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August 2003 | |
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Interview: The New Deal Unions: In the Line of Hire Culture: Too Cool for the Collective? International: The Domino Effect Industrial: A Spanner in the Works National Focus: Gathering of the Tribes History: The Welcome Nazi Tourist Bad Boss: Domm, Domm Turn Around Poetry: Just Move On. Review: Reality Bites
The Soapbox Education The Locker Room Postcard
The Secret Life of Us
 Bullies in the RanksIt Is Still About The Members Isn't ItTom's Purpose
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Industrial A Spanner in the Works
******** The issue of Works Councils is likely to be debated at the forthcoming ACTU Congress, and Participation at Work was the welcome subject of the most recent annual Fabian publication Labor Essays. Further, ALP Shadow industrial relations minister, Robert McClelland recently indicated that works council will be a priority for a future Labor Government, although there is some debate within the unions about this. This essay is therefore seen as a constructive contribution to these debates. The Labor Essays with few exceptions are too academic and legalistic, define participation too narrowly, and dealt very little with the real problems confronting the development of a strategy for democratise workplaces within the Australian Labor Movement. This essay will deal mainly with the problems within the unions and what they might do, not to criticise the unions, but because no one else can solve this dilemma of a strategy for workplace democracy but unions and their members. It certainly won't come from the employers, nor outside forces such as the ALP and sympathetic legislation, although that would help. First the context and the priority problems. Discussion of workplace democracy in Australia is seriously hampered by the current anti-union climate and legislation. Until the union movement regains such fundamental democratic rights as proper recognition, and the requirement that employers have to negotiate in good faith, issues such as works council will not be seen as a high priority. The Australian union movement has never confronted such a hostile government, and employer organisations possibly since Federation. Most of the positive climate up to the mid-nineties such as many consultative committees, various joint projects both within companies and across industries have disappeared, except in some isolated state government agencies. Participation at Work, and Works Councils have to be seen within that context. Having said that, it is also true that workplace democracy must be an integral element of the fight back strategy of the unions because their members, and almost certainly most non-unionists want a greater say in how their workplace is managed. There has never been strong commitment within the Australian unions to pursue industrial/workplace democracy. It began to emerge on the agenda with the Accord, particularly with Australia Reconstructed which was the result of a comprehensive study of mainly European union strategies in 1986, and adopted as ACTU policy in 1987. It was also one positive element of enterprise bargaining because it gave unions the chance to negotiate about management prerogatives, but by and large these opportunities were passed up. The essays are too narrowly focused on what constitutes participation. Dave Davies has already drawn attention to the fact that health and safety does not get a mention. Yet is anything more important than workers having a say in the safety of their workplace? An example is that the Victorian unions have not done nearly as much as they might have to take advantage of the Victorian Health and Safety legislation of the Cain Government, widely regarded as some of the best in the world and providing union representatives with considerable powers. With a few exceptions including good work by Trades Hall in raising awareness and training safety stewards, it has not been seen as an integral part of day to day union work by many union officials, but a job for specialists. Within the Australian union movement there is no pro-active philosophy or ideology which commits to wealth creation through worker empowerment. It maybe mentioned in some policy statements, but rarely reaches action at the workplace level, and is not seen as an integral part of union activity, but something added on. Neither is there within the Australian union movement a pro-active philosophy or ideology which challenges the generally accepted view that once workers are paid to enter the workplace they have alienated any rights to job satisfaction. By contrast many union movements in Western Europe have for decades regarded it as an important component of their strategy. A number of the essays suggest that we may follow the European example, but don't mention the fact that unions in the European Union operate within a far more supportive legal frame, including pan European directives. The widely used language in EU documents and many countries, of the employers and unions being "social partners", sums up the huge difference currently within Australia. To some extent a caveat needs to be placed on the above statement, as there is a growing anti-union stance especially from employers in a number of European countries not experienced for decades. The recent development in Germany which saw IG Metall suffer possibly its most serious defeat since World War 2, and divisions between the Social Democratic Government and unions, may herald a new climate of conflict. The difference with the