power to impose terms and conditions on recalcitrant companies.

However, a Corbyn-led Labour government will come under ferocious pressure from the political establishment not to encroach on the ‘rights’ of employers to profitably manage ‘their own’ companies for the benefit of their shareholders. With the economic levers remaining in their hands, big business could, for example, resort to a strike of capital to scupper this and other pro-worker policies, the economic consequences of which would be blamed on the Labour government.

Militant action by the organised trade union movement would be required to sustain a sectoral collective bargaining system that radically improved the lives of millions of workers. Such action across the whole British economy would be better utilised to bring the commanding heights of the economy into public ownership under the democratic control and management of the working class. This would represent a real break with the anti-union policies pursued since 1979.

Jim Horton