Partnership 'alive and well'

'Partnership' is an important yet elusive concept in UK industrial relations, and there are different assessments of its extent and effectiveness. Studies published in late 2001 and 2002 have found that certain aspects of partnership are problematic but that overall it is 'alive and well'.

The concept of industrial relations 'partnership' emerged in the UK in the mid-1990s. Though not defined precisely, it involves a joint commitment to problem-solving rather than adversarial relations, and often includes some reassurances by the employer over employment security (UK9907214F). In this sense, it reflects the debate stimulated throughout Europe by the European Commission's 1997 Green Paper, Partnership for a new organisation of work (EU9705131N and EU9707134F).

Partnership gained official support in the UK after the election of the Labour Party government in 1997. In 1998, the government launched a Partnership Fund, amounting to GBP 5 million over four years, to 'promote the best of modern partnership policies and to stimulate many more innovative partnerships at work'. The Trades Union Congress (TUC) has also endorsed the principle of partnership, which it defines as 'employers and trade unions working together to achieve common goals such as fairness and competitiveness' (UK9906108F). In 1999, the TUC elaborated six principles of partnership:

• a joint commitment to the success of the enterprise;

• mutual recognition of each party's legitimate interests and commitment to resolve differences in an atmosphere of trust;

• commitment to employment security;

• a focus on the quality of working life;

• transparency and the sharing of information; and

• mutual gains, delivering concrete improvements in business performance, employee involvement and terms and conditions.

The extent of partnership arrangements

Estimates of the number of partnership agreements vary. The TUC reckons there are currently only around 60 'real' partnership agreements in operation. A November 2001 report by the Industrial Society (now renamed the Work Foundation) on Managing partnerships suggested that there was a generally positive attitude towards partnership, but that relatively few employers had actually adopted it in practice, and even then employee involvement was restricted to only a few areas of decision making.

However a recent report for the Manufacturing Science Finance union (In search of partnership?, Martinez Lucio and Stuart, 2001) surveyed over 300 senior MSF representatives and found formal partnership agreements in nearly one in five workplaces. Furthermore, a 1999 study by the Department of Trade and Industry (Partnership at work, 1999) argued that the extent of partnership is underestimated. The new forms of work organisation and labour relations associated with partnership were growing, even if very few companies or unions actually used the term to describe their approach. This report also argued that 'firms with partnership-based approaches to employment relations achieve enhanced competitive performance', through a combination of innovation and job enrichment.

The latest research

Two recent reports reveal that partnership is difficult to manage in practice. However they also suggest that with sufficient commitment from both sides, these difficulties can be overcome to deliver real gains.

The first report, Partnership under pressure: how does it survive? (by P Reilly, Institute for Employment Studies, IES Report 383, 2001), looked at the experiences of around 50 organisations. It found that the commitment to partnership was likely to erode over time, partly because it was often based on personal relationships and intangible understandings, and partly because initial high expectations were frustrated by changing circumstances. This included changes in corporate ownership and management, internal restructuring, and disagreements over specific issues such as pay that might infect the relationship as a whole. There were also internal differences over the meaning and value of partnership between full-time officials and shop stewards on the trade union side, and between line management and personnel, or senior and local management, on the company side. Partnership was often ambiguous, and workers did not always clearly perceive the partnership approach to be the best way of articulating their interests.

The report therefore recommended that partnership should be institutionalised and regularly evaluated. Consultation and communication arrangements need to be reinforced, and employers should take risks with the early disclosure of information to help build trust and help defuse problems in advance. Managers and employee representatives need to be trained in the partnership approach, and organisations must promote an inclusive management style that seeks employee involvement and engages the workforce. There should also be a focus on 'hard' issues such as working conditions and reward, to tackle sources of conflict early and head on. Where this was done, the report found partnership agreements surviving and developing well under pressure.

These findings and recommendations were welcomed by both employers' groups and unions. John Monks, the TUC general secretary, said that: 'Partnership represents an excellent approach to modern industrial relations. Based on mutual trust, it is a far cry from the adversarial formula of the past. This report is a timely review ... and addresses the potential problems that must be faced so as to achieve productive employee relations.' John Cridland, deputy director-general of the Confederation of British Industry, commented that: 'Organisations that seek a problem-solving approach to management-union relations, such as offered by partnership arrangements, protect their investments better. Good relations underpin good business; this report can help both sides understand what partnership requires of them, the difficult issues that need to be confronted, and what benefits it can bring.'

The second report, Partnership works, published by the TUC in January 2002, draws on existing academic research to suggest that cooperation delivers business benefits in terms of productivity, sales and profitability, lower staff turnover and absence, as well as helping to make union members' jobs more secure and fulfilling. Drawing on the Workplace Employee Relations Survey, it found that partnership workplaces are one third more likely to have better than average performance, and a quarter more likely to have superior labour productivity than non-partnership workplaces. It also provided case studies of organisations such as call centres to show that partnership had a considerable positive impact on job design, training and career development. The report also highlighted the work of the TUC's Partnership Institute, launched in 2001 as 'a centre for best practice in workplace partnerships', which currently provides network and consultancy services to 46 organisations including manufacturers, utilities, finance companies, National Health Service hospitals, local government agencies, non-governmental organisations and government departments.

Commentary

Essentially, there is little new about the concept of partnership, if it is just about greater employee involvement. Partnership also fits well with the 'voluntary' approach of UK industrial relations, which is often based on tacit understandings and informal agreements. However, its distinctiveness concerns both focus and approach. Under partnership, bargaining is not simply a trial of strength but is conducted in an atmosphere of trust towards mutual ends. Partnership can also broaden the collective bargaining agenda to issues such as business strategy, training, and job security which often fall outside core areas of union influence. In return, employers get a union commitment to cooperation in support of business improvement and the anticipation of problems early on.

The profile of partnership is currently high for a number of reasons. One is the official support from the government and the TUC in particular. Second, some unions see it as a way of facilitating union 'renewal', helping them in marketing themselves to employers, and in gaining facilities to support organising the workforce. Third, the prospect of the spread of works council-type arrangements in the UK stemming from the recently adopted EU Directive (2002/14/EC) establishing a general framework for informing and consulting employees (EU0204207F) is seen by some commentators as a potential vehicle for the extension of partnership arrangements.

However, partnership is not risk-free, and the risks are greater on the union side. Partnership rests on trust and personal commitments, which are contingent on circumstances and individual relationships. In the UK there are very few sector- or national-level agreements to secure the trade unions' role as 'social partners' in the enterprise. Furthermore, workers and supervisors might be less convinced of the value of the project than full-time officials and senior management, especially given the harsh realities of work in response to increased competition, cost-cutting and short staffing. The MSF survey mentioned above, for example, found little evidence of job enrichment but much of work intensification (reported by 90% of senior union representatives), multi-tasking (76%), job insecurity (60%) and more flexible contracting such as temporary (47%) and part-time (43%) employment.

Partnership is more likely to thrive in stable and successful organisations (hence the difficulty of proving its effectiveness in performance terms), yet it is often embraced by troubled companies without the requisite conditions for long-term success. In broad terms, therefore, partnership remains more an aspiration than a reality, even if in some cases it is indeed alive and well. (J Arrowsmith, IRRU)