Australian situation may have something to do with the Anglo-Saxon culture as it is interesting that in the UK, USA, Australia, Canada, and New Zealand, the work of their unions is confined mostly to the wealth distribution side of the economy. There are some hopeful signs in NZ and Canada that this may be changing. The point is that after a great deal of experience, reading, study, and examining the better examples of participation around the world, the conclusion is that employee participation to be effective, not only has to be a union policy/strategy, but also has to be an integral element of day to day practice and not simply an add on. Further I am convinced that it has to be linked to improving the performance of the company/industry, because that is what interests most workers, and can also attract some management interest. In other words it has to be hard edged, but also linked with improving the quality of working life for employees, because it is a combination of the two that has a dynamic impact. Experience would suggest that it is very difficult to establish almost any kind of participation at work in the face of implacable opposition from management, this is also because when push comes to shove, workers and their unions will very rarely put up a fight about participation in the same way they will about traditional issues. This is not to suggest for a minute that we simply wait on management to decide that they want employee/union co-operation for improved performance, because it won't happen without strong pressure. Therefore among other things unions should set out to make themselves and their members indispensable to the good performance of their enterprise. Raising industrial democracy/participation as a thing in itself divorced from company/industry performance, has never grabbed the attention, nor commitment of Australian workers. However what frustrates them most is how badly their company is managed, and the barriers they encounter when they try to improve it. Hence most employees turn off and become cynical. Unfortunately not one essay dealt with this fundamental issue. This management incompetence was highlighted in the Karpin Report on Australian management commissioned some years ago by the Hawke Government. It was particularly scathing of Australian management capability in comparison with our OECD trading partners, and Australian frontline management rated very poorly. Rather than unions being an impediment to improved productivity management was the more significant factor. CEDA also did a report recently that showed the banking industry as having performed particularly badly in managing downsizing The finance industry is replete with scandalous examples of management incompetence with members having to pay the price, ie NAB's disastrous acquisition of Homeside which blew a $4bill. hole in the balance sheet and resulted in 2000 jobs being shed. George Trumbull and Paul Batchelor's destruction of AMP value and reputation leading to another 1500 or more jobs going etc etc Experience demonstrates that providing employees with the opportunity to impact their workplace to make it perform better, is what really gets them excited and committed, especially where it also improves their quality of work. I witnessed it recently in New Zealand. Visiting what is reputed to be the largest dairy in the world to inspect their management improvement program first introduced in late '99, we were struck by the enthusiasm, competence, and enjoyment of the shopfloor employees, including shop stewards when making their presentations and conducting people around. This workplace has a 100% membership of the Dairy Workers Union, (98% across the whole industry) which covers all workers including the transport drivers, and has a long tradition of being strong and militant This particular management improvement program was undertaken at the suggestion of the union because nothing else had worked and their members were sick of it. The new system required to be driven from the bottom up with the shop floor having a major say in what was done. Crucial in getting such buy in, is genuine involvement and control by the shopfloor personnel in dealing with the issues initially of direct concern to them. Starting with fixing such basic things as housekeeping, through to minute by minute control of the production process, upskilling to perform online maintenance, with immediate feedback at the end of every day so personnel know exactly how things are going in real time. The departments where the new management system has been implemented, have collectively contributed savings into the millions of dollars, with an agreement to ensure the employees share the improvements. It is interesting that the accountants had to change their accounting system as it was not geared to such improvements. At first they would not believe it, until a thorough accounting undertaken involving the shop floor employees and middle management proved the accuracy of the figures. In this context, consultation, (in their case called a taskforce) has real meaning. It is not about representative structures, but direct involvement in determining what has to be done. It is interesting that it took some time for the participants to recognise the need for an overall taskforce/works council, as they were initially concerned with their particular department. But as the problems led to larger issues, it became clear that such an overarching consultation was necessary. To highlight the impact of this experience and suggesting a strategy for genuine employee participation, at the end of the presentation