Social partnership takes centre stage
With the election of new Labour Government in May 1997 and the prospect of the UK opting-in to the EU's "social chapter", there are signs that some employers and their organisations seem to be warming to the idea of social partnership.
May 1997 saw Unilever defending its pro-European stance to shareholders, while the Confederation of British Industry (CBI) was also signalling its willingness to work with the trade unions prior to the adoption of European Union legislation.
The chair of Unilever, Niall Fitzgerald, said that companies had no reason to fear the changes associated with Labour's opt-in (UK9704125F) to the "social chapter" (the social policy Agreement annexed to the Maastricht Treaty on European Union). He said that "the social chapter is unjustly being used as a proxy for all undesirable continental social habits".
The CBI, although opposing the social chapter opt-in and the introduction of a national minimum wage (UK9703112F), has come around to the idea of working with Labour and the unions. Its director general, Adair Turner, expressed his confidence in Labour's pro-business stance and said that the CBI would work with Labour to implement change in a way which would best suit its members. The CBI also indicated its willingness to work with the Trades Union Congress (TUC) to talk about their particular positions prior to the EU making further employment legislation.
According to an article in the Daily Telegraph, John Edmonds, the general secretary of the General, Municipal and Boilermakers union (GMB), said that companies are rushing to start talks with unions on long-term social partnership deals involving modest pay rises in return for job security. Apparently, after similar agreements at companies such as Rover, United Distillers, Scottish Power and Welsh Water, other companies are eager to sign similar deals. An agreement signed on 12 May between Blue Circle Cement and unions means that all staff at the company have now switched to rolling three-year contracts with pay-plus-inflation rises in return for job security and training packages. British Airways cargo staff have also voted for a two-year pay freeze and the loss of 400 jobs in return for the airline agreeing not to put work out to contract. As with the Blue Circle agreement, British Airways is hoping to achieve the redundancies on a voluntary basis.
The TUC has also been urging social partnership with small businesses. Bill Callaghan, the TUC's head of social and economic affairs, has stated that "trade unions and small firms should work together to establish minimum standards to ensure fair treatment and to provide a firm basis for competitive success". He went on to insist that "employee ownership is another key element in business success and schemes such as ESOPs (employee share-ownership plans) will ensure benefits are widely and fairly shared."
While it is to be applauded that unions and companies are beginning to promote social partnership, if it is to work, long-term commitment and investment will have to be involved. The Blue Circle case, which has a very long history before arriving at this stage (UK9702102F), clearly highlights this fact. It should also be noted that at the moment most of these agreements are on a quid pro quo basis and need much more solid foundations if real social partnership is to be achieved.