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Collective bargaining can begin to rebalance our economy

Collective bargaining can begin to rebalance our economy

Dave Moxham is speaking at the launch of our election guide on work, pay and unions, in Glasgow on Thursday 12 February.

It has been often stated in the fortnight since the election of Syriza in Greece that this ‘radical’, ‘extreme’ left party actually has an economic and social programme which is distinctly reasonable. At the very least it is a programme – slower debt reduction, minimum wage restoration, tackling tax avoidance – which is also advocated by mainstream economists such as Nobel Prize winner Joseph Stiglitz and Paul Krugman and former Bank of England Monetary Policy Committee member Adam Posen.

Thus what appears radical to a section of the European elite and, undeniably, to a proportion of the European people (drip-fed as there are by messages of unavoidable austerity) is in fact far from radical in the eyes of a significant proportion of economics theorists.

The cost of living crisis in the UK with its attendant low wages and insecure employment is receiving increasing attention in the UK. And once again it is mainstream economists who are linking the undoubted suffering this is causing with increasing economic inequality and its wider economic impacts.

The support amongst the political classes for the payment of the Living Wage and legislating against the worst zero-hours contracts is to be welcomed. Unions should, and will continue to, use every pressure point available to improve pay and conditions, including the continuing fight to reduce gender pay discrimination.

However, as with the situation in Greece, the advocacy of mainstream economics theorists of the use of the full gamut of options in tackling inequality and driving growth appears to fall on deaf ears among UK policy makers.

Because whereas Joseph Stiglitz argues that, "Strong unions have helped to reduce inequality, whereas weaker unions have made it easier for CEOs, sometimes working with market forces that they have helped shape, to increase it."

And whereas Paul Krugman says, “there’s an even stronger case to be made that high unemployment – by destroying workers’ bargaining power – has become a major source of rising inequality and stagnating incomes even for those lucky enough to have jobs.”

The natural conclusions from such analysis – the need for stronger unions, collective bargaining as well as better employment protection – are either actively opposed or only very weakly advocated by mainstream political parties.

In Scotland, where the key workplace protection levers remain, reserved to Westminster, the STUC and affiliated unions have had some success in arguing for Scottish Government intervention using procurement legislation to increase workplace protection and bear down on blacklisting, zero-hours contracts and low pay, and we are actively working with the Scottish Government on the newly created Fair Work Convention to promote employee empowerment through recognised trade unions and the promotion of collective bargaining.

This notwithstanding something of a false auction of virtue has developed in which the SNP and Labour vie with each other to promote themselves as the party most committed to tackling low pay and insecure employment whilst not proposing, or being unable to propose, meaningful actions in the key sectors in which low pay dominates, including care, retail, hospitality and the wider food sector. Meanwhile, there is a growing risk that those working in these sectors including a majority of young workers will be normalised to insecure work to the detriment of their own happiness and future prospects as well as to the wider economy.

Clearly union organising is vital in these areas. But it presents enormous challenges due to the nature of the work, its high turn-over and the demographics of the workers employed. The removal of anti-trade union laws which limit representation, collective bargaining and the democratic right to undertake industrial action are vital and continuing demands, but just as important is the re-introduction of sectoral bargaining. Sectoral bargaining has a wide range of benefits – and not just confined to the low pay sectors – but it is of particular value where competition between large companies is a major downward driver on pay and conditions but the market is largely domestic and this is the case in most of the low pay sectors. Implementation of the Institute of Employment Rights, Collective Bargaining Manifesto would constitute very significant progress, but, if analysis of the various parties’ manifestos and programmes for government is anything to go by, we are a long way from achieving it.

Popularising trade union rights and employment rights continues to be a major challenge. Negative pre-conceptions of unions are prevalent, fuelled by aggressive anti-union coverage in the majority of the media. However the growing understanding of the precariousness of work and the growing recognition of the negative economic effects of labour market deregulation provide opportunities for trade unions in the period ahead to co-ordinate successful campaigning activities. As well as being driven by the improved organising approaches adopted by many of our affiliated unions, these are likely to include newer techniques, including those adopted by social movements.

And of course, in Scotland, the heightened level of political activism and interest in social and economic affairs provides a particularly interesting opportunity for trade unions to better engage with workers, particularly those who are currently without organised workplaces. Interesting times lie ahead.

Register here to see Dave Moxham speak at our event in Glasgow on Thursday 12 February 2015.