the shop steward said, and to paraphrase, "This experience has taught us that we can now run the production process with very little or no involvement of middle management. We intend talking to management in future about us having a significant input to larger decisions such as overall business strategy, purchase of new technology etc.. Beyond that, we will want to discuss the idea of employees having a share of the ownership of Fonterra.". Bear in mind that Fonterra is still a co-operative, although now managed as a typical corporate. It will be interesting to watch closely the impact of a recent change in CEO, which will demonstrate the sustainability of such improvement. Linking quality of working life to improving performance, the comment of an employee in another plant implementing the same system is instructive, "Going to work is still not as enjoyable as going fishing for the day, but it has made it more enjoyable". This experience also demonstrates the value of unions pursuing the achievement of best practice/high performance as part of their claims and enterprise bargaining. This not only meets the unspoken demand of many members, but highlights the union role in achieving high performance/best practice. This confirmed in a recently released World Bank study that showed unions not only contribute to a more equitable and fairer society which it acknowledged, but also showed that union companies/industries tend to perform better than their non-union one counterparts. The terms best practice and high performance raise difficulties because they have often been corrupted by management and politicians to the stage where the term best practice can be used to describe something that is the exact opposite of what unions may mean and what it originally meant. A good example was how the Kennett government often describe the things they were doing as best practice. Unfortunately this happens to most terminology. Therefore it is necessary for unions to spell out exactly what they mean by these terms so there is no confusion among their members when the employer means exactly the opposite of what they want. MANAGEMENT COMPETENCE The essays and for that matter most unions, have little to say about the competence of Australian management and yet most workers are trenchant in their criticism of their management. The interesting thing however is that they usually think that management down the road must be better, as no one could be as bad as theirs. They don't generalise the problem and recognise it as systemic. This is not to suggest that every management is bad, but a great many are. I remember once giving a talk to about a hundred union activists at Cornell University about these issues and happened to say that I thought that generally Australian management was not good. They started rolling about laughing, and interjecting. They argued that it wasn't possible as they had the worst management in the world. The labour movement allows management to get away with a great deal of incompetence and lack of commitment to high performance in a lot of workplaces, although not all. The Swedish unions have done a lot of work to conclude that most company failures and especially the poor use of new technology stemmed from poor management, and they are outspoken about what their members have to put up with. It is high time the Australian union movement became more outspoken on this issue as part of the argument for employee participation/industrial democracy, and they will find it will be welcomed by workers in many work places.
WORKS COUNCILS There is a great deal of comment on the need for works councils in Labor Essays, the developing discussion within the ACTU, and ALP. The problem is that the discussion often takes place in a vacuum, as if works councils of themselves are of value. Works councils are only valuable if they are part of a lot of other initiatives, and the agenda and decisions they take are real and practical. Further, not one essay talked about the importance of education and training for participants in works councils. The experience of the many Joint Consultative Councils (JCC) negotiated as part of the early enterprise agreements was that the only ones that survived for any period were those where there was significant training and resources for them. Race Mathews made the point during the May 7th. discussion, that this has also been a problem with the Mondragon Cooperatives, where insufficient training and education has been provided for those involved in the councils making important decisions through the consultation process. Unfortunately most JCCs were not vigorously supported by middle management, nor in many cases by the union organisers. Further, particularly those without training, discussion often degenerated into meaningless issues which had little to do with improving the performance of the enterprise. In the finish most JCCs simply became the vehicle for discussing the next enterprise agreement, which was not the original intention. Some unions rightly fear that in some, perhaps many cases, works councils will be influenced by managements as a means to bypass unions, and supplant them as the collective voice of the employees, and a vehicle to negotiate the enterprise agreement. Any strategy and legislation must be clear on this distinction. However this fear should not be an excuse for unions to simply oppose works councils. The unions should pursue works councils as an integral part of an holistic workplace strategy, and not only insist on a number of conditions, but actively pursue them as a principled campaign for works