United Kingdom: Industrial relations profile
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Background
The system of industrial relations in the United Kingdom (UK) is traditionally characterised by voluntary relations between the social partners, with a minimal level of interference from the state. In the context of very early industrialisation and a liberal political culture in which the state seldom intervened in the affairs of private actors, trade unions gradually consolidated their membership and power base throughout the 19th century. Various legislative developments also allowed trade unions the right to organise workers and engage in industrial action. In 1868 the UK Trades Union Congress (TUC), the umbrella body for UK trade unions, was formed. The 1871 Trade Union Act recognised trade unions as legal entities as corporations and granted them the right to strike. Subsequently, the 1875 Conspiracy and Protection of Property Act allowed the right to peaceful picketing, while the 1906 Trade Disputes Act allowed UK trade unions to engage in industrial action without the threat of being sued for damages. In addition to this body of legislation, a minimal level of legal regulation that stipulated basic health and safety conditions in workplaces was also built up during the 19th century.
The economic context throughout this time was also favourable to the development of trade unionism. Owing to the pace of industrialisation and the existence of substantial colonial markets for UK industry, the 19th century and early 20th century were characterised by extensive economic growth. This economic climate facilitated the development of a system in which some of the fruits of economic development could be designated for collectively bargained wage increases. In terms of the role of the law, collective bargaining was far more important than the influence of legal regulation. For employers and trade unions, the role of statute law was to support and extend collective bargaining rather than to comprehensively regulate the system. Notably, the law provided trade unions with a series of ‘immunities’ from UK common law. These immunities covered the right of trade unions to engage in industrial action with employers, which would otherwise have been unlawful under UK common law.
The membership of UK trade unions grew markedly in the post-war years. The era also represented the golden age of British ‘pluralism’, where the role of trade unions in securing industrial peace and efficiency was emphasised. In the private and public sectors, sectoral level collective agreements that covered whole industries were also typically reached. By the late 1960s, however, concerns emerged about the efficacy of a system in which shop floor industrial unrest appeared to be rising. This led to the Donovan Commission, a government commission that attempted to investigate the causes of workplace disputes. Industrial conflict grew markedly in the 1970s, partly as a result of the economic crisis that affected western countries after the 1973 ‘oil shock’. The era was characterised by trade union militancy and high levels of industrial action, and attempts by successive left-wing and right-wing governments to regulate the system largely met with failure. The period culminated in the 1978–1979 ‘winter of discontent’, where public sector trade unions engaged in regular and lengthy industrial action over the incumbent Labour government’s policy of public sector pay restraint.
A conservative government, led by the then Prime Minister Margaret Thatcher, was elected in 1979 on an anti-trade union, neo-liberal platform. Successive governments of this political stripe pursued a legislative programme that placed legal restrictions on trade unions’ ability to engage in industrial action, and that privatised many areas of the public sector, while managing the public sector in an anti-union fashion. During this period, trade union membership also declined markedly, and the majority of sectoral collective agreements in the private sector were dismantled as companies abandoned them. A ‘New Labour’ government, led by Prime Minister Tony Blair, was elected in 1997, offering a moderately conciliatory approach to the trade unions. The cornerstone of the Blair government’s approach to employment relations was the use of legal individual employment rights to protect workers. Most notably, a national minimum wage was introduced. Many of these legal rights emanated from the level of European Union, and the post-1997 period saw a marked increase in the influence of legal regulation in the employment relationship. Nonetheless, trade union membership continued to decline, and in 2011 trade union density stood at 26%. As of 2012, the UK system of industrial relations would appear to exhibit a mixture of characteristics. While the old tradition of the state not intervening in relations between the social partners is still manifest in the non-legally binding nature of collective agreements and in the fact that trade unions and employer organisations have little statutory involvement in public policy and little recourse to bipartite or tripartite forums at the national level, legally established employment rights would now appear to be a permanent feature of the UK system.
The global 2008 economic crisis particularly affected the UK. Unemployment rates have increased markedly and youth unemployment has reached its highest levels since the 1980s (UK1101019Q). Several financial institutions were rescued by the UK government. The effect of the crisis on the development of the UK system of industrial relations is unclear. Trade unions have responded to the crisis by calling for greater government intervention to support employment levels. At the same time, collective agreements have been concluded by the UK social partners at company level with the aim of reducing working time in order to preserve employment levels (UK0811029I).
The formation of a Conservative-Liberal Democrat coalition government in May 2010 presents a potential engine of change in the UKs industrial relations system. Although the precise nature of change is still to be seen, the coalition’s plans for reducing the national deficit has resulted in substantial public sector job losses and speculation over the impact of further cuts.
Throughout 2011, the government has phased out the statutory default retirement age (UK1102039I) and has increased the age at which citizens qualify for state pension provision to 66 years. The two governing parties traditionally have different policy views on the regulation of industrial relations, the Conservatives’ Euro-scepticism and the Liberal Democrat’s pro-European stance adds to the uncertainty for UK industrial relations (UK1005019I).
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