Trade Unions

Lord Monks Excerpts

Monday 7th July 2014 Grand Committee

[Lord Monks (Lab)]

My Lords, I must declare a current interest as president of the airline pilots’ union, to which the noble Lord, Lord Balfe, glowingly referred in his interesting remarks. It is nice to know that he retains his beliefs that encouraged me to vote for him on three separate occasions in his earlier political career. I wish him luck in his newish political party, in his evangelical campaign to persuade it that his views are desirable ones to follow. It will be an uphill task. I have just been speaking in proceedings on the Deregulation Bill and asking why unions are not included in a bit of deregulation. The noble Lord, Lord Cormack, will remember there was a debate about assurers, in addition to scrutineers and certification officers, and the red tape in which unions are being wrapped. In the news this morning, we heard that quite a bit more could apparently be on the way as a result of a strike later this week.

Trade unions grew out of injustice. In the face of rapid employment and industrial change, individual workers without unique skills—not the stars but the ordinary—found themselves vulnerable to decisions by employers and managers, and were in danger of being treated as commodities to be acquired and disposed of as judged necessary. So the instinct to form a union was powerful. They were founded in every industrialised democracy in the world. Those two words are important—“industrialised” and “democracy”. In that way, the employer was under pressure to listen to workers and meet their concerns. The growth of unions was a feature of societies like our own, and we in this country led the way. It was an area of British leadership across the world that is much recognised among trade unions in the rest of the world. Their growth was encouraged by alliances with socialists and, in some countries, political parties founded their own unions. Socialists, and in some countries Catholics, were, in the main, instrumental in forming unions.

Today, when societies are less industrial and their economies more service-based, this has led some to question whether unions are relevant or appropriate. In fact, in some US states in the middle and the south you could say that unions were almost an endangered species. Unions are relevant in Britain; they are relevant in 38% of the FTSE top 50 companies, which have collective bargaining with trade unions. In UK manufacturing, to which the noble Lord, Lord Balfe, referred, unions cushioned employers through the recession of 2008-09 by helping to preserve jobs, very often at the expense of a fall in living standards. The carnage of employment, however, was nothing like as bad as we expected it to be, given the depth of that recession. It was not as bad, for example, as the less severe recession we experienced in the early 1990s.

The two relevant unions are not in manufacturing, but in services. The biggest employer of unionised labour in the country is Tesco. To this day, the big supermarkets, security companies and banks are unionised. Of course, they are relevant in public services. I should mention the strikes that are due to take place later this week to remind the Government that change should be negotiated, not imposed. It is important for public sector staff morale that unions should be recognised properly and dealt with in a respectful manner, not in the rather careless, take-it-or-leave-it, way that is being displayed at the moment.

Unions are relevant to all those in insecure, low-paid occupations and to people who are subject to zero-hour contracts. There has been an increase in self-employment, with 40% of the new jobs that have been created since 2010 being on a self-employed basis. We know that not all of them are budding entrepreneurs. Many people are taking self-employment because it is the only thing they can get, with the employer stepping neatly away from PAYE tax, national insurance contributions, pensions, employment rights and so on. Workers today are still vulnerable, just as they were in the early industrialised societies. It seems to me that although the social protections of the welfare state are much better, the instinct for unionisation remains great. I think that it should be public policy to encourage the renaissance of trade unions. Collective bargaining should be seen as a way of checking the excesses of people at the top and boosting the position of people at the bottom. It can narrow the gap between the haves and the have-nots. The companies that are aware of their obligations to their workforces—unions tend to ensure that—are the ones which are more likely to do the right thing rather than the wrong thing. If we are going to tackle inequality in our society, which even the IMF has mentioned, stronger unions are a crucial part of that process.

Any new settlement must involve progressive and responsible trade unionism that is committed to high productivity, performance and long-termism. It must ensure that the benefits of growth are more fairly distributed than is the case at present. My watchwords are “co-operation”, “respect”, “professionalism” and treating people as you yourself would like to be treated. I look to the other side of the North Sea for exemplars, as did the noble Lord, Lord Balfe, in respect of worker directors in Germany. In terms of collective bargaining and the worker voice in how companies run themselves, as well as the approach to building skills over time and giving people ladders to climb, economies from Finland all the way round to Flanders seem to be able to achieve that. The crucial role played by trade unions in our society needs to be recognised properly, and I hope very much that this debate will be the start of something big. I hope that our evangelist on the other side of the Committee manages to take the hordes of the Conservative Party along the same path that he is treading.