councils. While we should push for any legislation which will assist with participation at work, I think we should be realistic about the possibilities. In the current climate it is doubtful that the next Labor Government certainly in it's first term, would be able to get such legislation passed, as it will be fought strenuously by the big end of town, and particularly the current crop of employer organisations. I think in that situation it would be better to put resources, hopefully from Labor Governments, into building the pressure from workplaces over time to make it clear that such framework legislation is critical to the future success of companies/industries and our economy. When we eventually think such legislation maybe possible, it should go beyond works councils, and in general principles spell out what they should do, the training and resources they should have, access to appropriate information, and with very clear union bargaining and representation rights which they don't have at the moment and must be a prerequisite. Premature legislation that can be suborned by employers would do more harm in the long term, and make workers even more cynical. Further, any legislation must include the right for unions to have independent sources of advice, training and resources, alongside the joint resources, so they are equipped to handle what increasingly will be very sophisticated problems and issues they have to deal with. From a strategic point of view unions should see works councils as an extension of the bargaining process, but dealing mainly with local issues, and not a cosy partnership with management, otherwise the works council will be of little value to anyone, and unions will lose out, and for that matter so will management although in the main they won't recognise it. Finally works councils providing the union conditions are met, should be for all employees union or not, if they are to be effective. It is very difficult for a union movement with only 25% density, and only 19% in the private sector, to argue that they should be the only source of representation. In fact this should be seen as an opportunity for the unions to demonstrate that they are giving leadership and are competent, and therefore can attract non-members. The German unions were faced with this dilemma in the fifties and sixties with the introduction of co-determination and decided to actively participate. As we would expect they demonstrated they were the most capable and came to have a major, if not dominating influence. SKILL FORMATION Vocational skills and knowledge of the workforce is a key part of any workplace democracy. With a few exceptional cases, it has been generally demonstrated that more highly skilled and educated employees have more control and power both in the labour market, collectively in unions, and over their immediate job. With a deepening and broadening of skills and knowledge, an employee starts to gain the competence to make decisions about their work, and understands more about the whole work process and not just about their immediate surrounds. From day one when the skills strategy began in the mid-eighties, it was argued strongly that skills and especially knowledge, go beyond the immediate work process so that employees could begin to exercise greater prerogatives about work. This was often opposed by employers, arguing why it necessary for workers to have such knowledge beyond their immediate needs, but it was really about them maintaining management control. The main focus has been on new career paths especially for those who have not had that facility previously, another avenue to increase pay through increased skills, but within that there was also the objective to increase bargaining capacity in the labour market, and improve even in a small way, power over the immediate work process. The unions could probably do more about the skill formation agenda as it seems to have diminished in priority in recent years, and that should also include strong encouragement for their members to undertake competency based training. Experience would suggest that the most developed and most advanced examples of workplace democracy have occurred in the more highly skilled, knowledgeable and sophisticated economies such as in Western Europe. However a caveat might be that it also required particular types of labour movements and Social Democratic governments, involving more industry based unions and a greater understanding of skills and the labour process, which seems to have been less prevalent in countries with an Anglo-Saxon tradition. LABOUR PROCESS The role the labour process/work organisation plays is critical in determining the extent of democracy/power an employee/s can exercise in their workplace. Any strategy that ignores the need to tackle head on the breaking down of the divisions of labour both horizontally, and especially vertically is not going to get very far. In many workplaces the Taylorist/Fordist division of labour is still alive and well. It is even strengthened in many cases by the casualisation of the workforce, as the employer takes further control by simply employing as necessary, workers in a very narrow skill range. Further, their very absence from regular employment in a particular workplace makes it very difficult to improve skills and have any say in their work system. The key Taylorist division was to take the thinking away from the doing precisely to give more control to management. There was a period in our industrial development to produce high volume, low cost products where Taylorism played an important role. Unfortunately in most cases at the cost of demeaning work with little prospect of advancement and skill improvement. It is interesting that Henry Ford initially had difficulty getting employees to work in such systems until he offered the five dollar a day. Much more needs to be said about this history as it is more complex, but this essay does not allow the space. It is necessary for unions/labour movement to spell out in greater detail what tackling the division of labour should mean. It may or may not mean work teams, but it is important to lay out the principles that should inform new work systems regardless of what precise form they take. For example the new system must enhance skills, require more decision making both individually and collectively, aim to minimise and phase out immediate supervision, provide a wider range of information on which decisions can be made, immediate real time feedback on progress including from customers for example, improve health and safety, potential for greater social inaction, etc.. Once established such principles should be bargained at the enterprise, and not just provide a warm inner glow. It was notable in the NZ example mentioned above these characteristics were increasingly evident, and they did not happen overnight as they progressed towards greater autonomy, and the necessary higher skills over some time. UNIONS An important issue which none of the essays dealt with is the commitment and capability of the unions to pursue participation at work. Their record has been patchy, and with some exceptions they have not shown great enthusiasm for genuine empowerment of their members in the workplace. This is often despite the union having good policies on these issues. In a number of cases it was obvious the local union organiser was not very supportive of consultation and workplace changes negotiated in enterprise agreements. For example quite correctly the organiser would insist that they had the right to attend and participate in Joint Consultative Committees (JCC). The problem was that in many cases they did not attend the training for the JCC, rarely turned up at the meetings, and if a decision was made they did not agree with, would seek to have it overturned in some way, even when that decision may have been in accord with union policies. In some cases they would simply ignore the JCC and act as if it did not exist. This eventually undermines it and destroys the members who participate. Some organisers seem to think that autonomy by members in their workplace to decide on local issues constitutes a threat to their power base. Union organisers are powerful and influential among the members they serve, and if they don't handle that influence carefully it gets in the way of genuine workplace democracy. A critical impediment to improving work systems and skills for workers are skill and work demarcations which numbers of unions still pursue. The irony is that by clinging to completely outmoded work systems, they are prolonging a management inspired system. Taylorism codified the strict division of labour and unfortunately a lot of unions picked it up as a defence mechanism to protect the jobs of their particular members without regard to that of others, and whether or not it really did save jobs. Demarcation probably cost as many jobs as it was supposed to save, especially in recent times with technologies which no longer recognise skill limitations. There are instances such as the Williamstown Naval Dockyards where it became so bad that it was a contributing factor along with bad management, and government bureaucracy to the closure. It eventually reopened in private ownership, which significantly altered the new work systems, although it is still a long way from being a leading enterprise. Whatever its effect previously, all demarcation does now is to protect the elite position of higher skilled workers against others who deserve access to new and higher skills. No worker has the right to prevent another worker achieving higher skills and knowledge, provided the training achieves the recognised competencies. The point being that changing skills, but particularly work systems is critical to improving participation at work, and as long as some unions continue to pursue artificial demarcation, they severely limit the potential, including for their own members. The term participation is inadequate as it connotes some kind of friendly agreement between unions and management. There is no doubt that at times this maybe the case, but it is much better for the unions to view this process as an extension of the bargaining process. It may be called Bargaining for High Performance, but whatever the title it should clearly show that there are two independent bodies negotiating for mutually beneficial outcomes. It is clear from the above that most of the initiative has to come from the unions if it is to have meaning, and this will require some thinking about both strategy and day to day practical application about business performance, wealth creation, and quality of working life as an integral whole. Far from being threatened unions have a great opportunity to give a lead in pushing for more efficient, wealth creating enterprises, which will energise their members, and provide another avenue for recruiting. PRINCIPLES FOR AGREEMENTS TO ESTABLISH WORKS COUNCILS:
The following colleagues contributed to this document: Ann Polis, Bernie Taft, Hugh McBride, Race Mathews, Kim Windsor, Richard Gough, Bruce Hartnett, Julius Roe, Dave Davies, Neil Watson, Tony Webb, Tony Beck, Suzy Goldsmith.
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